UAC of Nigeria (UACN) Plc at the weekend announced the appointments of Mr Dan Agbor as the new chairman of the board of directors of the conglomerate and Engineer Okechukwu Mbonu as a non – executive director.
The two appointments followed the resignation of the former chairman, Senator Udoma Udo Udoma and a non-executive director, Dr Okechukwu Enelamah, who were both recently appointed Ministers of the Federal Republic of Nigeria.
Agbor, 55, is the managing partner of one of the leading commercial law firms in the country – Udo Udoma & Belo-Osagie. A seasoned lawyer, Agbor, who joined the firm in September 1990 until date, has had a distinguished practice in areas covering banking, mergers and acquisitions, private equity, finance, tax, and the laws relating to foreign investment.
A former company secretary/legal adviser of Gulf Bank of Nigeria Limited, he worked variously at the corporate finance and legal departments of Citibank and as a Solicitor in the firm of Ajumogobia, Okeke & Oyebode, a Lagos-based firm of legal practitioners engaged in the general commercial practice of law.
Agbor currently serves on the board of FSDH Securities Limited, FSDH Merchant Bank Limited; Pensions Alliance Limited and Swift Network Services Limited.
Mbonu is a registered engineer, a Fellow of the Nigerian Society of Engineers (FNSE), a Fellow of the Nigerian Institution of Mechanical Engineers and a Fellow of the Sierra Leone Institute of Engineers. He is a Founding Partner of Execution Edge Limited, a company noted for the provision of management advisory services to medium and large scale business enterprises.
Mbonu worked with Shell Petroleum Development Company Limited, Nigerian Breweries Plc, Heineken International and PricewaterhouseCoopers. While at Nigerian Breweries, he was appointed the Human Resource Director in 1999 and the Customer Service Director in 2001.
•Enalamah
In March 2005, he was posted to Heineken International and then to Sierra Leone Brewery Limited, Freetown as the Managing Director/Chief Executive Officer of the company.
Mbonu attended Mayflower School, Ikenne where he obtained his West African School Certificate (WASC) with seven alpha distinctions and was awarded a Shell-BP Overseas scholarship to study Mechanical Engineering at the University of Manchester, UK, where he graduated in 1977 with a Bachelor of Science (B.Sc.) degree, with first class honours and four academic prizes.
In 1978, on completion of his National Youth Service with Shell-BP, he was awarded the prestigious Manchester University Noel Philip Bedson Research Scholarship which in 1982 led to the award of a Ph.D. degree in Mechanical Engineering from Manchester University, UK.
As part of his career development, Mbonu attended several local and international learning events including courses at Insead France; London School of Economics, UK; Stanford USA; Wharton School USA; IMD Switzerland and Heineken University, The Netherlands.
Skye Bank Plc has partnered with travel agencies to provide travel financing for customers.
At the unveiling of the partnership in Lagos at the weekend, the bank’s Head of Retail Banking Group, Nkolika Okoli, said the lender would provide financing for the customers to be able to buy their tickets and/or travel packages in good time to enjoy reduced fares.
According to her, the bank would provide 80 per cent of the travel cost while the intending traveller will provide just 20 per cent of the total travel cost at a minimal interest rate. The customer can repay the loan over a maximum period of 12 months.
Explaining the rationale for the special partnership, Okoli said because most people who travel in Nigeria are salary earners and small business owners in the middle income segment, they want to save up for their journey over a long period of time so end up buying their tickets two or three weeks to the date of travel.
“What this means is that they buy their tickets at a high price. But if you buy your ticket three or four months before your travel date, you may probably save 50 or 60 per cent of what the person who buys two weeks to his travel pays”, she said.
Managing Director of Dees Travels and Tours Limited, one of the partners, Daisi Olotu, praised Skye Bank for the innovative arrangement which has taken away from the agencies the risk of customer indebtedness over ticket.
Olotu said while the travel agencies must remit the ticket fares to the airlines within 14 days, travellers often buy ticket on credit and may not pay immediately, noting that Skye Bank has solved the agencies’ major problem.
Also speaking, the Chief Operating Officer of Ajala.ng, Omolua Nwoke said the bank had taken away their major burden by making it possible for travellers to be able to travel and pay with convenience.
Banks spent $4 billion quarterly to settle their foreign counterparts before the Central Bank of Nigeria (CBN) pegged withdrawals with naira-denominated Automated Teller Machine (ATM) cards abroad, it has been learnt.
The CBN pegged the withdrawals to $50,000 from $150,000 yearly. The daily limit was $300.
The policy is also to protect the foreign reserves, which have been depleted over the last one year by the slump in oil prices. The reserves fell from $44 billion in December last year to $30.1 billion last weekend.
CBN Director of Communications, Ibrahim Mu’azu told The Nation that there is no limit on dollar-denominated ATM cards because the account holder would be drawing from his domiciliary account.
He said the CBN placed limits on naira-denominated ATM cards because it was being abused by foreign exchange (forex) speculators, who harvest hundreds of cards, make huge withdrawals abroad at official rate of N197 to dollar. He claimed that they bring the funds home to sell at the parallel market rate of N221 to dollar.
Mu’azu said travellers can follow approved procedures and obtain Business Travel Allowance or Personal Travel Allowance from their banks, and when they need to import goods or buy products online above the limit, Letters of Credit (LCs) should be opened with local banks.
“You need to fill LCs form in your bank and follow the right procedure. You cannot travel abroad and be drawing dollars from your naira accounts at this time. Before the controls were imposed, people were using their naira-denominated cards to take dollar from Nigeria. The local banks were complaining because they need dollars to settle the foreign banks,” he said.
The CBN director said only those into illicit transactions will say the $50,000 limit is small, adding that most of those abusing the policy want to evade import duties and taxes.
“We want to work within the $50,000 annual limit because it can be accommodated without abuse. The problem is when people have naira and want to take dollars. We want to sanitise the market, control abuses and illicit transactions,” he said.
The $300 daily limit, he said, is to enable travelers pay for taxi, and other minor expenses while on their trip.
In a circular to banks, the CBN Director, Banking and Payment System, ‘Dipo Fatokun said where a corporate entity requires a card(s) for overseas payments, such entities should be encouraged to obtain foreign currency denominated card(s).
The cards, he insisted, would be issued against the corporate’s domiciliary account, prepaid or credit cards whose limits must be in line with the existing Business Travel Allowances (BTA) provisions.
Cardholders, he insisted, should be informed that the banking industry has instituted a tracking system on the use of naira-denominated cards abroad, adding that banks are required to educate their customers on the need to operate within the approved limits, as violators would be sanctioned.
The CBN director also threatened to sanction banks that violate its $50,000 annual spending limit on ATM withdrawals overseas with naira-denominated cards.
He advised banks to submit reports of all naira-denominated card transactions consummated overseas to Nigeria Interbank Settlement System (NIBSS) on daily basis. The report, he said, must be sent electronically via a file upload portal as specified by NIBSS, which would include the Bank Verification Number (BVN) and the account numbers of the cardholder for each transaction. NIBSS is expected to consolidate the reports and send details to the violators of the limits to the apex bank.
Keystone Bank Limited has through its Pink Network organised a training programme aimed at growing the businesses of its many female entrepreneurs.
The training, which held in Lagos, was termed PinkPreneur and it’s the first edition of sessions that would be held regularly. Various facilitators taught on efficiently using social media to promote businesses, business education and importance of creating a sustainable business structure and educating the participants on the benefits of the flagship Pink Account.
The founder, Masterpiece Resource Development Centre, Mrs. Module Oyekunle, who spoke on discovering and developing their business and career ideas, gave participants business tips on how to properly set up a business in Nigeria and the basic structures one must put in place to succeed and using the Pink Marketplace to sell and expand their customer base.
At the training, the Divisional Head, Product and Marketing Support, Keystone Bank, Temitayo Olutoye said the bank is committed to supporting female entrepreneurs, which was the strategic reason for creating the Pink Network and the training sessions.
On the benefits of the Pink Account, she said: “This account is about financial inclusion and making it possible for women to express themselves. It is also a simple account that speaks to the need of every woman. It is about speaking to the needs of women and bringing us together and letting us express ourselves.”
She urged the participants to take advantage of its Ecommerce platform as well as the other benefits offered by this account to ease and encourage female entrepreneurs.
She added: “We also have mentors on the platform and those interested in shopping can go to the market place. Also, those interested in life materials can go to the resource centre. It is a unique platform and it is part of what the brand stands for. For us, it’s about passion, convenience and reliability.”
For many of the 36 states, these are not the best of times; 23 of them got N576 billion loans from banks. These loans have been restructured into long-tenored Federal Government of Nigeria (FGN) bonds. Nineteen got a N300 billion bailout to meet short term obligations. To the Debt Management Office (DMO), which worked with the Federal Government to restructure the loans, the economy must be diversified to shore up revenue bases, writes COLLINS NWEZE.
The fall in crude oil prices has affected the revenues accruing to all the tiers of government. It has not only led to significant reduction in the statutory revenue allocation due to state governments, but created a huge fiscal imbalance between revenue and expenditure.
For states which have borrowed from banks to pay salaries and settle other obligations, drop in revenues portend grave dangers until the Federal Government and Debt Management Office (DMO) stepped in to restructure the N576 billion debts overhang of 23 states.
•Dr. Nwankwo
Its Director-General Dr. Abraham Nwankwo said: “The fiscal implications of the fall in revenue on states include the fact that after deductions of contractual commitments, such as Irrevocable Standing Payment Orders (ISPOs) and other debt service obligations due to banks, little or nothing is left to run the affairs of the states.”
Speaking during the Association of Issuing Houses of Nigeria (AIHN) fourth quarter meeting in Lagos, he said there were accumulation of salary arrears, structured benefits and other contractual obligations.
“Salaries and pension arrears ranging from three to nine months and would require special intervention to achieve fiscal balance,” he said.
It was, therefore, expected that when, early July, this year, President Muhammadu Buhari approved a package of short-term stabilisation interventions which included the sharing of special revenue (N2.1billion) among the governments.
•Prof. Osinbajo
The Vice President, Prof. Yemi Osinbajo closely worked with the DMO team on the debt restructuring project.
Besides, the lending of between N250 billion and N300 billion by the Central Bank of Nigeria (CBN) to the states on long-term, single digit interest terms, there was also the implementation of a proposal by the DMO to restructure state loans from commercial banks to long-tenored FGN Bonds.
Dr. Nwankwo explained that while the first two measures produced cash directly on a one-off basis, the third indirectly made cash available by reducing debt-service outflow but on a continuous basis over a long-term and thereby continue to moderate the fiscal imbalance.
He said the restructuring of the loans was an immediate stabilisation measures to enable the governments, particularly state governments clear arrears of salaries, pension obligations and other short-term liabilities.
Dr. Nwankwo said DMO commenced the implementation of the strategic objective of assisting the states to develop debt management institutions and capabilities in the last quarter of 2007, as part of its five-year strategic plan.
The DMO chief, who spoke on the theme: “Restructuring States’ Short-Term Bank Loans Into Long-Term Federal Government of Nigeria (FGN) Bonds” said the fall in crude oil prices led to significant reduction in the statutory revenue allocation due to state governments. This created huge fiscal imbalance between revenue and expenditure of most states.
“We restructured what each state owed to the banks into FGN Bonds for 20 years. What that means is that instead of the states owing the banks, they now owe Federal Government, which now pays the banks,” he said.
CBN speaks on bailout funds
The CBN said 19 out of the 27 states of the federation have accessed the bailout funds, and are expected to repay the loans in 20 years.
Its spokesman, Ibrahim mu’azu, said the decision was approved by the National Economic Council (NEC) and that the beneficiary states which had benefitted from the workers’ salary bailout package are expected to deploy the funds to pay the workers’ salary arrears.
He said contrary to reports that Ogun State had accessed N20 billion, N18.9 billion was accessed. On the tenor of the bailout facility, he said all the states had a 20-year tenor except Ogun which opted for a 10-year tenor.
Earlier, states such as Kwara, Zamfara, Osun, Niger, Bauchi, Gombe, Abia, Adamawa, Ondo and Kebbi had applied for and received various sums from the bailout facility. Other states included Ekiti, Imo, Ebonyi, Ogun, Plateau, Nassarawa, Sokoto, Edo and Oyo which were granted in the week.
CBN Governor Godwin Emefiele earlier told the NEC meeting that 18 states – up from 11 as at last month – had benefited from the Special Intervention Fund aspect of the presidential relief package.
Impact of debt restructuring
Dr. Nwankwo said the debt restructuring boosted state cash flow, making it easier for them to meet their obligations. He said the debt restructuring also cut the interest paid on the loans between three to nine per cent.
He said the current drop in crude oil prices is different from what obtained in the past, because the prices are not likely to rebound soon.
Dr. Nwankwo said: “There is not going to be oil boom again. And the impact is that many states were unable to meet both their capital and recurrent obligations including workers salaries, pensions among others. A peculiar challenge is that all or most of the states borrowed from banks, which demanded irrevocable standing order against states’ incomes”.
He said although the banks had irrevocable standing order from the states, and were taking back their loans from states’ earnings, the possibility of sustaining that approach declines after the states’ income dropped by over 50 per cent over oil price decline.
He said all the states were affected by the oil price burst, prompting the Federal Government to decide on the way forward.
“If you are allowing crises in some states, it also means there will be crises in the entire economy,” he said.
He said the revenue decline has caused more than half of the 36 states to owe salaries adding that salaries and pension arrears ranging from three to nine months would require special intervention to achieve fiscal balance.
Dr. Nwankwo said the debt restructuring was to forestall a relapse into debt un-sustainability, as was experienced by the country before its successful exit from the Paris and London Club debts over-hang.
The step was also meant to redress the very weak debt management institutions, structures and practices in different states of the federation and achieve a more effective coordination of public debt management.
He said: “The fact that after deductions of contractual commitments, such as Irrevocable Standing Payment Orders (ISPOs) and other debt service obligations due to banks, little or nothing is left to run the affairs of the states. It also led to the accumulation of salary arrears, structured benefits, and other contractual obligations.”
On the economy, he said government has no choice than to diversify the economy away from oil. “There is still a broad resources base for diversifying and industrialising the economy. With appropriately structured financing, Nigeria should be able to programme a trajectory of long-term fiscal stability and self-sustaining growth,” he said.
DMO operations
The DMO commenced the implementation of the strategic objective of assisting the states of the federation to develop debt management institutions and capabilities since the last quarter of 2007, as part of its five-year strategic plan.
The goal was to forestall a relapse into debt un-sustainability, as was experienced by the country before its successful exit from the Paris and London Club debts over-hang. The strategy was to redress the very weak debt management institutions, structures and practices at the state levels towards a more effective coordination of public debt management. The DMO has also established Domestic Debt Data of States of the 36 states, with framework in place for regular updates.
The debt office has also helped in the passage by 18 states of appropriate laws (Fiscal Responsibility/Public Debt Management Laws) to govern debt management and engender fiscal discipline.
Restructuring states debts
The loans were secured with statutory allocations and Internally Generated Revenues (IGR), which are now inadequate to meet debt service obligations for most States – and leaves little or nothing for paying salaries and meeting other recurrent obligations.
From debt management perspective, the plausible short-term restructuring option would be to refinance the commercial bank loans with bonds of up to 20 years tenor. This makes the repayment schedules of the loans much friendlier to the current cash flow of the states, and hence, free up resources for paying salaries and other recurrent obligations.
He said 15 banks were involved and that the restructuring was effected using a re-opening of the FGN issued on July 18, 2014 and maturing on July 18, 2034. The pricing was based on the yield to date of the bond at a 30-day average, resulting in a transaction yield of 14.83 per cent.
He said the debt service burden after the elongation of tenor and reduction in interest rate has dropped substantially ranging from about 55 per cent for some states to about 97 per cent for others.
“Debt Service of the Bonds has been structured in the same way it would have been, if the States had accessed the market directly – with appropriate arrangement between the FG and each State concerned, on the collection and remittance of debt service obligations – but over a longer period,” he said.
Way out
Chairman of AIHN Victor Ogiemwonyi said diversification and industrialisation of the economy remains the answer to Nigeria’s economic woes. He said issuing houses also play a major role in growing the economy and called for collaboration between AIHN members and the DMO.
The DMO chief believes restructuring of bank loans to FGN Bonds could only contribute to short term fiscal stabilisation adding that measures for long term fiscal stabilisation are necessary.
He said government should explore opportunities in agriculture, manufacturing, solid minerals, petrochemicals. “Every state to work towards dependence on IGR, while considering federal allocation funds as exceptional inflows. There is also need for improved infrastructure like power, roads, railways, critical to support a globally competitive industrialisation,” Nwankwo said.
With Nigeria’s small and medium enterprises (SMEs) sector buffeted by a myriad of challenges, banks have the capacity to reverse the trend and put the sector on the path of sustainable growth, Head, Personal and Business Banking West Africa, Standard Bank, Lincoln Mali, has said.
He said SMEs in Nigeria face diverse challenges such as management, finance and business environment. In the area of management are issues such as skills shortage, management expertise, financial management, business support and access to markets, while in the area of finance, the SMEs are confronted with cost of capital, lack of collateral, information requirements, regulation impact and culture clash.
Mali noted that SMEs have underperformed, despite that they constitute over 90 per cent of Nigerian businesses, and their contribution to the nation’s Gross Domestic Product (GDP) is below 10 per cent.
Also, MSMEs are estimated to contribute 10 per cent of the employment level in Nigeria, a level well below that of several other countries, including United Kingdom (UK) at 54 per cent; United States (US) at 50.3 per cent; Bangladesh 80 per cent; India 80 per cent; Belgium 66.6 percent; South Africa 60 per cent; Malaysia 57.7 per cent, and China 58.8 percent.
Enhancing financial inclusion according to Mali, is a major driver for moving SMEs from survivalist mode to formal entrepreneurship, and this is where banks have a pivotal role to play. Among other areas that banks can make the difference, according to him, include facilitating basic business trainings and various capacity development programmes; up-skilling relationship managers to become professional business advisors; providing various lending solutions and linkages between corporates and the SMEs in their value chain and strong partnership with MFIs to drive inclusive growth.
Others include having a real financial inclusion focus with the capacity to understand the market and properly de-risk it; providing some infrastructure to identified SME clusters as CSR (internet access, warehouses, trade portals); advocating for standardised measures of taxation and levying of SMEs in local markets; and leveraging on international affiliations to sponsor knowledge sharing between local SMEs and their foreign counterparts.
Though the commercial banks have the capacity, but they lack penetration, as they are largely concentrated in Lagos, Abuja and a few commercial hubs. This makes it imperative for banks to create workable partnerships and innovations for deeper penetration, leveraging existing capital to empower businesses and in turn drive economic growth.
“There will always be opportunities for those with the proper business skills to build a real future for themselves and the economy. At Standard Bank, we are extremely proud to help facilitate this process by helping to structure the financial packages that will help advance the success of SMEs in Nigeria and elsewhere in Africa,” Mali stated.
The naira fell from 225 to 234 against the dollar at the parallel market on Monday, 10 days after the Central Bank of Nigeria (CBN) mandated Bureaux De Change (BDC) operators not to sell foreign exchange (forex) to customers without Bank Verification Numbers (BVNs).
The policy implementation, which started on November 1, has reduced the volume of dollars sold by BDCs and created dollar scarcity in the market.
However, the CBN has been able to monitor the naira’s movement at the interbank market, keeping it between 197 and 197.5 on the interbank market in the last one week.
The CBN insists that the adoption of BVN as a condition for the purchase of forex is expected to reduce multiple purchases, round tripping and illicit transfer of funds, facilitate enforcement of authorised limits of forex sales to end users, sanitise the retail segment of the market and engender policies that will facilitate better allocation of forex, based on genuine demands.
It insisted that the BVN provides the unique identity of each customer for the purpose of achieving effective “Know Your Customer” (KYC) principle and fraud prevention.
It said the BVN is neither a payment instrument nor an account number and therefore, could not be used to access any account by unauthorised users. The banks, BDC operators and even regulators use the BVN to validate the identity of a customer, using some biometric information such as finger prints and photographs obtained at the point of enrolment.
Also, BDC owners have called on the CBN to make forex transactions relating to Personal Travel Allowance (PTA) and Business Travel Allowance (BTA) exclusive businesses of BDCs. This call was made during the second BDC Owners Forum’s meeting held in Lagos last weekend.
Presently, the banks and BDCs are being allowed to sell foreign exchange for PTA and BTA. The BDC owners, however, said: “The CBN should disengage banks from the sales of PTA and BTA and make it an exclusive preserve for BDC operation.”
The BDC owners also called on the CBN to extend the deadline for use of BVN as criterion for foreign exchange transactions. Consequently, they mandated the leadership of the Association of Bureaux De Change Operators of Nigeria (ABCON) to write a position paper on the CBN’s re-introduction of the BVN. “The position paper should seek for an extension in the deadline for compliance on the use of the BVN while emphasising the resolve of ABCON members to comply with the CBN circular and that we are indeed ready to partner with the regulatory authority on its monetary and fiscal policies”, they stated.
The meeting however lamented the gap between the official and parallel market exchange rates and resolved to take measures to reduce the gap drastically.
The Nigeria Deposit Insurance Corporation (NDIC) has identified the judiciary as a critical institution in achieving its core mandate of depositor protection and financial system stability.
Its Managing Director and Chief Executive, Alhaji Umaru Ibrahim, stated this at the opening ceremony of the corporation’s 2015 sensitisation seminar for judges of states and Federal Capital Territory (FCT) High Courts in Abuja.
He said no matter how robust the NDIC’s extant laws might be, the corporation needed the legal support to achieve its mandate, adding that it would continue to seek the cooperation and understanding of the judiciary, which is constitutionally vested with the powers of interpretation of statutes and laws in the federation.
Represented by the Corporation’s Executive Director Operations, Prince Aghatise Erediauwa, he said the forum was intended to address the challenges being faced by NDIC in its bid to successfully discharge its core mandates. The theme of the seminar was: Challenges to Deposit Insurance Law and Practice in Nigeria.
Prince Aghatise enumerated some of the major challenges to include the menace of protracted and complex bank liquidation related litigations as well as their attendant consequences; the execution of court judgments against the assets of the Corporation as the liquidator of failed banks and lack of proper understanding of its proper legal status on its role as a Deposit Insurer which is distinct from its status as a bank liquidator.
He urged participants at the forum to critically examine these challenges with a view to proffering a lasting solution in order to empower the NDIC to effectively discharge its mandate.
Declaring the seminar open, the Chief Justice of Nigeria and Chairman, Board of Governors of the National Judicial Institute, Hon. Justice Mahmud Mohammed, noted that some of the esoteric legal issues bordering on the established rights of creditors, shareholders and depositors of failed financial institutions were genuine matters before the courts.
The Chief Justice of Nigeria therefore called for a clear and proper understanding of the concept and operation of bridge banks as well as the execution of assets of failed banks within the context of deposit insurance system (DIS).
This, according to him, would facilitate better appreciation of the legal issues by the judiciary and eventually lead to more informed court judgments.
Access Bank Leadership Conference for this year will focus on enhancing Nigeria’s technology capabilities and adding value to the economy.
Speaking at a press briefing announcing the conference which hold December 10, the bank’s Executive Director, Personal Banking Division, Victor Etuokwu, listed Chris Hughes (Facebook Co-Founder), Steve Wozniak (Apple Co-Founder), Tony Fernandes (Air AsiaFounder and CEO) among others.
He explained that the inaugural conference in 2013 included an array of prominent global leaders, such as former presidents Nicolas Sarkozy and John Kuffour, who discussed the importance of sustainable leadership as a means to bring about change in society.
He recalled that in a call to arms for Nigerian businesses, former US President George W. Bush spoke on the need for a strong entrepreneurial culture in the fight against poverty.
He said the conference theme is: ‘Leading in a transformational world – the imperative of innovation’.
Etuokwu said life-changing innovations popping up in unexpected places around the globe with breakthrough developments in sectors such as nanotech, biotech, artificial intelligence, robotics and more, will affect every sector of the global economy in such a way that businesses will have nowhere to hide. According to him, innovation means BIG change and even BIGGER opportunities for those who decide to be part of it.
“As we are all experiencing it, innovation is moving at a speed that’s never been witnessed. With 2 billion internet users worldwide and 50 billion connected devices by 2020, innovative technology is definitely the defining trend for today’s business,” he noted.
Keynote speaker and Access Bank Chief Executive, Herbert Wigwe, said: “I am delighted to welcome such a distinguished line-up of individuals to the Access Conference 2015. We founded the event in recognition that Africa must now play a central role in the global debates that matter to its citizens”.
He said that whether it is technology, entrepreneurship or the impact of financial regulation on growth, the future direction of the world is increasingly being played out in this continent.
Ecobank Nigeria and Deutsche Bank have signed Memorandum of Understanding (MoU) to expand trade finance relationship.
Under the arrangement, Deutsche Bank will provide export credit guarantee programme GSM-102 to Ecobank Nigeria. The bank’s offering of a GSM-102 programme will guarantee credit to encourage financing of commercial exports of U.S agricultural products, while providing competitive credit terms to buyers.
Ecobank Nigeria will use irrevocable dollar denominated letters of credit for the import of eligible agricultural products from the U.S while Deutsche Bank will advise, confirm and negotiate these letters of credit as well as provide post-shipment financing in accordance with the GSM-102 programme regulations.
Speaking on the deal, Managing Director, Ecobank Nigeria, Jibril Aku said: “We look forward to expanding our relationship with Deutsche Bank with this GSM-102 programme. Deutsche Bank’s export credit guarantee service will offer a simple and efficient way for our importers to access agricultural products in the U.S and strengthen economic and trade development in the region.”
Head of Trade Finance, Financial Institutions, Western Europe & Africa, Global Transaction Banking, Deutsche Bank, said: “We are pleased to offer this programme to Ecobank Nigeria.” As a leading provider for GSM-102 business in Africa, and in close coordination with the Commodity Credit Corporation and the U.S Department of Agriculture’s Foreign Agricultural Service, Ecobank Nigeria will benefit from Deutsche Bank’s strong global and US footprint.”
