The Nation Newspaper

Category: Money

  • Transactions hit N2tr as more Nigerians embrace e-banking

    Transactions hit N2tr as more Nigerians embrace e-banking

    Despite initial doubts, more Nigerians are embrac-ing electronic banking, provoking an impressive growth in transactions.

    According to the Central Bank of Nigeria (CBN), the value of electronic transactions increased from N1.67 trillion in 2011 to N2.09 trillion,last year.

    From 355.2 million units, the volume shot up to 382.6 million units within the review period. The CBN said the figure reflected an increase of 7.7 per cent and 25.4 per cent, for value and volume.

    Data on various e-payment channels for the period under review indicated that automated teller machines (ATMs) remained the most patronised, accounting for 98.1 per cent, followed by point-of-sale (PoS) terminals at 0.7 per cent.

    Also, web and mobile payments accounted for 0.6 per cent each. Similarly, in value terms, ATM accounted for 94.7 per cent, PoS 2.3 per cent, while web and mobile payments averaged 1.5 per cent each.

    It said the volume and value of ATM transactions amounted to 375,487,756 and N1.98 trillion. These reflected an increase of 8.1 per cent and 27.1 per cent over the volume and value of 347,569,999 and N1,561.75 billion attained, in 2011.

    The volume of mobile payments decreased by 37.0 per cent to 2,297,688 from 3,649,374, while the value increased by 65.8 per cent to N31.50 billion, from N19 billion.

    Also, the apex bank explained that the value of transactions at the inter-bank funds market declined by 45.7 per cent to N23,811.91 billion. The development was attributed largely to improved liquidity in the banking system.

    Also, the breakdown of the volume of transactions at the inter-bank funds market showed that the inter-bank call and the open-buy-back (OBB) segments declined by 61.2 and 49.8 per cent respectively from their levels of N37.7 trillion and N6.1 trillion in the preceding year.

    Inter-bank call transactions accounted for 61.4 per cent of the total, while OBB accounted for the balance of 38.6 per cent.

     

  • Bill to establish global financial centre coming

    Bill to establish global financial centre coming

    A Bill for the establishment of an international financial centre is before the National Assembly, the Central Bank of Nigeria (CBN) has said.

    Its Governor, Sanusi Lamido Sanusi, who made this known at the launch of the Financial Markets Dealers Quotations (FMDQ) Over – The-Counter (OTC) Plc last week, said the FMDQ plan is in line with the objectives of the Financial Services Sector (FSS2020), initiated to develop financial markets.

    He said the platform is expected to bring about increased liquidity in the instruments of unlisted securities, increase attraction and flow of resources to small and medium-sized enterprises and enhance price discovery and financial inclusion potential, among others. He added that this would lead to a vibrant private sector and increase contribution to the economy.

    Sanusi said the CBN is keen to see that the strategic objectives are achieved. Of immediate relevance is the objective that relates to the strengthening and deepening of the domestic financial markets – money, bond, currency and derivatives.

    He said to improve on the governance of money market operations, the CBN executed the Nigerian Master Repo Agreement (NMRA) – an adaptation of Global Master Repo Agreement (GMRA) with banks and discount houses accessing funds at its window.

    Sanusi explained that one of the reasons the Nigeria financial system is at risk is because the country depends so much on the banks alone for the provision of finance.

    He said tapping into the pension funds and external parties basically diversifies the sources of long-term funding, reducing risk on banks’ balance sheet.

    “We all know that the country needs long-term funding for infrastructure development and a deeper financial market. One of the reasons the banking system remains a big risk is because the economy depends so much on the banks alone for the provision of finance,” he said.

    Sanusi explained that from a banking stability perspective, developmental perspective, financial development perspective and risk management perspective, the FMDQ is great idea.

    He said efforts of the FMDQ, a professional body for banks, discount houses and other relevant financial institutions, in fostering financial markets development in Nigeria is commendable and has complemented the efforts of government and regulatory authorities.

    CBN Deputy Governor, Economic Policy, Sarah Alade, said FMDQ will enhance market transparency. She said FMDQ will make the market more than before.

    “From the central bank point of view, you know the channel for implementation of monetary policy is financial markets. So if a market is efficient, the implementation of monetary policy will be efficiently done and everyone will benefit from it. We have been talking about how to channel credit to the real sector, the efficiency with which the financial market operates affect monetary policy,” she said.

     

  • Diversified financing sources’ll reduce banks’ risks, says Sanusi

    One of the reasons the Nigeria financial system is at risk is because the country depends so much on the banks alone for the provision of finance, Central Bank of Nigeria (CBN) Governor, Sanusi Lamido Sanusi has said.

    Sanusi spoke yesterday in Lagos at the launching of FMDQ OTC Plc, the over-the-counter platform for the trading of fixed-income securities and derivatives floated by the Financial Markets Dealers Association (FMDA) and other stakeholders.

    According to him, the development of the capital market, which entails other sources such as insurance companies, pension funds and external parties, will basically diversify the sources of long-term funding, reducing risk on banks’ balance sheet.

    “We all know that the country needs long-term funding for infrastructure development and a deeper financial market. One of the reasons the banking system remains a big risk is because the economy depends so much on the banks alone for the provision of finance,” Sanusi said.

    He said the launch of FMDQ OTC is a culmination of a journey that started few years back. He said that as the CBN governor, the project was one of the things he wanted to conclude before the end of his tenure.

    According to him, FMDQ provides an enabling environment for improved price discovery and deepening of the financial market.

    Sanusi explained that from a banking stability perspective, developmental perspective, financial development perspective and risk management perspective, the FMDQ is great idea.

    He said efforts of the FMDQ, a professional body for banks, discount houses and other relevant financial institutions, in fostering financial markets development in Nigeria is commendable and has complemented the efforts of government and regulatory authorities.

    The CBN boss said the launch of the FMDQ OTC PLC is yet another indication of the association’s persistence and quest to play a catalytic role in the development of the Nigerian financial markets.

    “I commend the association for this initiative aimed at extending the frontiers of the Nigerian financial markets,” Sanusi said.

    CBN Deputy Governor, Economic Policy, Sarah Alade, said FMDQ will enhance market transparency. She said FMDQ will make the market more than before.

    “From the central bank point of view, you know the channel for implementation of monetary policy is financial markets.”

  • ANAN urged on ‘missing’ N500b

    The President of the Association of Professional Bodies of Nigeria (APBN), Hon. Bala Kaoje has urged the Association of National Accountants of Nigeria (ANAN) to assist the nation in tracing the alleged missing N500 billion Subsidy Reinvestment and Empowerment Programme (SURE-P) Fund.

    Kaoje who spoke yesterday in Abuja at the induction of 167 fellows of ANAN said members of the accounting body could help trace where this money is.

    “This is a task I am giving as the President of the APBN to the ANAN President and all members of the association. We cannot as a nation allow corruption to ruin us. We must fight corruption in order to occupy our rightful place in the comity of nations, ‘’ the APBN President said. He explained that all other professional bodies look up to accountants, particularly ANAN.

    He was optimistic that the accounting body would help tremendously to fight corruption in the country. “Your body has been talking about whistle-blowing. This is a big challenge to all accountants because it is not everybody that is ready to blow the whistle as some people might be afraid. Blow the whistle about these people trying to milk this country dry,’’ Kaoje said.

    The President of ANAN, Alhaji Sakirudeen Labode disclosed ongoing plans to create a forum for Fellows in future. According to him, the Fellowship of ANAN goes with certain privileges and the criteria for Fellowship of the association are well known.

    He said that application for fellowship must be accompanied by payments of all levies. Labode added that nominees must have spent not less than 10 years in the profession and recorded number of credit hours.

  • Fortis MfB to enhance financial inclusion

    Fortis Microfinance Bank Plc (Fortis MfB) has said it operates a robust business model that fits into the financial inclusion agenda of the Central Bank of Nigeria (CBN). Managing director, Fortis MFB, Kunle Oketikun said microfinance banks have the capacity to drive the programme of expanded financial services delivery in the economy.

    Speaking at the 7th Annual Banking and Finance Conference held recently in Abuja, Oketikun described microfinance banks as very strong vehicles through which the full objectives of financial inclusion programme will be achieved.

    He noted that given efficient combination of the current licensed microfinance banks, the available deposit money banks, and the introduction of electronic and mobile channels financial products delivery, Nigeria will sooner than expected outperform Kenya and South Africa in the drive to include more people in the economic pyramid.

    Specifically, he said Fortis MfB has not only taken a firm root in the microfinance industry, but it is also at the leading edge of the mobile money business.

  • Foreign investors acquire Fan Milk

    Two new foreign investors-Danone and The Abraaj Group have acquired 100 per cent equity stake in Fan Milk International, the parent company of Fan Milk Plc in a global deal that will reverberate in Nigeria and other West African countries.

    With 2012 sales of around EUR120 million, Fan Milk is the leading manufacturer and distributor of frozen dairy products and juices in Nigeria and other West African countries including Ghana, Togo, Burkina Faso, Benin and Ivory Coast. Since its establishment over 50 years ago, Fan Milk has grown rapidly through a unique distribution network with its products popularly available in almost every nooks and crannies of Nigeria.

    Stanbic IBTC Capital Limited advised Danone, one of the largest food product manufacturers in the world, producing fresh dairy, water and nutritional products globally, in the deal. The Abraaj Group is a leading private equity investor operating in the growth markets of Africa, Latin America, Middle East, South Asia, South East Asia, Turkey and Central Asia.

    Under the transaction, The Abraaj Group, which had previously announced its agreement to acquire 100 per cent of Fan Milk through one of its Funds in June 2013, will now acquire 51 per cent equity stake while Danone will acquire 49 per cent stake in Fan Milk International. However, Danone will in the years ahead be able to gradually acquire a controlling stake in the business.

    There is expectation that the combination of Danone’s know-how in the fresh dairy category alongside Abraaj’s 20 year investment experience, insights and local presence on the African continent will boost Fan Milk’s growth.

    Founder and group chief executive, The Abraaj Group, Arif Naqvi, noted that the acquisition of Fan Milk represented the largest fast moving consumer good (FMCG) private equity transaction in Sub Saharan Africa, outside South Africa.

    “We look forward to partnering with Danone in order to accelerate the growth and penetration of Fan Milk’s portfolio of leading consumer food brands across West Africa,” Naqvi said.

    Co Chief Operating Officer, Danone, Emmanuel Faber, said the transaction represented a major step in Danone’s expansion in Africa noting that Fan Milk is a company with a unique business model driven by a neighborhood sales and distribution platform.

    According to him, Danone, which is already in North and South Africa, will now be able to develop the dairy product market in West Africa.

    Chief executive officer, Stanbic IBTC Holdings Plc, Mrs. Sola David-Borha, said the deal was another step towards Stanbic IBTC’s goal of becoming the leading financial solutions provider in Nigeria differentiated by its quality and range of knowledge across segments.

    According to her, the acquisition highlights investors’ increasing appetite for Africa and its consumer brands as well as Stanbic IBTC’s consistent objective to help its clients achieve their goals.

    Head, financial advisory, Stanbic IBTC Capital, Fola Aiyesimoju said advising on such a high profile transaction demonstrated the merger and acquisition expertise within Stanbic IBTC Capital and the broader Standard Bank Group.

    “It is in line with our commitment to take Africa to the world and bring the world to Africa,” Aiyesimoju said.

     

  • BDAN annual forum to discuss public sector financing

    Bank Directors Association of Nigeria (BDAN)’s annual conference for this year is expected to discuss issues around public sector funding for the economy.

    In a statement, BDAN stated that the annual stakeholders’ forum holding on Tuesday, November 12, at Wheatbaker Hotel, Ikoyi Lagos will bring together executive and non-executive directors of banks, officials of other financial institutions (OFIs), regulatory authorities, professional bodies and executives of other leading companies in Nigeria.

    It stated that the forum presents opportunity for bankers to network and share thoughts on the theme of the forum: “Public Private Partnership Innovations in Public Sector Financing”.

    Lagos State Governor, Babatunde Fashola is the guest speaker at the forum. Also, the programme will be chaired by Chief Executive Officer (CEO), Actis, Miss Ngozi Edozien.

    Among other things, this year’s forum is aimed at examining critical issues relating to public private partnership financing. This follows from the success of the 2012 stakeholders’ forum, which examined, “How Banks can leverage on Credit Bureau Services to accelerate Growth”.

    BDAN is the umbrella body of bank directors established to provide a forum for improving the knowledge and the competence of bank directors.

    The association also contributes to the development of the banking industry through recommendations and comments on policy and topical issues in the industry.

  • Keystone Bank Uganda gets new MD

    Keystone Bank has confirmed the appointment of Ms. Yetunde Kakulu as the Managing Director of its Uganda subsidiary.

    In a statement, the bank’s divisional head, marketing and corporate communication, Mohammed Ciroma, said Kakulu was, until her new posting, a divisional head in the bank’s Northern division.

    An old girl of Federal Government College, New Bussa, Kakulu possesses a Bachelor of Science Degree from the University of Ilorin as well as a Masters Degree in Banking and Finance from Ahmadu Bello University, Zaria.

    She also recently attended the leadership course at Wharton Executive Education College, University of Pennsylvania. Her foray into banking spanned over 20 years garnering experience variously as operations manager and business manager with some of the leading banks in Nigeria before being head-hunted by Keystone Bank to be part of the change management team.

    Her professional trajectory has been in retail, commercial and public sector banking in Keystone Bank where she rose to become an Assistant General Manager making her eligible for her new assignment as CEO of Keystone Bank’s subsidiary in Uganda.

  • ‘$90b private wealth in foreign banks’

    The volue of private funds stashed in foreign banks by Nigerians is currently worth $90 billion, Professor of Economics and former Vice Chancellor Olabisi Onabanjo University, Ogun State, Afolabi Soyode has said.

    In a statement, he said that a huge share of “private wealth’’ was financed by kick-backs from foreign loans, embezzlement of public funds and rip-offs of state owned companies. He said the figures have continued to rise in recent years.

    Soyode, who spoke on the ‘The Impact of Corruption on Sustainable Economic Reforms’’ at the 18th Annual Conference of the Association of National Accountants of Nigeria (ANAN) held in Abuja said off-shore banking is as large as many economies.

    According to him, from 1977 to 2003, the private wealth of Nigeria stacked abroad on off-shore accounts is by far greater than her foreign debts of about $40 billion dollars. He said poor remuneration remains one of the major causes of corruption in the country.

    He noted that, low and declining workers’ salaries and promotions are a case in pointing out that the motivation to remain honest may be undermined further if senior political and government officials are seen to use their positions for private gains.

    “The bribe received by underpaid workers in the Police Force, Customs, Immigration, schools, Civil Service fall into this category and is what I refer to as `forced corruption,” Soyode said.

    He expressed concern about the deepening poverty level, rising unemployment and the declining living standards in the country. “Really the poor is getting poorer and the rich is getting richer,’’ Soyode said.

    Soyode made reference to a report which estimated government funds lost to ‘endemic corruption’’ and entrenched inefficiency at $6.8 billion or N1.06 trillion.

    He also attributed rising cases of corruption to government’s inability to implement effective laws that will punish corrupt individuals within the society.

  • DMBs grow assets, liabilities to N23tr

    Assets and liabilities of deposit money banks (DMBs) currently stand at N23.1 trillion, a report by the Central Bank of Nigeria (CBN) has stated.

    The figure which is for August 2013, indicated an increase of 1.8 per cent above the level at the end of the preceding month.

    The report indicated the funds were sourced mainly from Federal Government deposits and reduction in claims on Central Government. The funds were used, largely, in the building up of reserves and in the extension of credit to the private sector.

    Also, commercial banks’ credit to the domestic economy fell by 3.9 per cent to N11.5 trillion, which is below the level in the preceding month. The development was attributed largely to the 89.3 per cent decline in banks holding of treasury bills and FGN Bonds during the review month.

    Total specified liquid assets of the banks stood at N6.6 trillion, representing 42 per cent of their total current liabilities. The report explained that at that level, the liquidity ratio fell by 8.5 percentage points below the level in the preceding month, but was 22 percentage points above the stipulated minimum ratio of 30 per cent.

    According to the report, the loans-to-deposit ratio, at 32.7 per cent, was 1.4 and 38 percentage points below the levels at the end of the preceding month and the prescribed maximum ratio of 80 per cent, respectively.

    The report showed that total assets of the discount houses stood at N231.73 billion at August ending, showing a decline of 9.2 per cent below the level at July ending. The development was accounted for, largely, by the 18.9 and 1.4 per cent decline in claims on the Federal and State Governments, respectively. Correspondingly, the decline in total liabilities was attributed, largely, to the 18.9 and 28.2 per cent fall in other amount owed to commercial banks and other liabilities, respectively.