The Nation Newspaper

Category: Business

  • 500,000 phones for security agents

    THE Nigerian Insurers Association (NIA) is set to hand over 500, 000 phones to law enforcement agents to access Nigerian Insurance Industry Database (NIID) this first quarter.

    Its Corporate Affairs Manager, Mr Davis Iyasere, said this in an interview with The Nation in Lagos.

    He said the date for the handover would be announced after its council meeting in February.

    The NIID was launched on June 26, last year in Lagos.

    According to him, the association has given some of the phones to its members to ensure that the motor insurance policies issued are uploaded into the database.

    “The 500, 000 phones NIA promised to hand over to law enforcement agents to enable them to verify the authenticities of motor insurance certificates are ready.

    “This will be handed over to them this first quarter.The actual date would be announced after the council meeting in February,” he said.

    Iyasere said the hand over was being delayed because the association did not want a situation where a person who has a genuine certificate was not captured on the database.

    “We are putting so many things into consideration and this includes not to embarrass genuine certificate holders by ensuring that majority of the policies are on the database,” he said.

    The phones would give the law enforcement agents access to NIID by sending the policy number and the vehicle plate number through SMS to 33125.

    Vehicle owners can also send their policy and plate numbers to 33125 or visit the website: www.askniid.org. to verify the authenticity of the certificates they are carrying.

  • AfDB offers $700m credit to BoI, NEXIM

    The African Development Bank (AfDB) has given $700 million credit to the Bank of Industry (BoI) and NEXIM Bank of Nigeria.

    TheAfDB credits are sovereign-guaranteed (Federal Government) multi-tranche lines of credit (LoCs) of USD $500 million to BoI and of USD $200 million to NEXIM.

    The agreements for the LoCs were signed yesterday in Abuja between the officials of the BoI and NEXIM as well as the officials of the AfDB. At the ceremony, it was disclosed that the lines of credits will be extended to support export-oriented small and medium enterprises’ (SMEs) modernisation and expansion in Nigeria.

    The terms of the agreement of the LoCs, it was learnt, “will allow local SMEs to be more competitive, scale up their operations and ultimately create more jobs in Nigeria.”

    The LoCs will also include a technical assistance package to strengthen institutional capacity at both BoI and NEXIM as well as at their SME clients.

    Speaking at the agreement signing ceremony, Dr. Ousmane Dore, AfDB’s Resident Representative in Nigeria said: “This AfDB combined programme will contribute to mobilise significant financial resources for Nigerian export-oriented SMEs, ultimately contributing to economic development, employment opportunities, foreign exchange and regional trade integration.”

    He added that through this integrated financing package, the AfDB will be supporting Nigeria’s efforts towards a more diversified economy away from oil and gas.

    The LoCs will supply multi-sector financing to address the challenges that SMEs face in accessing finance in the country.

    It is believed that by providing these lines of credit, export-oriented SMEs will be able to become more competitive, ensure sustainable growth for their operations and generate employment in the productive sectors.

    NEXIM Managing Director, Mr Robert Orya, said: “NEXIM is looking for important economic development achievements, including approximately 55,000 new jobs for its SMEs’ clients, $1.6 billion in foreign exchange and an overall contribution of almost seven per cent to non-oil exports, including a 10 per cent share in Economic Community of West African States (ECOWAS) exports.”

    This facility, he noted, “will provide a great opportunity for NEXIM to make available concessional long-term funding in pursuance of its strategic objectives of enhancing value-added exports and bolstering the capacity of SMEs for job creation and foreign exchange earnings.”

    Managing Director, Ms. Evelyn Oputu, said: “The AfDB’s credit is likely to generate significant additional lending to our export-oriented SMEs client at a time when it is sometimes difficult for commercial banks to finance this important sector of the economy.”

  • Firm exposes investors to financial market

    Investment One Financial Services Limited seeks to expose existing and potential investors to knowledge and skills that would enable them to understand the workings of the Nigerian financial markets, its Managing Director, Mr Nicholas Nyamali, has said.

    He made this known at the presentation of N500,000 star prize to the pioneer winner of the company’s Virtual Investment Simulator- an online investment training contest. He said the Virtual Investment Simulator was aimed at encouraging participants to learn about how to make informed investment decisions as well as enhance knowledge of the financial market.

    He said that the Securities and Exchange Commission (SEC) had approved the online investment simulation portal, noting that the portal also allows investors to form exclusive investment clubs within the portal whereby participants can invite friends and colleagues to join, compete with one another as well as share ideas and post comments on the portal’s blog page.

    According to him, the virtual investment simulator was designed to teach participants the art and science of investing as well as afford researchers the opportunity to acquire knowledge of the Nigerian equities market and financial asset market in an online gaming environment.

    Nyamali explained that Investment One is propelled by its core values of service excellence, innovation and market insight to provide forward thinking investment solutions to individuals and organisations looking for a partner to help them achieve their investment goals.

    At the end of the first phase of the investment simulation contest, Owolabi Afeez Oluwatosin emerged the winner with the highest returns on investment for the period.

    By winning the inaugural edition of the competition, Owolabi, a youth corps member serving in Kwande LGA of Benue State became the first winner and was awarded the star prize of N500,000. Owolabi beat several other players in the keenly contested investment game which lasted for 12 weeks.

    The next phase of the Virtual Investment Simulator contest will commence in February 2013.

    Investment One Financial Services Limited is licensed by the SEC to provide fund management, trusteeship and investment/financial advisory services. It has a wholly owned subsidiary licensed by the SEC and the Nigerian Stock Exchange (NSE) to provide securities brokerage services.

  • China’s $1.7tr debt weighs on economy

    Chinese companies are spending more than ever to service debt after their borrowing almost tripled over five years, prompting strategists to warn of rising default risk and a threat to economic growth.

    Total short- and long-term borrowing by 3,895 publicly traded non-financial companies rose to almost $1.7 trillion in their latest filings, from $604 billion at the end of 2007, data compiled by Bloomberg show.

    Financing costs, including interest, on all forms of debt climbed to the highest level as a percentage of gross domestic product last year, according to Sanford C. Bernstein & Co.

    For China’s real economy to expand at eight per cent this year, growth in non-loan credit would have to accelerate to 33 per cent from 25 per cent in 2012 if the credit-to-GDP efficiency remains at last year’s level.

    For China’s real economy to expand at eight per cent this year, growth in non-loan credit would have to accelerate to 33 per cent from 25 per cent in 2012 if the credit-to-GDP efficiency remains at last year’s level.

    Bernstein says that means less cash for investment to fuel the world’s second-largest economy, while Royal Bank of Scotland Group Plc says the threat of defaults will hold back interest- rate liberalisation. The average 10-year yield for top-rated company bonds is near a 13-month high at 5.27 per cent, compared with the 2.6 per cent yield in a Bank of America Merrill Lynch global corporate index.

    “There’s just a lot more debt in China today than there was really ever in the past, relative to nominal GDP,” said Mike Werner, a Hong Kong-based analyst at Bernstein. “More and more of the country’s resources have to be put to just financing outstanding debt, and that itself is a headwind for economic growth.”

    While the nation exited a seven-quarter slowdown in October-December as the government eased monetary policy, incoming Premier Li Keqiang may need to confront the fading effects of government support, a likely pickup in inflation and rising risks from shadow banking. Price growth accelerated to a seven-month high in December, driving up benchmark bond yields. GDP grew 7.8 per cent in 2012, the slowest in 13 years.

    On stimulus lending, Chinese banks doled out 8.2 trillion yuan ($1.3 trillion) of new loans in 2012, 10 per cent up from a year earlier and the second-highest level on record, central bank data show. The government quota for new lending may be set at 9 trillion yuan this year, Caixin reported on January 22.

  • Shippers’ Council to attract 3m cargoes

    The Acting Executive Secretary/Chief Executive Officer of the Nigerian Shippers’ Council (NSC), Mr Hassan Bello, has led a trade delegation, comprising port concessionaires, administrators, government officials and other shipping service providers, to Niger Republic.

    The visit is expected to attract over three million metric tonnes of cargo to Nigeria’s sea ports.

    The trip, according to a statement, was at the instance of the Ministry of Transport to convince the land-locked Niger Republic to patronise Nigeria’s sea ports.

    Bello said: “What we are doing is part of efforts of the Federal Government of Nigeria and the Government of Niger Republic to discharge their international law obligations as coastal/transit state and landlocked state.”

    He said the meeting between Nigerian maritime industry operators and the Niger Republic business community was facilitated by the Nigeria-Niger Joint Commission for Development.

    The NSC boss told The Nation the Council aims to attract up to three million metric tonnes of Niger Republic’s consignments to the Nigeria’s sea ports annually.

    “At present, Niger Republic is doing about 2.5 million metric tonnes in Benin Republic, 1.5 million metric tonnes in Togo, and close to a million metric tonnes in Ghana. Nigerian ports can do up to three million metric tonnes annually, and up to 2,000 Niger Republic-bound containers monthly from our projection. Don’t forget also that Nigeria has strong diplomatic relations with Niger Republic, and an international obligation to landlocked countries around it. We believe the visit will open up a bundle of business opportunities for our ports.

    “It may interest you to know that, until the year 2006, about 70 per cent of Niger Republic cargo transited through Nigerian ports, as against the current zero percent. So, the mission is aimed at attracting back Niger Republic’s cargo to Nigerian ports and ensuring access of their cargo to Nigerian seaports,” Bello stated. Major imports into Niger Republic, like Nigeria, are mostly consumer goods, while the country exports uranium, sesame seed, Arabic gum, groundnut and skin.

    “Niger Republic is an oil producing country, and looks up to the ports of neighbouring countries to export crude,” he said.

    Bello, who assumed the mantle of leadership at the NSC in December last year, said his major concern is to reinvigorate the Council to play its role of trade facilitation.

    “We have started the process of reinvigorating the shippers’ associations all over the country. We are the secretariat of all the shippers in Nigeria – importers and exporters – and we must now begin to really protect their interests,” he stated. Bello said, under his leadership, service delivery will become the watchword for all NSC staff.

    “Service delivery is important. We are here to serve the shippers. We have been solving their problems and attending to their complaints but now we need to automate the process. We’ll acquire toll-free numbers where they can call in and lodge their complaints and receive prompt attention from our staff,” Bello said.

     

  • Minister seeks efficiency at port

    The Minister of Transport, Senator Idris Umar, has urged stakeholders in the maritime industry to collaborate with the Federal Government in its quest to ensure sanity and efficiency to the ports.

    Speaking at the launch of an Integrated Port Community Information System in Port Community Information System (IPCIS), he said, President Goodluck Jonathan’s administration is determined to make the ports attractive for business and urged the stakeholders to embrace the IPCI system.

    The benefits of the new system include ship reporting; on-line automated notice of arrival and departure of vessels, tracking; automatic identification system, weather current and tide information, port community system, cargo tracking, smart port technology, unattended asset sensor, and also useful in operation of inland container deport.

    The system could also provide solutions to various aspects of challenges in port operation; reduce cost, offers steady profits to stakeholders and act as trade facilitator centre.

    In his own remark, the Managing Director, Nigerian Ports Authirity (NPA), Mallam Habib Abdullahi said the system was launched as part of the efforts of NPA to promote efficiency at ports.

     

  • More loans for SMEs, says CBN

    SMALL and Medium Scale Enterprises (SMEs) will get more loans after the Central Bank of Nigeria (CBN) reduces the cost of banking services by 30 per cent, the Head, Shared Services, CBN, Mr Chidi Umeano, has said.

    He told The Nation that efforts were on to ensure that banks achieved 30 per cent cost reduction, and further lend to SMEs, among others in the economy.

    CBN, he said, has identified cost drivers in the industry, and the possibility of reducing them to aid lending.

    “Banks are incurring huge expenses in cash handling, he said, adding that they have in the process transferred the cost on loans seekers,” he said.

    He said CBN introduced cash-less policy to reduce the cost of banking services, and further increase accessibility to loans. According to him, there would be more lending opportunities for SMEs, as the cash-less policy takes off fully in the country.

    Umeano said CBN had met SME operators in Lagos, to fashion out ways of using the cash-less programme to enhance their operations.

    According to him, there would be more lending opportunities for SMEs, as the cashless policy takes full effect in the country.

    He said: “The SMEs owners have been accommodated well in the cashless net. They are part of our plans. We have explained the value chains in the cashless initiative to them, the use of Point of Sale (PoS) providers, and what they need to do access facilities from the banks.

    “We believe that there will be increase access to facility and service levels across the industry, once banks have reduced their operational cost by 30 per cent. The motive for the cashless policy is to reduce cost of banking services (that is the cost of credit and the likes in the economy). This will increase lending opportunities for informal sector operators, that formed 70 per cent of the country’s population.”

    The cash-less guidelines, he said, had been structured in such way that SME owners are protected.

    CBN, he said, has provided card acceptance guidelines that accommodate all operators in the financial chains.

    Manufacturers Association of Nigeria (MAN), president Alhaji Bashir Borodo has praised the CBN initiative. He said the decision to make banks to lend more to SMEs is a good one capable of stimulating the economy’s growth.

    He described funding as the major problem facing SMEs, adding that their potentials would be galvanised when they have access to funds.

    Borodo said CBN’s reforms agenda “greatly” impacted on the economy, stressing that the apex bank has assisted SME operators via granting them N200 billion loans two years ago.

    A teacher at the Lagos Business School, Dr Austin Nweze, said SME operators had long been denied access to loan. Nweze said it would be good if banks are able to increase funding to SME owners. He said the problem facing banks is the capacity to do what is going to benefit the economy.

     

  • Firm holds forum on budget today

    The Bureau for Business Information (BBI) is organising a two-day business roundtable on policies and variables that would shape the economic and investment landscape.

    The event, billed to hold between today and tomorrow, will aid the strategic positioning of investors and others in the economy.

    The organisation said issues, such as the Euro Zone crisis, the looming fiscal cliff in the United States, Global Economic Outlook in the year, implications for private sector performance, structure and contents of 2013 budget vis-à-vis inherent challenges and opportunities for investors would be discussed during the two-day events.

    Others are outlook for foreign exchange, inflation and national outlook, interest rates, SWOT analysis of sectors, such as manufacturing , real estate, maritime, agriculture, oil and gas, retail trade, information and communication technology(ICT), capital market, consumer spending structures on sectoral and regional basis, among other financial services institutions.

     

  • How Nigeria can sustain growth, by AfDB

    Nigeria needs a stable environment to sustain its economic growth, the Country’s Representative, African Development Fund (AfDB), Mr Ousmane Dore, has said. Speaking during a stakeholders’ forum in Lagos, Dore said a stable macro economic environment is what the country needs to move forward.

    He said: “I think the Nigerian government can do is to have a degree of macro economic environment, that is stable and sound in place to encourage growth of investments.”

    He said the government needs to put in place fiscal monitoring policies in place to aid economic growth, advising that efforts must be made not to go back to a more volatile economy of the 70s and 80s.

    Ousmane said the document on Vision 2020, transformation agenda, and national implementation programmes talked about development of private sector, adding that efforts have not been geared towards that direction.

    “ The government policy must ensure that the environment is conducive for this kind of transaction to take place. The government cannot do better if there is no good environment in place. That is talking about regulatory environment such as the institutional reforms that led to the establishment of the ICRC, and the capacity building. All these would help in bringing about good financing”, he added. CBN assures.

     

  • Recapitalisation: Mortgage banks in merger, acquisition talks

    Ahead of the April 31 recapitalisation deadline, Primary Mortgage Institutions (PMIs) are forming an alliance to meet the new capital base.

    Last year, the Central Bank of Nigeria (CBN) directed mortgage institutions that want to operate nationally to raise their capital from N100 million to N5 billion and their state counterparts, N2.5 billion.

    Managing Director, Skyfield Savings & Loans Limited, Mr Kola Abdul, said the alliance was formed at a stakeholders’ meeting.

    He said: “Ahead of the April 31 deadline, the Mortgage Bankers Association of Nigeria (MBAN) brought together operators to brainstorm on the issue of recapitalisation and the options to be adopted.”

    According to him, some firms have agreed to merge, while others want to grow organically to meet the deadline.

    He said negotiations had started among those planning to merge so as to get the needed capital before the deadline.

    The paramount issue facing the companies, he said, was how to meet the deadline, not the size of their businesses.

    Abdul said: “The smaller mortgage banks need to merge with the bigger ones in view of the recapitalisation deadline. The Central Bank of Nigeria (CBN) has provided a flexible recapitalisation regime by directing the firms to either play at the state or national level. Therefore, the issue of merger is a welcome development that would foster the growth of the sub-sector.

    “Given the situations on ground, the issue of mergers and acquisitions cannot be ruled out.”

    He said mortgage firms’ contributions to the Gross Domestic Product (GDP) is low, adding that it would improve after recapitalisation. The recapitalisation would make the firms more active and function well in the financial market, he said.

    MBAN Executive Secretary, Mr Kayode Omotoso, said mortgage institutions would shop for funds at the capital market.

    Besides, there would be mergers and acquisitions as well as take-overs in the sector in the coming months.

    “There would be mergers; there would be acquisitions; there would be takeovers; there would be strategic investments and there would be efforts to go to the capital market for the mortgage banks to meet up with the deadline. More mortgage banks will approach the capital market to raise equity while the sector will approach the capital market to raise equity, hybrid and long-term debt instrument to finance home ownership,” he added.