The Central Bank of Nigeria (CBN) has successfully auctioned $876.26 million to 26 deposit money banks (DMBs) in the latest Retail Dutch Auction System (RDAS) held on Tuesday, August 6, 2024.
The auction was part of the apex bank’s efforts to enhance foreign exchange liquidity in the market, alleviate demand pressure, and support price discovery, in line with its objectives.
The CBN disclosed this development in a statement released on its website on Wednesday, signed by its Director of the Financial Markets Department, Omolara Omofunde Duke.
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According to the statement, the auction attracted total bids worth $1.18 billion from 32 authorised dealer banks. However, bids amounting to $313.69 million from six banks were disqualified. The disqualifications were due to four banks submitting their bids after the 3:00pm cut-off time, while two banks failed to provide bids in the required template.
The statement read, “A total bid valued at US$1.18bn was received from 32 Authorized Dealers Banks, of which, bids valued at US$876.26m from 26 banks qualified, while bids valued at US$313.69m from six banks were disqualified.”
ABN TV recalls that last week, the CBN announced plans to implement the RDAS to address the increasing unmet foreign exchange demand from end users. The aim is to ease the growing pressure in the FX market and stabilize the naira’s exchange rate, which has fluctuated between N1,450 and N1,600 in recent months.
In the latest auction, the CBN approved a cut-off rate of N1495/$ for the RDAS.
