…Justifies relocation of departments, says headquarters currently overpopulated
By Sodiq Adelakun
In a recent development, the Governor of the Central Bank of Nigeria, Yemi Cardoso, announced on Arise Television that approximately $2.4 billion of the foreign exchange backlog reported as federal government liabilities is not eligible for settlement.
This revelation came to light following a comprehensive forensic audit conducted by Deloitte Management Consultant.
The initial figure of $7 billion in FX liabilities has been under scrutiny, leading to the discovery of several discrepancies.
The audit uncovered a range of infractions, including claims from non-existent entities and unauthorised foreign exchange allocations. These findings have led to the conclusion that a significant portion of the reported liabilities is invalid.
Governor Cardoso’s statement has brought clarity to the financial situation, as the Central Bank moves to rectify the discrepancies identified in the audit.
The Nigerian government’s commitment to transparency and accountability in its financial dealings is underscored by this rigorous examination of its foreign exchange liabilities.
The Central Bank’s actions are expected to have implications for the country’s financial stability
Cardoso said, “We contracted Deloitte Management Consultant to do a forensic of all these obligations and to tell us what was valid and what was not. Of course, we were committed to ensuring that we would pay all valid transactions.
“The result that came out of this was startling in a great respect; it was quite startling. We discovered that of the roughly $7 billion, about $2.4 had issues, which we believed had no business being there – and the infractions from that range from so many things.
“For example, not having valid import documents and in some cases, even entities that did not exist and in some cases, beneficiaries and account parties that asked for FX and got more than they asked for. And those who didn’t even ask for any and got. So, there was a whole load of infractions there, which I said amounted to about $2.4 billion out of the $7 billion headline figure.”
He also said that the CBN has already settled legitimate FX requests totalling $2.3 billion, leaving an outstanding obligation of approximately $2.2 billion. The governor emphasized the bank’s determination only to honour validly constituted FX requests and to address the outstanding liabilities promptly.
The CBN Governor said, “We are not paying if you don’t qualify; they are not validly constituted requests. And of the validly constituted ones, we have settled about $2.3 billion and that applies to the airlines and a whole load of different entities spread throughout our economy – we’ve settled that already.
“And now what remains is about $2.2 billion to be settled and I am confident that we will shortly be addressing those and be able to move on and make progress.
“Now, how are we dealing with those that are not valid?/ As they were identified, we wrote to the authorsed dealers to come in and explain what the situation was and where the numbers differed. And sadly, quite frankly, I think much of those have not been disputed to our satisfaction.”
In dispelling rumours, Cardoso denied any plans by the federal government to convert domiciliary accounts into naira accounts as part of currency stabilisation efforts.
He reiterated the CBN’s commitment to resolving the outstanding FX obligations and ensuring economic stability.
In the same vein, The Governor of the Central Bank, Olayemi Cardoso, has defended the bank’s decision to relocate departments and personnel to other branches, citing the current “overpopulation” at the headquarters.
Cardoso stated that the move was a normal process for any vibrant entity like a central bank and was aimed at aligning the bank’s structure with its functions and objectives.
The redistribution of skills would also ensure a more even geographical spread of talent.
The decision to redeploy over 1,500 personnel from the headquarters to other branches has sparked outrage, but the bank maintains that it is part of a decongestion action plan to optimize the operational environment.
”This initiative aims to ensure compliance with building safety standards and enhance the efficient utilisation of our office space.”
Although the Northern Elders Forum and some other Northern groups had condemned the move, the move now being implemented reduced the HQ occupancy level to 2,733 personnel from 4,233.
According to reports, the departments relocated by the CBN include Banking Supervision, Other Financial Institutions Supervision, Consumer Protection Department, Payment System Management Department, and Financial Policy Regulations Department.
Cardodo said, “I think there’s been an attempt to sensationalise what is a normal process for any vibrant entity like a central bank. Bear in mind that as a national institution, the central bank has a presence in every state of the federation.
“A situation where a large number of technical skills are in one particular location to the detriment of others does not speak well. So this has been an attempt to realign that and to ensure that skills are moved from where there’s an overabundance to where there’s a great shortage of those skills. So that’s basically what that is about.
“And with respect to Lagos which you mentioned, from our perspective, it makes a lot of sense that the entities which we are attempting to regulate and need to be on top of that are based in Lagos and they should have the right skills from the central bank right next to them so they can adequately and effectively do their jobs.”
When asked if the CBN headquarters was above its carrying capacity, Cardoso replied in affirmation, stating, “It is overpopulated. And with what we are doing right now, we are hoping that will also help in easing the issue of overpopulation, which it is.
“And quite frankly, anybody that comes to the bank and interacts on that level will see that it is. It is overpopulated. And we’ve got to ensure that we can manage potential issues that could fall out from an overpopulated environment.”