The Nation Newspaper

Tag: Central Bank of Nigeria

  • Atuche’s prosecution an injustice – Utomi

    Atuche’s prosecution an injustice – Utomi

    A social critic and former board member of defunct Bank PHB, Prof. Pat Utomi, on Wednesday told a Lagos High court, Ikeja, that the bank’s former managing director, Mr. Francis Atuche was a victim of a plot hatched by the powers that be to forcefully take over the bank.

    He said Atuche’s prosecution was an act of injustice.

    Prof. Utomi, spoke during his testimony before the court presided by Justice Lateefat Okunnu.

    Atuche, his wife, Elizabeth and the bank’s former Chief Financial Officer, Ugo Anyanwu were arraigned before the court by the Economic and Financial Crimes Commission(EFCC) for allegedly stealing N25.7 billion belonging to the bank.

    Prof. Utomi, who was led in evidence by the defence counsel, Chief Anthony Idigbe (SAN) told the court that the plot to get Atuche out of the bank was hatched right from the top, adding that even the Governor of Central Bank of Nigeria, Mallam Lamido Sanusi, told him at a point that “if Atuche is removed as the bank’s chief executive that things will change.”

    The witness said the plot to take over Bank PHB by the CBN Governor was confirmed by a former presidential spokesman, Segun Adeniyi ,in his book “Power, Politics and Death: A Front-Row Account of Nigeria Under the Late President Yar’Adua.”

     

  • Naira remains firm against dollar

    Naira remains firm against dollar

    The Naira on Wednesday remained firm against the dollar at the Central Bank of Nigeria (CBN’s) biweekly Wholesale Dutch Auction System (WDAS).

    The apex bank disclosed this on its Website after the conclusion of the auction.

    It sold 272.52 million dollars worth of foreign exchange to banks at the rate of N155.75 to the dollar at the auction.

    The CBN had sold Naira to a dollar at the rate of N155.75 at the previous auction on Monday.

    Nineteen banks participated at the auction, as against the seven that took part in the bidding at Monday’s auction.

  • Jonathan nominates non-executive members for CBN board

    Jonathan nominates non-executive members for CBN board

    President Goodluck Jonathan yesterday forwarded the names of four non-executive members of the board of the Central Bank of Nigeria (CBN) to the Senate for confirmation.

    This is contained in a letter entitled “Request for the confirmation of the appointment of non-executive members of the board of the CBN.”

    Those nominated for appointment as non-executive members of the CBN included Muhammad Musa Kafarati (North East), Collons Chike Chikelube (South East), Adaba Anthony Adeiza (North Central) and Ayuli Jemide (South South).

    Jonathan noted in the letter read by Senate President, David Mark, that following the expiration of the statutory terms of appointment of some non-executive members of the board of the Central Bank of Nigeria (CBN), and the vacancy occasioned when the member representing the South-South geo-political zone on the board vacated the position in 2009, it became necessary to forward the names for the consideration of the Senate in accordance with the provisions of the CBN Act 2007.

  • CBN to maintain value of Naira

    CBN to maintain value of Naira

    The Central Bank of Nigeria  (CBN) continues to intervene in the currency markets to bolster the Naira, after its recent weakening to a seven-month low of 159.10 to the Dollar.

    Although Nigeria is the largest oil-producing nation in Africa, inflation and the need for imports have weakened the currency of late. This fall in value has prompted investors in Nigerian bonds to sell their positions, thereby putting more pressure on the Naira. The CBN’s stated objective, however, is to maintain the value of the nation’s currency within a tight bank of three percent, either side of 155.00. The Naira had strengthened to this plateau over the past year, maintained it for months, but then gradually began to depreciate over the last three months.

    Inflation was the primary concern in 2012. The central bank on six consecutive occasions raised interest rates to address rising prices. Rate changes stopped in November, resting at a 12 percent level. The NCB has passed on any rate adjustments since that time. Lamido Sanusi, Governor of the Nigeria Central Bank, stated this week that he expects the bank to leave interest rates unchanged at 12 percent over the coming months so as not to jeopardize the bank’s efforts to bring inflation back down to single digits, a program designed to stabilize the Naira’s exchange rate.

    Concurrent with this maintaining a constant interest rate posture, the CBN, however, has intervened in the currency markets by holding two U.S. Dollar auctions of $300 million and $276 million over the past week to cover various import needs of the country. When coupled with anticipated month-end sales by local oil producers, the combined effect is to provide stability for the Naira and keep it below the 159.75 threshold. The Naira today is holding steady at 158.55.

    Sewa Wusu, an analyst at Lagos-based Sterling Capital Ltd., has stated in a phone interview with Bloomberg that the “CBN’s increased intervention through the auction has ensured Naira stays within the targeted band amid increased dollar demand.”

    As for near-term prospects, most currency experts are forecasting a stronger Naira, based on the previous open-market actions and expectations of local oil companies. Investors also seem confident that the central bank will continue to support the Naira, as well. One dealer noted that, “We see the Naira trading around the 158 Naira to the Dollar level this week and early next week with more oil companies selling dollars as part of their month-end sales.”

    In a recent Reuters’ survey, 8 of 9 economists predicted that the CBN would not budge from their 12 percent interest rate benchmark. “The main focus of the debate … will be the inflation outlook … and the recent weakness in the currency,” said Andrea Masia, a Morgan Stanley analyst. He was also quick to add that the 2013 budget will have monetary implications that could impact inflation, as well. Inflation currently sits at 9 percent, but Governor Lamido Sanusi has publicly expressed concerns regarding the pressure posed on prices arising from outside of the country.

    Nigerian President Goodluck Jonathan recently approved a 4.99 trillion Naira budget that had received Parliamentary approval in February. The new budget represents a slight rise in government spending of 1.4 percent, a tentative compromise reached after several months of serious debate over future spending plans.

    The stage is now set for further minimal gains over the following week. Kunle Ezun and Kenneth Asenime, local analysts at Ecobank Transnational Inc. in Lagos, suggested a 158.10 figure in a newsletter to their clients, “with bias for moderate appreciation due to monetary policy support.”

    Bio:

    Article by Tom Cleveland of forextraders.com. Mr. Cleveland has been writing about economics and investments since 1980. Since 2010, Mr. Cleveland has been specifically researching currency fluctuations and many aspects of forex news. To read more on his work, view the news section on Forex Traders.

     

     

  • Banks mull funding strategy for power projects

    Banks mull funding strategy for power projects

    Nigerian banks have started a collaboration to develop amenable financing framework that would serve as financial industry’s master template for lending and funding of the power sector.

    The strategic funding plan is being developed under the auspices of the Bankers’ Committee with active participation of top management of banks, the Central Bank of Nigeria (CBN) and other key stakeholders.

    The funding strategy is a linchpin in the Bankers’ Committee’s programme for the year, which largely focused on aligning the Nigerian banking system to provide adequate financing to meet the peculiarities of the power sector.

    Banks’ chief executives, Governor and top officials of the CBN and several experts had brainstormed extensively on the power sector at the recently concluded 4th annual retreat of the Bankers’ Committee.

    Sources in the know said the development of an industry-wide funding strategy was part of the outcomes of the discussions at the retreat.

    It was gathered that the funding strategy will provide the banking industry with a master agreement or template that would foster best practices, remove inconsistency, ease access to funding and encourage regulator-operator understanding as banks move into the still-evolving power sector.

    A bank may adapt the funding strategy to suit its internal structure and terms, but the template would provide guidelines, structures, terms and concepts, among others for the industry.

    The CBN would sign on the banking industry funding strategy for power sector, which would give the template a quasi-regulatory status.

    Banks are also expected to consider input of key non-bank stakeholders such as the Bureau of Public Enterprises (BPE), Nigerian National Petroleum Corporation (NNPC), Ministry of Power, Energy Commission of Nigeria (Encon) and NBET among others in the overall draft of the funding strategy to give the plan a higher level of general acceptance beyond the banking industry.

    The funding strategy will enable banks to provide well-structured finances to support investments in gas transmission pipelines, upstream gas developments, Liquified Natural Gas (LNG) and Liquified Petroleum Gas (LPG) plants, gas processing facilities, key infrastructure, port, real estate, pipe milling and fabrication yards and gas supply and gas transportation infrastructure among other.

    Besides, banks are required to reinforce their energy desk to build capacity for power project financing while the Bankers’ Committee would continuously provide supports for advocacy and programmes that centre on the power sector transformation.

    Chairman, Economic Development and Sustainability of the Bankers’ Committee/Managing Director, Access Bank Plc, Mr Aigboje Aig-Imoukhuede, said banks are aware that the growth, prosperity and national security of Nigeria depend on the success of the power sector transformation.

    According to him, the Bankers’ Committee would continue to collaborate with the government and other stakeholders to create and sustain enabling environment for private sector funding of the required investments in the power sector.

    He noted the potential impact of stable and adequate power supply on the national economy pointing out inadequate power supply has been the bane of the underdevelopment and non-competitiveness of the manufacturing sector.

    He reiterated the commitments of banks to continuously explore ways of providing adequate and suitable finances to the three key sectors of power, agriculture and transportation adding that the Bankers’ Committee’s focus on these sectors was borne out of the deep appreciation of the critical importance of the sectors as catalysts for the growth and development of the economy.

     

  • CBN didn’t remove Maduka from Access board.

    CBN didn’t remove Maduka from Access board.

    The Central Bank of Nigeria (CBN) did not remove  Dr. Cosmas Maduka, from the board  of Access Bank Plc over alleged infringement on the rules and regulations set by the apex bank, contrary to the story in the Sunday edition of   our newspaper.

    Maduka , having  served his two terms on the bank’s board, stepped aside according to the existing regulations on tenure of board members.

    His exit also has nothing to do with the outcome of the risk- based examination of the bank by the CBN in 2011.

  • Central Bank of Liberia Governor’s visit to UBA

    Central Bank of Liberia Governor’s visit to UBA

    The Governor of the Central Bank of Liberia, Mr. Joseph Mills Jones on Tuesday  visited the head office of the  United Bank of Africa (UBA) Plc  in Lagos.

    1: l-r: Governor, Central Bank of Liberia, Dr  Joseph Mills Jones; GMD/CEO, UBA Plc, Mr. Phillips Oduoza; and MD, UBA Africa, Mr. Emmanuel Nnorom, during the visit.

    2: r-l: GMD/CEO, UBA Plc, Mr. Phillips Oduoza; Governor, Central Bank of Liberia, Dr  Joseph Mills Jones; and Chairman, UBA Liberia, Prof Dew Tuan-Wleh Mayson.

    3:  GMD/CEO, UBA Plc, Mr. Phillips Oduoza (2nd right); Governor, Central Bank of Liberia, Dr Joseph Mills Jones( middle) ; Deputy Managing Director, UBA Africa, Mr. Emeke Iweriebor ( 1st left);Chairman, UBA Liberia , Prof Dew Tuan-Wleh Mayson (2nd left); and MD, UBA Africa, Mr. Emmanuel Nnorom.

  • Keystone Bank MD resigns

    Keystone Bank MD resigns

    The Managing Director/Chief Executive Officer, Keystone Bank Limited, Mr. Oti Ikomi has resigned his appointment.

    Ikomi according to a statement by the Head, Corporate Communication of the bank, Dafe Iwvurie resigned on Thursday based on personal reasons.

    A seasoned professional banker with a wealth of experience spanning over two decades, Ikomi was appointed CEO of Keystone Bank in August 2011.

    The Chairman of Keystone Bank, Mr. Moyo Ajekigbe has convened a meeting for friday to review the development and appoint a successor.

    Keystone Bank is an insured, full service commercial bank granted banking licence on 5 August 2011 by the Central Bank of Nigeria (CBN) and wholly owned by the Asset Management Corporation of Nigeria (AMCON).

     

     

  • Naira trades flat

    Naira trades flat

    The naira traded flat against the U.S. dollar at both the interbank and foreign exchange markets yesterday, as strong demand for the greenback soaked up liquidity from two oil firms and the Central Bank of Nigeria’s currency auction.

    The naira according to Reuters closed at N157.80 to the dollar, around the same level it ended at on Friday.

    At the bi-weekly auction, the CBN increased dollar supply to $200 million, from the $180 million it sold at last Wednesday’s auction, but maintained the rates at N155.78.

    Dealers said the local unit of French oil firm Total sold $44 million to some lenders, while Agip sold around $7 million, but strong demand lapped it up.

    The naira has traded around the N157-158 level to the dollar over the past one month, owing partly to dollar sales from oil companies and inflows from offshore investors buying bonds.

    Dealers expect the currency to hover around current levels throughout the week, as month-end dollar inflows from oil firms boost liquidity.

  • Equities beat fixed-income securities

    Equities beat fixed-income securities

    Quoted equities have scaled up to the top of returns’ table among investment securities as sustained rallies continued to build up real positive return on investment for equities.
    The Nation’s check showed that most fixed-income securities opened this week several notches below average equity return, with gap as wide as five percentage points in some instances.
    Average return by equity opened this week at 22.22 per cent, 10 per cent above fixed-income benchmark Monetary Policy Rate (MPR) of 12 per cent and some 9.4 per cent real returns above current inflation rate of 12.8 per cent.
    Official data by the Central Bank of Nigeria (CBN) showed that 91-day Nigerian Treasury Bills currently carry a yield of 13.64 per cent while three-month tenor deposit rate of banks stand at 8.57 per cent. Average inter-bank call rate stands at 16.14 per cent.
    Market data showed that seven-day Nigerian Interbank Offer Rate (NIBOR) opened trading at 16.71 per cent while the 30-day and 90-day NIBOR started at 16.96 per cent and 17.33 per cent respectively.
    The Nation’s market intelligence shows that bonds currently have coupons of between 4.0 per cent and 19 per cent, indicating the yield spread within the fixed-income segment.
    Coupons or interest rates within the corporate bonds segment ranged between 10 per cent and 19 per cent. The UPDC 2015 bond issue carries the lowest interest at 10 per cent while Tower Funding Plc bond carries the highest rate of 19 per cent.
    In the sovereign bond segment, the five-year tenor Federal Government of Nigeria April 2015 bond has the lowest interest rate of 4.0 per cent while the 10-year long-term bond due for maturity in 2012 has the highest rate of 16.39 per cent.
    Sub-national bonds-comprising mainly of bonds by state governments, indicated return range of between 10 to 15.5 per cent. The N57.5 billion seven-year Lagos State Government bond carries the lowest coupon of 10 per cent while Imo State Fixed Rate Redeemable Bond indicates highest rate of 15.50 per cent.
    Market analysts said the improvement in returns at the equity market could lead to bandwagon gains as late adopters follow the track of the bullish rally.
    Investment analyst, TWR Stockbrokers Limited, Abdu-Rasheed Momoh, said equities still have headroom for growth, noting that market’s benchmark index could rise as high as 27,000 points, after some initial resistance. This implies possible addition of some eight percentage points to reach average return of 30.2 per cent.
    “My own momentum indicators, which are short-term, still indicate a positive trend, and the overall index is still below the middle of the trading ranges of the individual components,” Momoh indicated.
    He outlined that several stocks including Access Bank; Chemical & Allied Products, Evans Medical, First Bank of Nigeria, Guaranty Trust Bank, Okomu Oil Palm, Presco, Nestle Nigeria and Zenith Bank among others were still below resistant levels.
    He however, cautioned that the few stocks that have been leading the pack might not have the capacity to move the overall average return as they approach their five to eight- year resistant levels, except new bull leaders take over.
    Analysts at Partnership Investment Company Plc also shared the optimism that equities would sustain its lead noting that substantial upswing would remain, in spite of expected profit-taking transactions.
    “Some stocks however, still trade below their intrinsic value and are a pick for bargain hunters and value investors,” analysts stated.