The decisions were the highlights of a two-day meeting of the Monetary Policy Committee (MPC) of the CBN where the Central Bank Governor, Godwin Emefiele also allayed fears that the implementation of the TSA had created liquidity squeeze in the system.
He also dispelled rumors that some Ministries, Departments and Agencies (MDAs) have been exempted from the TSA policy, noting that the CBN has not received such memo. He advised all MDAs to transfer their funds to the CBN as demanded by the policy.
“There have been a lot of speculations on the amount of funds that have been moved from the market to the CBN. The truth is that the amount that was moved was less than the amount that people have been quoting on the pages of the newspapers. The TSA is an ongoing exercise. The amount as at 15th of September is less than what it is at today the 22nd; but what we are saying is that a lot of people had predicted liquidity squeeze as a result of TSA . The data the committee reviewed between yesterday (Monday) and today (Tuesday) shows that liquidity ration indeed increased moderately. That was why the committee came to the conclusion that the impact of movement of the funds from the banks to CBN on liquidity is sort of moderate,” he stated.
Emefiele allayed fears over the safety of the banks in view of the takeoff of the TSA police, adding that, ” the liquidity ratio that we saw based on data that was presented to us showed that the Nigerian banks are safe; Nigerian banks are healthy and still very strong and we will continue to monitor their liquidity from time to time to ensure they do not slide into a difficult terrain.”
He said the economy had begun to respond positively to the forex restriction imposed on some 41 items as a tomato paste company that had shut down has reopened.
“In the case of some 41 items that have been excluded from official sources as well some parallel segment of the foreign exchange, I repeat the CBN does not have the official power to ban importation of such times; but the impact is positive because we have begun to see people who before now had closed their factories as a result of uncompetitiveness of their products compared to prices of imported times now open their shops and employed more people thereby creating employment and boosting the business environment.