29 August 2012

Nigerian Senate Suspends Introduction of New Denominations

Photo: Vanguard
Nigeria N5000 note.

The Nigerian Senate on Monday directed the Central Bank of Nigeria (CBN) to suspend the introduction of 5,000 naira (30 U.S dollars) note until the Senate was properly briefed.

Chairman of the Senate Committee on Banking, Insurance and other Financial Institutions Bassey Otu gave the directive at a news conference in Abuja.

The re-denomination of currency required the approval of the National Assembly, Otu said, warning that the CBN must avoid sending the wrong signals to stakeholders in the economy.

According to him, it was vital for the CBN to discuss the implications of the currency re-denomination with the Senate before it was implemented.

He warned that the conversion of some denominations into coins would lead to a waste of public funds as the previous exercise did not yield the desired result. The Committee chairman said there were other mechanisms available to the apex bank to tackle the problem of inflation other than the re-nomination of the nation's currency.

Meanwhile, the CBN has said it received presidential approval on the proposed currency re-denomination before making the announcement public last week.

Spokesperson for the apex bank Ugo Okoroafor also confirmed that the bank had received a letter from the Senate Committee on Banking, Insurance and other Financial Institutions on the directive.

Source: Xinhua

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