Last week ThisDay newspapers published a story about how the CBN had fined StanChart Bank N2bn for a forex offence. Please read the story here.
Who gave this story to ThisDay? The story is not true so we strongly suspect it was someone in CBN who gave them the story.
So what really happened?
ICBC bank of China wanted to bring some dollars into the Nigerian economy. They called Stanbic IBTC who they normally use for their transactions and told them that they wanted to exchange the $60 million for naira and that they wanted a rate of N390 to $1.
Please be aware that Godwin Emefiele has previously warned all the banks to phone him before they do any foreign exchange transaction above N315 to $1 or else he will sanction them. Yes, you must phone Emefiele before you can buy dollars at more than N315 to $1!
So Stanbic called him to ask for his permission to buy the dollars from ICBC. Emefiele refused to give them permission. Stanbic now went back to ICBC to tell them they could not buy the dollars at that rate as CBN had refused them approval. Lo and behold, ICBC then informed Stanbic that they had already sold the $60 million to Zenith Bank at N390 to $1!!!
How did Zenith go behind Stanbic’s back to buy the dollars for the same rate when Emefiele had refused to give Stanbic approval??!
Please be aware that Emefiele has instructed banks to always post their transactions on Reuters. It is through Reuters that international investors and foreign media see Nigeria’s daily foreign excahnge transactions. But in this case, Zenith Bank did not post the $60m transaction on Reuters. Why? Is it because Emefiele wants to continue deceiving the world that Nigeria’s exchange rate is below N315 to $1?
But other banks heard that Zenith Bank had done a transaction for N390 to $1. Based on this, they thought that Emefiele had released his tight control of the market. Some of them quickly started calling their foreign clients to bring in money that could not be brought in because of the artificial low rates enforced by Emefiele.
This was where Standard Chartered entered Emefiele’s trouble. They called one of their foreign clients to arrange a $25m transaction at N380 to $1. They quickly bought it and then sold all the $25m to various Nigerian clients at N380.50 to $1. This is because Emefiele has another rule that banks must not charge more than a spread of 50kobo on forex deals. But typical of Emefiele, he allows some people break this rule!
The $60 million that Zenith Bank purchased from ICBC at N390 to $1 was sold to a Nigerian client at N420 to $1! Emefiele allowed them to do this and he also allowed them not to put the transaction in the Reuters system.
Standard Chartered then committed another offence according to the rules of Emefiele. They updated the $25 million transaction in Reuters. This means that Reuters then showed that rates on the interbank market were going up. They also did not call him for approval before doing the deal.
These 2 offences made Emefiele very angry so he immediately wrote Standard Chartered a letter (we have seen a copy of this letter) asking them to explain themselves. He immediately debited their account with a N1.7bn fine (Please note that the profit that they made on the deal was N12.5 million!). He also asked them to suspend their Chief Treasurer. Standard Chartered have placed the Treasurer on suspension as instructed.
Please be aware that we are not here to defend Nigerian banks and bankers. They are not saints. We are here to tell the truth about the damage Emefiele is doing to our economy. This forex scarcity has increaed his power over the economy and he is now doing anything he likes. Is this because he is protected by Abba Kyari?
From this story we inform you of 3 things that Godwin Emefiele is using his office to do
- He is using the CBN to enrich Zenith Bank and allowing them break the rules he applies to other banks. For those who don’t know, Godwin Emefiele used to be the CEO of Zenith Bank before he joined CBN.
- He is blocking foreign exchange from entering Nigeria at a time when the country is suffering a serious forex crisis.
- He announced to the world in June that he was floating the Naira and then turned around to do another thing. In the eyes of foreign investors, Nigeria has no credibility again because the Central Bank governor can say one thing and do the opposite.
Godwin Emefiele is destroying our industries and our economy. Nigerians need to know the truth about what he is doing and we will reveal more of his corrupt deals and bad policies on this website!
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