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The Central Bank of Nigeria, CBN has reduced cash reserve requirement of merchant banks from 32.5percent to 10percent effective August 1, 2023.
TheNewsGuru.com, (TNG) reports this was contained in a circular signed by the apex bank’s Director, Banking, Department, Haruna Mustafa.
It was expressly stated in the circular that:”The Central Bank of Nigeria (CBN) hereby informs all Merchant Banks that it has approved a reduction in their cash reserve requirement from 32.5 per cent to 10 per
cent effective August 1, 2023.
“The above regulatory measure is in recognition of the nuanced business model of the
Merchant Banks, in particular their wholesale funding structure, regulatory restrictions
from the retail market and permissible activities vis-a-vis conventional commercial
banks.
“The measure is expected to boost the banks’ ability to avail increased infrastructure,
real sector and other long-term financing needed to support the development of the
Nigerian economy.
“The CBN will continue to monitor market developments and implement measures to
address unique challenges faced by the merchant banking sector.
Please be guided accordingly.
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