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  • CBN to bank chiefs: don’t allow politicians launder money

    • MPC keeps interest rate at 14%

    As the 2019 elections approach and political maneuvering intensify, the Central Bank of Nigeria (CBN) has warned Deposit Money Banks (DMBs) to be careful not to violate the  money laundering Act.

    Banks that violate the Act in the guise of handling money for politicians,  the apex bank warned, risk  stiff penalty. CBN Governor Godwin Emefiele gave the warning yesterday at the end of the Monetary Policy Committee (MPC) meeting in Abuja.

    The apex bank held its key interest rate at a record high level as it sees inflationary pressures persisting even as prices are becoming more stable.

    The MPC maintained the benchmark rate at 14 per cent.

    Read also: $8.1b: CBN, MTN on verge of striking deal

    Emefiele told reporters that the CBN’s position and warning was handed down to the DMBs Chief Executives at a recent meeting to intimate them of the dangers they may be exposed to as a result of the activities of politicians.

    He said: “On the 2019 elections, we had a meeting with the banks. We advised them to be very careful of money laundry issues. If they are caught, they will be heavily penalised. But banks have their rules and criteria; I don’t think banks will do anything that will violate the rules. When they go wrong, we will deal with them.

    “When you say banks lending to politicians, banks have their acceptance criteria and I don’t think that the banks will do that at this time. Everybody must have learnt their lessons and I believe that the right thing for everybody is to conduct their businesses carefully. But we as central bank, we are staying behind and watching to make sure that when things go wrong or about to go wrong we will deal with it appropriately.”

     

  • $8.1b: CBN, MTN on verge of striking deal

    The Central Bank of Nigeria (CBN) is on the verge of an agreement over a $8.1 billion dispute with South African telecoms gaint MTN, its governor Godwin Emefiele said yesterday, declining to provide further details.

    In August, the apex  bank ordered MTN and its banks to bring $8.134 billion back into Nigeria, sending the company’s shares plummeting. The regulator alleged the firm had sent the funds abroad in breach of local foreign exchange (forex) regulations.

    “We have held meetings with the MTN Group from South Africa and we are at the verge of announcing the resolution. I am very certain that we have reached the end of the road on this issue, and I will continue to say that the sanctity of the Certificate of Capital Importation (CCI) issued by our banks remain sacrosanct,” Emefiele said.

    Aside the $8.1billion the telco allegedly ferried out of the country in breach of local forex rules, the Office of the Attorney-General of the Federation had also issued a demmand notice of $2billion allegedly to be tax debt over a period.

    MTN was not immediately available for comment, had however strongly rejected doing any wrong in both instances and had dragged the Federal Government to court over the allegations.

    Read also: CBN probes bank customers’ enrolment in BVN

    Emefiels said the telco had submitted documents making the impending agreement possible, and that no other firm or person is being investigated for similar issues.

    MTN’s latest troubles come about two years after it agreed to pay more than $1 billion to settle a dispute over subscriber identity module (SIM) cards in Nigeria, whose finances have been hit by a weak economy and volatile global oil prices.

    Nigeria, which accounts for a third of MTN’s annual core profit, making it MTN’s biggest market.

    MTN’s lenders – Standard Chartered, Stanbic IBTC Bank, Citibank and Diamond Bank – were also fined in connection to the money transfer.

  • CBN probes bank customers’ enrolment in BVN

    •MPC keeps interest rate at 14% 

    The Central Bank of Nigeria (CBN) is probing banks’ enrollment of their customers in the Bank Verification (BVN) platform to ensure the integrity of the process, The Nation learnt yesterday.

    The BVN gives a unique identity across the banking industry to each customer of Nigerian banks. But many banks are breaching the BVN enrolment process.

    In some cases, customers BVNs are attached to wrong accounts due to improper validation. The practice, if not addressed, could present serious identity crisis in the financial system.

    Besides, some banks are not submitting names of their customers identified through their BVNs to be involved in suspected fraudulent activities to the apex bank as required by regulation.

    The CBN had directed banks to establish a database of their customers identified through their BVNs to be involved in confirmed fraudulent activities.

    The directive is contained in the Regulatory Framework for BVN Operation and Watch-list for Nigerian Financial System released by the CBN. The framework is in exercise of the powers conferred on the CBN, by Sections 2 (d) and 47 (2), of the CBN Act, 2007, to promote the development of efficient and effective payments systems for the settlement of transactions.

    The watch-list comprises a database of bank customers’ identified by their BVNs, who have been involved in confirmed fraudulent activity in the banking industry.

    Confirming the development, Principal Manager, Banking and Payment System Department of the CBN, Olubukola Akinwunmi, said identity theft is a serious challenge that needed to be tackled in the industry and needs the collaboration of all stakeholders.

    He said the apex bank is currently auditing the BVN process in banks ‘to ensure system integrity’.

    According to him, banks were aware of the ongoing audit exercise and that at the right time, sanctions will apply to culpable lenders.

    AkinwunmI, who represented CBN Director, Banking Service Department, ‘Dipo Fatokun, at the Access Bank Anti-Fraud Week Stakeholders’ workshop held in Lagos, spoke yesterday.

    On how banks are culpable in identity theft, he said: “I think the clarity I want to give to this is that banks have the responsibility to enroll their customers. And they also have the responsibility to ensure that when a customer comes to enroll on the BVN platform, they do the necessary verification for that exercise. Those are areas banks need to improve on their controls to ensure that appropriate steps are taken and customers are properly validated before they get the BVN.

    On BVNs not matching account holders, he said: “That is something that banks are in charge of reviewing their accounts regularly and ensuring that their data is clean. So, it is a regular  cleansing activity that banks do.

    “The banks have really done so well in terms of collaboration. We have the industry fraud desk on collaborating to address issues of fraud especially those related to identity theft, internet fraud and all that.

    “The CBN is tackling the issue of identity theft seriously. In the industry, collaboration is the key word. No single individual or institution can do it alone. The banks are collaborating with the Central Bank.

    ‘Beyond that, the banks are also collaborating with other regulators such as the Nigerian Communication Commission, on the issue of SIM Swap that we have seen in the industry in recent past. We have joint technical committee and memorandum of understanding to address certain issues that will help us tackle the problems.”

    On banks not doing enough to blacklist watch-listed customers, he said: “It takes a while to actually finalize investigations. So, what we do is to ensure that banks are encouraged to do the needful as soon as possible in order to conclude investigation.

    “You cannot just pick on anyone without being sure of your facts. The process of determining who should be watch-listed for fraudulent activities or not may take a while. But notwithstanding, we have continued to encourage banks to expedite action on some of these issues in order to have a conclusive issue on any account that may be related in any way to fraudsters or might have received a fraudulent posting. So, banks are working to ensure they expedite their investigations in order to do the needful in terms of watch listing.

    “Now, banks have been very responsive to issues, or any initiative to arrest the malaise. So, we expected that this will continue to trend downwards. In the past two years, you will see that fraud in electronic banking has been on downwards trend.”

    Executive Director, IT and Operations at Access Bank Plc, Ade Bajomo, said that tackling e-fraud is a collective responsibility. “What I can say is that no-one should be relaxed on this matter. All of us need to be vigilant, and where we see fraud. It has to be a zero-tolerance approach.

    “This is about sharing information. If you know someone is a criminal and you keep quiet, then that criminal will carry on perpetrating crime. The moment we criminalize that criminal, then the crime stops. This is no brainer. I can only urge all the banks, that have to participate in this watch list process to ensure they actively participate and they do what they need to do to make sure the whole system is as secured as possible.”

  • CBN lends banks N956b in three months

    COMMERCIAL banks got N956.64 billion loans from the Central Bank of Nigeria (CBN) in three months to boost their liquidity positions and meet commitment to customers, the quarterly economic report released by the apex bank has shown.

    The report, for the third quarter showed that  Standing Lending Facility (SLF) daily average transaction value amounted to N19.13 billion in 50 transaction-days, with total interest earned at N3.07 billion.

    The apex bank’s tough monetary policy stance has led   banks to borrow more. The Monetary Policy Rate (MPR) – benchmark interest — has remained at 14 per cent since July 2016 despite rising calls from economic experts for a lower interest rate. This has raised banks’ demand for CBN’s loans to boost their liquidity.

    “Total request for the Standing Lending Facility (SLF) inclusive of Intra-day lending facilities (ILF) that was converted to overnight repo during the review quarter stood at N956.64 billion, compared with N3,960.24 billion in the preceding quarter. Daily average transaction value amounted to N19.13 billion in 50 transaction-days, with total interest earned at N3.07 billion,” it said.

    “The banks continued to access the CBN’s Standing Facilities window to square up their positions either by borrowing from the standing lending facility (SLF) window or depositing excess reserves at the standing deposit facility (SDF) window of the CBN at the end of each business day,” it added.

    Total standing deposit facility (SDF) granted during the review period was N5.5 trillion, with daily average of N91.09 billion, in contrast to N5.9 trillion, in the second quarter of 2018. The cost incurred on SDF in the review quarter amounted to N1.99 billion, compared with N2.15 billion in the preceding quarter.

    The SLF and SDF were available for market participants to square up their positions or invest excess funds at the close of business. Similarly, Intra-day Liquidity Facility (ILF) was accessible as temporary credit to the banks to meet their funding needs within the operating hours of the CBN Inter-bank Funds Transfer System (CIFTS).

    The report also said that the total assets and liabilities of the commercial banks stood at N36.2 trillion at end-August 2018, representing 0.8 per cent increase over the level at end-June 2018. The funds were sourced, largely, from mobilisaion of unclassified and foreign liabilities, and realisation of claims on CBN.

    The funds were used, mainly, for payment of matured demand deposits, accretion to reserves and extension of credit to the private sector.

  • CBN lifts forex market with $210

    The Central Bank of Nigeria (CBN) has again intervened in the interbank foreign exchange market by injecting the sum of $210 million in the sales concluded yesterday.

    Figures obtained from the bank indicated that it offered the sum of $100 million to the wholesale segment, while the Small and Medium Enterprises (SMEs) segment received the sum of $55 million. Also, the invisibles segment, comprising tuition fees, medical payments and Basic Travel Allowance (BTA), among others, also received a $55 million boost.

    The Director, Corporate Communications at the CBN, Isaac Okorafor, while confirming the figures, said the CBN was pleased with the state of the Forex market, adding that the Bank will continue to intervene in order to sustain the liquidity in the market and guarantee the international value of the naira.

    He said the bank was determined to achieve its objective of exchange rate stability, thus the continued injection in the foreign exchange market. According to him, the level of transparency in the market was also a confidence boost for the market.

    It will be recalled that the CBN in its last intervention window on November 16, 2018, injected the sum of $318.03m and CNY 62.18m into the Retail Secondary Market Intervention Sales (SMIS).

    Meanwhile, the naira continued to maintain its stability in the foreign exchange market, exchanging at an average of N361/$1 in the BDC segment of the market.

     

  • CBN injects $318.03m, CNY 62.18m into SMIS

    The Central Bank of Nigeria (CBN) on Friday injected $318.03 million in the retail Secondary Market Intervention Sales (SMIS) of the inter-bank foreign market

    The CBN also offered CNY62.18 million in the spot and short-tenored forwards segment.

    The bank’s Director, Corporate Communications, Isaac Okorafor, while confirming the sales, reiterated that the retail SMIS were for requests in machineries, agricultural and raw materials sub-sectors, while the Chinese Yuan was for Renminbi denominated Letters of Credit.

  • Electronic fraud in banking hits N6.1trn by 2021 – CBN

    Mr Sunday Salam-Alada, Director, Consumer Protection Department, Central Bank of Nigeria (CBN) has said electronic fraud losses in the banking system are projected to reach N6.1 trillion by 2021.

    Salam-Alada disclosed this at the ongoing workshop for Business Editors and Finance Correspondents, organised by Nigeria Deposit Insurance Corporation (NDIC) in Benin.

    According to him, the volume and value of e-transactions is projected to continue to increase nationally and globally.

    Salam-Alada, represented by Mr Ibrahim Hassan, Director, Research, Policy, International Relations Department (RPIRD) NDIC, said it was due to broader ecosystem scope, evolution of channels, adaptability to disruptive innovations and modes payment.

    He said other reasons included increased inclusion and evolving technologies.

    The director also said that the CBN, through its Consumer Protection Department (CPD), had resolved over 13,715 complaints.

    Read Also:Stanbic IBTC opens Africa-China Banking Centre

    Salam-Alada added that this resulted in the refund of about N72.2 billion to customers by the commercial banks based on 25,043 cases of fraud in 2017.

    He said the amount represented a 28 per cent increase if compared to 19,531 cases recorded in 2016.

    Salam-Alada said there was a 24 per cent reduction in actual fraud loss value in 2017 with N1.63 billion as against the to 2016 figures.

    According to him, the statistics provided by the CBN shows there is a significant increase in the year-on-year volume and value of transactions across all payment channels in Nigeria.

    Consequently, 1.4 billion transactions with a value of N97.4 trillion were processed in 2017 as against 869 million transactions with a value of N69.1 trillion recorded in 2016.

    He said the increase of 59.7 per cent and 40.9 per cent were recorded in the volume and value of transactions in 2017.

    The director hinted that the CBN would soon issue a framework on consumer protection.

    Salam-Alada said the CPD conducted a mapping exercise of financial literacy activities in the country.

    He added that it was one of the achievements of the department.

    He said the achievements also included the biannual consumer protection compliance exams and review of the guide to banks’ charges.

  • CBN injects $210m into forex market

    The Central Bank of Nigeria (CBN) yesterday injected $210 million in the inter-bank foreign exchange market.

    Figures obtained from the CBN indicate that the authorized dealers in the wholesale segment of the market received the sum of $100 million while the Small and Medium Enterprises (SMEs) and invisibles segments were allotted the sum of $55 million each.

    The bank’s Director, Corporate Communications Department, Isaac Okorafor assured that the CBN would continue to sustain liquidity in the forex market. He also expressed optimism that the Naira will continue its strong run against the dollar and other major currencies around the world, considering the stability in the market and robust reserves.

    The CBN had on Friday, November 2, made interventions to the tune of $337.16 million in the retail Secondary Market Intervention Sales (SMIS) and CNY 56.17 million in the spot and short-tenored forwards segment of the foreign exchange market.

    Meanwhile, the Naira on Tuesday, November 13 exchange at an average of N360/$1 in the bureaux de change segment of the market.

     

  • Senate, CBN on collision course over MTN $8.1b fine

    AN alleged attempt by the Federal Government to reduce the $8.1 billion fine imposed on the communication giant, MTN, to $800 million is causing ripples in the Senate.

    It was gathered that the Federal Government, working through the Central Bank of Nigeria (CBN), may have resolved to cut the $8.1 billion fine to $800 million through the back door.

    The Senate alleged yesterday that the planned reduction of the fine was a matter of interest to it.

    The upper chamber noted that though it was not particularly against whatever the government would want to do with the MTN fine, it should be intimated why the reduction became necessary.

    The Senate also said how the percentage of reduction from $8.1 billion to $800 million was arrived at is of interest to it.

    The upper chamber said that it was interested to know what informed the penalty of $8.1 billion in the first instance.

    The Senate in 2017 adopted a resolution largely exonerating MTN of alleged illegal repatriation of $14 billion out of the country.

    Chairman, Senate Committee on Banking, Insurance and other Financial Institutions, Senator Rafiu Adebayo Ibrahim, told reporters yesterday that the CBN failed to implement Senate resolutions before conducting another investigation into the alleged infraction by MTN.

    Ibrahim said his committee would immediately demand the CBN’s report on the matter to be better informed.

    He said the only way Nigerians would know what transpired between the CBN and MTN on the $8.1 billion fine was through a detailed report.

    Ibrahim said: “The last time we heard about this issue was when we had a little retreat last two weeks in Lagos, where they (CBN) did the presentation of their biannual activities to the committee (Senate Committee).

    “We took them up on the issue, and the bank, that’s the CBN told us how they did the investigation.

    “We’re taking them up based on the fact that we have investigated did and we saw what happened.

    “All our resolutions were passed to them, and they did not even implement the resolutions before saying they’re going into another investigation.

    “They said their investigation was based on a petition from a law firm and their stand was that the penalty was correct.

    “So, if from the information you have now, it will be ridiculous for them to say they’re bringing the penalty down from $8.1billion to about $800million. That will be ridiculous for the CBN.

    “What they told us that day was that they were going to give us the report from when they started the investigation to date and their discussion with MTN.

    “So, if that’s the case, they have to answer to Nigerians through us in the Senate Committee to the legislature, what informed the penalty of $8.1billion?

    “And what information have they now gathered that informed the reduction to $800million.

    “I don’t know what percentage of reduction you can call that. Is it not up to 1000?

    “So, we will be interested to know that. We’re not against whatever they’re doing, but they will have to explain to Nigerians. Did they take the decision they took against MTN in a hurry, a foreign direct investor like MTN?

    “We took into consideration the role of MTN in the economy.

    “That’s why we did a very thorough job, and we believe we did a thorough job, that they did not steal any money then, that was our own assertion, though they repatriated.

    “By then, CBN said all the places where some infractions to the law or guidelines where they gave them waivers.

    “That was our position. So, we will be interested in the investigation.

    “We want to know what informed this decision. We as a committee and as a Senate will be interested.

    “They will have to explain. As I sit here, I believe it may not be true.

    “If it is close to the truth, then they will have to explain to Nigerians.

    Asked if the committee is likely to take up the matter

    Rafiu said: Definitely, I will call the Clerk to ask them that we are expecting their report as promised in the retreat. “In the report, if we find anything close to this, I will let you know.

    “We will write them and probably give ultimatum for the report. This is a very sensitive thing to the economy.

    “All of us know they (MTN) committed a lot of resources in Nigeria; so we don’t want them to be used as a yardstick as to how the Nigerian government treats investors.”

    The Senate adopted a report last year largely exonerating MTN of alleged illegal repatriation of $14 billion out of the country.

    The upper chamber also asked the CBN to sanction Stanbic IBTC Bank “for improper documentations in respect of capital repatriation and loan repayments” on behalf of MTN.

    This followed the consideration of the report of its committee on Banking, Insurance and other Financial Institutions which investigated alleged unlawful repatriation of $13.92 billion from Nigeria.

    MTN accepted the Senate report saying: “We welcome the report. We will study it in more detail. As we’ve placed on record previously, we have always insisted that our actions have been compliant with the law in this regard.”

    On CBN, Senate said the apex bank’s failure to properly regulate foreign exchange should be condemned.

    It also asked the bank to propose amendments to current regulation to foster economic growth and improve Nigeria’s foreign currency inflows.

     

  • CBN honored at 2018 ESQ Legal Awards

    The Central Bank of Nigeria  (CBN) has been recognised for its reforms in the the banking industry with  the Regulatory Team of the Year at the 2018 ESQ legal awards.

    CBN Director of Legal Department Johnson Akinkunmi said the honour is a recognition of their various initiatives to regulate the banking industry.

    He said being recognised for doing it’s work not knowing that someone is looking makes it more comforting as it will encourage them to double their efforts  in actualizing the mandate of the apex bank which is financial stability of the banking sector.

    Akinkynmi said, “At CBN, we always strive for excellence and customer satisfaction without playing to the gallery and to be bestowed with the prestigious award by a reputable organisation is a thing of pride to us.

    Esq Nigeria Legal Awards was hosted by Legal Blitz Limited  and it is the biggest and largest legal awards in the country.

    It was a celebration of the important contribution of lawyers to the Nigerian economy and commemorated the various breakthroughs of commercial deals across the various sectors of the Nigerian economy.

    It also recognized outstanding law firms and legal professionals who have contributed to the successful execution of deals in Nigeria.

    Lere Fashola, CEO Legal Blitz, said: “It has become important that dedicated and committed individuals in the Nigerian legal practice be set aside, recognized and celebrated. This is also an effort to encourage young individuals who are interested in pursuing a career in law.”