The Federal Government is expected to make up to $17bn if it sells down its stake in most joint-ventures oil and assets, JP Morgan has stated.
The United States bank’s projection came against the backdrop of the government’s plan to boost foreign exchange earnings and external reserves in order to ease forex pressure.
The US bank stated this in a report titled, ‘Nigeria: Reform pause rather than fatigue (CBN’s financial accounts open a can of worms).’
The lender said the Central Bank of Nigeria’s net FX reserves were around $3.7bn as of the end of 2022, down from the $14bn it was at the end of 2021, based on its recently released reports.
It said, “Based on partial information from the audited financial accounts, we estimate that CBN’s net FX reserves were around $3.7bn at the end of last year, from $14.0bn at end-2021. In arriving at the said estimate we make a few assumptions which if incorrect would substantially change the picture.
“They include: (i) an addition of $5bn in IMF Special Drawing Rights to external reserves in order to arrive at total gross FX reserves of $37.8bn, broadly in line with the 30-day moving average of $37.08bn previously published on the central bank’s website; (ii) adjusting the gross external reserves with three key FX liability lines that include FX forwards (US$6.84bn), securities lending ($5.5bn) and currency swaps (US $21.3bn).
“And (iii) estimating currency swaps by backing out FX forwards and outstanding OTC Futures balances from an overall aggregate published i n the financial accounts.”
