The Central Bank of Nigeria (CBN) recently conducted a Retail Dutch Auction System (rDAS) on August 6, 2024, in an effort to mitigate the rising demand pressures in the foreign exchange (FX) market and to promote price discovery.
In this auction, the CBN sold a total of $876.26 million to 26 qualified banks at a rate of N1,495 per dollar.
This move came in response to the continued strain on the FX market, exacerbated by unmet demand from end users, particularly as businesses and individuals scramble for foreign currency amid the ongoing economic challenges in Nigeria.
A total of 32 banks initially participated, submitting bids valued at $1.18 billion. However, six banks were disqualified for failing to meet the submission deadline or for submitting incomplete bid templates.
This left 26 banks to share the $876.26 million provided by the CBN, covering approximately 75% of the total bid amount. The settlement for the successful bids was scheduled for August 8, 2024.
This auction marks one of the most significant FX interventions by the CBN under the leadership of Governor Yemi Cardoso, who has been actively working to stabilize the naira and address the ongoing volatility in the FX market.
Here are the top 10 banks that secured the highest amount of foreign exchange (FX) from the CBN during the latest Retail Dutch Auction:
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Union Bank
Union Bank, one of Nigeria’s oldest and most reputable banks, recently found itself under the spotlight following the Central Bank’s decision to dissolve its board due to regulatory non-compliance.
Despite these challenges, Union Bank remains a significant player in Nigeria’s banking sector, having transitioned to a privately held company after its acquisition by Titan Trust Bank.
The bank continues to stabilize its operations, as evidenced by its participation in the CBN auction, securing $13.27 million in successful bids. The bid range for Union Bank was between N1,500.00/$1 and N1,600.00/$1.
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Sterling Bank
Sterling Bank has been recognized for its innovative approach, particularly in digital banking and sustainability. The bank’s commitment to financial inclusion and green financing continues to set it apart in the Nigerian banking industry. It secured $14.4 million in FX from the CBN auction.
The bids submitted by Sterling Bank ranged from N1,500.00/$1 to N1,595.00/$1.
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Jaiz Bank
Jaiz Bank, Nigeria’s pioneer non-interest bank, has made significant strides in the financial industry. With a focus on ethical banking, Jaiz Bank has grown its customer base and diversified its portfolio. The bank got $16.71 million in FX from the CBN. Jaiz Bank’s bids ranged between N1,520.00/$1 and N1,585.00/$1.
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TAJ Bank
TAJ Bank, another non-interest financial institution, has continued to proliferate since its inception. The bank’s focus on ethical financial services has resonated well with its customers. It secured $19.11 million in FX from the CBN. TAJ Bank’s bid range was N1,500.00/$1 to N1,570.00/$1.
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Standard Chartered (Stanchart)
Standard Chartered Bank, a global banking giant with a significant presence in Nigeria, continues to be a leading provider of financial services. Known for its corporate and institutional banking services, the bank secured over $28.43 million in FX. Stanchart’s bids ranged from N1,500.00/$1 to N1,650.00/$1.
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GTBank (GTB)
Guaranty Trust Bank (GTBank) remains one of Nigeria’s most innovative and customer-centric banks. With a strong digital banking platform and a loyal customer base, GTBank got a successful bid of $29.54 million in FX from the CBN. The bids submitted by GTBank ranged between N1,500.00/$1 and N1,620.00/$1.
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Fidelity Bank
Fidelity Bank has been steadily growing its market share, focusing on retail and SME banking. The bank got $43.62 million in FX from the CBN. Fidelity Bank’s bid range was N1,495.00/$1 to N1,595.00/$1.
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Access Bank
Access Bank, Nigeria’s largest bank by assets, continues to lead the industry in terms of scale and reach. The bank’s aggressive expansion strategy across Africa and its strong financial performance have positioned it as a top contender in the market. It secured $79.09 million in FX from the CBN. Access Bank’s bids ranged from N1,500.00/$1 to N1,635.00/$1.
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First Bank of Nigeria (FBN)
First Bank of Nigeria, the oldest financial institution in the country, remains a cornerstone of Nigeria’s banking industry. Despite recent challenges, including board changes and regulatory scrutiny, FBN continues to perform remarkably well. The bank had a successful bid of $228.99 million in FX from the CBN. FBN’s bids ranged between N1,500.00/$1 and N1,600.00/$1.
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Zenith Bank
Zenith Bank tops the list, securing the highest amount of FX from the CBN at over $267.86 million. Known for its strong corporate governance, robust financial performance, and innovative banking solutions, Zenith Bank continues to set the pace in the Nigerian banking industry. Zenith Bank’s bid range was N1,500.00/$1 to N1,650.00/$1.
(Nairametrics)
