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Structure of Nigeria's Foreign Exchange Market

FX Structure | FX Mgt Before Now. | FX Mkt | Debt Conversion | Exchange Rate Policy | Movement in Reserves | International Payments | Reserve Management

The Nigerian foreign exchange market has witnessed tremendous changes. The Second-tier Foreign Exchange Market (SFEM) was introduced in September 1986, the unified official market in 1987, the autonomous Foreign Exchange Market (AFEM) in 1995, and the Inter-bank Foreign Exchange Market (IFEM) in 1999. The Retail Dutch Auction System (RDAS), Wholesale Dutch Auction System (WDAS) and Interbank Rate System were used between 2002 and 2015. The managed floating exchange rate regime was introduced in June 2016.

Bureaux de Change were licensed in 1989 to allow access to small users of foreign exchange and to deepen the officially recognized foreign exchange market. Exchange rates in the Bureaux de Change are market driven. The foreign exchange parallel market has been in existence since the exchange control era. It has been established that scarcity in the official sector and prevailing bureaucratic procedures necessitated the growth and development of the parallel market.

Facts : 1/7/1959
Evolution of Departments:At inception, the organisational structure of the CBN was understandably simple consisting of two departments, namely, the General Manager's and the Secretary's Departments, with the appropriate division of labour as then percieved. The General Manager's Department was responsible for all the Department banking, currency issues, debt management and other operational functions of the bank while the Secretary's Department handled the administrative and staff matters, carried out some research into the economic and financial conditions, and collected and analysed relevant statistics for policy formulation.
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