The Nation Newspaper

Category: Money

  • Enterprise Bank inaugurates Association Savings Account

    Not-for-profit organisations in the country now stand the chance of growing their savings when they open and operate the Enterprise Association Savings Account (EASA), an interest-bearing account, specially developed by Enterprise Bank Limited to satisfy the financial needs of that segment of its customers.

    The bank said the contribution of these organisations to humanity and society in general, requires support that ensures they earn some form of revenue on their savings to aid their humanitarian services.

    A statement from the Corporate Communications Department of the bank said: “We have a large number of non-profit bodies, associations, organisations, clubs and movements among others in the country that do not engage in profit-making businesses. But because of the nature of their role, they require our support.

    “As a financial institution that cares, we are aware that these associations require savings accounts to keep their funds as against transactional current accounts with its attendant charges. It is for that reason that we have also ensured that EASA, is not for profit making businesses or Individuals. It is strictly designed for charities, religious bodies, associations, clubs, societies, Non Governmental Organisations (NGOs) among others,” the statement added.

    To make this product attractive, Enterprise Bank also simplified the opening processes of the account. EASA has an opening and operating balances of N10,000 with a credit-payable interest at the going rate that is dependent on the Monetary Policy Review (MPR) of the Central Bank of Nigeria (CBN).

  • FCMB relocates Alaba International Market branch

    First City Monument Bank (FCMB) Limited has relocated its Alaba 2 branch within Alaba International Market in Lagos, assuring its customers on its commitment to quality services delivering.

    The new branch, which offers full banking, operates from S Line, Old Garage, Alaba Electrical Section, Alaba International Market, Lagos. The move, is part of the bank’s strategy to streamline its operations and enhance service delivery.

    The branch at the Electrical Section of the renowned Alaba International Market is equipped with experienced financial experts, unique physical and technological infrastructure that ensures convenient banking and sundry financial services to enable customers experience comfort and relaxation while conducting business at the bank.

    In a statement, the bank explained that the relocation of the Alaba 2 branch to a more strategic location brings its services closer to the mainstream, especially those who transact business or reside in the area and its environs.

    The Group Head, Branch Services and Channels Management of FCMB, Mr. Oluwakayode Adigun, said: ‘’This is part of our commitment to serve more Nigerians by getting closer to our customers and all segments of the society. We are focused on bridging the service gap. We are demonstrating our drive in the provision of simple, reliable and helpful banking services as an inclusive lender.’’

    Adigun assured that the lender will continue to raise the bar in the manner and environment that customers are serviced to meet their lifestyles.

    He added that the bank will sustain its ongoing expansion and service delivery initiatives across all touch points.

    Earlier last month, the bank opened an ultra-modern and full service branch in Lagos, which is located at Plot 123, Amuwo Odofin Link Road by Amuwo Odofin residential scheme.

     

  • Naira to back foreign exchange demand, says CBN

    Naira to back foreign exchange demand, says CBN

    •Demands 48hrs advance payment 

    The Central Bank of Nigeria (CBN), in its sustained drive to defend the local currency, has directed that all foreign exchange demand must now be backed by naira cover 48 hours before the request is sent to the apex bank’s intervention window.

    The order which was communicated to the Deposit Money Banks yesterday, The Nation investigation revealed, is to take effect from today.

    Consequently, some of the banks, in implementing the directive, have notified their  customers who intend to purchase foreign exchange through the CBN intervention window, “to make funds available in their accounts two working days before each intervention day.”

    In a document obtained by The Nation, one of the banks said: “Given the effective date of 6th August for this new arrangement, collation for intervention window of  10th August 2015 will be done on 6th August, 2015 when the bank will be expected to move funds to the CBN position.

    “Kindly ensure that all customers’ requests are received in Trade Services  on or before 12noon two days preceding their intended CBN intervention window,” the financial house stated, adding that ”in case of matured obligations that will require the booking of naira IFF (Import Finance Facility) to fund account, booking may be deferred until successful FX (foreign exchange) allocation in which case, Trade will debit customer’s account naira equivalent of FX sold, whether or not the account is adequately funded, while the Branch/Relationship Managers will be required to follow up with the relevant department, or unit for regularisation with same value date as original debit.”

    The document clearly stated that bids supported with incomplete documentation will not be processed.

    It said apart from the exception earlier highlighted for matured obligations,  bids presented on unfunded account will not be attended, it stressed.

  • CBN, MTN Group discuss $600m loan repayment plan

    CBN, MTN Group discuss $600m loan repayment plan

    MTN Group Ltd is discussing with the Central Bank of Nigeria (CBN) about early repayment of about $600 million debt it is owing to reduce exposure to the naira, which has weakened against the rand this year.

    “We have already been negotiating with the lenders but the challenge has been getting the central bank to approve that we can accelerate the payment.  It would help a lot in terms of dealing with the currency fluctuations,” its Chief Executive Officer Sifiso Dabengwa told Bloomberg yesterday.

    MTN, Africa’s largest wireless carrier with operations in 22 countries, profit declined 11 per cent in the six months through June in part because of weakening African currencies against the South African rand, in which it reports earnings. The Johannesburg-based company said Nigerian sales decreased nine per cent in the period, compared with a 1.1 per cent fall on a constant currencies basis.

    MTN executives have met with Nigerian President Muhammadu Buhari, who replaced Goodluck Jonathan following elections earlier this year, Dabengwa said at a presentation to analysts and reporters earlier yesterday. “The conversations were positive,” he said, and the company has no pending regulatory issues in Nigeria, its biggest market with 62.8 million subscribers.

  • Zenith Bank mulls half-year audited financial reporting

    Zenith Bank mulls half-year audited financial reporting

    Zenith Bank Plc is to adopt a new financial reporting policy, The Nation has learnt. The bank’s new policy thrust would require the financial institution to publish, for the first time, its audited financial results half-yearly. The first publication is expected in the coming days.

    Investigation at The Nigerian Stock Exchange (NSE), indicated that the bank would henceforth, publish audited half-year results, as against the current yearly industry practice.  It was learnt that the bank’s Board of Directors, which met last week, has already approved the audited half-year result which is expected to be forwarded to the Central Bank of Nigeria (CBN) for approval.

    Already, feelers from the Capital Market and analysts, have welcomed the development and praised the decision of the board.

    Over the years, Zenith Bank has consistently posted superior performance results.  Gross earnings was N403.4billion for last year’s financial year, profit before tax was N119.80billion while Profit After Tax stood at N99.46billion.

    The bank’s total assets was N3.76trillion, with total shareholders’ funds of N552.64billion which ranks the bank as the largest bank in Nigeria and the sixth largest in Africa by shareholders funds. The bank paid dividend of N1.65 per share for the financial year 2014.  The bank is noted for its strong asset quality with a non-performing loan ratio of 1.8 per cent, which is one of the lowest in the industry.

    The bank’s outstanding service delivery has won numerous international endorsements and awards, including Best Bank in Corporate Governance in Nigeria by Global Banking and Finance (2015), Best Customer Service Bank in Nigeria by Global Banking and Finance (2014) and the Most Customer-Focused Bank in Nigeria by KPMG (2014).

    The bank only recently scored another first, becoming the first Nigerian institution to be awarded a triple ISO certification by the British Standards International (BSI): the ISO 22301, 27001 and 20000 standards.

    The three standards, which require the bank to subscribe to internationally accepted principles/standards, according to the bank deepen customer experience through greater information security and IT management system that emphasise the protection of the customers and their investments in an increasingly unpredictable business environment.

    Zenith Bank Plc started this year on a good footing with considerable growths in overall earnings and profitability, according to the latest earnings report of the bank.

    Interim report and accounts of the bank for the first quarter ended March 31, 2015 indicated that while gross earnings grew by 14 per cent, pre and post tax profits rose by 15 per cent and 17 per cent respectively. Earnings per share thus improved to 88 kobo within the three months, in contrast with the 75 kobo recorded in the corresponding period of 2014.

    Gross earnings rose to N113.32 billion by March 2015 compared with N94.32 billion by March 2014. Interest income for the period rose to N81 billion compared with N71 billion posted in the similar period of 2014 translating to 14 per cent increase. Similarly, non-interest income appreciated by 39.5 per cent at N31.9 billion up from N22.9 billion in 2014.

    The bank’s Operating income rose to N72 billion as against N66 billion in the same period of 2014 translating to nine per cent growth, while operating expenses of N39 billion was recorded amounting to 4.8 per cent increase from N37.6 billion reported in the corresponding period of 2014.Profit before tax also rose from N28.92 billion to N33.13 billion, while profit after tax increased from N23.68 billion to N27.68 billion.

    The latest earnings report is broadly in line with the performance of the bank in the previous financial year. The board of Zenith Bank  earmarked N54.94 billion as cash dividends to shareholders for the immediate past business year ended December 31, 2014.

  • Bank barred from accepting foreign currency deposits

    Bank barred from accepting foreign currency deposits

    The Central Bank of Nigeria (CBN) yesterday stopped banks from accepting foreign currency cash deposits into customers’ accounts.

    A circular to all authorised dealers and general public titled: ‘Developments in the Foreign Exchange Market- Re: Cash Deposit Into Domiciliary Accounts’ said the regulator has considered the recent statements by Deposit Money Banks (DMBs) concerning the large volume of foreign currencies in their vaults and the decision to stop accepting foreign currency cash deposits into customers’ accounts as a welcome development.

    Its Director Trade and Exchange Department, Olakanmi I. Gbadamosi who signed the circular, said the policy shift is in line with its continued efforts to stop illicit financial flows in the Nigerian banking system which aligns with the anti-money laundering stance of the Federal Government.

    He explained that for foreign currency cash lodgments made before yesterday, the account holder has the option to either withdraw his or her foreign currency cash or the naira  equivalent.

    “For the avoidance of doubt, only wire transfers to and from Domiciliary Accounts are henceforth permissible,” he said.

    The CBN urged individuals that wish to source foreign currency for eligible and legitimate purposes such as Business Travel Allowances, Personal Travel Allowances medical, mortgage, school fees, goods among others to do so through recognized channels with the use of Form ‘A’ for “invisible” and Form ‘M’ for “visible” transactions.

  • Skye Bank gets IT, security management certification

    Skye Bank gets IT, security management certification

    Skye Bank Plc has attained three International Standard Organisation (ISO) certifications from the British Standard Institution.

    The three certifications were the IT service management system which meets the requirements of ISO/IEC 20000-1:2011; information security management system which complies with the requirements of ISO/IEC 27001:2013; and the business continuity management system which complies with the requirements of ISO 22301:2012.

    The IT security management system certification implies that the bank can design, develop, deliver and improve its IT services to both its internal and external customers, while the information security management system means the security of all data transacted and stored in the bank is guaranteed.

    Besides, the business continuity management system underlines the bank’s business continuity model in relation to critical financial services provided by the bank. The Central Bank of Nigeria has made the certifications statutory for banks as a way of expanding their capabilities in IT and security management systems as well as business continuity management.

    Speaking about the integrated management system certifications, the bank’s chairman, Tunde Ayeni said the certifications represented a major thrust of the bank’s philosophy of service excellence and its customer centric approach.

    He restated the commitment of the bank to continually improve its services using modern technology for the benefit of its customers, adding that service innovation would be a major component of the bank’s value delivery to its customers.

    The Group Managing Director/Chief Executive Officer of the bank, Timothy Oguntayo, described the certifications as a milestone towards achieving the vision of the bank of becoming a leading and first class commercial bank.

    He also said the awards reflected the bank’s mission of providing excellent services to the customers using technology, noting that the acquisition of Mainstreet Bank had helped the bank to enhance the pursuit of international honours.

  • Diamond Bank votes N6.6b for bad loans

    Diamond Bank votes N6.6b for bad loans

    • Profit After Tax down by 44%

    Diamond Bank Plc has posted  N5.8 billion  Profit Before Tax (PBT) in the second quarter of the year.  But the profit declined by  15 per cent compared to that of the previous year, while Profit After Tax (PAT) stood at N5.1 billion, representing a 13 per cent decrease.

    Analysts at FBN Capital, an investment and research firm, said the decline was caused by a 62 per cent increase in loan loss provisions of N6.6 billion and a nine per cent rise in expenses.

    A loan loss provision is an expense  reserved for defaulted loans, or credits.

    The analysts insisted that though profit before the provisions was up by nine per cent to N39.4 billion, this is not enough to offset the negatives on the loan provisions and expenses.

    “Diamond’s Bank’s impairment charge continues to be high in the sector and may worsen going forward, given the trend observed in some of the banks that have reported second quarter results, particularly given Diamond’s relatively high exposure to the Small and Medium Enterprises (SMEs) and the retail segments,” they said.

    Besides, Bloomberg consensus forecasts a PBT of N30.1 billion for Diamond for the year, but the performance of the lender portends a slight downward revision.

    Diamond Bank’s shares are down by 28.3 per cent, much worse than the All Share Index’s -10.2 per cent performance.

    For the analysts, though the bank’s cost of risk is in the three to 3.5 per cent range, below the four per cent guidance provided for the full year, it is believed the ratio is likely to worsen in the fourth quarter ended in December given the weak macro environment.

    “Further up the Profit and Loss, although both income lines contributed to the growth in pre-provision profits, non-interest income, which grew by 19 per cent year-on-year, was the stronger of the two lines. Funding income grew by only seven per cent year-on-year. Given that Diamond Bank’s loan book shrunk by two per cent quarter-on-quarter, it is believed that funding income most likely benefitted from a combination of higher yields on earning assets and a three per cent quarter-on-quarter decline in customer deposits,” they said.

    Sequentially, the bank’s PBT and PAT declined by 30 per cent per quarter and 44 per cent quarter mainly because non-interest income declined by five per cent per quarter while  expenses grew by 12 per cent quarterly.

    Compared with forecasts, PBT and PAT missed it by between 23 per cent and 25 per cent because profit before provisions came in four per cent behind forecast, expenses was around two per cent higher than analysts’ forecast.

    “The non-interest income line which came in around 18 per cent behind our forecast was the major driver behind the weakness in pre provision profit. In hindsight, our forecast may have been somewhat optimistic given how much deterioration the operating environment saw in second quarter,” they added.

     

  • Visa begins campaign to enhance cardholders’ experience

    Visa begins campaign to enhance cardholders’ experience

    Visa, a global payments technology company, has launched NotATourist, an innovative, regional campaign aimed at driving international tourism during holidays and rewarding holidaying card users.

    The campaign will run in the Middle East and African markets including Nigeria, Ivory Coast, Cameroon, Democratic Republic of Congo (DRC) and Senegal until 31 August.

    It provides cardholders with real and rich destination-related information to help plan their travel as well as access Visa’s global merchant offers and exclusive promotions.

    It is designed to inspire travel beyond the regular tourist sites to savour truly local experiences that are the essence of making a destination unique. As travellers experience unforgettable moments, Visa remains the gateway to an array of offers that give cardholders the ability to maximize their joy and access to thousands of attractions that unlock the secrets of their preferred destinations.

    Visa’s General Manger for West Africa, Ade Ashaye said the most important highlight of the campaign is that the firm is able to communicate with the hearts and minds of travellers and help them appreciate the hidden treasures of the places they visit.

    “As a global payments technology company, we believe in the power and reach of mobile applications, to tap in to the large population of smart phone users, mostly millennials who can effectively influence other aspirational travellers in the same age group,” Ashaye said.

    He said that in Nigeria, tourists are encouraged to participate in a competition by posting pictures of themselves on twitter. The winners will get weekly prizes such as Ipads, Nikon cameras, $1000 and a grand prize of $15,000 trip to Dubai for four nights.

  • ‘Remove fuel subsidy before devaluation’

    ‘Remove fuel subsidy before devaluation’

    The government has been urged to remove fuel subsidy before it embarks on another devaluation of the naira.

    The Managing Director, Financial Derivatives Company Limited, Bismarck Rewane, who gave the advice at a seminar for finance journalists,  organised by the Central Bank of Nigeria (CBN) in Calabar, the Cross River State capital, said the impact of the devaluation on the economy would be reduced if the government removed the subsidy.

    “Currency adjustment will happen, but depending on when they take away the subsidies, the adjustment required will be minimal. What is required is the exchange rate determining mechanism which allows for a floating currency with interventions to create stability,” he said.

    Rewane insisted that if oil price dropped below the value, the adjustment impact would be higher.

    “The problem of currency adjustment is not unique to Nigeria; all the oil producing countries are all facing the same thing. So, let us not wallow in it. Whether we like it or not, I can assure you that they will get rid of petrol subsidy. Not because of the pricing but because it is a system that is wrong”.

    He said subsidy fuels corruption, adding that the about 40 million litres of petrol consumed daily are exaggerated, adding that the subsidy is either on imported or exported fuel to neighbouring countries or overseas.

    “In 2002, total subsidy paid in this country was N200 million, by 2012 it had gone to N2 trillion, does this mean that we now have 20 times more vehicles in Nigeria, no. We are talking about 40 million litres of petrol a day. Is it that we are driving on top of one another? The true figure should not be more than 10 to 15 million litres,” he said.

    The FDC chief executive also stressed the need to increase productivity in the country, saying: “We must recognise that Nigeria has 2.6 per cent of the world population and produces 0.7 per cent of the world output. We can only desire and lay a claim to a higher quality of life if we can produce more.’’