Standard Chartered Plc had a wild 2023 with Nigeria’s volatile currency as the African nation struggled with foreign-exchange rules to attract investment from overseas and boost the supply of dollars.

The London-based lender, in its corporate filings last week, said it made almost $120 million in a single day on June 1, in anticipation of new policies including an impending naira devaluation.

By November, its position whipsawed as it made around $40 million only to lose more than $20 million later after the government announced a crackdown on the black market, where the US dollar at one point commanded a premium of as much as 60% over the official rate.

The gap, which has now narrowed, resulted from too little capital inflows and a severe dollar scarcity that’s plagued the continent’s most-populous country despite currency reforms and a sharp devaluation. As of Monday, the dollar fetched 1,540.40 naira, compared with roughly 1,590 on the street, where most residents source their forex needs.

The naira slumped 49% last year against the dollar, making it the third-worst performer among 150 currencies tracked by Bloomberg. The wide spread between the rates have also discouraged investments from abroad.

Standard Chartered’s one-day currency gains on June 1 came after Nigeria’s newly elected President Bola Tinubu took office in late May and immediately proposed to unify the exchange rates and let the naira trade more freely.

“After announcement of planned potential economic reforms in Nigeria, there were sharp movements in the offshore naira FX market in anticipation of Naira devaluation,” StanChart said.

But those gains were put at risk in November when Nigeria announced that it would be introducing new foreign-exchange rules, including a crackdown on the black market in a bid to narrow the spread. The plan was for the currency to reach a “fair price” by the end of 2023.

After the government’s announcement on Oct. 30 that it planned to target an exchange rate of 750 naira per dollar, “the onshore spot market became more volatile on low volumes,” StanChart said.

In a matter of days, the bank recorded a profit of about $40 million followed immediately by a loss in excess of $20 million, according to the corporate filings that accompanied the lender’s full-year earnings on Feb. 23.

The gains and losses came after the Nigerian authorities took steps to clear a backlog of matured foreign-currency forward contracts with some banks that they said had hampered dollar inflows. The announcement by the Central Bank of Nigeria on Nov. 2 that it cleared the matured foreign-currency contracts for some lenders had prompted some speculators to offer their dollars for sale.

“Standard Chartered operates in over 50 markets that are periodically subject to currency movements that breach value at risk thresholds in line with the pillar 3 disclosure,” a representative for the bank said.

Despite the currency volatility in Nigeria, StanChart’s Africa and Middle East region last year posted its highest annual pretax profit since 2015, with earnings climbing 66% to $1.3 billion, as higher income and a net release in credit provisions offset an increase in expenses.

Bloomberg