Central Bank of Nigeria, CBN, has said the cut in Cash Reserve Ratio, CRR, to 25 percent from 31 percent had injected N300 billion into the financial system, Moses Tule, monetary policy director at the apex said according to a Reuters report.
In the same vein, Tule affirmed that the CBN believes there is adequate liquidity in the Nigerian banking system despite its slowing economic growth the report said.
It noted that prior to the move, liquidity on the interbank market had depleted after commercial banks were ordered to move government revenue to the Treasury Single Account (TSA) at the central bank which ended September 15, as part of President Muhammadu Buhari’s move to check deepening corruption in the nation.
The report says JP Morgan’s decision to remove Nigeria from its influential emerging markets bond index (GBI-EM), which means investment funds tracking the index will sell Nigerian bonds, added to upward pressure on national borrowing costs.
“There’s sufficient liquidity in the Nigerian banking system to take up whatever foreign investors may dump, so we are not disturbed,” the report quoted Tule as saying.
“By cutting the cash reserve ratio, we introduced back more than 300 billion naira,” he said adding, however, that the bank was “concerned that the economy is slowing”.
The report further affirmed that growth halved in the second quarter compared with the same period last year, prompting Godwin Emefiele, the Central Bank Governor, to say at last week’s monetary policy committee meeting that the economy was at risk of slipping into recession in 2016.
However, Banks are of divergent views on the single account and its impact on their operations, some say it’s necessary for the economy to boom, others say no matter what happens, they will find a way around it and improve on their operations.

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