CBN: RMAFC Advised Us against Designating Excess Crude Account in Dollars
Deputy Governor of the Central Bank of Nigeria (CBN), Suleiman Barau
A Deputy Governor of the Central Bank of Nigeria (CBN), Suleiman Barau, Thursday told Senate Committee on Banking how the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) advised the bank against designating the Excess Crude Account in dollars.
He also revealed how the apex bank recorded N2 billion profit from mint in 2012 after the Nigeria Security and Minting Company (NSMC) “printed 2.8 billion notes in 2011 and 2.6 billion notes in 2013 out of total 3.2 billion notes the CBN printed.”
He explained that the N2 billion profit from mint in 2012 was a matter of capacity and not patronage.
Barau who was answering questions from the committee ahead of his confirmation for re-appointment as CBN deputy governor said constitutional constraints militate against plans by CBN to designate the funds shared from the excess crude account in dollars.
He told the screening committee that the issue “is a constitutional constraint. When it was first mooted, the Revenue Mobilisation Allocation and Fiscal Commission informed us that the Constitution only recognises the naira the unit of account.”
Barau noted that the bank was still discussing the matter internally to ensure a well advised position, adding that it was still an ongoing issue that would be completely addressed.
On interest rates, he noted that the lending rates by banks were still high as a result of the adverse consequences that lower rates could cause to the rate of inflation at the moment.
He noted that the CBN was making efforts to ensure that the banks were strong enough to support the real sector for national development.
Responding to the allegations that the CBN does not patronise NSPMC for the printing of naira notes, Barau said the allegation was untrue. He disclosed that a residual quantity of the 3.2 billion notes required by the CBN were printed by a foreign company.
He also insisted that the CBN should continue to maintain its financial autonomy as against the proposed amendments to the CBN Act to subject its budget to the scrutiny of the National Assembly.
According to him, such autonomy is in line with the spirit of the law and international best practices.