- The Central Bank of Nigeria has approved a foreign exchange code to foster ethical conduct
- The FX code will be launched on January 28
- The approval of the FX code is part of CBN’s efforts to enhance the foreign exchange market
The Central Bank of Nigeria (CBN) has officially approved the release of the Nigerian Foreign Exchange (FX) Code to foster ethical conduct among authorised dealers and transparency in the forex market.
The apex bank disclosed this in a statement on its website on Wednesday, January 22.
It said the FX code is to ensure that authorised dealers uphold the highest standards of professionalism and integrity when conducting forex transactions.
The statement added that the introduction of the FX code is part of its efforts to enhance the stability and integrity of Nigeria’s forex market.
It said the code will offer clear directives on the expectations for market participants, ensuring that the market operates fairly and transparently.
The apex bank added that the code will be formally launched on Tuesday, January 28, at the CBN Head Office Auditorium in Abuja.
The CBN said, “The Central Bank of Nigeria has approved the release of the Nigerian Foreign Exchange (FX) Code as a guideline to the banking industry to promote ethical conduct of Authorised Dealers in the Nigerian Foreign Exchange Market.
“The Bank will formally launch the Code at the CBN Head Office Auditorium, Abuja, on Tuesday, January 28, 2025.”
FX code is part of CBN’s efforts to enhance FX market
As part of efforts to stabilise the naira, enhance liquidity in the FX market, and curb unethical practices such as arbitrage and speculation, the CBN introduced some policies.
In October 2024, the CBN introduced the Electronic Foreign Exchange Matching System (EFEMS), for forex transactions in the Nigerian Foreign Exchange Market (NFEM).
The system mandated $100,000 as minimum trade for interbank forex transactions to enhance market transparency, ensure efficient trading, and strengthen compliance within Nigeria’s forex market, streamlining trading and reducing risks.
The CBN said with the EFEMS, authorised dealers will conduct all foreign exchange transactions on the platform, which will be reflected in real-time.
The CBN also granted licenced Bureau De Change (BDC) operators access to purchase forex directly from authorised dealers to meet customers’ needs, ensuring forex stability and reducing market volatility.
In August 2024, the CBN auctioned $876.26 million to end users whose bids were submitted by 26 commercial banks in the apex bank to strengthen the naira.
FX matching system will address rate disparity, naira’s true value – Cardoso
Meanwhile, TheRadar earlier reported that the governor of the Central Bank of Nigeria (CBN), Olayemi Cardoso, said the electronic foreign exchange (forex) matching system will soon address the disparity between the current naira-to-dollar exchange rate and the naira’s true market value.
Cardoso stated this at the Bankers’ Committee annual dinner held on Friday, November 29, in Lagos.
