Liberia: CBL Releases ‘New Money’
.... The Bank is mindful about giving specific deadlines at this time, to avoid the unnecessary rush and unintended consequences that could undermine the exchange process,” CBL Executive Governor, J. Aloysious Tarlue, said while announcing the currency exchange exercise.
The Central Bank of Liberia is expected today to begin the process of replacing two old denominations of the country's banknotes with updated versions, releasing a total of L$1.9935 billion of the notes.
The Bank's decision would affect the L$20 and L$50 notes, which would be replaced with new ones that come with more enhanced security measures; however, the old notes of the two denominations will remain legal tender until phased out of the market.
The CBL has received a total of L$1.9935 billion in values of L$50 and L$20 – and per the 54th Legislature's mandate, the exchange exercise will be done entirely through commercial banks and other regulated financial institutions, the CBL said.
“As we have repeatedly said, there is no need to rush. All existing banknotes in circulation will be exchanged at their full value without any discount in value. The Bank is mindful about giving specific deadlines at this time, to avoid the unnecessary rush and unintended consequences that could undermine the exchange process,” CBL Executive Governor, J. Aloysious Tarlue, said while announcing the currency exchange exercise.
“As such, the Bank will decide on the duration of the exchange exercise as the exercise progresses and we have a better appreciation of the operational challenges. We want to avoid the mistakes of the other countries in rushing the exercise,” he said.
Tarlue noted that the CBL, considering the challenges faced by the commercial banks and limited branch network across the country, is working on a strategy to decentralize the exchange exercise through its cash hub in Gbarnga, Bong County, and other approved facilities under the direct control and supervision of the Bank.
The CBL boss added that in addition to ensuring the timely delivery of the new currency in the country, the bank has also been working to put in place the necessary logistical and operational capacities, to ensure the smooth implementation of the exchange exercise.
“As we commence this exercise, we urge the public, the commercial banks, the business community, and all key stakeholders to work with the Bank to ensure a smooth and successful exercise. The CBL alone cannot do it; we need the support of everyone,” Tarlue said. “This is the first time that the country is undertaking such a huge national initiative. Therefore, it is important that we take due care to protect the integrity of the process.”
“We expect to receive a total of L$34,533,500,000.00, including the initial L$8,000,000,000.00 of the new banknotes that were brought in between November 2021 and February 2022 and a total of L$462,900,000.00 coins by the end of 2022. This will comprise all the existing denominations, including the L$1,000 denomination, which is being introduced for the first time.”
“The remaining amount will be brought into the country in 2024. For clarity, no banknotes or coins will be brought into the country in 2023. However, the exchange exercise will continue with the banknotes and coins that will be in the country.”
In May 2021, the CBL was authorized by the 54th Legislature to print new family banknotes. The Legislature approved the printing and minting of money in three phases, specifically 2021, 2022, and 2024.
CBL in December 2021 introduced the new Liberian dollar currency, starting with the 100 Liberian dollar banknote to the tune of four billion Liberian dollars. The amount, the CBL says, was intended to increase Liberian dollar liquidity in the economy.
Meanwhile, CBL clarified a report indicating a fire incident in the vault of the Bank.
“The actuality is that an electrical shock occurred in one of the air conditioners located in the vault on September 21, but there was neither damage to the vault, nor the banknotes or harm to a staff of the Bank due to the existing enhanced security.
The CBL assures the public of steps the Bank has taken to prevent the recurrence of the recent incident.