Apex Bank Executives to meet over naira crisis

By Bintu Jidda
Kanempress
12th February 2023

Members of the management team of the Nigeria ‘s Apex Bank are to meet on Monday to review the crisis that the naira redesign programme has generated and proffer solutions to the acute cash crunch which had nearly paralysed activities.

Reports say the meeting would also consider the advice given by the Nigeria’s Governing Organ, the National Council of State that the apex bank should print more redesigned N1,000, N500 and N200 notes or re-circulate the old ones withdrawn from circulation in order to ease the current cash crunch.

Reports also say the meeting, which will hold at CBN headquarters in Abuja, would involve the top executives of the apex bank, and a fresh directive might be issued to Deposit Money Banks on whether to keep accepting deposits of the old notes or not.

Correspondents say that a decision would likely be made on the continuous circulation of the old notes at the meeting.

The advice to print more money would not be straightforward due to logistic reasons and the fact that the Nigerian Security Printing and Minting Plc had capacity issues as regards the printing of the new notes.

The CBN was considering contracting foreign firms to print the redesigned naira notes as the Mint was unable to meet the demand for the currency, thus leading to the current nationwide scarcity.

The Mint had succeeded in printing N500bn worth of the new N1,000, N500 and N200 notes and might not have the capacity to do more than that at the moment, whereas the CBN had withdrawn about N2.1tn of the old notes from circulation.

The advice given by the Council of State would be weighed carefully vis-à-vis the security implications of the continued scarcity of the notes, the cost of printing more notes and re-circulating the old ones, and the implementation of the Supreme Court interim order that the old notes should be allowed to circulate alongside the new ones.

Confusion reigns

However, developments in the last few days have thrown bankers, traders and ordinary Nigerians into confusion regarding the acceptability or otherwise of the old notes as legal tender.

While the Nigerian Government, through the Attorney-General of the Federation and Minister of Justice, Abubakar Malami (SAN), had indicated that the Supreme Court order would be complied with, he also said it would be appealed.

A manager of a Tier-1 bank, said there was confusion everywhere as the CBN had not given any counter directive to its earlier order that the old notes should not be in circulation again from Friday, February 10, 2023.

The bank manager said, “The whole thing has thrown us into confusion as we don’t know what to do. The last communication we received from the CBN was that we should begin to pay customers a maximum of N20,000 over the counter and that the February 10 deadline for the withdrawal of the old notes stays.

“We have stopped accepting old naira deposits from customers. We stopped on Friday. For instance, we didn’t open today (Saturday) to collect deposits as earlier directed by the central bank. We received an advisory from our zonal head to stop collecting old notes from Friday. Except there is a new directive on Monday, we will not take deposits of old naira notes again.”

Meanwhile, some petrol filling stations in Lagos and Ogun states, on Saturday, rejected the old naira notes from customers and insisted on new notes, transfers and Point of Sale payment only.

A similar situation played out in supermarkets and fast food restaurants, while some traders in different markets rejected the old notes.

Some residents of Abakaliki, Ebonyi State, have urged the Federal Government to, as a matter of urgency, address the nation on the suspension/extension of the deadline for the old naira note swap.

The residents, in separate interviews on Saturday, said the appeal became imperative due to the rejection of the old naira notes by traders and petrol stations across the state.

The residents, who expressed worry about the development, noted that the refusal by the business community in Abakaliki to accept the old notes amounted to a contravention of the recent Supreme Court ruling suspending the February 10 deadline set by the CBN.

A lawyer, Mr Lawrance Onwe, said Nigerians deserved to know from the government the true position of the naira swap so as to avoid the confusion, chaos and panic the development had generated since the deadline elapsed on Friday.

A civil servant, Mr Silas Nkpuma, said he almost engaged in a brawl with a commercial motorcyclist, who insisted on being paid with a new naira note.

He said, “I hadn’t any new naira notes on me and the man refused a mobile transfer. I was held hostage by the cyclist until a a good Samaritan intervened and bailed me out.

“I think the confusion arising from the rejection of the old notes would have been averted if members of the public were properly informed by relevant government agencies.

“The rejection stemmed from apparent ignorance and what is more worrisome is that filling stations and big business organisations started rejecting the old money on Friday.”

Mrs Chika Iteshi, a foodstuffs dealer at the Ophoke-Abba, Kpiri-Kpiri Market, said that she stopped collecting the old naira because okada and keke (tricycle) riders refused to collect it.

Similarly, some residents of Enugu, on Saturday, started rejecting the old naira notes.

According to News Agency of Nigeria, NAN many residents, who were still holding the old naira notes, were finding it difficult to spend them.

A resident of Awkunanaw in the Enugu South Local Government Area of the state, Mr George Nweze, said he observed the situation when he gave a bus driver the old N500, which he rejected.

“I was surprised that the driver rejected the old note because I thought he could easily use it to buy fuel. He flatly rejected it,” Nweze said.

A petty trader, Mrs Marta Chukwu, also said that she went to buy provisions with the old naira notes totalling N25,000, but they were rejected by her customer.

Chukwu said her customer declined to collect the notes from her, insisting that he stopped collecting old notes on Friday.

NAN observed that tricycle operators were asking intending passengers if they had new notes before boarding.

Mr John Nwabueze, a civil servant, said he paid old notes to a taxi driver while going to work on Friday, but while returning home in the evening, things had changed.

A tricycle operator, Mr Ejike Ogbodo, said the problem started when an NNPC mega station started refusing old naira notes.

“We queued to buy fuel yesterday at the NNPC mega station and the attendants refused to collect old notes from us; so, we decided not to collect old notes again,” Ogbodo said.

Similarly, the Amalgamated Union of Northern Traders, on Saturday in Sokoto, lauded the directive given by Governor Bello Matawalle of Zamfara State to security agents to arrest anybody who rejected the old naira notes for commercial transactions.

Matawalle was among the governors who dragged the Federal Government to the Supreme Court, seeking a restraining order to stop the naira redesign policy.

The union’s Youth Leader, Alhaji Sanusi Daudu-Nufawa, lauded the directive of the governor to security agents in Zamfara State to closely monitor all trading activities around markets in order to reduce the suffering of the masses.

Daudu-Nufawa noted that the informal economic sector could only be revived if leaders took drastic decisions to effectively make people do transactions with the old and new notes.

He said the effort would further reduce and relieve the pains that ordinary Nigerians were experiencing in the face of scarcity of the old and new naira notes.

He expressed optimism that the circulation of old notes and their gradual replacement with new notes would ease peoples’ sufferings.

Unions threaten strike

The National Union of Banks, Insurance and Financial Institution Employees and the Association of Senior Staff of Banks, Insurance and Financial Institutions have said their members will down tools if they continue to come under attack from angry customers.

The President of NUBIFIE, Anthony Abakpa, said “Nigerians are suffering and bank workers are also the target. Customers are venting their anger on staff members, who are also our members.

“The CBN is the sole regulatory body that supervises banks. So, if it gives certain amounts to Bank A or Bank B, it should be able to supervise them and know which bank is doing the right thing. If nothing is done within a week, I think we will mobilise to shut down.”

Similarly, the President, ASSBIFI, Olusoji Oluwole, said the banks could only disburse to customers the amount of cash made available to them.

Oluwole stated, “The sad thing is that yes, banks are being given money, but banks are not being given enough money to circulate. The banks can only issue out what they have. But coming out to tell an already agitated public that banks are the ones keeping the money creates a lot of worry for us, because what it does is that you’re practically eroding the confidence of people in the banking system and putting the workers in danger, and that is the sad part of it right now.

“Beyond that, I think people just want access to cash, whether it is the newly-designed ones or even the old ones. I’m talking about the N100, N50, and N20 (notes). Let the CBN make them available.

“We’re sure it has them in stock and when they’re doing that, it should bring the ones that are distributable, not the ones that are mutilated. It should be able to do that and, at least, ease the tension a bit.”

No problems – CBN

Meanwhile, the Apex Bank had said that the NSPMC has the capacity and enough materials to produce the required indent of the naira notes.

The apex bank also said that it was working to increase the circulation of the new notes across Nigeria .

The apex bank’s Director of Corporate Communications, Osita Nwasinobi, in a statement dated Friday but released on Saturday, said such reports about the Mint’s capacity to print the required banknotes that were credited to the governor of the bank, Godwin Emefiele, were not true as he was misquoted.

Some news media (not PUNCH) had reported that Emefiele admitted that the Mint did not have enough materials to print the new notes and that accounted for the current scarcity.

Nwasinobi said at no time did the CBN governor make such a statement during his presentation to the National Council of State at its meeting on Friday.

He said, “For the records, what Mr Emefiele told the meeting was that the NSPMC was working on printing all denominations of the naira to meet the transaction needs of Nigerians.

“While the CBN appreciates the concerns shown by all stakeholders about the distribution of the naira, we are alarmed at the extent to which vested interests are attempting to manipulate facts and pit the public against the bank.”

Nwasinobi also said the CBN remained committed to performing its monetary policy functions as stipulated in the CBN Act, 2007 (as amended).

He added, “We also wish to restate that the NSPMC has the capacity and enough materials to produce the required indent of the naira.

“The bank, therefore, wishes to appeal to the public to disregard the said reports and exercise more restraint, even as we work assiduously to increase the circulation of the new notes in the country.”

On a particular voice note trending on the social media alleging that the CBN planned to shut down some banks, particularly in a geopolitical region of the country, the CBN director said there was no such plan and that the claims were illogical and did not comply with the workings of the banking system.

Niger sues FG
The Niger State Government has filed a lawsuit against the Federal Government at the Supreme Court over the naira redesign policy.

A statement by the state Attorney-General and Commissioner for Justice, Nasara Danmallam, on Saturday, said the case with suit number SC/CV/210/2023, was filed on Friday.

The statement said that the state government was seeking an extension of the timeframe given by the CBN for the currency swap and withdrawal from circulation of the old N200, N500 and N1,000, among other reliefs.

The statement said the three months given by the Federal Government for the withdrawal of old notes across the country was not reasonable and was in violation of sections 13, 14 (2) (b), 17 (1) (c) of the 1999 Constitution as amended.

In the affidavit in support of the originating summons, the state government contended that the unavailability of the redesigned notes had caused untold hardship and suffering on residents of the state, especially those living in rural areas.

The statement expressed the state government’s concern about the inconveniences the policy had brought on the people, saying it would continue doing everything within its constitutional limit to ameliorate their suffering.