Forex policy uncertainty pushes naira to 357/dollar

The naira dropped against the United States dollar at the parallel market from 355 on Friday to 357 on Monday, foreign exchange traders said. Analysts and traders linked the drop to the mounting fears among traders and investors over the flexible exchange rate policy proposed by the Central Bank of Nigeria.

CBN Governor, Mr. Godwin Emefiele

They said the continued delay by the CBN in releasing the blueprint for the planned flexible exchange rate policy was fuelling hoarding and speculation in the forex market. The CBN’s Monetary Policy Committee had two weeks ago announced plan to adopt a flexible exchange rate. The Governor, CBN, Mr. Godwin Emefiele, said the blueprint for the proposed policy would be released soon. The delay has, however, caused the stock market to record huge losses after recording landmark gains following the announcement of the plan to adopt the policy.

“The market’s perception of the lack of clarity over the regulator’s plan on the exchange rate policy is fuelling hoarding and all manner of activities; this is why the naira dropped against the dollar at the parallel market today,” the National President, Association of Bureau De Change Operators, Alhaji Aminu Gwadabe, said. Analysts had last week said the local currency would trade around 350 per dollar this week as uncertainty over the implementation of the CBN’s planned new flexible exchange rate policy persisted.

The local currency retreated to 350 to the dollar on the parallel market on Thursday from 360 the previous week. The naira had weakened shortly after the CBN’s Monetary Policy Committee announced plans for new exchange rate policy two weeks ago, but strengthened when the details of the new policy were delayed, Reuters reported.

Skye Bank sacks 175 workers

The recent trend of retrenchment of workers in the financial services sector on Monday extended to Skye Bank Plc, which sent 175 of its employees into the labour market. The bank confirmed the development in a statement through which it explained that the affected workers failed the year 2015 appraisal exercise.

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The staff disengagement exercise is coming a year after the bank’s successful integration with the erstwhile Mainstreet Bank, which it acquired in October 2014; the integration exercise described by analysts as a landmark in Nigeria’s banking industry has significantly improved Skye Bank’s ICT capacity and helped strengthen the bank’s service delivery. “The bank extended its appreciation to the affected staff for serving the bank, describing them as members of the family who will always be accorded deserving respect in their future dealings with the bank.”

According to the statement, Skye Bank is adjudged by the Central Bank of Nigeria as one of the systemically important banks with over N1.3tn balance sheet, and has over 400 branches.

The PUNCH had exclusively reported last week that Diamond Bank Plc retrenched over 200 members of its workforce, while Ecobank Nigeria sacked over 1,040 of its employees, in response to the difficulties in the economy.

FBN Holdings, the parent company of First Bank of Nigeria Limited, had recently said it would cut down the number of its employees by 1,000.

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