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  • CBN may revalidate some revoked Bureau De Change licences

    CBN may revalidate some revoked Bureau De Change licences

    The Central Bank of Nigeria (CBN) says it may revalidate some Bureau De Change (BDC) operators’ licences revoked over their inability to meet up with the recapitalisation deadline in 2012.

    Mr Olufemi Fabanwo, the Director of Other Financial Institutions and Supervision Department (OFISD), disclosed this yesterday in an interview with the News Agency of Nigeria (NAN) in Lagos.

    He said that the CBN might reconsider allowing the affected bureau de change operators to resume their operations, if they were not found guilty of any offence.

    According to him, the authority may reconsider, reinstate and align the bureau de change operators back into business, if their licences were not supposed to have been revoked.

    “If they have not paid before the deadline, it means that they got their licences under a false pretence and that cannot be revisited.

    “For those that had paid prior to the revocation and there is evidence and proof that they paid, then, the CBN can reconsider their licences,” Fabanwo said.

    The CBN had in January 2013 withdrawn the licences of 236 Bureau de Change operators over their inability to recapitalise to the tune of $250,000.

    The bank, in a circular dated Jan. 11 said that the withdrawal of the licences took effect from January 14. Also the CBN had on Nov. 3, 2010, cancelled the issuance of Class ‘A’ BDC licences, following its review of the two-tier structure of the market.

    The bank said appraisal of the policy initiative revealed gross abuses of the enhanced official funding of Class ‘A’ category of the BDCs and the negation of expected benefits to the economy

    “The CBN has also been inundated with complaints from foreign countries that some Nigerian travellers indulged in cross-border transportation of large sums of foreign currencies in cash,” it said.

    The CBN said that the Class ‘A’ BDCs, whose licences had been withdrawn, were free to apply for Class ‘B’ licences with the attendant privileges by fulfilling the stipulated licensing requirements.

    The Apex bank had on Feb.26, 2009, restructured the BDCs into categories ‘A’ and ‘B’, to further liberalise the foreign exchange market and enhance its efficiency.

     

  • Heritage Bank integrates into NIBSS Instant Pay

    Heritage Bank integrates into NIBSS Instant Pay

    In its commitment to the Central Bank of Nigeria (CBN) cash-less banking initiative and providing quality service to its customers, Heritage Bank Limited has been integrated into the Instant Pay Platform of the Nigeria Interbank Settlement System (NIBSS).

    NIBSS explained that with this development, new and existing customers of the bank can make payment and transfer funds through Point of Sale terminal, Automated Teller Machines (ATMs) across the country, and from any of the bank’s branches and electronic payment platforms.

    NIBSS communicated this development to banks and electronic payment firms saying, “Please be informed that Heritage Bank has been migrated to the Nigeria Instant Payment (NIP) production environment. Kindly accept all upstream transactions from them.”

    Managing Director/Chief Executive, Heritage Bank, Mr. Ifie Sekibo, said the integration reflects confidence in the robust information technology infrastructure and electronic payment platform of the bank.

    He said, “Most banks take quite a long time to integrate into the NIPS platform, but within a very short period of our existence, within two to three months, we have integrated into their system. Our entire payment platforms have been fully integrated. And we are functional, up and running. So for us it is a real ground breaking and record-setting achievement, and it reflects confidence from an e-payment switch like NIBSS.

    “Also it expands our business environment. We are now connected to other e-payment switches, banks, banking platforms. People can now use our internet banking platform to make instant payment for goods and services, make funds transfer to people in other banks, and vice versa. It is a seamless and full integration into the banking and e-payment platforms in the country.”

  • CBN appointments divide Senate

    CBN appointments divide Senate

    The Senate was yesterday divided on the confirmation of the appointment of four non-executive members of the Board of the Central Bank of Nigeria (CBN).

    The division was based on geo-political zone consideration and representation.

    Although those pencilled for confirmation including Muhammad Musa Kafarati (Northeast), Collons Chike Chikeluba (Southeast), Adaba Anthony Adeiza (Northcentral) and Ayuli Jemide (Southsouth) were confirmed, senators insisted that the federal character principle as enshrined in the constitution should be complied with in all appointments.

    Senator Ganiyu Solomon (Lagos West) noted that since the Southwest was not represented on the list of those nominated for appointment, the remaining slot should be reserved for the zone in the interest of equity and fair play.

    But Senator Mohammed Goje (Gombe Central) reminded him that the Accountant-General of the Federation and the Permanent Secretary are members of the board.

    He said the Northeast zone was always forgotten in terms of appointment.

    Goje added that Kafarati appointed from the Northeast is qualified for the position, having served meritoriously in sensitive positions in the past.

    Senator Olufemi Lanlehin (Oyo South) said the Accountant-General and the Permanent Secretary are members of the board due to the positions they hold.

    He submitted that it would be wrong to say that they represent the Southwest in the board since they were not appointed as non-executive members of the board.

    Senate Minority Leader George Akume said qualified people should be appointed to sensitive positions, such as the board of the CBN.

    He noted that in a country populated by professionals, efforts should be made to appoint the best.

    Senator Smart Adeyemi (Kogi West), after observing the trend of the debate, said the way out was for the Senate to amend the CBN Act to accommodate all geo-political zones in appointments.

    He noted that senators struggle to ensure that their geo-political zones are represented in appointment because of favouritism and nepotism, which characterise appointments.

    Adeyemi said everyone knows that those in authority recruit only persons from their areas.

    Senate President David Mark described the debate as “healthy”, adding that senators should speak because they recognise that the day of reckoning would come.

    He said the Senate should ensure that every zone is represented in appointments.

    He noted that there would be no end to the debate.

    The same sentiments occurred in the confirmation of the secretary and members of the Economic and Financial Crimes Commission (EFCC).

    Messrs Michael Ebong, Uwasomba Udochukwu, Emmanuel Ibitolu and Dr. Ismaila Mohammed Dukku were confirmed as members of the EFCC, while Emmanuel Adegboyega Aremo was confirmed as member/secretary of the commission.

    Mark congratulated the appointees and urged them to live up to expectation when they resume duty.

    He told them not to disappoint the committees that screened them, the Senate and Nigerians.

  • Naira pares loss after CBN dollars sale

    Naira pares loss after CBN dollars sale

    The naira pared its biggest loss since September after the Nigerian Central Bank of Nigeria (CBN) sold the most dollars in 20 months at its regular auction yesterday.

    According to Bloomberg report, the CBN sold $500 million, the highest amount since October 12, 2011, according to data on its website. The regulator auctions dollars on Mondays and Wednesdays to support the local currency. Foreign investors were said to exit the country, according to CSL Stockbrokers Ltd., boosting dollar demand that earlier weighed on the naira.

    The currency traded less than 0.1 per cent stronger at N159.38 per dollar, paring its earlier decline of as much as two per cent.

    “The central bank is signaling its willingness to defend the exchange rate amid less favorable external and market conditions,” Samir Gadio, an emerging-markets strategist with Standard Bank Group Ltd.’s London-based unit, said.

    “The pressure on the currency will persist in the absence of foreign capital inflows, and especially if there are further outflows.”

    ”The naira is under pressure from a combination of falling oil production and portfolio outflows as foreign investors adjust their positions in light of Fed comments last week,” Alan Cameron, an analyst with CSL Stockbrokers in London, said.

    Yields on Nigeria’s $500 million Eurobonds due January 2021 rose three basis points, or 0.03 percentage point, to 6.2 per cent. Borrowing costs on local-currency debt due January 2022 fell 15 basis points to 13.85 percent on June 21, according to data compiled by Bloomberg.

  • Proliferation of ATMs favours higher notes, says CBN

    Proliferation of ATMs favours higher notes, says CBN

    The proliferation of Automated Teller Machines (ATMs) is making banks to stock higher naira denomination notes over smaller notes, the Governor of the Central Bank of Nigeria (CBN), has said.

    Speaking at the opening ceremony of the West African Institute for Financial and Economic Management, (WAIFEM)/Currency Research regional workshop on banknotes and currency management in Abuja yesterday, the CBN governor Mallam Sanusi Lamido Sanusi said ATMs have had considerable impact on note design and sharpened the focus for both commercial and central banks.

    “The growing network of ATMs has affected the compositional shift from lower denomination notes to higher denomination notes,” he said. The governor explained that in most cases, “the banks do not find it commercially viable to stock their machines with lower denomination notes because they run out sooner and increase both the capital cost and operating costs. Hence, the demand for higher denomination notes.”

    Sanusi lamented that currency management has become “not only cumbersome with the attendant complex logistical arrangements but also very expensive.”

  • CBN’s intervention strengthens Naira

    The Central Bank of Nigeria (CBN’s) market intervention and dollar inflows from the twice-weekly Wholesale Dutch Auction System (WDAS) helped the naira to regain its positive outlook last week. Consequently, last Friday the Naira gained 0.9 per cent to N159.65 per dollar, putting last week’s gains at 1.9 per cent.

    The banking watchdog sells dollars at auctions on Mondays and Wednesdays to boost the Naira and had last week alone, offered and sold $600 million at auctions. It has offered and sold the same volume over the last three auctions to support the naira.

    Although the naira breached CBN’s three per cent above N155 to a dollar target a fortnight ago, analysts insist the CBN is positioned to stabilise the currency within the three per cent band either side of N155 to a dollar in the short term.

    The Debt Management Office (DMO) raised N20.8 billion this month through three offerings, which were re-openings: four per cent Federal Government of Nigeria April 2015 bond, 15.1 per cent April 2017 bond and 10 per cent July 2030 bond.

    Currency Analyst at Ecobank Nigeria, Olakunle Ezun said although the market demand matched the supply, the pricing reflected investor’s “wait and see attitude” on the naira short term outlook. The stop rates were 12.25 per cent, 13 per cent and 13.5 per cent respectively.

     

    KYC deadline

     

    The CBN extended Know Your Customer (KYC) deadline for Designated Non-Financial Businesses and Professions (DNFBPs) from April 30 2013 to December 31, 2013.

    Its Acting Director, Financial Policy and Regulation, A.O Ikem advised DNFBPs that have not registered with Special Control Unit against Money Laundering (SCUML) to do so before the deadline ends, failing which they would not be allowed to operate such accounts. The CBN said the extension is meant to address some of the challenges encountered by SCUML as a result of the number of persons seeking to enjoy late compliance.

    The CBN had earlier issued a circular, mandating DNFBPs on the need to provide additional KYC requirements to their banks and Other Financial Institutions (OFIs). It said compliance is in line with international best practice against adverse developments resulting from money laundering and financing of terrorism globally.

     

    NDIC

     

    The Nigeria Deposit Insurance Corporation (NDIC) also signed a memorandum of understanding (MoU) with Bank Guarantee Fund of Poland in a move seen as helping both bodies share ideas on regulation.

    NDIC said the move is in line with the mission of the International Association of Deposit Insurers (IADI) to share knowledge and experience in deposit insurance and areas of compliance with core principles of effective deposit insurance practice among its affiliates globally.

    The MoU was signed at the end of the NDIC’s working visit to the Bank of Guarantee Fund of Poland on capacity building, information and experience sharing in key operational areas.

    The statement named such areas to include early warning system, failure resolution, establishment of target fund ratio and implementation of a single customer view system.

    The NDIC delegates comprised the Managing Director and Chief Executive Officer, Umaru Ibrahim and the Executive Director of Operations, Prince Aghatise Erediauwa.

    It said both bodies are members of International Association of Deposit Insurers (IADI) and the President of the Management Board of BGF, Poland, Jerzy Pruski is the current Chair of the Executive Council and President of IADI.

     

    NIBSS

     

    The vision of Nigeria being among the top 20 economies in the world providing efficient e-payment services by the year 2020 will be achieved, the Nigeria Inter-Bank Settlement System (NIBSS) has said.

    NIBSS Executive Director, Business Development, Chritabel Onyejekwe disclosed this at the 13th Card , ATM & Mobile Expo held in Lagos. She said the cash-less banking initiative has recorded huge success and has been able to drastically reduce banks’ operational costs significantly.

    She said NIBSS in collaboration with the CBN, banks and other international partners are committed to the journey of transformation for the e-payment industry via cash-less economy. He said all the parties agree that a lot of work needs to be done at the grassroots.

    She said, SIBS International, a Portuguese firm has been supporting NIBSS in achieving the cash-less objective.

     

    CITN

     

    The Chartered Institute of Taxation of Nigeria (CITN) has elected Mark Anthony Chidolue Dike as its new President. He replaces Asiwaju John Femi Sunday Jegede, his predecessor. Dike was elected at the 21st Annual General Meeting of the Institute.

    A statement signed by CITN Head, Corporate Services, Gbolahan Bilewu, said other elected officers of Council included Teju Somorin as Vice President; C. I. Ede, Deputy Vice President and Adesina Adedayo who returned unopposed as the Treasurer.

    Dike, the Director of Tax Policy in the Federal Inland Revenue Service, is a seasoned tax administrator and chartered accountant. He obtained a Bachelor of Science (B.Sc.) degree in Economics from the University of Ife, (now Obafemi Awolowo University) Ile-Ife, Oyo State.

     

    IFC

     

    The International Finance Corporation (IFC) has estimated that the bankable need for private health institutions within the country is currently worth $3 billion. The global lender also said in a statement that with an available leveraged funding potential of about $1 billion that could be tapped for investment into health.

    This is according to a new Study by the IFC, the private sector arm of the World Bank Group, which is partnering with the Federal Ministry of Health and James Daniel Consulting to organize the Nigerian Healthcare Infrastructure Investment Summit holding this month in the country.

    “This summit targets the private sector in healthcare and aims to showcase the best practices of what works within the private health sector in Nigeria and other countries. The IFC will also be launching her maiden edition of the study, Nigeria Health Market Studies, which details investment opportunities within the Nigerian health sector and how to create value for Nigerian patients through private sector investment.

     

    CIBN/FITC

     

    The Chartered institute of Bankers of Nigeria (CIBN) will be partnering with Financial Institutions Training Centre (FITC) to improve the competency level among bank’s staff.

    In a statement, CIBN said such move would help in bridging skills gaps in the banking and finance industry. The exercise is coming after stakeholders’ engagement with the FITC led by CIBN’ President/Chairman of Council, Segun Aina.

    He noted that the engagement was part of familiarisation and bridge-building efforts to dialogue with major stakeholders in the sector. He observed that the industry was so large and replete with many value adding opportunities such that there was room for the each of the two organiSations to make its own impact without any hindrance. He called for collaboration and cooperation between the CIBN and FITC in areas of common goals and interest.

     

    Investment

     

    Actis, a private-equity company, will lead investment of as much as $1.5 billion in African commercial property to meet rising demand from international companies targeting a growing middle class, Bloomberg report had said.

    “We are seeing a shift in interest from South African brands to European retailers” seeking opportunities in fast-growing economies such as Nigeria, Ghana and Kenya, Kevin Teeroovengadum, director of Actis’ sub-Saharan Africa real estate unit, said.

    Actis, which is based in London, plans to invest in projects including shopping centers, office towers and industrial parks that will come to fruition over the next five years, Teeroovengadum said. The company will use the proceeds of its second African real estate fund that raised $280 million in October, while the rest of the investment will come from commercial partners and loans.

    Africa’s economy, excluding Libya and Somalia, is forecast to expand 4.5 per cent in 2013 and 5.2 per cent next year amid a rise in oil and mining projects and direct investment from foreign companies, according to the Tunis-based African Development Bank’s annual outlook. Nigeria, the continent’s most populous country, grew 6.6 percent in the first quarter while South Africa, the continent’s biggest economy, expanded by an annualized 0.9 percent.

    Actis has raised about $1.4 billion across seven Africa funds since 2003, according to data compiled by Bloomberg. The company is also pursuing deals in South America and Southeast Asia in sectors including energy and technology.

    Bank to bank report

     

    Mainstreet Bank Limited released its group financial result for the year ended 31 December 2012, which saw the bank’s profit before tax (PAT) hitting N24.1 billion during the period.

    The lender is one of the bridge banks that emerged on August 5, 2011 following the takeover by the Nigeria Deposit Insurance Corporation (NDIC) of the defunct Afribank Plc and its subsequent recapitalisation and ownership by the Asset Management Corporation of Nigeria (AMCON).

    A statement issued by the bank said the result rekindled hope across the industry especially amongst customers, financial analysts and investors who had expressed mixed feelings on the ability of AMCON to stabilise the nation’s financial system after taking over some banks under the bridge model.

    “The declared result, showed a marked improvement in all key financial indices especially given the bank’s loss position of N4.4 billion within the five-month period it operated as at December 2011. The figures from the result also show that the bank grew its gross earnings to N47.9 billion within the period under review,” it said.

    United Bank for Africa (UBA) Plc has been named the best bank in support of agriculture in the country. In a statement, the bank said it got the recognition following its contribution to the growth of the agricultural sector and value addition to the economy.

    UBA clinched the award at the maiden edition of BusinessDay Annual Banking Awards, which held recently in Lagos.

    According to statistics, UBA tops the Central Bank of Nigeria’s (CBN’s) list of lenders to the agricultural sector. By 2012 financial year end, the lender had channeled seven per cent of its N687 billion loan book to agriculture. This is the highest exposure of any bank in Nigeria and invariably places the bank as one of the strongest supporters of agriculture in Nigeria.

    Divisional Head, Consumer Banking, UBA Plc, Mr. Ilesanmi Owoeye, received the award on behalf of the bank.

    Diamond Bank said it had broken a new campaign to claim its position as one of the leading financial institutions in Nigeria. In a statement, the bank said the launch follows a successful brand refresh in November 2012 where the brand saw changes in its colours moving away from the monosyllabic greys and dark tones to more vibrant colours. It said the motive was to make the brand more approachable in line with its positioning as one of the leading retail bank in Nigeria.

    Diamond Bank’s new media campaign “you need a new bank,” reminds customers of the power of choice especially when it comes to choosing a bank. As customers are becoming more discerning of banking products and services, the bank is putting a stake in the ground- armed with a portfolio of products and technology to produce faster and more efficient services, the question becomes ”why do you stay with a bank that does not meet your needs?” said Ayona Trimnell, the bank’s Head Corporate Communications.

     

     

     

     

  • CBN governor seeks investment in rice production

    CBN governor seeks investment in rice production

    The Governor of Central Bank of Nigeria, Sanusi Lamido Sanusi, has advised that the N365 billion set aside for rice importation annually should be invested in massive rice production.

    Sanusi made the remark at a lecture titled: “Exploring Central Bank of Nigeria’s special intervention in agriculture for the transformation of Nupeland.”

    The News Agency of Nigeria (NAN) reports that the lecture was held at the IBB University in Lapai, Niger to mark the Nupe Day celebrations on Friday.

    The governor, who was represented by the bank’s Director of Development Financing, Mr. Paul Nduka, decried low funding of the agricultural sector in the country.

    He said there were lots of funding packages initiated by the bank to encourage agriculture, saying the low budgetary allocation for agriculture was not good enough.

    Sanusi said gross under-funding and low budgeting for the agric sector was contrary to the Maputo declaration which set 10 per cent of budget for agric sector.

    “Gross under-funding has also been the bane of the agricultural sector and posed a major challenge.

    “The allocation to the sector of less than four percent of the federal budget since 2006 is not appropriate.

    “It is contrary to the 2003 African Union (AU) Maputo Declaration which directed member-countries to increase investment in the agricultural sector to at least 10 per cent of the national budget,’’ he said.

     

     

  • CBN on religious bodies’ accounts

    CBN on religious bodies’ accounts

    The Central Bank of Nigeria (CBN) has refuted reports that it had ordered the freezing of the accounts of some religious organisations, citing alleged suspicion of links with terrorist groups.

    In a statement posted on its website, the banking watchdog said it had not ordered the closure or freezing of the bank account of any religious body or any institution.

    It explained that prior to 2006, Nigeria was on the list of the Non-Cooperating Countries and Territories (NCCTs) of the Financial Action Task Force (FATF), a global watchdog on financial crimes.

    The country was removed from the list on account of stringent actions taken by the Federal Government.

  • Experts back CBN directives on off-shore branches

    The decision of the Central Bank of Nigeria (CBN) to re-strain banks from using local funds to finance their off-shore subsidiaries will help in protecting depositors, experts have said.

    The former director, Banking Supervision, CBN, Mr Titus Okunronmu, said the apex bank stopped banks against taking such funds abroad for investments to protect depositors.

    He said depositors had lost huge funds to the liquidation of banks, arguing that the apex bank does not want a recurrence. He said the ideal thing is for banks to make money where they are operating and not to repatriate funds generated locally to international markets.

    The moment Nigerian banks start complying with the corporate governance issues of their host countries, they would survive offshore, he said.

    According to him, depositors are crucial to the growth of the industry and any attempt to gamble with their money would have dire consequences.

    He said it would amount to uncalculated risks if banks use local funds to finance foreign subsidiaries, stressing that CBN has taken a good decision. He said banks have demonstrated capacity to succeed by taking some proactive measures, adding that such efforts would improve the economy.

    Former President, Association of National Accountants of Nigeria (ANAN) Dr Samuel Nzekwe cautioned banks against flouting rules relating to raising funds at the international market.

    He said if banks got cheap funds, the tendency to mismanage the cash would be, adding that depositors’ fund are cheap money because banks do not pay special interest on them. He advised them to raise money for investments in countries where they operate subsidiaries.

    Chief Executive Officer, Dunn Loren Merrifield, Mr Sonnie Ayere, said the CBN directive was to prevent banks from using local funds to fund offshore operations.

    “While we cannot blame CBN for warning banks against using the local funds to finance offshore subsidiaries, it is pertinent that the apex bank monitor the banks well to avoid crises,” he said.

    He added: “What CBN is saying is that banks should CBN raise the money in international markets to finance their subsidiaries. Raising capital is a task in the country. If for instance, bank A or B has taken most of its capital abroad, this implies that the bank must raise fresh capital to make its balance sheets look good. To avoid immediate and future problem, CBN has directly puts a safety valve on depositor’s money by issuing the directive.”

     

  • CBN insists on polymer notes’ phase out

    CBN insists on polymer notes’ phase out

    The Central Bank of Nigeria (CBN) on Monday reiterated its decision to change some naira notes from polymer to paper.

    The Head of Corporate Communications Department of CBN, Mr. Ugochukwu Okoroafor, however, told the News Agency of Nigeria (NAN) in Lagos that the change would be gradual.

    NAN recalls that the Deputy Governor of CBN, Mr. Tunde Lemo, on April 2013, in Washington, said there were plans to withdraw the polymer notes.

    Okoroafor said that there was no fixed date for the change, but the apex bank would complete the phase-out before December 2013.

    “We will print all the paper notes here in Nigeria as usual, but it is only when we have cash in hand that we will print the naira notes abroad.

    “It depends on the volume the CBN intends to produce. Our hope is to print everything here in Nigeria, “ he said.

    Okoroafor said the change became necessary because of the challenges associated with the use of polymer notes.

    He said that one of the challenges was the fading of the polymer notes and the high cost of printing.

    Okoroafor said that in spite of the CBN’s plan to print paper notes, the bank would not relent in its effort to ensure that the cashless policy was effective.