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  • CBN warns bank CEOs over forex

    CBN warns bank CEOs over forex

    Bank chiefs caught frustrating efforts by the Central Bank of Nigeria (CBN) at getting more dollars to end-users risk severe punishment, the apex bank warned yesterday.

    The warning came on the backdrop of reports that lenders are setting difficult hurdles for foreign exchange (forex) end-users wanting to make purchases for Business Travel Allowances, Personal Travel Allowances, tuition payment abroad and medical bills.

    More than $2 billion has been injected by the CBN into the retail end of the forex market to meet demands by genuine users. The regulator deployed examiners and ‘mystery’ shoppers to the banks to monitor compliance with the intervention funds’ disbursement guidelines and possible abuse by the lenders.

    CBN spokesman, Isaac Okorafor confirmed that the regulator had received complaints from customers over frustrations which they were meant to go through in getting foreign exchange for invisible items.

    He therefore warned commercial banks and other dealers to desist from sabotaging the efforts aimed at making life easier for foreign exchange end-users.

    He urged the general public to report to it any bank that fails to meet customers’ needs after due documentation and reiterated the regulator’s determination to deal with any official or institution found to be sabotaging the operations of foreign exchange market in whatever guise.

    Yesterday’s warning came after a similar threat was made to banks mid-February, in which the CBN also threatened the bank officials with heavy sanctions.

    The statement reads: “Any bank that fails to comply with the rules of this and other extant forex guidelines shall be sanctioned, which will affect the executive and other officers of the bank,” CBN Director, Financial Markets Department, Alvan Ikoku said in circular to all banks.

    The apex bank explained that the forward sale by banks to their customers shall be for mature or past due obligations and should not exceed 60 days.

    It said the special intervention will be via a “wholesale bid” whereby commercial lenders will apply for a particular dollar amount as opposed to submitting individual customer demand. The lenders will then allocate the dollar to their customers, the CBN said in a mail to commercial banks, asking them to maintain the bid spread of 50 Kobo.

    “Successful banks shall send their returns to Financial Markets Department, 24 hours after the release of the intervention results. After release of the results, banks shall sell forwards to match the forward purchases from the CBN,” it said.

  • Niger Delta Youth Coalition supports Gov. Dickson educational policies

    The Niger Delta Youths Coalition for Peace and Progress (NDYCPP) on Sunday commended the educational policies of Gov. Seriake Dickson of Bayelsa.

    The News Agency of Nigeria (NAN) recalls that Dickson had on Friday announced that he had signed the Bayelsa Education Development Trust Fund and Bayelsa Higher Education Trust Fund.

    The laws make it mandatory for every taxable adult, civil servants, and corporate bodies to contribute on a monthly basis to the trust funds.

    The fund would be used to run secondary educational institutions in the state and to provide revolving loans to indigent students in tertiary institutions.

    NDYPP in a statement signed by Pastor Olayinka Tiedor and Chief Henry Nabena, Acting National Chairman and Acting State Chairman in Bayelsa respectively pledged to collaborate with Bayelsa government to sensitise the public to contribute towards the trust funds.

    The coalition noted that the educational programmes of the Dickson’s led administration in Bayelsa were panacea to reverse the educational backwardness of the state.

    It noted that the establishment of Ijaw National Academy, a model boarding secondary school providing scholarship to 1, 000 students from the Niger Delta region was an ambitious effort worthy of support.

    “We support in totality, the educational development levy because of its importance in sustaining quality education at all levels in the state.

    “This will also check youth restiveness in the state by providing opportunity to youths to ensure self development.

    “This wake-up call to give education the priority it deserves is key to the speedy transformation of Bayelsa and indeed the Ijaw nation.

    “Therefore, all hands must be on deck to bring it to fruition irrespective of political party affiliation or tribe.

    “The NDYCPP, a coalition of several youth groups across the Niger Delta with structures in all the states and Local Government Areas of the region, remain a viable youth advocacy platform.

    The group said it is committed to empowerment of 5, 000 youths in Bayelsa within the next one year.

    The group further stated that in collaboration with the Bayelsa Ministry of Agriculture, it had facilitated the participation of some 200 youths in the CBN Anchor Borrowers Scheme for Fish/Cassava farmers.

    It stated that the target of empowering 5,000 youths was feasible going by its efforts in agriculture, entrepreneurship development, wealth creation and existing partnership with the three tiers of government and private sector

    The group also lauded the plans of Bayelsa government to float Bayelsa Young Entrepreneurship Programme to provide soft loan to youths with viable business ideas capable of creating jobs to decongest the labour market.

    Meanwhile, the Ijaw Youths Council (IYC) on Sunday urged state governors in the Niger Delta region to priotitise education and step up investment in education.

    The youth group was reacting to the foundation laying for Senate building of Niger Delta University by Gov. Seriake Dickson in Amassoma, Southern Ijaw Local Government Area of Bayelsa on Thursday.

    Secretary of the IYC Mr Parkins Ogede said that the Dickson has taken the bull by the horns in tackling the educational disadvantage of the region by initiating the education development trust fund (EDTF) in the state.

    The group urged other governors in the region to emulate Gov. Dickson by paying attention to education.

    Ogede said that IYC will not hesitate to call out under-performing state governments in the region and in extension the Ijaw nation to take steps to meet the expectations of the people to provide education to uplift the living standards of the people.

  • CBN to sustain forex intervention

    CBN to sustain forex intervention

    The Central Bank of Nigeria (CBN) on Sunday reiterated its determination to sustain the provision of foreign exchange with a view to ensuring liquidity in the market and enhance accessibility and affordability for genuine end users.

    The apex bank’s acting Director, Corporate Communications; Mr Isaac Okorafor in a statement on Sunday said the bank wants to disabuse the notion by market speculators that it wouldn’t be able to sustain its forex intervention.

    He said that the bank would again, early this week, inject more foreign exchange into the market, leading to a further weakening of the dollar.

    “This is in addition to the further increase in the sale of dollars to the Bureau de change operators from 8,000 dollars to 10,000 dollars per week,’’ he said

    Okorafor warned commercial banks and other dealers to desist from sabotaging the efforts aimed at making life easier for foreign exchange end users.

    According to Okorafor, the CBN had received complaints from customers over frustrations in getting foreign exchange for invisible items like tuition fee, medicals, personal and basic travel allowance.

    The Bank urged the general public to report it to any bank that failed to meet customers’ needs after due documentation.

    It once again reiterated its determination to deal with any official or institution found to be sabotaging the operations of foreign exchange market in whatever guise.

    It would be recalled that the Naira closed at N394 to a dollar on Friday, which translated to 10 per cent depreciation of what was recorded earlier in the week.

    The depreciation was attributed to the alleged hoarding of forex by banks rather than selling to genuine customers.

    Analyst believe that with the twice weekly sale to BDCs up to 20,000 dollars, the Naira is likely to appreciate in the coming week. (NAN)

  • Forex: New rate for BDCs out tomorrow-CBN

    Forex: New rate for BDCs out tomorrow-CBN

    THE Central Bank of Nigeria (CBN) will announce a new foreign exchange rate for licensed Bureaux de Change operators (BDCs) on Monday.
    Giving this hint at the weekend was Isaac Okorafor, the Acting Director, Corporate Communications of the CBN.
    Speaking in an interview with The Nation, Okorafor who confirmed this development however kept the new rate under wraps.
    “I don’t know the new rates yet but it would certainly be announced by Monday. That is the much I can say for now,” he said.
    The CBN spokesman had in a statement issued earlier said the apex bank hopes to commence sale of forex twice weekly to Bureaux de Change operators (BDCs) from Monday, said it was part of efforts to sustain liquidity in the foreign exchange market.
    Specifically, he said: “Licensed BDC operators are therefore required to fund their accounts with the CBN on Mondays and Wednesdays, while they receive their purchases on Tuesdays and Thursdays respectively.”
    Expatiating, he said: “The sale amount to BDCs is hereby increased to $10,000 weekly ($5,000 per bid).”
    The CBN had initially fixed N360 to a dollar, as the rate at which BDCs will be allowed to purchase greenbacks from International Money Transfer Organisations (IMTOs) and subsequently fixed the rate at which BDCs will sell dollars to end users at not more than N362/$1.
    Before the development, the country’s over 3,000 licensed BDCs were buying dollars from IMTOs under the supervision of the CBN at a rate of N381 to the dollar and selling at N399/$.
    The regulator had last Monday directed Deposit Money Banks (DMBs) to sell foreign exchange sourced from it to retail end-users at not more than N360/$1 for Personal/ Business Travel Allowance (PTA/BTA) and other invisibles even as it offered a fresh $100million in forwards.
    The CBN’s almost daily dollar sales have crashed dollar rates at the parallel market to about N375/$ and N365/$ in Lagos and Abuja respectively.

  • Why Naira value keeps falling in spite of CBN’s intervention

    Why Naira value keeps falling in spite of CBN’s intervention

    Alhaji Aminu Gwadabe, the President, Association of Bureau De Change Operators of Nigeria (ABCON), has blamed the recent depreciation of naira on the speculators’ onslaught and resistance by the banking industry.

    Gwadabe told the News Agency of Nigeria (NAN) on Saturday in Lagos that the refusal of some banks to sell the invisibles such as personal and business travel allowances frustrated naira recovery.

    The ABCON chief said that the CBN had recently accused the banks of frustrating its policies.

    He said it was ironical that the naira started losing strength in spite of the CBN’s review of the rates from N375 to N360 to a dollar.

    According to him, the naira started trading on Monday with a promising outlook for sustained strength against the dollar and other currencies, but it began to somersault at the middle of the week.

    “The naira ended deeper northward to close at N394 to a dollar on Friday, translating to 10 per cent depreciation of what was recorded during the week,’’ Gwadabe said.

    The association president said that the removal of disparity in applicable exchange rates among the BDCs, Travelex and the banks should have strengthened the nation’s currency.

    The financial expert said, “CBN’s knack for last minute solution as recent development has shown, accounted for the misfortune of the naira at the foreign exchange market.’’

    Gwadabe said that the battle for the soul of the naira would be won if the CBN could boost liquidity to the BDCs for effective unification of rates.

    “It is evident that the injection of liquidity to the interbank market rather than the BDC sub-sector is not effective and transparent for sustained FOREX rate convergence and unification.

    “Statistics from the CBN shows that about 20 banks get 80 million dollars weekly for invisible transaction as against the 20 million dollars weekly for over 3000 CBN licensed BDCs nationwide.

    “The CBN should enhance public awareness to guide end users on FOREX availability and applicable exchange rates.

    “The CBN should diversify the buffers from oil proceeds to foreign investors inflows and Diaspora remittances,’’ Gwadabe said.

    He urged the CBN to sponsor a bill for an act of the National Assembly for naira convertibility in West Africa, as part of the solutions to full recovery of the naira.

    Gwadabe said that naira was currently a means of exchange in about 15 countries in Africa.

    He urged the Federal Government to increase security surveillance at the nation’s airports and land borders to checkmate illegal foreign cash evacuation.

    NAN reports that the naira ended the week on a negative note, eroding the 12.36 appreciation it recorded in its trading last week.

    The Nigerian currency appears to be on trial again, as experts argue that winning the battle for the soul of the naira requires more than pulling the monetary policy lever.

    They called for a blend of fiscal and monetary policy and indeed patriotism from all Nigerians to save the naira from further sliding. (NAN)

  • CBN licenses Development Bank of Nigeria

    CBN licenses Development Bank of Nigeria

    The Central bank of Nigeria (CBN) has approved a Wholesale Development Finance Institution Licence to the Development Bank of Nigeria (DBN) Plc, the Minister of Finance, Mrs. Kemi Adeosun has confirmed.

    The approval was conveyed in a letter addressed to the Managing Director/Chief Executive of Officer of DBN dated March 28, 2017. The letter was signed by the Deputy Governor of the CBN in charge of Financial System Stability.

    The approval was subject to meeting the minimum capital requirement of N100 billion and the reconstitution of the Board of the Bank and reviewing its organogram.

    The DBN, was conceived in 2014 however, its take-off had been fraught with delays. The President Muhammadu Buhari led administration inherited the project with a determination to resolve all outstanding issues and set a target of 2017 for its take-off.

    It could be recalled that the Minister of Finance said that the DBN will have access to US$1.3bn (N396.5 billion) which has been jointly provided by the World Bank (WB), KfW (German Development Bank), the African Development Bank (AfDB) and the Agence Française de Development (French Development Agency). The Bank is also finalising agreements with the European Investment Bank (EIB).

    She also stated that the DBN, will provide loans to all sectors of the economy including, manufacturing, services and other industries not currently served by existing development banks thereby filling an important gap in the provision of finance to Micro, Small and Medium Enterprises (MSMEs).

    As a wholesale bank, the DBN will lend wholesale to Microfinance Banks which will on-lend medium to long-term loans to MSMEs. The MSMEs contribute about 48.47 per cent to the Gross Domestic Products (GDP) of Nigeria but have access to only about five per cent of lending from Deposit Money Banks (DMBs).

    The Federal Government expects that the influx of additional capital from the DBN will lower borrowing rates and the longer tenure of the loans, will provide the required flexibility in the management of cash flows, giving businesses the opportunity to make capital improvements, and acquire equipment or supplies.

  • DMO lists FGN Savings Bond on NSE to service budget deficit

    DMO lists FGN Savings Bond on NSE to service budget deficit

    The Debt Management Office (DMO) on Wednesday listed series 1 of the Federal Government of Nigeria (FGN) Savings Bond worth N2.067 billion at N1,000 on the Nigerian Stock Exchange  (NSE).

    Dr Abraham Nwankwo,  DMO Director-General,  said in Lagos that the listing became imperative to guarantee liquidity of the bond.

    The News Agency of Nigeria (NAN) reports that the savings bond, the first of its kind in Nigeria was opened to the investing public by way of offer for subscription over a five-day offer period.

    The five-day period began on March 13, and would end on March 17, with N2. 067 billion raised from the retail market at 13.01 per cent coupon.

    Abraham stated that the bond would help to finance the nation’s budget deficit.

    According to him, the bond with subscription units of 2,577 will be issued monthly in tenors of two and three years, with quarterly payment of interest to investors.

    Nwankwo said that the response to the bond had been huge as individuals made enquiries with interest to participate in the bond.

    According to him, the bond will provide retail investors and ordinary Nigerians the opportunity to partake in infrastructural development of the country as well as generate good returns on their investments.

    “Over a year ago, the NSE mentioned the possibility of introducing retail bonds and we started working on it, with the team on NSE with the CBN, Securities and Exchange Commission and with other agencies that are relevant.

    “The FGN bond is meant for every Nigerian both at the grassroots as well as the common man.

    “The objectives of the bond had been achieved from the beginning as about 95 per cent of the subscriptions were from average individual Nigerians.

    “This means the grassroots’ common man dominate the FGN Saving Bonds,” Abraham stated.’’

    He said that the success showed that the initiative taken by the financial system and the NSE and other players in the market including stock broking community, had yielded fruits in terms of financial inclusiveness.

    The director-general commended all the stakeholders for the successful issuance of the first FGN Savings bond and urged Nigerians to be optimistic on the future of the nation’s economy.

    Also speaking, Mr Haruna Jalo-Waziri, NSE Executive Director, Capital Markets, said that the exchange was delighted with the savings bond listing which would mature in March 2019.

    Jalo-Waziri said that the bond among others would help to enhance the savings culture among Nigerians, while providing all citizens irrespective of income level an opportunity to contribute to national development.

    He stated that the FGN Savings Bond was safe and backed by the full faith and credit of the Federal Government of Nigeria, with quarterly coupon payments to bondholders.

    According to him, an interested investor needs to approach any of the accredited brokers and require only the sum of N5, 000 to subscribe with additions in multiple of N1, 000 subject to a maximum amount of N50 million.

    “We are pleased to list the series 1 of this innovative investment offering that caters to the retail segment of the Nigerian Capital Market.

    “The off take of the first tranche underpins the efforts of the Federal Government to continue to work with stakeholders to deepen the capital market while delivering value to investors at all income levels.

    “We look forward to continue the collaboration with DMO to list subsequent series of the Savings Bond”, Jalo-Waziri added.

  • Wheat farmers in Kano secure N50m loan

    The Wheat Farmers Association of Nigeria (WFAN) in Kano State, has secured a N50 million loan from the State Government, its Chairman, Alhaji Faruk Rabi’u, said on Wednesday.

    Rabi’u said that the loan would be used to assist the farmers warehouse their produce after harvest.

    The chairman told the News Agency of Nigeria (NAN) in an interview in Kano that the association had introduced the ‘ Warehousing Finance Receipt Programme’, to ensure safety of produce at the end of the season.

    Rabi’u said farmers who need money during the period would be given interest-free loan from the N50 million.

    “The idea is to discourage farmers from selling their produce at a give away prices after harvest.

    “When there is bumper harvest, middlemen buy and hoard the product and later sell it at exorbitant prices which is to the detriment of farmers.”

    He believed that the introduction of the warehousing receipt programme, farmers would keep their products safely until when the commodity appreciated.

    According to him, if any member requires money during the period his product is warehoused, the association would offer them the interest-free loan, to repay after selling the produce.

    Rabi’u said under the programme, farmers would get 30 per cent value of their products as loan and would be made to pay a token for warehousing their commodity.

    The chairman disclosed that the association had set up a committee to recover the loan disbursed to its members under the CBN anchor borrower programme.

    “Harvesting has commenced and we have set up a committee for loan recovery which will soon commence its assignment.”

    He called on farmers to ensure prompt payment of the loan, to avoid any embarrassment.

  • CBN sells forex to BDCs at N360/$

    CBN sells forex to BDCs at N360/$

    The Central Bank of Nigeria (CBN) yesterday reduced rate at which it sells foreign exchange (forex) to bureau de change (BDCs) from N381 to dollar to N360 to dollar. The BDCs are to sell to end users at N362 to dollar.

    The rate reduction comes barely 24 hours after its directive to Deposit Money Banks (DMBs) in the country to sell forex obtained from it to retail end-users at not more than N360 to dollar for invisibles.

    The CBN Acting Director of Corporate Communications, Isaac Okorafor, confirmed the directive in Abuja, adding that the CBN, under the new policy, will sell forex to the licensed BDCs at the rate of N360/$1, while they will in turn sell to customers at a rate not more than N362 to dollar.

    Okorafor said the objective of the new forex sale policy was to ensure a convergence of rates in the interbank and BDC. He stressed that the CBN remained committed to ensuring transparency in the market as well as fairness to end-users, many of who hitherto experienced challenges in accessing forex.

    He therefore urged licensed BDCs to play by the rule, warning that the CBN would not hesitate in sanctioning any erring dealer.

    Okorafor also disclosed to reporters that $100 million offered to authorised forex dealers in the interbank wholesale window to meet the requests of genuine wholesale customers was fully subscribed at March 28  auction.

    He also reiterated his call to all stakeholders to play their respective roles in ensuring a smooth running of the forex market for the benefit of the economy.

  • CBN stimulated Bayelsa’s economy -Dickson

    Bayelsa State Governor, Seriake Dickson, on Tuesday hailed the Central Bank of Nigeria (CBN) for stimulating the state’s economy through its various economic and social interventions.

    Dickson called on other corporate organizations operating in Bayelsa to emulate the worthy example of CBN by fulfilling their corporate social responsibilities.

    The governor, who spoke when he received a six-member CBN team led by its Branch Controller in the state, Mr. Godwill Obiora, in Government House, Yenagoa, said the bank had contributed immensely to the development of small and medium scale enterprises in the state and the country.

    Dickson particularly commended the apex bank for its investments in the social sector, through the provision of health, educational and other amenities as part of its social responsibility.

    He enjoined the bank to explore other areas of collaboration with the state government to boost development.

    Dickson also applauded the Federal Government and the bank for the proposed establishment of a school at Swali area of the state capital,

    He directed the state Ministry of Education to liaise with the bank and support the project.