Nigerians on Twitter (X) have demanded that Buhari and former Central bank of Nigeria (CBN) governor, Godwin Emefiele be imprisoned for reportedly using Nigeria’s foreign reserve secretly as collateral for loans
The CBN owes JP Morgan and Goldman Sachs a combined sum of $7.5 billion as of the financial year ending December 2022.
Also included as part of its liabilities is another $6.3 billion owed in foreign currency forwards.
This is contained in the audited financial statement of the apex bank, published on its website. Nairametrics earlier reported the bank reported a profit after tax of N103.8 billion in its most recent financial year.
The securities lending forms part of the CBN’s total external reserves of about N14.3 trillion or $29 billion using the official exchange rate of N494/$1 as of 2022.
However, the apex bank also owes another N3.15 trillion ($6.3 billion) in foreign currency forward which are forex obligations it needs to make to foreign investors.
Further analysis of the breakdown of the apex bank’s external reserves reveals it is made up of the following;
- Time deposits and money placements – N4.6 trillion
- Other foreign securities – N5.8 trillion
- Current accounts with foreign Banks (GS and JPM) – N3.34 trillion
- Domiciliary accounts _ 294.8 billion
- Sundry currencies and travellers’ cheques – N199.8 billion
This totals a sum of about N14.4 trillion or $29 billion. Adding the N578.6 billion ($1.1 billion) held in Gold Bullion Reserves takes the grand total to about $30.1 billion. This is according to figures in its financial statements.
While the central bank suggests it had about $30.1 billion, backing out other obligations such as securities and lending and foreign currency forwards means it has just a net reserve of $ 17 billion.
The current status of the loans is not clear as the apex bank is yet to publish any interim financial statement in this regard.
However, the CBN external reserve position published on its website as of December 2022 was $37 billion. It is currently $ 33.9 billion.
BusinessDay’s calculations showed an ability to meet the above obligations due to FX shortages might cost Nigeria 40.7 percent of its $34.1billion foreign reserves.
Experts who spoke to BusinessDay said the above development has caused distrust about Nigeria’s current external reserves despite the CBN delivering a much-needed reform in floating the currency in June.
“Senior treasury officials from banks and portfolio managers are telling me that they don’t trust the numbers the CBN is stating as the official foreign reserves position,” Kelvin Emmanuel, CEO at Dairy Hills Ltd said.
“And they believe that this is contributing to the apex bank’s inability to clear FX backlogs up to date,” he added.
Reacting to this development, a financial analyst, Kalu Aja via his verified Twitter page blamed the country’s federal lawmakers for their failure to provide oversight functions that would have stopped Buhari and Emefiele from taking the loan.
Who own fx reserves? CBN
Who spent fx reserves? CBNSpent on what? Defending the Naira
Why did the Naira need defending? Because it was weak I.e. $1: N469
Why was the Naira weak? Many reasons but a big reason was the CBN printed N23t for Buhari to spend at will without…
— Kalu Aja (@FinPlanKaluAja1) August 11, 2023
He said, “Who own fx reserves? CBN Who spent fx reserves? CBN Spent on what? Defending the Naira. Why did the Naira need defending? Because it was weak I.e. $1: N469. Why was the Naira weak? Many reasons but a big reason was the CBN printed N23t for Buhari to spend at will without oversight. Who should have provided oversight on the printing of N23t? “Well National Assembly and Debt Management Office. So the CBN printed N23t, that made the Naira lose value, then same CBN used foreign reserves to prop up the Naira they were weakening? Yes. Will anyone go to jail? Depends” Another user, Serah Ibrahim, said Prof Yemi Osinbanjo who served as the head of the National Economic Council during Buhari’s regime should not be exonerated from the mess.
Osinbajo is the biggest ghost worker in history.
We cannot blame Emefiele for his economic blunders without also blaming Buhari and the BDSM ghost worker of Aso Rock.
Osinbajo was the head of NEC but claims his hands were always tied as the BDSM performer that he is but stood by… pic.twitter.com/akNIrLxETE— SERAH IBRAHIM (@TheSerahIbrahim) August 12, 2023
He said, “Osinbajo is the biggest ghost worker in history. We cannot blame Emefiele for his economic blunders without also blaming Buhari and the BDSM ghost worker of Aso Rock. Osinbajo was the head of NEC but claims his hands were always tied as the BDSM performer that he is but stood by and watched Emefiele take loans from 2 US Banks SECRETLY and used Nigeria’s foreign reserve as collateral.
“How can CBN borrow $13.8 BILLION from US Banks and then use Nigeria’s foreign reserve as a COLLATERAL. They have sold this country and completely destroyed our economy ON PURPOSE. They also secretly printed ₦32 trillion.
“Emiefele did not act alone, everything was done under instructions from Buhari.
“You cannot arrest Emiefele and allow Buhari and BDSM Ghost Worker to roam free.
“Buhari and Osinbajo should also be arrested for this economic sabotage.
“We are in deep trouble in Nigeria.”
Another user, Nefertiti also said, “Obasanjo grew your Foreign Reserve from $5.4B to $51.3B. He cleared your debts as well. Buhari has sank Nigeria back in 13.8B debt. Bubu & Emefiele took loans from US banks using Nigeria’s Foreign Reserve as collateral. CBN printed N32T in Ways & Means. WHERE ARE THESE MONIES?
BREAKING!!!
CBN borrowed $13.8 Billion from U.S Banks (JP Morgan & Goldman Sachs). Bubari & Emefiele “secretly” used Nigeria’s Foreign Reserve as Collateral. They printed N32 Trillion in Ways & Means as well.
Both men sabotaged Nigeria’s Sovereignty, they wrecked the Naira &… pic.twitter.com/lFLwXa6SpI
— NEFERTITI (@firstladyship) August 12, 2023
“When you read that CBN’s Audited Report, you will weep for Nigeria. Buhari had no business managing a kiosk, much less an LGA. The damage APC did to Nigeria will take more than 30 years to cleanup. CBN did not publish any audited report in 8 years.”