CBN approves Nigerian FX code to enforce Ethical standards

The Central Bank of Nigeria (CBN) has approved the Nigerian Foreign Exchange (FX) Code, a comprehensive guideline aimed at promoting ethical conduct among authorised dealers in the country’s foreign exchange market.

In a statement released on Wednesday, the apex bank announced that the new framework would provide a foundation for transparency, integrity, and professionalism in forex trading practices.

The Bank said the formal launch of the code is scheduled to take place at its headquarters in Abuja on 28 January.

“The Central Bank of Nigeria has approved the release of the Nigerian Foreign Exchange (FX) Code as a guideline to the banking industry to promote the ethical conduct of authorised dealers in the Nigerian Foreign Exchange Market.

“The Bank will formally launch the Code at the CBN Head Office Auditorium, Abuja, on Tuesday, January 28, 2025,” the statement read.

This move comes amidst continued efforts by the CBN to stabilise the naira, enhance liquidity in the FX market, and curb unethical practices such as arbitrage and speculation.

The code is expected to align Nigeria’s forex operations with international best practices, while fostering confidence among participants and investors in the sector.

READ ALSO: How to use the HFM trading app for real-time forex market insights

In October 2024, the bank introduced the Electronic Foreign Exchange Matching System (EFEMS), for Foreign Exchange (FX) transactions in the Nigerian Foreign Exchange Market (NFEM).

This allows authorised dealers to subsequently conduct all foreign exchange transactions in the interbank Fx market on the Electronic Foreign Exchange Matching System approved by the CBN where transactions will be reflected immediately.

The apex bank explained that the new system is expected to enhance governance, transparency and facilitate a market-driven exchange rate that will be accessible to the public.