₦airaland Forum

Nigeria’s foreign reserves hit a three-year high of $40.2 billion in 2024, but the naira saw instability for much of the year, with the Central Bank of Nigeria (CBN) tweaking policies to stabilise the foreign exchange (FX) market.

These were some of the highlights of 2024, which challenged Governor Yemi Cardoso to introduce policies, including the Electronic Foreign Exchange Matching System (EFEMS), to stabilise the FX market.

Monetary policy tightening

Escalating inflation driven by currency depreciation and rising food prices pushed an aggressive monetary tightening by the CBN, including interest rate hikes totaling 875 basis points throughout 2024, and a raise in Cash Reserve Ratio of 50 percent.

These measures aimed to tighten liquidity and curb inflationary pressures but they raised concerns about the potential negative impacts of inflation on economic growth and domestic investment.

Inflation peaked at a record 34.6 percent in November, and according to experts, including the International Monetary fund and CBN governor, Yemi Cardoso, this indicates that relying on monetary policy alone is not really enough, even though it has helped in moderating pace of increase.

“The measures implemented to curb inflation, coupled with foreign exchange market reforms, are bolstering Nigeria’s economic growth,” Cardoso said.

“But the case for economic diversification has never been more urgent – reliance on a single sector is simply unsustainable,” Cardoso told bankers at their annual dinner late November.

Foreign exchange market reforms

The CBN streamlined the foreign exchange (FX) market into a single framework, promoting a “willing buyer, willing seller” model, aimed to curb arbitrage, improve transparency, enhance liquidity and reduce market distortions. Its periodic interventions also reduced exchange rate volatility, leading to a calmer market in the latter half of the year
It also took significant steps to clear a $7 billion backlog of valid foreign exchange (FX) forwards, which equally helped to stabilise the exchange rate and boost market confidence.

Those efforts saw average daily turnover in the autonomous FX market increase by 226 percent in the first half of the year, as against same period in 2023. Foreign portfolio inflows rose by over 72 percent within the period, while foreign exchange reserves rose from $32 billion in May 2023 to over $40 billion today, the highest level in nearly three years.

Just recently, the CBN announced the introduction of EFEMS, an electronic FX matching system to further enhance transparency, curb speculation and market distortions, restore confidence, and attract new investments.

The CBN further directed BDCs to integrate their IT systems with its own infrastructure, promoting transparency and better regulatory monitoring, alongside some new corporate governance requirements.

Bank licensing and expansion

In 2024, the CBN approved one bank as a non-operating financial holding company, while another transitioned from a merchant to a national commercial bank. Two banks received Approvals In Principle (AIP) for regional commercial licenses, and one for regional non-interest banking. In the microfinance sector, it licenced 16 new banks and re-licensed 53 of them whose licences were previously revoked. Also, five new approvals were given to finance companies for operations.

Banks’ recapitalisation

Cardoso had hinted late 2023 of a possible bank recapitalization to raise their minimum capital requirements. This was later announced, with March 31, 2026, set as a deadline. The directive, Cardoso said, was to strengthen their resilience and capacity for risk-taking and further stabilise the financial system. It would also enable sufficient bank capital to service the $1 trillion economy by 2030 as proposed by President Tinubu. In 2024, many banks deployed different strategies, including equity issuance and license adjustments to shore up their capital.

“I am pleased to note that a significant number of banks have raised the required capital through right issues and public offerings well ahead of the 2026 deadline,” Cardoso disclosed in November.

Meanwhile, Nigerian banks continued on a resilient path, with the non-performing loan ratio remaining within the 5 percent prudential benchmark, as their liquidity ratio exceeded the 30 percent benchmark, ensuring adequate cash flow in the system.

Market conduct and Transparency

To improve financial system resilience, the CBN prohibited banks from distributing unearned income, including foreign currency revaluation gains, for the financial year ending December 31, 2023. A letter dated March 14, 2024, emphasised the need for banks to exercise prudence and set aside these gains as a counter-cyclical buffer to mitigate potential adverse movements in the foreign exchange rate, while also ensuring that investors receive a clear picture of bank performance.

The CBN also introduced guidelines to improve the management of dormant accounts, unclaimed balances, and other financial assets in July 2024. This was aimed to identify and reunite them with their owners, hold these funds in trust for them, standardise management practices, while establishing procedures for reclaiming warehoused funds.

Suspension of Processing Fees on Cash Deposits

Effective May 6, 2024, the CBN suspended processing fees on cash deposits exceeding N500,000 for individuals and N3,000,000 for corporates until September 30, 2024.

Additionally, a three-month waiver (from January 15 to April 15, 2024) was granted to DMBs for depositing lower denominations (N50 and below) with the CBN at no processing cost. This initiative was targeted at encouraging cash deposits, strengthening financial intermediation, and aiding in the effective transmission of monetary policy.

Naira Instability

In spite of these achievements, the naira was mostly unstable this year, closing the year at N1538/$ on December 30.

Though the naira has seen some stability recently, it was once adjudged one of the worst-performing currencies in the world. It has lost over 70 percent of its value in about one year.

Source: https://businessday.ng/news/article/reserves-grow-naira-flutters-as-cbn-tweaks-policies/

Also add mass sacking of staff

So much progress from this government this year.

We are hoping for better year 2025

Propaganda!!

Propaganda here and there. I hope dollar doesn't rise more to Naira.

Inside Alhaji Mai Deribe's $100M Gold Palace: and why the Luxury Mansion Lies Abandoned!

https://www.youtube.com/watch?v=NX09w_KPHS4?si=IvWa6MpYZHhPo054

Happy new year

C

Ndi ala

Bring back our náírà, no reason can explain why cefa should be stronger than náírà.

Nigeria is the economic hub of the African continent and by every reasonable standard should have the best currency.

SpiritMoney:
Propaganda!!

From another IPOB retard.

Una go soon join Namdiot coward Cownu in the Nigerian prison zoo.

helinues:
So much progress from this government this year.

We are hoping for better year 2025

bst

Say what you like. All of you in APC are failures...

What of the exchange rate? Propaganda agenda

Propaganda, if your policies does not positively affect the lives of the citizens you Govern, they are worthless

May God's will for my life and my family come to fulfillment this 2025. May good things overshadowed I and my family. May we never lack money and wealth in this new year 2025. Amen

2024, The year Nigerian came face to face with reality.

No more free lunch if you must eat then you must work for it.

I so much love it how the lazy mannerless importers were cut to size.

No more my container det for sea by unpatriotic wasters and prodigal citizen

YEAR OF WEALTH FOR HUSTLERS ESPECIALLY FARMERS

CBN


but no cash flow


Princess Faith Chukwu

Kk

Dittodat:
From another IPOB retard.

Una go soon join Namdiot coward Cownu in the Nigerian prison zoo.

Continue to support lies. That's how you lied that Warri refinery is now functional. Even though it has not.

Mtchweee!

Dittodat:
From another IPOB retard.

Una go soon join Namdiot coward Cownu in the Nigerian prison zoo.

^^^
Trying to derail the thread and divert it to your preferred territory, I see.

If the person you quoted used just one word to describe an entire writeup, you had ample opportunity to prove him wrong with evidence - if the evidence does exist. But you didn't do that.

This is a thread on economic and financial policy outcomes. Those of us who want to learn would like it to remain so. Please be guided.

Thank you.

Usual bullocks🤣🤣🤣🤣😂😂😂
# all motion, NO MOVEMENT govt of self serving THIEVES 💯💯💯

Banks’ recapitalisation

Cardoso had hinted late 2023 of a possible bank recapitalization to raise their minimum capital requirements. This was later announced, with March 31, 2026, set as a deadline. The directive, Cardoso said, was to strengthen their resilience and capacity for risk-taking and further stabilise the financial system. It would also enable sufficient bank capital to service the $1 trillion economy by 2030 as proposed by President Tinubu. In 2024, many banks deployed different strategies, including equity issuance and license adjustments to shore up their capital.

So the 1trillion dollar economy that Tinubu has boasted about achieving is to be financed by Nigerians o😂? Because for banks to have sufficient capitals to service that economy, the banks have to pilfer ordinary Nigerians and businesses.

Abi na me no dey reason straight? God abeg make e be say na me don craze o!

To even think that Buhari just drank all the reserves that year. Na wa.

We cannot allow any northern clown take us backward again Abeg

helinues:
So much progress from this government this year.

We are hoping for better year 2025

Cornified people

helinues:
So much progress from this government this year.

We are hoping for better year 2025

Can you show them please?

AmazingGenius:
Source: https://businessday.ng/news/article/reserves-grow-naira-flutters-as-cbn-tweaks-policies/

Here’s a conversational response:

It’s clear the policies introduced by the CBN, like monetary tightening and FX market reforms, were aimed at stabilizing the economy and boosting foreign reserves. However, the harsh realities faced by ordinary Nigerians tell a different story.

Hyperinflation peaking at 34.6% has made basic necessities unaffordable for many, and currency depreciation has eroded the purchasing power of the naira. While the FX market reforms and measures to improve transparency might look good on paper, they haven't translated into relief for the average Nigerian struggling with skyrocketing food prices and living costs.

The aggressive interest rate hikes and tightening liquidity have squeezed businesses, stifled growth, and limited job opportunities. For many, these policies feel like they prioritize optics over impact, leaving the people to bear the brunt of economic hardship.

What’s needed now is a more inclusive approach—policies that not only stabilize the markets but also address the immediate needs of the people. Without tackling hyperinflation and supporting local businesses to thrive, these measures risk being seen as disconnected from the everyday struggles of Nigerians.

Deceit

I don't know what to say to be honest 😔

Useless incompetent animals. God punish una dia

These white Bretton Wood guys are always happy when your currency gets weaker.. it gives them more powers over you. It's a new form of colonialism (neo-colonialism). That's why everytime you run to them with cap in hand begging for money, they ask you to devalue your currency, as a precondition. With all the oil wey we get o..🤔🤔