Emerging Markets Rates and Currencies Handbook

172 Citi | Emerging Markets Currencies Handbook 2021 Source: Citi indicative information FX Spot FX Forwards NDFs FX Options Interest Rate Swap Interest Rate Options XCCY swaps Market Overview Onshore Offshore Onshore volume (MM USD daily) 25 — 150 20 — 50 15 — 35 N/A N/A N/A N/A Offshore volume (MM USD daily) N/A N/A 10 — 15 N/A N/A N/A Negligible, settled on NDF basis Onshore max tenor (or typical tenor for spot) T + 2 5 years 5 years N/A N/A N/A N/A Offshore max tenor (or typical tenor for spot) N/A N/A 2 years N/A N/A N/A 5 years Onshore typical deal size (MM USD) 0.5 — 3 0.5 — 3 0.5 — 3 N/A N/A N/A N/A Offshore typical deal size (MM USD) N/A N/A 1 — 5 N/A N/A N/A Transactions are episodic CitiFX Pulse Capabilities Market opening hours and liquidity during the day 14.00 09.00 Good Liquidity No Liquidity Fixing (incl. ticker) USDNGN Fixing — NAFEX. Fixes daily at 12 noon. Bloomberg Code — NIGNNAFX. Regulation Offshore restrictions Onshore entity (e.g. resident corporate) is not permitted to transact FX with an offshore entity (e.g. offshore bank) in NGN as it does not settle offshore. Exchange controls will apply where an onshore entity requests to settle foreign currency to the offshore counterparty i.e. such payments must conform with existing regulations. Non-resident restrictions Non-resident (e.g. non-resident corporate) is permitted to transact FX with an onshore entity (e.g. onshore bank). Some documentation may be required for LHS trades like board resolution, CCI request etc. Documentation is also for RHS trades. The specific documentation will depend on the nature of the underlying payment. License requirements Not applicable. Requirements to open a foreign currency account Corporates are allowed to open a foreign currency account but the NGN is not convertible. Foreign currency accounts cannot be funded from local currency. Deal Management Rollover: Yes, with supporting documents. Gross-settled. Unwinding: Not allowed. Early Maturity : Not allowed. Documentation Requirements Product specific For both FX Spot and Forwards: Bid side — limited controls (FCY to NGN). Offer side — subject to the rules of the Central Bank of Nigeria Foreign Exchange Manual (NGN to FCY). Trade flows Central Bank of Nigeria Foreign Exchange Manual specifies what is needed for Trade Flows. Nigeria only permits letters of credit (LC) or bills for collection (BFC). Open accounts are not permitted. Clients are required to open a regulatory document called Form M in order to initiate an import. Capital flows/FDI Capital inflows into Nigeria must be converted and a Certificate of Capital Importation (CCI) issued, evidencing the inflow of capital. The CCI is a key underlying document for the purpose of repatriation of dividend, loan repayment etc. Citibank Nigeria Limited 27 Kofo Abayomi, Street, Victoria Island, Lagos, Nigeria FX Sales Contact: +234 1463 8488 Nigeria