The Nation Newspaper

Category: Money

  • Diamond Bank engages entrepreneurs on capacity building

    Diamond Bank Plc at the weekend, held its 36th BusinessXpress Enterprise Series for Small and Medium Scale Enterprises (SMEs) during which it advised participants on how to grow their businesses.

    The Head of SME, Chima Nnadozie, said the lender understood that banking is not just about offering customers financial services alone, but seeing how it could add value to their businesses.

    Nnadozie, who was represented by Segment Manager, MSME Proposition Segment Manager, Cheta Agbo, said: “In as much as they need money to grow their businesses, they also need knowledge to drive the business. So we are trying to provide a platform in such a way that as we grow a business, we are offering multiple things that support their growth.”

    He said Nigeria has 18 million SMEs contributing about 50 per cent to the Gross Domestic Product (GDP), which he described as massive. He said banks need to extend their contributions to the SMEs sector, adding that Diamond Bank is committed to providing the support that SMEs need to move their businesses to the next level.

    He disclosed that the bank is supporting the SMEs with the realisation that the wealth of a nation is directly connected to the level of entrepreneurship in that nation.

    “We are supporting the growth of SMEs because we recognise that the future of this nation lies in the hands of entrepreneurs, so any energy expended in building that sector cannot be wasted. It is something that is going to benefit the economy in years to come,” Nnadozie said.

    He noted that the business express seminar is a complete package of everything a bank could provide to a small business to enable it grow.

    The facilitator, Olugbenga Mark-George, of Mark-George Consultants, said the purpose of the seminar which is being hosted across the country, was to support owners of SMEs grow their businesses through capacity building.

  • Keystone Bank inaugurates trade portal

    Keystone Bank Limited has introduced a trade portal to support the international trade activities of its customers.

    In an address presented at a customers’ trade forum in Lagos, the Managing Director/CEO, Mr. Philip Ikeazor, described the product as a simple end-to-end solution that supports manufacturers, importers, and other companies engaged in foreign exchange transactions.

    He said the portal would also help customers initiate trade transactions from the comfort of their offices, homes or anywhere they are.

    Besides, he said new trade patterns would lead to new financial instruments and new ways of adding value for customers. This, he pointed out would also drive trade transactions in the economy.

    Ikeazor said the forum was vital as governments and various bodies have continued to emphasise the significance of international trade to the growth of the economy.

    “As a country, we cannot afford to wait while other nations are moving ahead with various bilateral arrangements which will not only redefine global trade flows but also deployment of resources and investment flows.

    “As an industry, banks must be more proactive in engaging with all stakeholders, including the regulatory community. This is the reason we invited the Central Bank of Nigeria (CBN), Nigeria Customs Service (NCS), importers, exporters and other stakeholders to be part of this forum.

    Comptroller-General, NCS, Inde Dikko, who was represented by the Deputy Comptroller-General, Aber Benjamin, acknowledged the lapses and delays caused by the service providers at the ports.

     

     

     

     

     

     

  • Pensioners get N178b

    Pensioners get N178b

    STANBIC IBTC Pension Managers, a member of Stanbic IBTC Holdings, has paid N178 billion to retirees in the last eight years.

    The firm pays about N1.7 billion to over 28,000 retirees monthly. The firm started operations in 2005.

    Head of Service, Lagos State Civil Service Commission, Adesegun Ogunlewe, made this known at the launch of Stanbic IBTC Pension mobile office in Lagos.

    Ogunlewe, who was represented by the Executive Director, Technical, Lagos State Pension Commission, Mrs. Folashade Onanuga, said the new product was in line with its commitment to ensuring excellent and convenient service for clients.

    The mobile office has been deployed in Lagos and will be subsequently deployed in other cities aso as to enhance access to customers.

    Chief Executive Officer, Stanbic IBTC Pension Managers, Dr. Demola Sogunle, said the visibility would demystify pensions matters and encourage more Nigerians to subscribe to the contributory pension scheme, thereby enhancing financial inclusion.

    “We believe that this initiative, which speaks of convenience and accessibility is one of our key steps to building a legacy of exceptional service delivery where the customer is the focal point of all our activities. This initiative will bring pension service to the doorsteps of our customers and prospective customers alike,” he said.

    Sogunle also said there are plans to deploy more mobile offices in various cities across the country, adding the the new service window will complement the group’s expanding footprint in Nigeria by adding to the almost 200 branches of Stanbic IBTC Bank, Stanbic IBTC Pension Managers’ nine regional offices, as well as selected branches of Zenith Bank where the Pension Fund Administrator operates.

    Sogunle said Stanbic IBTC Pension Managers is backed by the requisite expertise and experience, strong and sound financial clout, ensuring efficiency in the management and safety of clients’ retirement savings.

    “We believe that the support, experience and capabilities of the Standard Bank Group to which we belong, have been instrumental in enhancing our expertise, resource base and general service delivery, thus reinforcing our goal of providing excellent service to all our customers,” he stated.

     

  • ‘Finance houses need IFRS to do better’

    Operators of finance houses need to adopt and implement tenets outlined in the International Financial Reporting Standard (IFRS) to achieve their objectives, Jim Osayande Obazee, the Executive Secretary/Chief Executive Officer of Financial Reporting Council of Nigeria has said.

    He disclosed this at the quarterly chief executives business luncheon organised by Finance Houses Association of Nigeria (FHAN) in Lagos.

    He called for easier regulation of financial information of entities and enhancement of investors’ confidence in the quality assurance systems of financial reporting in public and private sector entities.

    Obazee, who spoke on the theme, IFRS Adoption in Nigeria: Issues and challenges for non-bank financial institutions, said the implementation of IFRS required considerable preparation at the country and entity levels to ensure coherence and provide clarity on the authority IFRS will have in relation to other existing national laws.

    He said there was the need for technical partners’ forum of accounting firms that can identify financial reporting issues requiring clarification to avoid inconsistencies.

    He said there should be limited number of professional accounting organisations, preparers and users, including regulators that can provide the International Accounting Standard Board (IASB) with useful feedback, not only after standards are finalised and ready for implementation, but early in the drafting process.

    Obaze said the shortage of expertise in IFRS affects not only the private sector, but also regulators and other government agencies.

    He noted that IFRS has been developed primarily to meet the information needs of shareholders, lenders and other investors, adding that these needs do not always align with those of the tax authorities as seen in extensive use of fair value and the application of substance over form.

    “IFRS is a new world order, in corporate reporting, that is currently altering not only the financial accounting and reporting landscape but also tax accounting/reporting, tax cash flows and tax distributable reserves,” he said.

    Obazee said there is the need to consider the functions of institutional bodies associated with financial reporting standards or having operational interest in financial reporting.

    He also called for consideration of the appropriate functions, powers and operational arrangements of institutional bodies in the country.

     

  • Foreign reserves down to $46.8b

    Foreign reserves down to $46.8b

    The nation’s foreign reserves declined to $46.8 billion as at August 29. It lost $200 million from the $47 billion it entered the month with.

    Data obtained from the Central Bank of Nigeria’s (CBN’s) website, showed that the reserves were $47.7 billion on July 1, and dropped to $47 billion on July 15. The figures hit $47 billion on August 1.

    The foreign currency reserves were $68 billion in August 2008 before the global financial crises affected it. The CBN had consistently maintained that inflows into the reserves were not consistent with the oil prices, thus underscoring the need for tighter fiscal controls around oil revenues.

    The apex bank has also said there was urgent need to pursue policies that would foster macro-economic stability, economic diversification as well as encouraging foreign capital inflows.

    It said a higher rate of retention of oil revenues should facilitate the efforts at maintaining exchange rate stability as an antidote to imported inflation without excessive reliance on monetary tightening measures.

     

  • CITN to regulate tax practice

    The Chartered Institute of Taxation of Nigeria (CITN) has said regulation of tax practice falls within its preview.

    Its President, Mark Dike said during his investiture as the 11th president, that the clarification became necessary following the ongoing controversy on whether CITN or to Institute of Chartered Accountants of Nigeria (ICAN) has the right to regulate tax practice.

    He said: “I believe that all well meaning people recognise the CITN’s right to regulate the practice of taxation in Nigeria. In line with this, efforts have been stepped up towards ensuring that only our members engage in tax practice and administration in Nigeria.”

    The institute, he said, had begun circulating the list of members with practice licence to guide stakeholders accordingly, stressing that this was the first-step in enforcing compliance before sensitisation of stakeholders. He said where there are clear breaches in the practice of taxation, the institute would not hesitate to take legal action.

    He said CITN under his leadership had come up with a six-point agenda that includes development of technical and research capacity of the institute, stating that the CITN should be a reference point when it comes to tax issues in Nigeria, and that the development of the research institute would help the body to achieve that objective.

    Dike said the body would reposition its tax faculties to international standard, as such would make stakeholders to court its members for solutions to their revenue generation challenges.

    He said the body will also instill culture of greater accountability in all its activities and processes. “It is important that we entrench a system of accountability in our activities and processes in a way that it becomes deep rooted and outlives successive regimes of the institute,” he said.

    The CITN boss also said the body will equally focus on strengthening its national and international outreach programmes, establish tax academy for Nigeria, sustaining the activities of the nation body district societies as well as enhancing manpower development.

    He said more attention will be given to right staffing, process reformation, training and retraining, improved remuneration and motivation. He said accomplishing these objectives will ensure that the collective goals of stakeholders in the Nigerian tax system are achieved.

     

  • Money laundering: errant banks to face sanctions

    Banks violating money laundering laws will not go unpunished, Director, Nigeria Financial Intelligence Unit (NFIU), Juliet Ibekaku, has said.

    Speaking in Lagos at the training of banks and other financial institutions staff on money laundering, she said violation of anti-money laundering rules, locally and internationally by some lenders, has become an issue, considering the Financial Action Task Force (FATF) Regional Review Group on-site visit to Nigeria this month.

    She said the NFIU largely draws its powers from the Money Laundering (Prohibition) Act (MLPA) 2011 as amended in 2012, the Terrorism Prevention Act (TPA) 2011 as amended in 2013, TPA Regulation 2011 and the Economic & Financial Crimes Commission (EFCC) Establishment Act, 2004.

    She noted that sector regulators are reviewing their anti-money laundering/combating the financial terrorism (AML/CFT) regulations in line with the recent amendments in the MLPA 2011 and TPA 2011, adding that it is hoped that these updated regulations would be of immense value to reporting entities.

    “I would want to say that the NFIU has found reports from a good number of financial institutions not impressive; and this calls for urgent improvement as the NFIU will not hesitate to recommend sanctions within the provisions of our extant laws. This is the only way to ensure deterrence and to protect our financial system,” she said.

    The NFIU director said under Section 9 of the MLPA 2011 as amended, reporting entities must train employees, and build strong AML/CFT infrastructure in their systems. Customer due diligence is also very vital for an effective AML/CFT regime in the country, she added.

    Likewise, Section 3 of the MLPA as amended has expanded the requirements on the implementation of customer due diligence policies by reporting entities.

    She said there are also provisions of the law bordering on reporting entities protection for reporting in good faith, but they can also be punished for failure to act in the interest of public good. Violation of these guidelines will attract penalties ranging from monetary fines, terms of imprisonment or even revocation of licences, she added.

    Ibekaku said compliance and deep knowledge of money laundering laws will ensure that the financial system is safeguarded from criminals, making it easier for the country to attract foreign direct investments (FDIs) for economic growth.

    She advised stakeholders in the fight against money laundering to cooperate with regulators to ensure that the AML/CFT programme is evaluated favourably in terms of policy frameworks and effectiveness by the FATF this month. She assured that the NFIU will continue to render support for initiatives and programmes designed to enhance best practices and increase capacity in the area of AML/CFT in the country.

    Chairman, Committee of Chief Compliance Officers of Banks in Nigeria (CCCOBIN), Pattison Boleigha said the FATF Recommendations increase transparency and enable countries to successfully take action against illicit use of their financial system. He disclosed that banks and other financial institutions have been under pressure to adopt best practice AML/CFT programmes in line with local and International regulations so as to avert sanctions on default.

    However, Boleigha said intelligent application of AML/CFT programmes should align with business objectives of the banks. This he said, requires that compliance supports businesses, as such would enable the executors achieve sustainable growth while avoiding financial fines. He said doing so, will balance regulatory requirements with business interests in AML/CFT implementation.

    “Government and industry regulations are changing the way banks do business and have an important impact on strategic and operational drivers. In today’s environment, the ability to stay profitable while quickly adapting to satisfy compliance is critical.

    The competition is bending the rules and the customer is not averse to bending the rules. There is increased pressure from shareholders for better profit results and huge targets have become the order of the day. These necessitate need to proactively balance business objectives within the ambit of regulations to achieve sustainable business growth,” he said.

    He said the Know Your Customer (KYC) procedures can help protect banks’ reputation and the integrity of banking systems. This can be done by reducing the likelihood of lenders becoming a vehicle for or a victim of financial crime and suffering consequential reputational damage.

    CCCOBIN boss said the KYC constitutes an essential part of sound risk management system as it provides the basis for identifying, limiting and controlling risk exposures in assets and liabilities, including assets under management.

    However, he said there is also need to protect the banks when they report suspicious transactions, and such report are later found to be wrong when compared with the issue of customer confidentiality which the financial institutions have sworn to protect. He said there are cases of abuse of information by officers of the supervisory authorities.

    He advised financial institutions to comply with all laws and regulations applicable to the conduct of their businesses or related activities. “Failure to comply with anti-money laundering or anti-terrorism laws or regulations can expose financial institutions to severe civil and criminal penalties, including loss of professional licensing and imprisonment of its principal officers,” he said.

     

  • e-clearing at branches may begin in Q4

    Electronic clearing (e-clearing) will be extended to banks’ branches this third quarter of the year, it was leant.

    However, this is subject to the Central Bank of Nigeria (CBN) approval.

    The policy, which became effective last August, could not be implemented in all banks’ networks because of poor technical know-how and infrastructure needed for seamless take-off in those units.

    An Executive of Sybrin Systems Limited, Daniel Parreira, said provision of sophisticated payment solutions, adoption of fully integrated management systems and anti-fraud mechanisms by banks will enable them achieve the feat.

    Decentralisation to branches, he said, will further reduce the pressure on clearing centres at banks’ headquarters.

    Sybrin Limited, a software technology firm based in South Africa, provides e-clearing services and other payment solutions among Africa’s leading banks, clearing houses and corporations.

    Besides, banks are expected to plan transmission of their outward presentation by taking into account presentation volume, the bandwidth of network with the clearing house, and the session window. In the event of an exchange file being received at the clearing house within a session time but not passed to the clearing house, the clearing house would unbundle the exchange file, and reattach to a new session.

    In case e-banking fails, paying bank may return such items with appropriate return reason codes.

    The introduction of truncation process changes the roles and the responsibilities of the various participants in the clearing system and may lead to introduction of certain risks.

     

  • ‘10% of MfBs subscribe to credit bureau’

    only 10 per cent of microfinance banks (MfBs) operators have keyed into credit bureau services, The Nation has learnt.

    Confirming this development, an executive of Lovonus Microfinance Bank, Chibuzor Okudo, said many of the MfBs were not willing to subscribe to the services because of high cost implications.

    He said not more than one out of every 10 MfBs send their credit customers to credit bureaux for verification of credit history.

    He said the subsector would have embraced the services more but for the cost associated with it.

    Managing Director, CRC Credit Bureau, Tunde Popoola, who also confirmed the poor compliance among MfBs operators, said there is need for regulators to assist it in creating awareness that will deepen operators knowledge and understanding of their services. “You know that’s part of the issue we have as a nation. Lack of unique identification is still a serious challenge in Nigeria. As a credit bureau, the only thing we can do is what we are doing. Keep on bringing data from various sources, and once those data are increasing, the number of people on the database is also increasing. And so, that becomes what you can work with as a mortgage bank or mortgage financial institution or even as a real estate developer,” he said.

    He said competition in the sector remains healthy and is required in an economy.

    “Monopoly is not good. Where you have monopoly in any sector, it brings in inefficiency, and prices of products are always high. At CRC, our major asset is our ability to respond to customer requests and meet them. Also, we are web based and our pricing is not bad and is tailored to ability to pay by each of the sectors that we are dealing with,” he added.

    Popoola said the acceptance of credit bureau in Nigeria has gone up. Also, he said the sector coverage has expanded. “When we started, we had only commercial and mortgage banks and some microfinance banks. But beyond banking, we moved on to leasing companies, debt management companies, finance houses, pharmaceutical companies, retailers, hotels and tourism companies. Even cooperative societies have also joined,” he said.

     

  • Sterling Bank creates awareness for non-interest banking

    Sterling Bank Plc has begun enlightenment for the Muslim community on the need to embrace non-interest banking.

    Its Group Head, Non-Interest Banking, Basheer Oshodi said there is need to let Nigerians know about the opportunities that exist in that segment of the market.

    Oshodi, who spoke in Lagos at the weekend during a non-interest banking workshop organised by the bank, said the lender is committed to introducing the banking concept to everyone. He said the bank recently got the Central Bank of Nigeria’s (CBN’s) approval-in-principle to practice non-interest banking in the country.

    “What we are trying to do here today, is to introduce non-interest banking to everyone. We have gotten approval-in-principle from the Central Bank of Nigeria (CBN). What we are doing now is to get people to be aware of what non-interest banking is all about. We are trying to showcase the type of products we are going to come out with. Those products cover both risk assets and liabilities,” he said.

    According to him, research showed that 30.5 million adult Nigerians are willing to buy into non-interest banking products. Also, over 60 per cent of Nigeria’s adult population remains unbanked. Both scenarios, he said, are indications that the non-interest banking concept cannot fail in the country.

    Oshodi said, the bank will not only be focusing on the 30.5 per cent interested adults, but would also target the over 60 per cent unbanked population, when it finally begins operation.

    He said non-interest banks do not pay interest on deposits, but relies more on partnership and profit sharing, usually in a ratio of 70:30. The customer he said takes 70 per cent, while the bank takes 30 per cent from the profit, and also gives a portion to depositors.

    Chairman, Advisory Committee of Experts on Non-Interest Banking, Sterling Bank Plc, Sheik Abdulkader Thomas said Nigeria is a huge market for non-interest banking given its huge population base. He said the banking concept is a viable means of gathering huge deposits that banks can even use in financing infrastructure and other developmental projects.