Central Bank of Nigeria Unveils Seven Years of Financial Statements

The Central Bank of Nigeria has taken a momentous step towards transparency by releasing its Consolidated Financial Statements spanning the last seven years, marking the first time since 2015 that the apex bank has made its financial records available for public scrutiny.

These Consolidated Financial Statements, encompassing the financial periods from 2016 to 2022, were recently made public by the CBN.

In a noteworthy development, the CBN reported a robust profit after tax of N103.8 billion in 2022, a significant rise from the N75.13 billion recorded in the preceding year.

However, amidst these financial revelations, the CBN’s financial obligations have also come to light. The apex bank has accrued a combined debt of $7.5 billion to JP Morgan and Goldman Sachs, with an additional liability of $6.3 billion in foreign currency forwards.

Remarkably, the CBN clarified that it holds a securities lending arrangement with Goldman Sachs and JP Morgan, categorizing $500 million owed to Goldman Sachs and $7 billion owed to JP Morgan under securities lending.

The 2022 financial statement elucidated, “The Group entered into a securities lending agreement with Goldman Sachs and J. P. Morgan and as part of the agreement, the Group pledged its holdings on foreign securities in return for cash. The cash received from Goldman Sachs is N0.23 trillion ($500 million), 2021: N0.22 trillion ($500 million), and JP Morgan N3.23 trillion ($7 billion), 2021: N3.05 trillion ($7 billion) is recognized in other foreign securities.” These securities lending arrangements contribute to the CBN’s overall external reserves, valued at approximately N14.3 trillion or $29 billion, using the official exchange rate of N494/$1 as of 2022.

Moreover, the CBN has also revealed a separate obligation of N3.15 trillion ($6.3 billion) in foreign currency forwards, which represents forex obligations owed to foreign investors.

The publication of these financial statements on the CBN’s official website signifies a decisive move towards accountability and transparency under the leadership of acting Governor Folashodun Shonubi. This action also brings attention to the previous lack of disclosure, as the suspended CBN Governor, Mr. Godwin Emefiele, faced criticism for failing to release financial statements to the public.

It is important to note that this action by Emefiele was in contravention of the CBN Act. The CBN Act of 2007 stipulates that the apex bank is obligated to publish its annual report within two months after the conclusion of each financial year.