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  • CBN pegs maximum agric loan per project at N2b

    CBN pegs maximum agric loan per project at N2b

    The Central Bank of Nigeria (CBN) yesterday amended the Commercial Agriculture Credit Scheme (CACS) following which it pegged maximum loan intake for any project under the scheme at N2 billion.

    It equally pegged the maximum interest rate to the borrower under the scheme shall not exceed nine per cent, inclusive of all charges.

    The apex bank also approved the participation of all deposit money banks under the scheme, with all the participating banks required to sponsor projects from any of the target areas indicated in the guidelines and bear all the credit risk of the loans they will be granting.

    The CACS is being financed from the proceeds of the N200 billion, three year  bond raised  by  the  Debt  Management  Office  (DMO).  The fund will be  made  available  to  participating  bank(s), to  finance  commercial agricultural enterprises.

    “The single obligor for any project from a participating bank under the Scheme shall be N2 billion while for State Governments shall be N1 billion. However, for special schemes and programmes for agricultural development, state governments may be granted concessionary approval for more than N1 billion,” the CBN.

    The scheme is expected to help  fast  track  development  of  the  agricultural  sector  of  the  Nigerian economy  by  providing  credit  facilities  to  commercial  agricultural enterprises at a single digit interest rate; enhance  national  food  security  by  increasing  food supply  and effecting  lower  agricultural  produce  and  product  prices,  thereby promoting low food inflation.

    The CBN explained that  part  of  its  developmental  role, it has in collaboration with the Federal Government of Nigeria, represented by the Federal    Ministry    of    Agriculture    and    Rural    Development    (FMARD) established  the  Commercial  Agriculture  Credit  Scheme for  promoting commercial agricultural enterprises in  Nigeria, which is a sub–component of    the    Federal    Government    of    Nigeria    Commercial    Agriculture Development  Programme  (CADP).

    This fund will complement  other special initiatives of the Central Bank of Nigeria in providing concessionary funding for agriculture such as the Agricultural Credit Guarantee Scheme (ACGS)   which   is   mostly   for   small   scale   farmers,   Interest   Draw-back scheme,    Agricultural    Credit    Support    Scheme    and    other    similar developmental initiatives.

  • Forex: Naira loses against dollar

    Forex: Naira loses against dollar

    The naira on Thursday continued to fall against the dollar at the parallel market, the News Agency of Nigeria (NAN) reports.

    The Nigerian currency lost one point to exchange at N368, weaker than N367 posted on Wednesday, while the Pound Sterling and the Euro closed at N478 and N432.

    At the Bureau De Change (BDC) window, the naira was sold at N363 to the dollar, while the Pound Sterling and the Euro closed at N478 and N432.

    However, the naira appreciated at the investors’ window, exchanging at N361.17 stronger than N362.39.

    Traders at the market told NAN that in spite of the weekly auction of foreign exchange by the Central Bank of Nigeria (CBN) to BDC, the naira continued to depreciate.

  • FG engages international audit firms to recover TSA funds from banks

    FG engages international audit firms to recover TSA funds from banks

    The federal government has unleashed international audit firms to reconcile and retrieve public sector funds being withheld by banks.

    Mr. Hamza Adeyemi, Director Funds office of the Accountant General of the Federation (AGF) made the disclosure Thursday in Abuja.

    Adeyemi lamented that “banks have thrown professionalism to the winds; some banks are still holding on to funds of Ministries Departments and Agencies (MDAs) not transferred to the Treasury Single Account (TSA).”

    This he said is Inspite of the fact that the Central Bank of Nigeria (CBN) had sanctioned some banks by directly debiting the accounts of banks.

    Adeyemi stated that the federal government in 2004, lost over N70 billion funds while in the possession of commercial banks.

    To recover and reconcile all public sector accounts, Adeyemi said “accounting /auditing firms are auditing banks to recover funds still with banks. Some of the audit firms involved are Ernst and Young, PWC etc, the audit will be very comprehensive.”

    He accused banks of not adhering to presidential directive to return all public funds in their possession to the TSA domiciled in CBN.

    As recently as some few weeks ago, Adeyemi said more money was recovered from some banks still holding to government monies.

    Government he assured “is monitoring to ensure that these monies are paid into the federation’s coffers. Comprehensive reconciliation is ongoing. A lot has been done but more still needs to be done.”

    When asked to comment of the some idle funds captured under the TSA, Adeyemi disclosed that there is “over N300 billion idle funds in (TSA) a special CBN available window to be invested in Treasury Bills (TB) which attracts interest. The interest accrued goes back to the TSA of government” he said.

    Speaking to the success of the TSA, Adeyemi noted that “this is the first time in the history of this country that N1.2 trillion will be disbursed for capital projects in the 2016 fiscal year. This is because of TSA, in the past some of the monies were fixed in the banks or just idling away in the banks not being used for what they are meant for.”

    With the introduction of TSA, Adeyemi added that the exact amount in the consolidated cash position of the federal government can now be accessed by the AGF at the touch of botton thus availing the government of how much it has at its disposal for spending.

    Earlier, Mr. Mohammed Usman, Director Inspectorate Department of the OAGF fingered the Independent National Electoral Commission (INEC) for withholding unspent cash at the end of the financial year.

    According to Usman, “INEC says it is empowered to retain funds, but we (OAGF) have written to the Attorney General of the Federation (AGF) for clarification on that because it is part of public accounts procedure to return left over cash to the chest.”

    Usman said “the issue is now a subject with the public accounts committee of the National Assembly since 2015.”

    He also disclosed that all MDAs at one time or the other have fallen short of keeping proper assets register. According to Usman, “all MDAs are not abreast with the asset register. It has become more imperative now giving the new accounting techniques adopted by the federal government to keep accurate assets register.”

     

  • Fraud, a challenge for e-payment, by CBN

    The Central Bank of Nigeria (CBN) has described e-fraud as the biggest challenge facing the electronic payment sector insisting it needs to be collectively tackled by customers, banks and financial sector regulators.

    CBN Director, Banking & Payments System Department, ‘Dipo Fatokun, who disclosed this at the weekend in Lagos, said fraud not only leads to loss of funds, but reduces confidence of customers using e-channels.

    Fatokun, who spoke at the Finance Correspondents Association of Nigeria (FICAN) Bi-Monthly Forum said e-fraud has never been completely eliminated, even as bank customers lost over N2 billion to e-fraud last year.

    The CBN director who spoke on the theme: “Electronic Payments Industry’s Performance and Regulatory Issues”, described e-payment as any form of payment that allows the use of electronics system to initiate, authorise and confirm the transfer of money between two parties.

    The transaction reason, he said, could be for the payment for goods and services, settlement of obligations, gifts, among others.

    He explained that e-payments are driven by a network of interconnected systems, which make it possible for exchanges of value between payer and payee, sender and receivers or donor and donee.

    “Banks, Payment Service Providers(PSPs), Financial Authorities and Central Banks play various roles in developing the payments system infrastructure to drive electronic payments, that is nationally utilised. The e– payments industry refers to all stakeholders, operators, regulators, infrastructures, merchants, retailers and the final consumers of the payments products and services. Payment technologies and platforms bind the industry together in a tight ecosystem,” he said.

    Fatokun disclosed that global non-cash (electronic payment) transaction volumes grew at 8.9 per cent to reach $387.3 billion in 2014, an increase, driven by accelerated growth in developing markets.

    “Cards have been the fastest growing payments instrument since 2010, as cheque use has declined consistently and significantly. Debit cards accounted for the highest share (45.7 per cent) of global e-payment transactions and were also the fastest growing (12.8 per cent) payments instrument in  2014,” he said.

    He said the volume and value of transactions based on cheques and National Electronic Funds Transfer (NEFT) have been consistently reducing annually since 2013, while same data for the Nigeria Interbank Settlement System- NIBSS Instant Payment (NIP), Automated Teller Machine (ATM), and mobile money channels have been on the increase. This is an indication of users’ preference for instant value channels over non-instant payment channels.

    “The ATM Channel accounts for the highest volume of transactions, while the NIP accounts for the highest value of transactions annually. This is because the ATM is usually the e-payment channel that new and lower value account holders always interface with, while corporates and upwardly mobile middle class customers make transfers using NIP,” he said.

    Also, in furtherance of its effort to promote and facilitate the development of efficient and effective systems for the settlement of transactions, including the development of electronic payments system, the CBN has, since 2008, issued and reviewed several e-payment related framework, guidelines and circulars.

  • CBN boosts forex market with $195m

    CBN boosts forex market with $195m

    The Central Bank of Nigeria (CBN) on Monday boosted the foreign exchange market with $195 million intervention.

    The Acting Director, Corporate Communications Department of CBN, Mr. Isaac Okoroafor, disclosed this in a statement on Monday in Abuja.

    He said: “In the wholesale segment of the inter-bank foreign exchange market, the bank auctioned $100m and also intervened in the Small and Medium Enterprises (SMEs) with $50 million.

    “The invisible segments also had $45 million intervention.”

    Okorafor reaffirmed the CBN’s commitment to sustain liquidity in the market to ensure that genuine requests for forex were met as well as improve liquidity and flexibility in the market.

    The last intervention followed last week’s injection of $462,336,426.74 to the market.

    About $267 million was offered for the Retail Secondary Market Intervention Sales (SMIS), while $100 million was offered as wholesale interventions.

    NAN

     

  • Keystone Bank launches *533# Convenient Banking Platform

    Keystone Bank launches *533# Convenient Banking Platform

    In keeping with its promise to make financial services easy and accessible to its teeming customers, Keystone Bank Limited on Monday July 31, 2017 launched another innovative mobile channel enabled by dialing *533# within Nigeria.

    According to the bank’s Divisional Head, E-Business Channels, Mr. Ernest Obi, the USSD code *533# platform will enable Keystone Bank customers to conveniently perform third party transfers to both Keystone Bank and other bank account holders in Nigeria, open Keystone Bank accounts, buy airtime, pay bills and access a mini statement such as balance enquiry using their mobile phones without necessarily having internet data or airtime.

    “The Keystone Bank *533# USSD application is a convenient, reliable, fast, secure, and affordable way to access your Keystone bank account 24/7 through mobile phones without internet data. It works on all phone types.

    “To initiate transfers to a Keystone Bank account and beneficiaries in other banks, simply dial *533*Amount*NUBAN Account No# from the mobile number registered with the bank. Also, you can top-up your airtime by dial *533*Amount# and third-party top-up can be done by dialing *533*Amount*Phone number#. Customers will then require the four digits PIN created at registration to authenticate each transaction”. Mr. Obi noted.

    In his remarks, Keystone Bank’s Acting Managing Director/Chief Executive Officer, Mr. Hafiz Bakare, stated: “Following the successful divestment of AMCON’s shareholding in Keystone Bank which culminated in the change in ownership and management, the bank has witnessed series of positive developments.

    “The *533# product is Keystone Bank’s solution to facilitate customers’ access to their accounts at anytime of the day. Our *533# makes it possible for a Keystone Bank account to be viewed and transacted upon using any type of functional phone.

    “The launch of this product demonstrates our culture of service excellence, strengthening the emotional bond with our existing customers while reinforcing the Keystone brand as one to be associated with by the entire banking public.

    “Our internet banking is accessible on any internet enabled device while our mobile app is available on the Blackberry, Apple and Android stores. These services are enjoyed by the about 90 Million internet users in the country (according to the Nigerian Communications Commission, NCC) representing almost 50% penetration of the population.” He said.

    The bank’s Chief further disclosed that the lender will definitely witness more landmark events which would be communicated when it is auspicious as it moves ahead with its transition. He stressed the importance of remaining focused whilst relying on communication through proper channels as the transition progresses and the Bank awaits CBN approval of the full complement of a substantive board and management.

    Keystone Bank is a technology and service-driven commercial bank offering convenient and reliable solutions to its customers.

  • Foreign reserves near three-month high at $30.8b

    Foreign reserves near three-month high at $30.8b

    •CBN injects $195m into interbank market

    The foreign exchange reserves have risen to an almost three-month high of $30.74 billion, latest Central Bank of Nigeria (CBN) data showed.

    The dollar reserves grew 1.62 per cent from a month earlier. The CBN did not provide a reason for the increase.

    The foreign reserves rose by $7 billion in six months to hit $31 billion at the end of April this year. The increase has restored the total to a level last seen in August 2015.

    According to FBN Capital Research, the reasons for the recovery are the disbursement of $600 million by the African Development Bank (AfDB) last November and the recent sale of N1.5 million Eurobond.

    “There has also been a significant recovery in oil production over the period. With less certainty we can speculate about improved forex management and possible swap transactions,” it said.

    The research firm said the positive surprise was due to the upward swing in reserves, since the CBN stepped up its forex sales in early March.

    “The steady accumulation makes it less, not more, likely to adopt the forex reforms sought by the market. There is no sign that the CBN plans to slow its sales, which for wholesale transactions alone are close to $3 billion: rather, it launched its latest window (for investors and exporters) only last month,” the report said.

    It said the macroeconomic damage from the latest period of oil price weakness, which is approaching three years, could have been manageable if a fiscal buffer against external shocks had been functioning.

    “Legislation passed in 2011 created such a buffer, Nigeria’s own ring-fenced sovereign wealth fund, but the opposition of state governors has prevented its effective operation. The accumulation from 2011 through to the start of the oil price slide in August 2014 would have been substantial,” it added

    Meanwhile, the CBN yesterday offered $100 million in wholesale auction at the inter-bank forex market and intervened in the Small and Medium Enterprises (SMEs) and invisible segments, with the sum of $50 million and $45 million, respectively.

    Confirming the figures, the CBN Acting Director, Corporate Communications, Isaac Okorafor reiterated that the bank’s intervention was in line with its commitment to sustain liquidity in the market to meet genuine requests as well as deepen flexibility in the foreign exchange market.

    Monday’s sale follows the major intervention, last Friday, to the tune of $462,336,426.74, comprising $267.3 million for the Retail Secondary Market Intervention Sales (SMIS), $100 million for wholesale interventions, $50 million for the SMEs forex window and $45 million for invisibles.

    Okorafor had said last week that the CBN leadership was quite impressed by the positive impact its current foreign exchange management was having on the manufacturing sector, agriculture and economic activities in general across the country.

    He said the CBN would not continue working on achieving the objective of convergence between the exchange rates at the Nigeria Autonomous Foreign Exchange (NAFEX) and the Bureau-de-Change segments of the market, even as he assured proper surveillance of the forex market to guarantee transparency in the sale of foreign exchange.

  • CBN alarm

    CBN alarm

    •Dire as it is, solution not beyond the fiscal and monetary authorities

    On Tuesday last week came a dire warning from the Monetary Policy Committee (MPC) of the apex bank: the current fragile economic recovery risks a relapse. Said Central Bank of Nigeria (CBN) governor, Godwin Emefiele, on behalf of the MPC: “Available forecasts of key macroeconomic indicators point to a fragile economic recovery in the second quarter of the year”.  The recovery, the committee cautioned “could relapse in a more protracted recession if strong and bold monetary and fiscal policies are not activated immediately to sustain it.”

    To start with, we are not surprised about this latest prognosis. To pretend otherwise is to succumb again to the illusion that the factors that have hobbled the economy have been eliminated. From what we have seen over the past few months, we know that this is far from being the case. Whereas oil prices may have recovered modestly and production boosted, the macro-economic indices are nothing to cheer: inflation, despite the climb-down, remains unbearable at 16 percent; the interest rate at above 25 percent, clearly incongruous with the country’s growth aspirations, stands out among the highest in developing countries.

    The exchange rate, despite its relative stability – thanks to the modest recovery in oil prices and the relative peace in the Niger Delta in recent times, remains potentially volatile to the extent that its performance is linked to the fortunes of crude oil. For an import-dependent economy, our ports system suffers twin lethal afflictions of inefficiency and corruption. The power sector, despite the billions sunk into it, has remained comatose just as infrastructure from road to railways are, quite frankly, antediluvian.

    To its credit, the Buhari administration has moved on a number of issues. For instance, Acting President Yemi Osinbajo signed three executive orders on a number of policy issues covering the promotion of transparency and efficiency in the business environment, designed to facilitate the ease of doing business; timely submission of annual budgetary estimates by all statutory and non-statutory agencies, including companies owned by the Federal Government; and support for local contents in public procurement by the Federal Government. While these are important steps, one big minus is the annual budget conundrum. At a time the economy has barely begun to crawl out of recession, consider for instance that Budget 2017 – was only signed into law in June!

    The truth however is that the CBN warning could well have been released five or even 10 years ago – with or without oil-induced shocks. In other words, the issues, just as the problems they gave rise to are nothing new. Had the fiscal and monetary authorities – then and now – moved from endless dissection of problems to applying themselves to tackling the problems headlong, the country ought to have been on a steady, sustainable growth path by now.

    One sure step in this direction is for the monetary authorities to move away from the current fixation with textbook orthodoxies that bear little relevance to our local problems. For, while it was not surprising that the apex again left the Monetary Policy Rate, MPR, at 14 per cent, largely unanswered is how local infrastructure-challenged businesses can match competition from their foreign counterparts where rates are under five percent.  It is high time the apex bank reexamined its obsession with inflation targeting that is currently the root and branch of the excessively high cost of funds to the system.

    The same also can be said of the fiscal branch that pretends to be oblivious of the policy and infrastructure imperatives so critical to turning the economy around; to the extent that both are at the heart of the current stasis under which nothing moves. This is overdue for a rethink

    As for the CBN’s warning, our view is that the situation as dire as it is, is not beyond the fiscal and monetary authorities to solve. It would therefore be most regrettable should the economy be allowed to suffer a relapse.

  • Senate withdraws report acquitting MTN of forex scam

    Senate withdraws report acquitting MTN of forex scam

    The Senate has withdrawn a report that largely exonerated South African telecoms giant, MTN, of accusations of illegally repatriating $14 billion and rebuked the Central Bank of Nigeria (CBN) for regulatory failures.

    The report, presented to the Senate on Thursday, was almost immediately sent back for further work because it did not capture possible infractions by all stakeholders, two people familiar with the matter told Reuters.

    The upper legislative chamber agreed in September to investigate whether Africa’s biggest telecoms firm unlawfully repatriated $13.92 billion from Nigeria – its most lucrative market which generates a third of its revenue – between 2006 and 2016.

    MTN, which has denied any wrongdoing, could not immediately be reached for comment.

    The crux of the allegation is that MTN did not obtain certificates declaring it had invested foreign currency in Nigeria within a 24-hour deadline stipulated in a 1995 law, making the repatriation of returns on the investments illegal.

    The Senate formed a committee to investigate the allegations against the South African company, the CBN and commercial banks such as Stanbic IBTC Bank Plc.

    The committee’s report did not recommend any punitive measures against MTN.

    Instead, the report rebuked the CBN for its failure to monitor fund transfers to and from the country, calling its oversight of banks “inadequate.”

  • Senate Committee hails CBN on moves to block leakages in foreign exchange

    Senate Committee hails CBN on moves to block leakages in foreign exchange

    The Chairman of the Senate Joint Committee on Customs, Excise & Tariff and Marine Transport, Chief Hope Uzodinma, has commended the Central Bank of Nigeria (CBN) for installing an Enterprise Screening Platform (ESP) through which the leakages in the allocation and management of Foreign Exchange as well as the collection of revenue in the country by the Nigerian Customs Service (NCS) will be substantially blocked.

    The platform is to replace the manual examination of cargo for the purpose of duties collection by the customs.

    It was  designed by the apex bank for the purpose of stabilizing  the naira, by providing accurate cross referenced data on all trade facilitation documents like the Form M, Bill of Lading, Letters of Credit, Clean Certificate of Inspection, tracking of repatriation of forex proceeds records and online real time remote screening of inbound and outbound cargo or passengers.

    It also helps in checking incorrect classification, under-valuation, under-declaration, incorrect declaration, incorrect origin, error in calculation, temporary importation, exemptions and waivers, forex manipulations, unit cost analysis and excise, smuggling and illegal removal of cargo from terminals and lack of exit certificate by vessels.

    Uzodinma, speaking in Abuja, said the CBN’s move was timely in curbing leakages in revenue collection by the customs.

    He was responding to the briefing of the committee by the Chairman of the Technical Committee on the Comprehensive Import Supervision Scheme (CISS), Gotring Wuritka Dauda, who said  Nigeria was losing trillions of naira through the manual revenue collection and other associated infractions.

    Giving a detailed account of how the platform works, the CBN said that it  utilizes its revolutionary modular architecture to integrate hardware and software solutions to create a factual data mapping platform that ensures absolute visibility of all transactions within the import-export value chain.

    The platform boasts of Remote Screening Stations (RSS), configured as a war room, which is installed at the CBN, the Nigerian Customs Headquarters, the Ministry of Finance and the Presidency from where the ESP could be monitored in real time on a video graphic display with 36 panels given life views of activities across all Nigeria’s entry and exit points.

    The ESP has an inbuilt remote support system that welds the geographical dispersed locations onto a single platform that is administered from the NOC and supports them through video, audio and data channels with real life interactive personnel who use video calls, online chat, standard operations manuals and knowledge bases to support field operatives.

    Though the Nigerian Customs Service (NCS) is yet to adapt to the new technology,

    it is expected  that once the service puts it into use, all  the leakages associated with revenue collection and other sharp practices by the NCS would be curtailed.

    The Senate  Committee at the hearing, frowned at the activities of a cabal at the ports which had cost the country over N30 trillion in loss of revenue.