The Nation Newspaper

Tag: cbn

  • Skye Bank gets CBN’s loan to boost liquidity

    Skye Bank gets CBN’s loan to boost liquidity

    The Central Bank of Nigeria (CBN) has provided loan to Skye Bank Plc to boost its liquidity after the lender breached requirements on capital and lending.

    The short-term lending facility will allow the new management to “ensure that some withdrawals it suffered in the wake of the undue panic of last week do not adversely affect its operations,’’ Isaac Okorafor, a spokesman for the CBN told Bloomberg.

    The regulator has also issued guarantees to the bank’s depositors and creditors as a demonstration of its health, he said.

    The CBN replaced top managers of the lender earlier this month after it breached required thresholds for liquidity and non-performing loans. While the regulator moved to calm markets, assuring that the bank and indeed, the industry remained healthy, its stock plunged to record lows, leading to declines among other lenders.

    Skye Bank’s shares, however, rose for the fourth straight day yesterday, gaining nine per cent to 85 kobo in Lagos trading, the best performance on the 171-member Nigerian Stock Exchange All-Share Index. Almost 53 million shares were traded, more than three times the three-month average. It has declined by 46 per cent this year, compared with a 1.8 per cent retreat by the Nigerian All Share Index. The CBN said it has no plan to sell Skye Bank.

    In an earlier statement, the new management at Skye Bank said the lender’s fundamentals remained strong and virile, assuring customers and other stakeholders of the safety of their funds and investments.

    Its Group Managing Director/CEO, Tokunbo Abiru, said his team would leverage on the bank’s reputable information technology platform to make it not just a frontline retail and commercial bank, but also an industry leader.

    Abiru, who outlined his vision for the lender, said his team would harness the expertise and skill sets of the bank’s employees and the reconstituted board to take the bank to new heights.

    He noted that as a Systematically Important Bank (SIB), Skye Bank occupies a sensitive role in the financial life of Nigerians and the entire West African sub-region.

  • NBCC advises CBN on monetary policy plans

    Nigerian-British Chamber of Commerce (NBCC) has urged the Central Bank of Nigeria (CBN) to sustain a monetary policy aimed at increasing capital inflows, encouraging domestic lending and enhancing production for export.

    The Chamber also asked the apex bank to focus more on policy that will drive infrastructural development, enhance tax compliance and ensure a favourable environment for SMEs in the country.

    NBCC President, Prince Dapo Adelegan, who disclosed this during the Chamber’s quarterly review of the economy identified decline in economic activities, increase in the rate of unemployment and high operating cost as some of the effects of the restriction earlier placed on foreign exchange.

    On foreign portfolio investment, Adelegan said the foreign inflow dropped from N53.20 billion in April, last year to N14.52 billion in April, this year.

    He noted that many investors had left the country due to foreign exchange restriction and economic downturn.

  • Buhari seeks NASS approval for NNPC, CBN, others’ budget

    Buhari seeks NASS approval for NNPC, CBN, others’ budget

    President Muhammadu Buhari on Tuesday forwarded the 2016 budget proposal of 38 Federal Government agencies to the National Assembly for consideration and passage into law.

    The President said the action was informed by the provisions of the Fiscal Responsibility Act, 2007, which provides that the budgets of the agencies should be collated and forwarded to the National Assembly for consideration and approval.

    Senate President, Bukola Saraki, read the presidential letter forwarding the agencies’ budget proposal to senators on Tuesday.

    Most of the listed agencies had been flouting the provisions of the Fiscal Responsibility Act in the yearly operations.

    The list contained mostly revenue generating agencies including the Nigeria National Petroleum Corporation (NNPC), Central Bank of Nigeria (CBN), Nigeria Customs Service and Nigeria Port Authority (NPA).

    Others were – Bureau of Public Enterprises (BPE), National Agencies for Science and Engineering Infrastructure (NASEI), Nigerian Airspace Management Agency (NAMA), Nigerian Shippers’ Council (NSC), National Maritime Authority (NMA), Raw Materials Research and Development Council ( RMRDC), National Sugar Development Council (NSDC), Nigerian Postal Service (NPS), Federal Airport Authority of Nigeria (FAAN), Securities and Exchange Commission (SEC), Nigerian Tourism Development Corporation (NTDC), Nigerian Communications Commission (NCC), National Agency for Food and Drugs Administration and Control (NAFDAC), Nigerian Customs Service (NCS), National Broadcasting Commission (NBC),National Insurance Commission (NAICOM)  and News Agency of Nigeria (NAN).

    Also listed were – Nigerian Copyright Commission (NCC), Nigerian Deposit Insurance Corporation (NDIC), Nigerian Civil Aviation Authority (NCAA), Federal Inland Revenue Service (FIRS), Nigerian Immigration Service (NIS), Nigerian Electricity Regulatory Commission (NERC), Federal Radio Corporation of Nigeria (FRCN), Federal Housing Authority (FHA), Nigerian Television Authority (NTA), National Automotive Design and Development Council (NADDC), Nigerian Nuclear Regulatory Authority (NNRA), National Business and Technical Examination Board (NABTEB), Federal Mortgage Board (FMB), National Environmental Standards and Regulations Enforcement Agency (NESREA), Industrial Training Fund (ITF), Corporate Affairs Commission (CAC), Standards Organisation of Nigeria (SON) and Oil and Gas Free Zone Authority.

    President Buhari asked the lawmakers to note that in line with the provisions of the Act, budget of the agencies and corporations which have been privatised or otherwise seized to exist were not included in the list.

     

  • Economists urge CBN to review forex policy

    Economists urge CBN to review forex policy

    •Warn of depression

    The Nigerian Economists Society (NES) has urged the Central Bank of Nigeria (CBN) to review the new foreign exchange (forex) regime, saying some form of managed pegged system is consistent with the structure of the Nigerian economy.

    NES also warned that the country may slide into depression, saying the flexible forex regime of the CBN cannot survive in a non-productive economy.

    They said managed float policy is a better option given the Nigerian economy’s current local productive capacity and over-dependence on crude oil as its major source of forex earning with its price determined exogenously driven in the global market.

    The economists, majorly varsity dons, spoke separately yesterday at a one-day symposium on the topic: “Managing the Naira”, at the University of Uyo.

    In attendance were the Director-General, West African Institute for Financial and Economic Management, Prof. Akpan  Ekpo; Prof. Badayi Sani of Bayero University, Kano;  former Executive Secretary, National Man-Power Board, Prof. Joe Umo;  Vice-Chancellor, Veritas University, Abuja, Prof. Mike Kwanashi, former NES President; Prof. Akin Iwayemi, University of Ibadan and former Special Adviser on Economic Affairs, Office of the Chief of General Staff, the Presidency, Prof. Edet Akpakpan.

    According to them, given the structure of the economy, the current forex  policy is not a viable option as it suits an industrialised economy of which Nigerian economy has not yet reached.

    A communiqué issued by the society at the end of the programme urged the Federal Government to declare national economic emergency to galvanise the entire country into action in order to save the economy.

    “The new foreign exchange policy which implies that the exchange rate will be determined by market forces (clean float) is faulted as it admonishes a spot and forwards, assumes the economy is sophisticated and productive in producing needed goods and services typically of the advanced economies, when the actual problem in the foreign market is a supply-side issue (scarce availability of foreign reserves) which is insufficient to satisfy the demand.

    “Floating will generate macroeconomic instability as financial market participants stand to gain through market speculation which will only stimulate portfolio investment (hot money) as the real or “green field investment’ which is expected to generate wealth and create employment would not be attracted because of macroeconomic uncertainty.

    “This in turn has the tendency to generate further inflationary pressures, reducing the value of financial assets,”the communique read in part.

    The communiqué added that CBN should approve only institutions that meet its conditions noting that policy harmonisation should be enforced to curb fiscal dominance and monetary accommodation, promote local production with import-substitution strategies as import bill is high.

    The communiqué explained that the CBN intervention should be in the areas that enhance local production particularly SMEs, and the manufacturing sector. The economists suggested that the CBN should also buy from the market to stabilise the exchange rate when the need arises.

  • CBN okays no deposit for new accounts

    CBN okays no deposit for new accounts

    Customers are free to open accounts without deposits, the Central Bank of Nigeria (CBN) has said.

    The directive is contained in the Monetary, Credit, Foreign Trade and Exchange Guidelines for Fiscal Years 2016/2017 guidelines posted by the CBN on its website.

    Commercial banks ask for cash deposits to cover operating cost of opening new accounts to discourage customers from abandoning their account opening plans after completing documentations.

    The initial deposits are usually around N1,000 or N5,000 for savings accounts and N10,000 and above for corporate accounts.

    The CBN said the new policy directive is in line with its commitment to encourage banks to improve their deposit mobilisation efforts while promoting the financial inclusion initiative.

    “The CBN shall continue to encourage banks to improve their deposit mobilization efforts. In line with the financial inclusion initiative, banks shall be required to allow zero balances for opening new bank accounts so as to make banking services accessible to the unbanked public. Accordingly, banks are encouraged to develop new products that would improve access to credit and simplify their account opening processes, without compromising the Know-Your-Customer (KYC) requirements,” the guidelines indicated.

    It said that despite the drive for deposits, banks and other financial institutions should continue to apply the principle of KYC as specified in the CBN the Anti-Money Laundering and Counter Financing of Terrorism (AML/CFT) Regulations in Banks and Other Financial Institutions Regulations (BOFIA) Act, 2013. “Financial institutions should not conduct any business with persons/entities who fail to properly identify themselves,” it said.

  • 35,000 Kano farmers to benefit from CBN’s borrower scheme

    35,000 Kano farmers to benefit from CBN’s borrower scheme

    The Kano State Chairman of Rice Farmers Association of Nigeria (RIFAN), Alhaji Abubakar Aliyu, said about 35,000 registered rice farmers would benefit from the Central Bank of Nigeria (CBN) anchor borrower programme.

    The Federal Government introduced the programme to boost rice and wheat production.

    The CBN has earmarked N40 billion from the N220 billion Micro, Small and Medium Enterprises Development Fund for farmers in 12 states participating in the programme at a single-digit interest rate of nine per cent.

    Aliyu said 35,000 fell short of the100,000 farmers initially targeted for the programme.

    “One of the prerequisites for obtaining the loan is that one must register with the association. Secondly, one must open an account with one of the commercial banks,” he explained.

    He said most of the farmers, especially local ones, have no account with any bank, and that this was one of the challenges preventing many farmers from  registering.

    Aliyu said of the 35,000 farmers that had scaled the CBN’s hurdles, 30 per cent are women, 40 per cent youths, while the remaining 30 per cent are elderly persons.

    He said under the programme, each farmer is expected to receive seeds, fertiliser, chemicals and water pump, which represent a total package of N220, 855.

    He explained that after paying for the inputs, the balance of the money would be given to each farmer to enable him or her pay for the labour.

    Aliyu added that each farmer was expected to cultivate one hectare and repay the loan after harvesting the commodity.

    The chairman also said farmers were expected to receive training from extension workers on modern techniques of rice production.

    He said a technical committee on the programme had been constituted with a view to ensuring effective implementation of the programme in the state.

    The committee, which comprised farmers, agro-chemical dealers, state government and CBN officials, had already swung into action to ensure the success of the programme.

    Aliyu said the association had purchased six computer sets and scanners to speed up the registration process.

  • Economics students visit CBN, SEC on excursion

    Students of the Department of Economics in the Faculty of Social Sciences of the Usmanu Danfodiyo University, Sokoto (UDUS), have gone on excursion to Abuja.

    The students under the aegis of Nigerian Economics Students’ Association (NESA) visited the Central Bank of Nigeria (CBN) and Securities and Exchange Commission (SEC).

    The 32 students, who undertook the trip, were lodged at Masi Hotels and Suites Ltd in Wumba Apo. They were accompanied by some of their lecturers, including Mallam M.B. Achida and Mallam Audu Bello.

    At the CBN, the students were received by some officials. At the conference room, Muhammad Muhammad, an official, spoke on Naira depreciation and CBN’s strategy in managing foreign exchange flows.

    The students described the lecture as “interactive” and “educative”, saying it helped them to appreciate their monetary policy course.

    After the session, the students were conducted round the various CBN departments. They were taken to the CBN gallery, where old currency samples, such as cowries, timbers and coins, were on display. They were also taught how they could detect fake currencies.

    At SEC office, the students met with the Deputy Director for Investigation, Abubakar Ambursa, Head of Enforcement, Bello Gwamba,  and Zayyanu Bandiya, who are all alumni of UDUS.

    The students were tutored on capital market, functions of SEC, its vision and its organisational team structure. The session was conducted by Mrs Olayeni Johnson.

    The students were given books and compact discs (CDs) for further reading on the activities of the commission. The students left for the University of Abuja (UNIABUJA) where they visited the Department of Economics on the Gwagalada campus. They had interactive session with lecturers and students before leaving for Sokoto.

    Some of the participants described the trip as educative, saying they would be willing to go again in the coming session.

  • Buhari sends CBN, NNPC, others estimates to Assembly

    Buhari sends CBN, NNPC, others estimates to Assembly

    President Muhammadu Buhari has sent the budgets of agencies and corporations under the Fiscal Responsibility Act, 2007 to the National Assembly for passage.

    In a June 30 letter  addressed to Speaker of the House of Representatives, Hon. Yakubu Dogara,  the President said he was submitting the budgets of 38 agencies and corporations in line with extant laws.

    It is the first time the budget of some of these agencies are being sent for passage.

    Buhari wrote: “Further to the provisions of the Fiscal Responsibility Act, 2007 which provides that the budgets of the Agencies listed in the Act be collated and forwarded to the National Assembly for consideration,  I forward herewith the 2016 budget proposals of the underlisted Agencies for your consideration and passage. “

    The President, praying for an expeditious approval of the budgets of the Agencies and Corporations, said in line with the provisions of the Act, “ budget of the agencies and corporations which have been privatised or otherwise ceased to exist are not included herein.”

    The submitted budgets include those of the Central Bank of Nigeria (CBN), Federal Inland Revenue Service (FIRS),  Nigerian National Petroleum Corporation  (NNPC), Nigerian Ports Authority (NPA), Securities and Exchange Commission (SEC) and National Agency for Food and Drug Administration and Control (NAFDAC).

    Others are: Bureau of Public Enterprises (BPE), National Maritime Authority (NMA), Federal Airport Authority of Nigeria (FAAN), Nigerian Communications Commission (NCC), Nigerian Deposit Insurance Corporation (NDIC), Nigerian Immigration Service (NIS), Federal Housing Authority (FHA), Federal Mortgage Bank of Nigeria (FMBN) and Corporate Affairs Commission (CAC), among others.

    The non-submission of the budgets of these establishments has been a major source of contention between the National Assembly and the Executive over the years.

     

  • Buhari sends budgets of CBN, NNPC, others to NASS

    Buhari sends budgets of CBN, NNPC, others to NASS

    President Muhammadu Buhari on Tuesday sent the budgets of agencies and corporations under the Fiscal Responsibility Act 2007 to the National Assembly.

    In a letter dated June 30, 2016 and addressed to the Speaker of the House of Representatives, Hon. Yakubu Dogara, the President said he was submitting the budget of 38 agencies and corporations in line with extant laws.

    Buhari said: “Further to the provisions of the Fiscal Responsibility Act, 2007 which provides that the budgets of the agencies listed in the Act be collated and forwarded to the National Assembly for consideration, I forward herewith the 2016 budget proposals of the underlisted agencies for your consideration and passage.”

    The President while praying for an expeditious approval of the budgets of the agencies and corporations said that in line with the provisions of the Act, “budget of the agencies and corporations which have been privatized or otherwise ceased to exist are not included herein.”

    The submitted budgets include that of Central Bank of Nigeria (CBN), Federal Inland Revenue Service (FIRS), Nigerian National Petroleum Corporation (NNPC), Nigerian Ports Authority (NPA), Securities and Exchange Commission (SEC) and National Agency for Food and Drug Administration and Control (NAFDAC).

    Others are – Bureau of Public Enterprises (BPE), National Maritime Authority (NMA), Federal Airport Authority of Nigeria (FAAN), Nigerian Communications Commission (NCC), Nigerians Deposit Insurance Corporation (NDIC), Nigerians Immigration Service (NIS), Federal Housing Authority (FHA), Federal Mortgage Bank (FMB) and Corporate Affairs Commission (CAC), amongst others.

  • CBN forex reforms brighten outlook for Lafarge

    Adjustment in the official value of the naira against major international currencies will affect the second quarter results of Lafarge Africa Plc, the company has said.

    According to its latest profit update to the Nigerian Stock Exchange (NSE) at the weekend, the company has a total of $495 million in external borrowing on its book.

    It said the figure comprised debts by UNICEM, one of its operating companies acquired last year.

    Prior to the completion of the LafargeHolcim merger, Lafarge Africa had 53 per cent stake in UNICEM.

    Besides the Southwest where WAPCO Lafarge is the dominant operator with two major factories in Ewekoro and Sagamu, UNICEM is a key supplier to the market in Southsouth.

    The update noted that the company’s  Board of Directors is upbeat about the company’s prospects this year.

    It said: “The impact of the naira adjustment is seen as a one-off event with durable future benefits. With the reform of the interbank forex market boosting the confidence and interest of foreign financial institutions in the Nigerian market, Lafarge Africa Plc is confident it can refinance UNICEM’S $495 loan by the end of 2016, thus making significant savings on interest payments.

    “Lafarge Africa Plc, in June 2016, refinanced the naira component of the company’s debt when it issued a N60 billion bond, the largest in Nigeria’s corporate history.

    “This was seen by analysts as a display of confidence in the company’s fundamentals and generally in the prospect of Nigeria’s construction sector.

    “UNICEM is strategically located in Mfamosing, Calabar, in Cross Rivers State and is a major cement plant in the Southsouth and Southeast.

    “It has a cement capacity of 2.5mm tonnes; Lafarge Africa Plc plans to inaugurate a 2.5m tonnes line during the second half of 2016, which will double UNICEM’s capacity.”