The Central Bank of Nigeria (CBN) has lifted its suspension on banks borrowing from its Standing Lending Facility (SLF), setting the lending rate at 31.75 percent following decisions made during the bank’s 296th Monetary Policy Committee (MPC) meeting.
Omolara Duke, Director of the Financial Markets Department, announced in a statement dated August 26, 2024, that the MPC had adjusted the upper corridor of the standing facilities to 5.00 percent from 1.00 percent above the Monetary Policy Rate (MPR) during its meeting.
“As a result, the suspension of the Standing Lending Facility (SLF) is now lifted, and authorized dealers are instructed to submit their SLF requests through the Scripless Securities Settlement System (S4) during the operating hours of 5:00 PM to 6:30 PM,” Duke stated.
Authorized dealers are now allowed to access the SLF at a rate of 31.75 percent. They may also utilize the Intraday Liquidity Facility (ILF) to prevent system gridlock without incurring costs if repaid on the same day.
Duke added that the 5 percent penalty for participants who fail to settle their ILF remains in place. In such cases, the system will convert the ILF to SLF at a rate of 36.75 percent, and collateral execution (the rediscounting of pledged instruments at the penal rate by the CBN) will be reintroduced as outlined in the approved repo guidelines.
