LAGOS The Central Bank of Nigeria (CBN) Friday hiked banks' cash reserve ratio to 11 from 10 percent as part of measures to remove excess liquidity from the system.

"Developments in monetary conditions in the last quarter of 2000 revealed renewed pressures on domestic prices and the naira exchange rate," the CBN said in a statement.

"These pressures have intensified since the beginning of the year, and our projections indicate a further worsening of the problem of excess liquidity in the system," the CBN said.

According to an AFP report, the increase in the cash reserve ratio -- the percentage of customers' deposits that commercial banks must hold in reserve -- is aimed at curbing excess cash by reducing the funds available to lend.