Government of Sierra Leone through the Bank of Sierra Leone (BSL), said it has auctioned a total of $USD 9.7 million to commercial banks across the country.
This was disclosed by the Director of Research – BSL, Morlia Bangura, who said out of the initial $USD 10 million on offer to reduce dollar shortage in the market, $USD 9.7 million have been auctioned.
He said the sum of $USD 300,000 still remains as one commercials bank wanting to acquire it fails to meet the necessary documentation required.
He disclosed that since the Bank started the auction process, they have been getting positive feedbacks, adding that prior to their intervention the exchange rate was rather unstable.
Mr. Bangura noted that the exchange rate for the dollar has started going down and expressed hope that after the auction process would have ended its impact will be felt down the road.
He explained that before this time, the Bank has been doing retail auction but because of the bureaucracy and bottlenecks involved in the process, they are now doing wholesale auction to commercial banks, who in turns sell to the local market.
The Bank Director disclosed that the Bank started dollar auction way back in 2001, mainly for the importation of fuel and rice using what he referred to as “Special Window.”
He furthered that during the auction; they were not selling physical dollars to commercial banks, but rather use their foreign exchange reserve account overseas to remit the amount bought into the account of commercial banks branches there.
He said as part of their monitoring responsibility, they are always ready to intervene using their foreign exchange reserve to provide dollar in the market whenever there is a shortage.
He assured that at the moment the Bank has enough exchange reserve that necessitated their intervention, adding that going forward, with the coming of the World Bank and IMF; it will have the opportunity of replenishing its reserve base and gives back confidence to investors.