- CBN Governor Olayemi Cardoso warns financial institutions that violations of the new FX Code will lead to severe sanctions, aiming to restore trust in the market
- Cardoso reveals the forensic review of $7 billion in FX backlogs is nearly finished, uncovering unethical practices and marking a significant step in market reform
- The FX Code is built on six principles to ensure ethical conduct, with the CBN focusing on compliance, governance, and risk management to strengthen the FX market
The governor of the Central Bank of Nigeria (CBN), Olayemi Cardoso, has issued a stern warning to financial institutions, stressing that any violations of the newly launched Nigeria Foreign Exchange (FX) Code will lead to severe sanctions.
During the launch of the FX Code at the CBN headquarters in Abuja on Tuesday, January 28, Cardoso emphasised the critical role the framework will play in restoring trust and transparency in Nigeria’s foreign exchange market.
He described the FX Code as a comprehensive and enforceable set of guidelines designed to address past abuses and unethical practices that have undermined the integrity of the market.
"The era of opaque practices is over. We will not hesitate to act against any institution or individual that undermines the integrity of our financial markets," Cardoso stated.
The CBN governor also revealed that the forensic verification of $7 billion in FX backlogs, a process that has taken over 12 months to complete, is nearing its final stages.
This verification exercise uncovered multiple unethical and illegal practices that have contributed to distortions in the FX market.
He reassured stakeholders that final settlements for the FX backlogs would be processed shortly, marking a key step in rectifying past irregularities.
"We must not forget where we are coming from. The era of multiple exchange rates, which created privileges for a select few at the expense of most Nigerians, severely undermined market integrity," Cardoso said.
Cardoso noted that the forensic review of the $7 billion in FX backlogs had revealed a range of unethical and even illegal activities that the CBN is determined to prevent in the future.
The verification process is now nearly complete, and final settlements are set to be processed in due course.
The FX Code, Cardoso explained, is supported by both the CBN Act of 2007 and the Banks and Other Financial Institutions Act of 2020, which provide the legal basis for imposing penalties and administrative actions on violators.
He called on board chairs, managing directors, and chief compliance officers in the financial sector to ensure their organisations fully adhere to the Code’s principles, underscoring the importance of embedding these standards across the industry.
"Self-regulation and conduct are at the core of the changes in culture we expect to see at play in the industry. I expect the principles of the FX Code to be applied across other business areas," the CBN boss added.
CBN extends BDCs’ recapitalisation deadline by 6 months over low compliance level
Meanwhile, TheRadar earlier reported that the Central Bank of Nigeria (CBN) extended the deadline for the recapitalisation of Bureau De Change (BDC) operators by six months due to a low level of compliance.
The deadline to meet new capital requirements was extended from December 3, 2024, to June 3, 2025.
