SWITZERLAND, SEPTEMBER 12 – The Central Bank of Nigeria has updated its Guidelines on the Issuance and Treatment of Bankers Acceptances and Commercial Papers.
The apex bank announced the latest development on Thursday, September 12, 2019, via a statement seen by Today’s Echo.
The full upgraded guide can be read and downloaded via this link: https://bit.ly/2kIMzsB
“In order to ensure uniform practice and correct treatment of Bankers Acceptances (BAs) and Commercial Papers (CPs) by Banks and Discount Houses in Nigeria, it has become imperative to issue these guidelines, to deepen and facilitate the effective and efficient functioning of the Nigerian money market.
“These guidelines are issued by the Central Bank of Nigeria (CBN) in exercise of its statutory powers under Section 33 (1)(b) of the Central Bank of Nigeria Act 2007, ” the CBN said in its opening statement on the guidelines.
The CBN defines a Bank Acceptance(BA) as a draft drawn on and accepted by a bank, unconditionally ordering payment of a certain sum of money at a specified time in the future to the order of a designated party.
It also defines a Commercial Paper(CP) as an unconditional promise by a person to pay to the order of another person a certain sum at a future date. Such an instrument may or may not carry the bank’s guarantee.