- West Africa
- United States
Nigerian reserve safe despite US financial crisis ?
The financial storms that hit two of New York’s esteemed Wall Street firms, as stocks fell across the globe has not caused worries for Nigerian reserves, reports bring a sigh of relief last night following revelations that the storm that hit the United States claimed.
Commenting on the likely impact of the crisis on Nigeria, a senior government official said yesterday that the country’s external reserves estimated at about $64 billion was not in any of the affected firms.
A highly placed Central Bank of Nigeria (CBN) official said as a precautionary measure, the Federal Government had given a standing order to use any reserve in excess of £200,000 for the purchase of investment bonds. The official also dismissed fears that some Nigerian banks may have been exposed in the financial crisis.
Lehman Brothers, a 158-year-old investment bank, stifled on credit crisis and falling real estate values, filed for Chapter 11 protection in the biggest bankruptcy filing ever.
Another major bank, Merrill Lynch & Co. Inc., was swallowed in the storm by Bank of America Corp in a $50 billion all-stock transaction, just as insurance giant, AIG, was struggling to shore up its capital base.
Merrill Lynch was world’s largest brokerage firm and had long been on the casualty list of the crisis caused by rising mortgage defaults and plunging home values in the US. It agreed to be acquired by Bank of America for 0.8595 shares of Bank of America common stock for each Merrill Lynch common share.