The Nation Newspaper

Tag: cbn

  • How shipping companies, terminal operators milk Nigerians

    Shipping companies and terminal operators are making several billions of naira yearly at the nation’s seaports from storage charges they have unilaterally imposed on importers, The Nation has learnt.

    The charges are in respect of rates importers are forced to pay on weekends and public holidays that the shipping companies are not opened for business.

    Speaking at the official opening of their secretariat at Tin-Can Island port, Lagos, the Association of Nigeria Licensed Customs Agents’ (ANLCA) Chairman,  Prince Kayode Oyinlola, berated the shipping companies and terminal operators for collecting excessive money for services not rendered.

    He  bemoaned the amount deducted from their container deposits while their trucks are waiting to discharge empty containers because of lack of holding bays in most of the terminals.

    Police, quarantine and other agencies, he alleged, impede the government’s trade facilitation programme by blocking the release of containers through frivolous excuses.

    Oyinlola said: “These issues are not exhaustive, but are enough to catalyse us into action to recue our members from unwarranted hardship.”

    e high tariffs charged at our home ports.

    The importers also alleged that it takes terminal operators more than three days to position their containers after they have requested for them.

    The spokesman for the importers, Johnson Eromosele, alleged that the terminal operators have also consistently asked them to pay storage charge even when the operators fail to position their containers for examination.

    The amount they pay, Johnson said,  most of the time, is  inflated, adding that most of the terminals at the Lagos ports,  do not have suitable examination bays,  where all containers confirmed for examination by the Nigeria Customs Service can be positioned.

    The importers are furious that the terminal operators cause undue      delays in the clearing process, resulting in increased port charges which over time erode their gains and customer confidence.

    Findings also revealed that when a consignee submits all the necessary documents to some of the terminal operators and makes request for an invoice to enable the clearing process, the invoices are sometimes delayed till the following day before they were issued.

    This delay, the importers claim, gives rooms to the shipping companies and terminal operators to milk Nigerians.

    “When the importer, clearing agent, or the truck driver presents a Terminal Delivery Order (TDO) to the terminal operators, most of the time, they find it difficult to locate the container, thus causing undue delay and still , they go ahead to demand for storage fees,” Johnson said.

    Investigation however  revealed that the terminal operators have unilaterally increased the storage charge in violation of the last approval given by the Federal Government through the Minister of Transport on May1, 2009.

    Sources at the Federal Ministry of Transport said in the said approval, “it was emphasised that the rates are the absolute maximum any terminal operator is allowed to charge, and under no circumstances shall any of the operators charge an importer any amount higher than the rates approved by the government. But the terminal operators have since embarked on progressive increases in the storage charge thus violating the government’s order.”

    The Federal Government, through the Nigerian Shippers’ Council, the official said, has directed all shipping companies and shipping agents to ensure the refund of container deposit fees within 10 days after the empty container has been returned to the terminal.

    “Failure will attract interest on the outstanding amount of deposit at the Central Bank of Nigeria (CBN) prevailing commercial rate until refund is made,”  he said.

    Findings revealed that more than 35 per cent of container deposits collected for shipping companies by terminal operators are not refunded despite the efforts by importers and their agents  to return empty containers on time and in good condition.

    To resolve the issues, the Federal Government, a source said, has ordered joint examination of the condition of containers before the truck drivers will move them out of the port and when it is returned, so that nobody will use it to exploit the importers.

    The terminal operators and the shipping companies, it was learnt, also feed fat on the importers because of endemic traffic situation in Apapa and Tin-Can Island ports.

    The Federal Government, through the Nigerian Shippers’ Council, it was learnt, has pegged fees paid for container cleaning and maintenance to N1, 500, while the free period prior to payment of demurrage has been increased from five days to 10, in line with sub-regional and international practices.

    Before the recent move by the government, Nigerian port had five demurrage-free days, Ghana, eight days, while Benin Republic, has 10 days.

    The Seaport Terminal Operators Association of Nigeria (STOAN), it was learnt, is not happy with the reversal in the storage charges and it has gone court to seek redress.

  • NITP set to eliminate quacks, unethical practices

    NITP set to eliminate quacks, unethical practices

    The Nigerian Institute of Town Planners (NITP) has stated that it will wield the big stick on any member for unprofessional practice. This was made known by the Institute at its 45th Annual Conference and General Meeting. The body also used the occasion to induct 115 new town planners into its fold.

    The immediate past president of the institute, Mr Steve Onu, also used the occasion to make a charge on his colleagues to eschew unprofessional acts which he said were capable of tarnishing not only their reputation but that of other professionals as well.

    “It doesn’t matter whether you got into this profession by accident, I also did too, but still I was able to rise to the position of the National President. Therefore, the sky is your limit, and as long as you professionalise and internalise what you’ve learnt, you will also make a success of this profession,” he declared.

    Other town planners at the event also called on the new professionals to choose the path of integrity, and keep at arms’ length any negative tendency and desperation for instant gratification.

    Onu listed some of the basic ‘ingredients’ that will help produce a successful town planner to include integrity, fairness, delayed gratification, professionalism, commitment to duty, not giving room for intimidation, especially from other professionals in the built environment, among others.

    In the meantime, when reeling out some of his programmes for the new administration, the new National President, Mr Olomola, said his administration would be working towards improving job creation for town planners, especially by working with the Central Bank of Nigeria (CBN) for the introduction of Land Use Planning Report, which he said the apex bank would be expected to buy into with a view to making it a condition for the opening of any corporate accounts. He said the report would also prove useful in the processing and eventual issuance of C-of-Os for lands.

    He also added that his administration would also work towards completing and putting into good use, the institute’s assets – the Franklin Akinyemi and the Iba Buhari House – in Lagos and Abuja, respectively, among other ideas, which he believes, will help to move the institute forward.

    The AGM also saw to the election of new leaders who will be expected to hold key offices in the institution over the next two years.

     

  • CBN denies selling MSMEDF loans form

    CBN denies selling MSMEDF loans form

    The Central Bank of Nigeria (CBN) has denied claims that it is selling application forms for applicants for loans from the N220 billion Micro, Small and Medium Enterprises (MSMEs) Development Fund provided by the bank.

    A statement from the bank signed by Ibrahim Mu’azu, Director, Corporate Communications Department said that “that some unscrupulous persons are defrauding unsuspecting members of the public by selling application forms purportedly from the CBN for the purpose of accessing loans from the N220 billion Micro, Small and Medium Enterprises (MSMEs) Development Fund provided by the Bank.”

    He said “reports reaching the CBN indicate that these dishonest elements extort between N2,000 and N40,000 from their victims by asking them to pay the said sums for forms as a pre-condition and/or guarantee for securing loans from the Fund.”

    The fraudsters he added “are also reported to be asking would-be borrowers to contribute into a dedicated account certain sums as percentages of the loan they intend to access.”

    The Central Bank of Nigeria, the spokesman said, did not authorize or appoint any agent to sell forms or collect any fee to access the Fund.

    According to him, “THE ONLY FORM AVAILABLE UNDER THE FUND IS THE FORM TO BE FILLED BY PARTICIPATING FINANCIAL INSTITUTIONS (PFIs) – Microfinance Banks, Non-Bank Microfinance Institutions, Financial Cooperatives, Finance Companies, Commercial Banks, Bank of Industry and Bank of Agriculture – to enable them access the Fund and IT IS FREE.”

    The Public was advised to beware of the activities of fraudsters and report anyone that approaches them with the fake forms to the law enforcement agencies.

  • CBN settles N20b ATM disputes

    CBN settles N20b ATM disputes

    The Central Bank of Nigeria (CBN) yesterday said it has resolved disputes worth N20billion that arose between deposit money banks (DMBs) and their customers across the country, adding that it has done well so far at putting measures in place to check frauds in the banking industry.

    Its Head, Payment Systems and Oversight, Musa Itopa Jimoh who spoke during a training programme organised by the E-Payment Providers Association of Nigeria (E-PPAN) for information communications technology (ICT) reporters in Lagos, said though there are challenges on the way, the achievements so far recorded by the apex bank in the area of putting in place dependable payment platforms far outweighs these challenges.

    He said complaints received from bank customers by the apex bank are usually treated diligently, adding that this has led to the resolution of customers’ complaints in relation to the use of ATM which financial value he put at N20 billion.

    Director, Banking & Payments System Department at CBN, ‘Dipo Fatokun who made presentation on Understanding the Policy of e-Payments in Nigeria, said payments system is the entire arrangement of instruments, procedures, regulations and laws governing institutions, inter-connected networks of hardware/software and communications technology facilitating transfer of monetary value between transacting parties.

    He identified the e-payments objectives of the apex bank to include elimination of delays in the payment process; enabling the processing of payments on-line real time; minimising people interaction (contractors and government officials), adding that this means less human interaction with the system value chain.

    “It improves controls and supervision. The relevant systems control is embedded, audit trail of transactions maintained for ease of oversight/supervision; improves process efficiency and effectiveness and allows for Straight Through Processing (STP) of eligible transactions,” Fatokun said.

    According to him, some of the scope of the initiative covers government supplier payments; person–to-person payment (mobile phone); salary and pension payments  for organisations with more than 50 employees; consumer bills payments (using ACH debits); e-collection of taxes at all levels of government (individual, company – taxes includes value added tax (VAT), withholding tax and others.

    Some of the recent developments on e-payment scheme, he said, are the licensing of Mobile Money Operators (MMOs); licensing of payments Terminal Service Providers; licensing of Switches/Processors; creation of Payments System Policy and Oversight Office (PSPO) to monitor compliance with the various guidelines and standards; and Payment Card Industry Data Security Standard (PCIDSS) requirements

    He identified economic constrains and cash culture, public acceptance of innovations, admissibility of electronic evidence in court and infrastructure (power, communication, roads and other means of transportations); network connectivity, arising from Nigeria Interbank Settlement System (NIBSS), switches, banks and telcos; and unavailability of financial services 24/7 in remote locations as some of the challenges facing the initiative.

  • CBN urges bank directors on corporate governance

    CBN urges bank directors on corporate governance

    The Central Bank of Nigeria (CBN) has urged bank directors on the need to imbibe sound corporate governance practices to sustain the stability of the banking sector.

    Its Deputy Governor Financial System Stability, Dr. Kingsley Moghalu, who spoke at the Financial Institutions Training Centre (FITC) 2014 Continuous Education Programme for Directors of Banks and Other Financial Institutions in Lagos, said the level of corporate governance in banks can sometimes reflect the culture of governance in the system.

    Speaking on the theme: ‘Enhancing Board Effectiveness for Enduring Quality of Banks’, he explained that in the advanced countries, the level of corporate governance in the banks before the global financial crisis was an extension of the larger governance culture in those countries.

    The banks, he said, were seen as private and profit making institutions and so the values of capitalism drove those institutions to the extreme and many of them collapsed.

    “This is what we have to avoid; and the responsibility is on you as bank directors. We do not want the privatisation of profits and socialisation of losses. You don’t run your bank well and when it is about to collapse, you start looking for CBN for accommodation.

    “The CBN under the previous administration reached a decision that no banks will be allowed to fail again. And it was a good decision. This was because; this country has gone through a very scarring and scary history of failed bank failures.

    “People have lost fortunes and as a result lost complete trust in the banks. But let’s not make it a habit. That is what I am saying. Going forward, do not count on the CBN, if you don’t run your banks well.”

    Moghalu said effective corporate governance stemming from good risk governance is critical to stable financial system.

    He said the global financial crisis would have been averted if there were effective risk and corporate governance practice in the financial system.

    He said: “Many of the bank directors don’t govern effectively the management of risks. If bank failure had not occurred, all those collateralised debt obligations and structured investment vehicles and other financial engineering which was an increase in the multiples of all the risks banks were taking, would not have taken place.

    “There are questions. And those who should be asking those questions are boards of directors of banks. So we believe that the failure of corporate governance, especially the failure of risk governance was a major cause of the global financial crisis.

    “Corporate governance is not just about compliance, it is about governing to create value, governing to build enduring institutions. Corporate governance is a key factor in financial systems. However in an environment like Nigeria, it is even more critical because it is bound up in a number of wide cultural issues.

    “It is also bound up in a number of wider governance issues. It is the same as public governance. This is because, to make impact, you have to have the same issues of integrity, ethics, avoiding conflict of interest, respecting processes and avoiding insider dealing. All these things are requirements for corporate governance.”

    FITC Managing Director/ Chief Executive Officer of FITC, Dr. Lucy Newman said the event was organised to take stock of the institutes’ journey since it was established 30 years ago.

    FITC used the opportunity to recognize its past leaders, strategic partners and high volume nominating institutions, frequently trained directors among others.

  • Court hears contempt suit against CBN directors tomorrow

    The Federal High Court in Laos will hear a contempt charge against three Central Bank of Nigeria (CBN) directors tomorrow.

    CBN pensioners, represented by James Jemilo, Thompson Edun, Jacob Amao, and Joachim Ajala are praying the court to commit the directors to prison for allegedly flouting a judgment.

    The alleged contemnors are CBN Deputy Governor, Corporate Services, Alhaji Suleiman Barau; Director Human Resources Ms Chizoba Mojekwu, and Director of Legal Services, Mr Simon Onekutu.

    The plaintiffs are also praying the court to compel CBN to comply with the Federal Government’s directive on pension harmonisation.

    The suit was earlier fixed for hearing on October 6, but was adjourned because the day fell on a holiday.

    The CBN directors have objected to the suit. Their preliminary objection will be heard on the next adjourned date.

    The plaintiffs had averred that the harmonisation policy was introduced in the public service with effect from Jan. 1, 1997.

    “The policy was designed to eliminate the disparities in the pensions of workers who retired on the same grade, with those who served the same number of years but retired at different times” they averred

    According to them, following CBN’s alleged failure to comply with the policy, they filed suit number FHC/L/CS524/99 before a Federal High Court in Lagos, seeking an order compelling it to abide by the directive.

    The CBN had however, in its defence, said that it could only pay the harmonised pension, subject to “affordability and sustainability” of pension funds.

    Meanwhile, in a judgment delivered on May 22, 2000, the court, presided by Justice Wilson Egbo-Egbo, (now retired), granted the pensioners’s prayers.

    Egbo-Egbo had directed CBN to pay the applicants all accrued pensions with effect from January 1 1997, on emoluments currently earned by their serving counterparts.

    The judge held that this was as prescribed by the Federal Government’s policy on harmonisation of pensions, adding that such accrued pensions were to be paid subsequently, as and when due.

    Dissatisfied with the judgment, CBN had appealed at the Court of Appeal, and later the Supreme Court. Both appellate courts affirmed the lower court’s decision on December 5, 2006, and May 21, 2010 respectively.

  • CBN cuts banks’ foreign currency borrowing limits

    CBN cuts banks’ foreign currency borrowing limits

    The Central Bank Nigeria (CBN) yesterday cut banks’ foreign lines of credit and issuance of foreign currency denominated bonds (Eurobonds) to 75 per cent of shareholders’ funds unimpaired by losses.
    CBN Director, Banking Supervision, Mrs. Tokunbo Martins who unveiled the new policy, said the 75 per cent limit, supersedes the 200 per cent specified in Section six of the apex bank’s Guidelines for Foreign Borrowing for on-Lending by Nigerian Banks issued on November 26, 2001.
    The policy change which was issued in a circular to all banks with theme: ‘Prudential Regulation for the Management of Foreign Exchange Risks,” noted with concern, the growth in foreign currency borrowings of banks.
    She said the lower interest rate on foreign debt has created an incentive for banks to borrow abroad, stating that this has the advantage of providing fairly stable and long term funds to extend credit facilities in foreign currency and enhancing their capital base.
    However, this also exposes banks to foreign exchange risks and other risks, she said, adding that the new policy, is to ensure that these risks are well managed and avoid losses that could pose material systemic challenges.
    She said: “ Henceforth, the aggregate foreign currency borrowing of a bank, excluding inter-group and inter-bank (Nigerian banks) borrowing, should not exceed 75 per cent of its shareholders’ funds unimpaired by losses.”
    She explained that the Net Open Position (NOP, long or short) of the overall foreign currency assets and liabilities, taking into cognisance both those on and off-balance sheet, should not exceed 20 per cent of shareholders’ funds unimpaired by losses using the Gross Aggregate Method.
    The circular said that “banks whose current NOP exceed 20 per cent of their shareholders’ funds are required to bring them to prudential limit within six months. The current NOP limit of one per cent of shareholders’ funds has been renamed as Foreign Currency Trading Position. This will continue to subsist in line with guidelines issued by the CBN.”
    She said lenders are also required to have adequate stock of high-quality liquid foreign assets, such as cash and government securities in each significant currency to cover their maturing foreign currency obligations. In addition, banks should have in place a foreign exchange contingency funding arrangement with other financial institutions.
    The policy also stipulates that banks should borrow and lend in the same currency (natural hedging) to avoid currency mismatch associated with foreign currency risk.

  • CBN vows to defend naira

    CBN vows to defend naira

    The central bank of Nigeria (CBN)has pledged to keep supporting the naira after the currency approached a record low amid declining oil prices.

    “We will continue to defend the naira,”  CBN Deputy Governor, Economic Policy, Dr. Sarah Alade told Bloomberg. “Yesterday, we saw the naira at a level we were not comfortable with. We increased dollar supply in the market and it calmed.”

    Since mid-September, the CBN has used foreign reserves to sell dollars outside of regular auctions held Mondays and Wednesdays, according to Standard Chartered Plc.

    It will keep using the auctions and direct dollar sales to banks to preserve the value of the currency, Alade said. The currency strengthened 0.2 per cent to 164.90 per dollar. It earlier weakened as much as 0.8 per cent to 166.42, a record low on a closing basis.

    The naira weakened 0.9 per cent this month as Brent crude fell to the lowest level in more than four years last week. Further losses would force Nigeria to choose between raising interest rates, eroding reserves or, eventually, devaluing the currency, according to Exotix Ltd., a London-based investment bank. The Federal Reserve is poised to end a program this month of asset-buying that drove investors to buy stocks, bonds and currencies in developing nations.

    The currency yesterday weakened as much as 0.4 per cent to 166.07 before rebounding. At auctions, the central bank offers the currency at 155 per dollar, plus or minus 3 percent.

    “We expect that investors will demand more dollars,” Alade said. “Our foreign-exchange reserves are still robust.”

    Nigeria’s reserves were $39.2 billion as of Oct. 21 from $43.6 billion at the end of last year. “The central bank has staked its credibility as an institution on the stability of the currency,” Bryan Carter, money manager at Boston-based Acadian Asset Management, said in an interview yesterday in London.

  • Kogi, CBN sign N2b MoU for agriculture

    Kogi State government  has signed a N2 billion Memorandum of Understanding (MoU) with the Central Bank of Nigeria (CBN) for agriculture.

    Governor Idris Wada said this at the opening of a four-day-training for cashew farmers in Anyigba, Dekina Local Government Area.

    He said the government has provided the will for farmers to succeed, adding that the N2 billion would be spread across agricultural areas where the state had comparative advantage.

    Wada, who was represented by the Commissioner for Agriculture, Zacchaeus Atte, said N300 million would be voted for cashew farmers.

    The President, National Cashew Association of Nigeria (NCAN), Mr. Tola Fasheru, urged  the  governments to provide incentives for cashew farmers.

    In  another  vein, Faseru, said   Nigerian cashew is becoming one of the best in the world as it  reached consistently 51Lbs and 52Lbs/ 80kg, with nut count around 180-185 per kg as the intensive training in good farming practices, harvest and post harvest handling practices  conducted for farmers and local buying agents and  produce inspection officers are beginning to pay off.

    According  to him,  efforts are also being put in place to provide infrastructure such  as storage facilities and drying platforms for  farmers.

    Faseru  noted  that  farmers are being trained on how they can conduct quality test for their cashew particularly with respect to moisture,out turn and the nut count. All of these, he  added,  are geared towards achieving increased cashew productivity and quality.

    Currently, he  noted   that  the  annual production for the raw cashew nuts is put at 125,000 metric tonnes valued at N24 billion  ($160,000,000).

    He  said the  sector has the potential for an annual output of about $2 billion  within the next five years.

    Already at the moment, he  said   the cashew industry  provides livelihood for over 300,000 families directly employing over 600,000 people.

    He  noted  that  efforts are ongoing to increase the level of processing and value addition to  cashew nuts and cashew apple for  local consumption and export to the international market.

    Faseru  said  an increase in the volume of the cashew being produced would impact directly on the jobs being created and this would in turn impact positively on the economy of the cashew producing states.

     

  • CBN denies activists’ allegation

    The Central Bank of Nigeria (CBN) has denied allegations that people are using the apex bank to fund the activities of the Boko Haram sect.

    The apex bank’s denial was in a letter, dated October 16, to a rights group, the Socio-Economic Rights and Accountability Project (SERAP). It was signed by O. A. Ogundana on behalf of the Director, Legal Services Department of the apex bank.

    It reads: “We write to acknowledge the receipt of your letter dated September 15, 2014 on the subject: ‘Request to Provide Information About Alleged Money Laundering to Boko Haram Through the Bank’.

    “In your letter you had requested from the CBN information about persons or office involved in alleged money laundering activities of the Boko Haram through the CBN; and information on the exact nature and duration of any such transactions.”