Central Bank of Liberia Executive Governor, Milton Weeks, says commercial banks in the country are responsible for the proliferation of mutilated banknotes on the local market.
Mr. Weeks said although CBL has repeatedly urged commercial banks to desist from transacting in mutilated banknotes, the banks are unabatedly transacting in the mutilated notes.
The Central Bank Governor made the remarks on Tuesday, May 2, 2017, when he appeared before members of the House of Senate to explain while the market is flooded with mutilated banknotes.
Governor Weeks also disclosed that Central Bank ability to control exchange rate has been limited because most of the money in circulation are outside of the banking system.
CBL Governor told the senators only 1.5 billion Liberian Dollar has been circulating within the banking system, out of the 12.6 billion currently in circulation.
Mr. Week noted that bulk of the money out of CBL system is old currency that commercial banks have reportedly refused to change.
According to him, removal of mutilated Liberian banknotes from the local market requires the collective efforts of Central Bank and commercial banks operating in the country.
The CBL Executive Governor had an exclusive session with members of the Liberian Senate to further discuss the matter, but the outcome of Tuesday’s close-door session is yet to be known.