With a pass mark on the ongoing reforms in the banking industry, Central Bank of Nigeria (CBN) Governor, Prof Charles Soludo yesterday hinted of a major restructuring of the country’s currency, the naira.
Prof Soludo who spoke in Lagos at a luncheon with media executives noted that the introduction of coins was meant to tame inflation and reduce prices of goods and services.
He said that under the new currency regime, N2, N1, and 50 kobo denominations would be produced as coins, while denominations of N5, N10, N20 and N50 notes would be restructured within the year.
Although, he would not give details, the CBN boss also informed that the currencies would be produced in Nigeria at half their previous costs, just as they would last.
He added that managing the external reserves in order to preserve the international value of the naira is one of the core functions of the apex bank adding that the Bank has performed creditably in this task.
Prof Soludo stated that the CBN has adopted a new policy of using the size of the external reserves which now stand at $36 billion to fast track the development of the domestic banking system by requesting foreign banks insiting to manage part of the reserves to enter into joint ventures with Nigerian banks.
According to him, such joint venrures would result in transfer of global best pratices and skills to Nigerian banks adding that for the nation to achieve its dream of becoming the financial hub of Africa, it must leverage on its resources.
He disclosed that a number of Nigerian banks have signed agreements with some foreign banks to partner the management of the reserves.
Prof. Soludo said that the apex bank is embarking on far reaching currency reforms and overhaul of the payments system.
He said that part of the reforms include making it an offence under the new CBN act to deface, mutilate, write on or spray the naira, explaining that the same respect accorded to the national flag should be given to the naira.
The CBN, he stated, is trying to restructure the currency as is the practice in developed economies where currency is restructured every eight years.
He said the apex bank is embarking on the currency reforms in phases with notes within five and 50 naira being redesigned and issued within this year while advanced technology would be employed to enable the notes last longer.
However, he said the CBN would reintroduce the use of coins in 50 kobo, one naira and two naira denominations in a bid to drive prices down.
Source: Daily Champion