CBN spent N100bn to print N420bn for troubled banks - We ’ll print more naira to save other banks - CBN - Reps set for showdown with CBN gov

From Odidison Omankhanlen, Gbola Subair, Friday Ekeoba and Idowu Samuel - 02.09.2009

THERE are strong indications that the Central Bank of Nigeria (CBN) expended over N100 billion to print the N420 billion bailout funds for the five troubled banks in the country.

The cost of printing the currency was borne by the apex bank at the normal rate currencies are printed, which is usually three times less the value of the current value of the naira.

However, the CBN has said that it will print more naira to bail out more banks as it concludes auditing of 11 other banks in the ongoing audit process.

The currency notes, which were printed abroad, was done without the approval of the National Assembly, a development which the legislature had kicked against as usurpation of its power by the CBN. All efforts to get the response of the apex bank proved abortive.

http://www.tribune.com.ng/02092009/news/news3.html

Ade0001:


The currency notes, which were printed abroad.

http://www.tribune.com.ng/02092009/news/news3.html

Printed abroad,why?

Printing our money abroad may also give the printers the freedom to print naira since all it will cost them is the cost of printing the money, not so?

They are so unpatriotic.

Honestly,nigeria is a circus,full of clowns on administrative and management level.

From what is happening,one can rightly see that nigerian economy does not basically depend on the banking system like in a normal world,rather it depends on hard working individuals like traders in onitsha market,alaba,balogun and other small businesses,they hardly have anything to do with banks.

The banks are just there for nigerian thieving elites.

I would take this story with a pinch of salt.

I dont think the money was physically printed. It was prolly created electronically.

I dont think the money was physically printed. It was probably created electronically.

There's no way in hell it could have been physically printed.  It was definitely created electronically.

Some journalists are funny.  How did they get the 100 billion they used to print the 450 billion?  Did they print that too?  And how much did they have to print to get the money they needed to print the 100 billion they needed to print the 450 billion?

That money supply was increased does not necessarily mean it was printed.

otokx:

That money supply was increased does not necessarily mean it was printed.

In Nigeria? roflmao!!

Sanusi himself disclosed this on Tuesday in Abuja at a press briefing held after the 210 edition of the Monetary Policy Committee (MPC) meeting. According to Sanusi, the N420 billion given to the five troubled banks was not a bailout but financial intervention to bring back those banks into a position where they would be able to meet their contractual obligations to their customers

What is the diff between bailout and financial intevention? Nigeria sabi English pass oyinbo sef.

so how much will the banks pay back, is it the cost price (100billion), or the selling price (420billion)?

My fellow Nigerians. Let's not use Einsteinous logic to reason this matter. It is quite simple.

N420 billion divided by N100 billion equals to 24 kobo per note.

24 kobo per note, it must Al Majiris that printed the money for them.

The average Naira note cost between $3 to $6 to print.


Make your own conclusion on the issue. As for the tribune newspapers, I'd rather sit in the grapevine than read the rubbish they publish. Themselves and Vanguard.

Let assume the notes printed were in 1000 bills.

How many N1000 bills would printed?

= 420000000000/1000

= 420000000 bills of 1000.

If 420m bills cost 100B,

The cost of each bill should be 100b/420m

= About 238 naira per bill

if N500 bills approx 238/2 = N 119 and so on and so forth.

So, looks like it in the range of the $3 mark, if you ask me,