CBN Says Banks Breached Forex Borrowing, So This Happens


The Central Bank of Nigeria (CBN) has now increased the limit on banks foreign currency borrowing to 125 percent of shareholders fund after some lenders breached its regulatory limit due to the fall in the naira (of recent).

 The new regulation replaces a 2014 rule capping foreign borrowings, including Eurobonds, at 75 percent of shareholders’ funds as Nigeria tries to manage widespread capital shortfalls at lenders due to a currency crisis and bad loans.

“A major consequence of his development was the inadvertent breach of the regulatory limit for foreign currency borrowings by some banks.” CBN said in a circular.
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