Naira Tumbles To N545 Per $1 As CBN Set November Basel III Implementation
Naira, the nation’s currency has tumbled further against the United States dollar, dropping N5 representing 1 percent to stand at N545 per US dollar at the ps Parallel market on Friday.
This is as the Central Bank of Nigeria (CBN), issued the BASEL III/Reporting Templates for implementation by all deposit money banks (DMBs) in the country.
Figures from AbokiFX.com, a website that collates parallel market rates in Lagos, indicated that the local currency traded at N545.00 to $1 on Friday afternoon, declining by N5 or 1 percent from its last cloning value of N540 per $1 on Thursdsy.
However, data obtained from the FMDQ Security Exchange where forex is officially traded, indicated that the Naira is currently trading at N411. 25 Kobo per $1 at the Nafex window, as against its last closing at N411.67 Kobo per $1 on Thursday.
Meanwhile, the Central Bank of Nigeria (CBN) has fixed November 2021 as the deadline for banks to begin implementing Basel III criteria.
The Basel III regulatory standard is a voluntary global regulatory framework that is saddled with the task of ensuring that banks maintain capital adequacy and address stress testing, and market liquidity risk.
The apex bank has in September 2020 said it would commence a gradual adoption of Basel III requirements and update existing Basel II guidelines on Regulatory Capital and Supervisory Review Process in the fiscal years 2020-2021.
According to a circular with reference No: ID-BSD/ DIR/PUB /LAB /14/ 063, signed by Haruna Mustafa, Director of Banking Supervision, the regulator said the implementation of the framework will commence with a parallel run from November 2021 for an initial period of six months.
The CBN added that upon elapse of the half year period, it may be extended by additional three months, which will be subject to milestones achieved in the supervisory expectations.
According to the regulator, if fully complied with, it would decrease the risk of the financial sector becoming overly leveraged and militate against undue concentration.
The CBN noted that during the parallel run, the BASEL III guidelines will operate concurrently alongside the existing BASEL II guidelines, adding that it will be subject to the successful conclusion of the parallel run, the BASEL III guidelines shall become fully effective.
“All banks shall submit monthly returns not later than five working days after the end of the preceding month, with effect from November 2021.
“Finally, all banks are to note that capital add-on will be introduced in a phased manner as part of the overall supervisory process of Pillar II assessment to enhance better risk management practices and better align their capital with their risk profiles.”
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