CBN Reveals JP Morgan’s Intention After Report On Nigeria’s Foreign Reserves

The Central Bank of Nigeria (CBN) Director of Monetary Policy Department, Hassan Mahmud, said the report by JP Morgan on Nigeria’s foreign reserves is an attempt to mislead the public.

Mahmud stated that JP Morgan’s intention could also be to rouse market sentiments. He made this known on Thursday during an interview with Nancy Umeh on AIT’s  Moneyline business show.

Recall that JP Morgan had stated that Nigeria’s foreign reserves’ not $37.08 billion as disclosed by the CBN at the end of 2022, claiming that the international reserves are $3.7 billion as of the end of last year.

He disclosed that the CBN is not concerned about the report, as there have been similar reports in the past, “We also read the JP Morgan numbers in-house and we didn’t panic over that. That’s not the first time we see people, institutions reeling out numbers; they must have their intentions to do that, whether to rouse market sentiments or to mislead the public.”

Speaking further, Mahmud said: “But the central bank has tried as much as possible to be transparent. What I will say about those numbers is that it is just funny in the sense that number one, reserves like any account balance, is a flow; there are changes that go within it at any particular time.

“Two, even if you have outstanding liabilities, you don’t mark the outstanding liabilities to market on a day and say this is your net balance.“

On the basis JP Morgan arrived at its conclusion on Nigeria’s foreign reserves, Mahmud said: “I can have $20 million in my account and I am owing someone maybe $13 million that is supposed to be paid in 2027; you can’t come in 2023 and say if I remove that $13 million, your money is $7 million or you are having $7 million.

“Now, I am not having $7 million, I am having $20 million. ore I took a facility of $13 million, I know I will get $17 million in the next three years so I can pay you back.

“But for you to come and tell me that no, your balance is $7 million and you can’t pay back in three years; it’s just putting it out of context.

“I don’t know how they did their calculations, and I don’t have any information about that, but we also saw those numbers that came out.”