CBN directs commercial banks to accept, pay out old N500, N1,000 notes

The monetary policy rate (MPR), which is a measurement of interest rate, has been raised from 15.1 per cent to 16.5 per cent by the policy-setting committee of the Central Bank of Nigeria (CBN).

In line with a recent Supreme Court ruling, the Central Bank of Nigeria (CBN) has told commercial banks and other financial institutions to keep accepting and giving out the old N200, N500, and N1,000 notes until December 31, 2023.

In a statement signed by Dr Isa Abdulmumin, CBN’s Acting Director of Corporate Communications, the central bank said it had met with the Bankers’ Committee and told them that both the old and the new banknotes would still be accepted as payment.

This seems to be a response to public resentment over the federal government’s long silence and slow response to the March 3 Supreme Court ruling on the redesign of the currency. But the presidency said yesterday that the Central Bank of Nigeria (CBN) did not need another order from President Muhammadu Buhari to follow the apex court’s ruling. Mallam Garba Shehu, the official presidential spokesman, made the announcement.

The CBN said, “In compliance with the established tradition of obedience to court orders and sustenance of the rule of law principle that characterised the government of President Muhammadu Buhari, and by extension, the operations of the CBN, as a regulator, deposit money banks operating in Nigeria have been directed to comply with the Supreme Court ruling of March 3, 2023.

“Accordingly, the CBN met with the Bankers’ Committee and has directed that the old N200, N500 and N1000 banknotes remain legal tender alongside the redesigned banknotes till December 31, 2023. Consequently, all concerned are directed to conform accordingly.”

Yesterday, Buhari said he had nothing to do with the reports that the federal government would not follow the Supreme Court’s decision to let the old banknotes be used until December 31, 2023. The presidency said that the CBN did not need a presidential directive to do what it needed to do.

In a statement released by presidential spokesperson Shehu, the presidency said that Buhari never told the Attorney General of the Federation (AGF) and the Central Bank of Nigeria (CBN) not to follow the order of the highest court about the ongoing currency swap.

Shehu said that in the nearly eight years that Buhari has been in power, he has never done anything to slow down or stop the course of justice. Instead, he said, Buhari will continue to respect the legal process and the authority of the courts.

The statement said, “The Presidency wishes to react to some public concerns that President Muhammadu Buhari did not react to the Supreme Court judgement on the issue of the N500 and N1,000 old currency notes, and states here plainly and clearly that at no time did he instruct the Attorney General and the CBN governor to disobey any court orders involving the government and other parties.

“Since the president was sworn into office in 2015, he has never directed anybody to defy court orders, in the strong belief that we can’t practise democracy without the rule of law, and the commitment of his administration to this principle has not changed.

“Following the ongoing intense debate about the compliance concerning the legality of the old currency notes, the presidency, therefore, wishes to state clearly that President Buhari has not done anything knowingly and deliberately to interfere with or obstruct the administration of justice.

“The president is not a micromanager and will not, therefore, stop the Attorney General and the CBN governor from performing the details of their duties in accordance with the law. In any case, it is debatable at this time if there is proof of wilful denial by the two of them on the orders of the apex court.

“The directive of the president, following the meeting of the Council of State, is that the bank must make available for circulation all the money that is needed, and nothing has happened to change the position.

“It is an established fact that the president is an absolute respecter of judicial process and the authority of the courts. He has done nothing in the last eight or so years to act in any way to obstruct the administration of justice, cause lack of confidence in the administration of justice, or otherwise interfere or corrupt the courts and there is no reason whatsoever that he should do so now when he is getting ready to leave office.”

Also, the president’s spokesman said that the negative campaign and personal attacks against the president by the opposition and all kinds of commentators were unfair and unjust because no court order had been issued against him.

The statement went on to say, “As for the cashless system the CBN is determined to put in place, it is a known fact that many of the country’s citizens who bear the brunt of the sufferings, surprisingly support the policy, as they believe that the action would cut corruption, fight terrorism, build an environment of honesty and reinforce the incorruptible leadership of the president.

“It is, therefore, wide off the mark to blame the president for the current controversy over the cash scarcity, despite the Supreme Court judgement. The CBN has no reason not to comply with court orders on the excuse of waiting for directives from the president.”

Buhari also rejected the impression that he lacked compassion, saying, “No government in our recent history has introduced policies to help economically marginalised and vulnerable groups like the present administration.”

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