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Tag: credit

  • APC to PDP, Jonathan: stop taking credit for Ebola control

    APC to PDP, Jonathan: stop taking credit for Ebola control

    The All Progressives Congress (APC) yesterday told President Goodluck Jonathan and the Peoples Democratic Party (PDP) to stop taking credit for the country’s successful containment of the Ebola Disease Virus (EVD).

    It said it would amount to dishonesty for the President and his party to turn what was a collective effort to a campaign issue.

    But the PDP fired back, saying the APC preferred that “the Ebola scourge continued unabated in Nigeria so as to have what to blame the PDP-led government for”.

    The PDP made its position known in a response to a statement by the APC National Publicity Secretary, Alhaji Lai Mohammed.

    The APC said President Jonathan and his party were wrong to have appropriated the credit for the successful containment of the EVD without giving due credit to the real heroes of the successful battle: Dr. Stella Adadevoh and her colleagues at the First Consultant Hospital; officials of the ministries of Health in Lagos and Rivers states and the patriotic Nigerian volunteers, among others.

    It described as a cheap shot and a shameless venture the President’s decision to make the Ebola success story a campaign issue during a PDP rally in Benin, giving the impression that only the PDP deserves the credit for the successful containment of the disease.

    The APC said while indeed Health Minister Onyebuchi Chukwu exhibited the kind of professionalism and purposefulness that are not common with the Jonathan Administration during the battle against Ebola, it will be uncharitable for the PDP-led Federal Government to pretend as if the governments of the two affected states did nothing.

    The party reminded President Jonathan that the two states hit by Ebola, Lagos and Rivers, are APC states, and that the promptness, purposefulness, doggedness and determination shown by the governors contributed largely to the successful containment of the virulent disease.

    ‘’The cities of Lagos and Port Harcourt are perhaps the largest metropolis to have ever been hit by the EVD since the first outbreak was recorded in the Democratic Republic of Congo almost 40 years ago, and any mishandling of the disease could have spelt disaster not just for the cities but for the country as a whole.

    ‘’But the ever-dogged and determined Governors Babatunde Fashola of Lagos State and Rotimi Amaechi of Rivers states employed the same winning strategies that have stood their states out of the pack and quickly rose to the occasion, putting in place measures that ensured a quick curtailing of the EVD spread. The measures include painstaking contact-tracing, unrelenting follow-up and creative treatment of infected patients even without access to the experimental drug Zmapp.

    ‘’There is no doubt that Nigeria is fortunate that the EVD outbreaks were recorded in those two states. It is a measure of the high premium that the Chief Executives of the states place on human life, a testimony to the strong health systems they are building and an indication of their purposeful approach to governance that they successfully contained the disease, thus earning Nigeria a rare accolade from the global community.

    ‘’Unlike the President and the PDP, we will also like to give credit to the Minister of Health, Prof. Onyebuchi Chukwu, for acting out of character with the do-nothing Jonathan Administration. We hope President Jonathan and his party will stop making the Ebola success story in which opposition states were the main actors a fulcrum of their campaign for the 2015 general elections. They cannot and should not take credit for the containment of Ebola in Nigeria,’’ APC said.

    The party also advised President Jonathan not to use the Ebola containment effort as another tool to divide Nigerians along party lines.

    ‘’President Jonathan is the most divisive President in Nigeria’s history. He inherited a united Nigeria, but has divided the country along ethnic and religious lines on the altar of selfish personal ambition and short-term opportunism. It will amount to a monumental tragedy if the President will again use the Ebola success story, which has earned Nigeria a rare acclamation from the global community, as a tool to further divide Nigerians,’’ it said.

     

  • Chinese manufacturers reject Letters of Credit from Nigeria, says CBN

    Chinese manufacturers reject Letters of Credit from Nigeria, says CBN

    The Central Bank of Nigeria (CBN) yesterday said Chinese manufacturers have started rejecting Letters of Credit (LCs) from Nigerian importers, insisting on cash payment only.

    Its Director, Trade and Exchange, Olakanmi Gbadamosi lamented that in spite of improved banking regulation in the country and the apex bank’s cash-less  policy, the Chinese exporters still reject LCs from the country.

    Gbadamosi spoke at the 2014 Wema Bank Customer Trade & Structured Finance Forum in Lagos.

    An LC is a document issued by a financial institution or a similar party, assuring payment to a seller of goods or services provided certain documents have been presented to the bank. LC serves as a guarantee to the seller that the money will be paid regardless of whether the buyer ultimately fails to pay.

    It ensures that the risk that the buyer will fail to pay is transferred from the seller to LC’s issuer. The letter can also be used to ensure that all agreed standards are met by the supplier, provided that these requirements are reflected in the documents described in the letter of credit.

    Gbadamosi, who was represented by CBN’s Deputy Director, Trade and Exchange, Mrs. Onyinye Ahuchiogu said the practice is affecting Chinese trade volume with the country and is being addressed.

    “At CBN, we are aware of that because I want to tell you authoritatively that at that end, some people monitor foreign exchange flows. We do know that so much money goes to China, cash, not LCs. The demand for cash is against the CBN cash-less banking policy.

    “I do know that the cash-less policy is gaining ground; everybody is going cash-less, but China has refused. I think it is a bilateral issue and we have suggested that it should be tackled because this people are doing business in our environment and they are making profit. They are enjoying our environment. Despite security challenges in Nigeria, businesses are still thriving.”

    He however said the CBN is looking at ways of resolving the challenge.

    Continuing, he said the CBN is committed to ensuring that banks fund their accounts, two days before the bid date for foreign exchange adding that importers can source for funds either through the official window or interbank.

    “As a business man, you can source fund from any segment, depending on the transaction you want to execute. But in Nigeria, we have a list of eligible bank transactions, which we expect that importers chose only from this list. It is also our expectations that banks educate their customers about these transactions, and the supporting documents needed for effective import,” he said.

  • IOSCO reviews reliance on credit rating agencies

    The International Organization of Securities Commissions is reviewing the extent to which asset managers, investors and other parties should rely on credit rating agencies (CRAs) in their asset management.

    The global body of securities regulators has published a consultation report on Good Practices on Reducing Reliance on Credit Rating Agencies (CRAs) in asset management with the aim of gathering the views and practices of investment managers, institutional investors and other interested parties on the subject.

    It will subsequently develop a set of good practices on reducing over reliance on external credit rating in the asset management space.

    IOSCO noted that CRAs play a prominent role in today’s global financial markets pointing out that while approaches may differ across jurisdictions, investment managers often use the services of CRAs to form an opinion on the creditworthiness of a particular issuer before purchasing securities, selecting counterparties, or choosing the best collateral to secure transactions.

    It added that investors often refer to CRA ratings before buying shares of a fund, or when guiding investment managers on the basis of a tailored investment mandate.

    IOSCO pointed out that the role of CRAs has come under regulatory scrutiny, mainly as a result of the over-reliance of market participants, including investment managers and institutional investors, on CRA ratings in their assessments of both financial instruments and issuers in the run-up to the 2007-2008 financial crisis.

    According to IOSCO, the good practices that result the consultation paper will be addressed to national regulators, investment managers, and investors, where applicable while IOSCO has also launched a separate project to identify the good practices of intermediaries with regard to the use of alternatives to credit ratings to assess creditworthiness.

    The report stresses the importance for asset managers to have the appropriate expertise and processes in place to assess and manage the credit risk associated with their investment decisions. Recognizing the utility of external ratings, the report mentions that they can be used as an input among others to complement a manager’s internal credit analysis and provide an independent opinion as to the quality of the portfolio constituents. However, in order to avoid the over-reliance on external ratings, the report lists some possible good practices that managers may consider when resorting to external ratings.

    Some of the good practices undergoing consultation include that investment managers make their own determinations as to the credit quality of a financial instrument before investing and throughout the holding period. While external credit ratings may form one element, among others, of the internal assessment process but it should not constitute the sole factor supporting the credit analysis.

    Also, there should be an internal assessment process that is commensurate with the type and proportion of debt instruments the investment manager may invest in, and a brief summary description of which is made available to investors, as appropriate.

    Regulators are also expected to encourage investment managers to review their disclosures describing alternative sources of credit information in addition to external credit ratings while also encouraging investment managers to disclose the use of external credit ratings and describe in an understandable way how these complement or are used with the manager’s own internal credit assessment methods

    Also, were external credit ratings are used, investment managers should understand the methodologies, parameters and the basis on which the opinion of a CRA was produced, and have adequate means and expertise to identify the limitations of the methodology and assumptions used to form that opinion.

    Regulators will also encourage investment managers not to rely solely on external credit ratings and to consider alternative quality parameters such as liquidity and maturity when assessing the credit quality of their counterparties or collateral.

     

  • Apapa-Iganmu LCDA disburses N320m micro credit loans

    Apapa-Iganmu LCDA disburses N320m micro credit loans

    The Apapa-Iganmu Local Council Development Area of Lagos State has granted N320 million loans under its micro credit scheme over the last three years,its chairman, Dr. Adesola Adedayo, said yesterday.

    Reviewing the programmes of the local council at a stake-holders’ forum at  Ijora-Badiya, Dr. Adedayo said  more than 8,000 petty traders, artisans and small-scale manufacturers in the area benefitted from the scheme.

    He described  the micro credit scheme  as  the bedrock of his women and youth empowerment programme.

    He said: “A major highlight of this heart-warming report is that customers’ re-payment stood at over 99 per cent while total portfolio at risk (doubtful and bad debt) stood at N1.5 million.

    “Considering the canons of lending employed in the packaging and delivery of these soft loans, I cannot but commend the integrity of our people,’’ adding: ‘’your response has put to rest the widely held misconception that lending to the poor is risky and fraught with uncertainty.’’

    The chairman said that the scheme was rooted in a tripartite agreement involving the council, Lagos State Micro-Finance Institution (LASMI) and Infinity Micro-Finance Bank Limited.

    Dr. Adedayo said the council was committed to the creation of more employment opportunities through the promotion of small-scale industries and vocational training.

    The chairman, who is a medical practitioner, said that the council had, under its free health programme, had performed 100 eye surgeries (mostly cataract extractions) and 670 other surgical cases of hernia, appendectomies, ovarian cysts, gynaecology and dentistry.

  • New FG’s vehicle credit scheme ready in four months

    New FG’s vehicle credit scheme ready in four months

    Minister of Industry, Trade and Investment, Mr. Olusegun Aganga, said yesterday that a new Vehicle Credit Finance Scheme to make new cars affordable to the ordinary Nigerian would be in place in the next four months as the details of the scheme is being worked out.

    The minister said that the financing scheme is a combination of palliative measures, including partnering with banks towards having a common pool of funds for lending at concessionary interest rate of not more than 10 percent to potential car owners.

    He said it is only in Nigeria that cars are purchased on cash-and-carry basis.

    With the new financing scheme, Nigerians will be able to buy new cars assembled in Nigeria at an interest rate of not more that 10 percent, repayable over a period of four years.

    Clearing the air on the effects of the ongoing implementation of the Nigeria Automotive Industrial Plan, NAIDP, Aganga said there will be no increase in the prices of cars.

    The Minister said: “The rumour that the federal government has increased the tariff on imported cars by 70 percent is incorrect and misleading. The Nigerian automotive manufacturers have already assured the government and all Nigerians that there is adequate stock of imported vehicles and that its members have not and will not increase the price of imported vehicles.”

    He said that last year about 50,000 vehicles were imported at an estimated cost of $3 billion, while between January and June this year, 37,000 vehicles were imported before the take off of the auto policy.

    He said: “Nigeria is the only country in the world where used vehicle were not banned following the introduction of the new automobile policy.

    “This is because President Goodluck Jonathan had taken into consideration current socio-economic conditions and would not want to come up with any policy that will inflict more hardship on Nigerians.”

  • Visa, Mastercard to stay in Russia

    Visa, Mastercard to stay in Russia

    Credit and debit card companies Visa Inc and Mastercard Inc have pledged to continue to operate in Russia and proposed creating their own Russia-based payment operators.

    Visa and Mastercard executives met members of the Russian government in St Petersburg to discuss new rules that would oblige foreign card companies to pay a hefty security deposit to the central bank to work in Russia. The companies said the rules – passed by Russia’s parliament after the West imposed sanctions on a number of individuals and companies over the Ukraine crisis – would complicate their Russian operations but had no plans to exit.

    “In any situation, we will stay in Russia,” Ilya Ryaby, general director of Mastercard in Russia, told journalists at the St Petersburg International Economic Forum. Andrew Torre, director of Visa in Russia, said: “We are willing to work in Russia and after this meeting we hope that a compromise solution will be found”.

    After Friday’s meeting, Ryaby said the card companies had discussed what could be done to create a system of cashless transactions and a system of servicing payment cards in Russia.

    Russian Finance Minister Anton Siluanov told reporters that Visa and Mastercard’s plans to set up Russia-based subsidiaries would take around a year and a half. In the meantime they would work with Russia’s existing payment systems, he said.

    “We are willing to cooperate in this direction,” Siluanov said. “I think we will find a solution that suits both Visa and Mastercard and the Russian Federation.”

    Visa and Mastercard stopped serving several Russian banks after the United States imposed sanctions over the annexation of Crimea in March.

    Russia later launched a package of measures aimed at stimulating the creation of a Russian national payment system to reduce its reliance on Western companies.

    Among those measures, foreign card companies would from July 1 have to pay a security deposit of 25 per cent of their average daily turnover in Russia to the central bank once a quarter.

  • Increasing access to credit

    Increasing access to credit

    Over the years, a number of policies and programs aimed at alleviating the plight of the Nigerian women in business were put into place. Yetunde Oladeinde spoke with stakeholders on the challenges and the way forward.

    A lot of women in business who should benefit from policies and funds ear-marked for them but do not usually have access. The result is that a number of our female entrepreneurs contend with an unfavorable business environment characterised by critical barriers such as a lack of access to finance, and discriminatory cultural and social norms, which curb their potential engagement and contribution to society.

    What can be done to make a difference? Representatives of about 3000 female entrepreneurs from across the country have been working out modalities on the best way to make lack of access to credit a thing of the past. They opine that enhancing Nigeria’s democratic consolidation begins with strengthening the voice of Nigerian business women in public policy reforms.

    So, how can these business women leverage their dominant role in the country’s economy for more active participation?

    “The most effective way to do this is by enhancing the capacity of Nigerian business women’s organisations to advocate for policy reforms”, informs Titilola Adisa coordinator of the Association of Nigerian Women Business Network, a coalition of 17 women business associations across the country.

    She goes on to say that: “the group is currently, implementing a project entitled ‘Increasing Access to Credit among Micro and Small Women Entrepreneurs’ for the development of women businesses. A survey is being conducted to assess the needs of women in micro and small businesses in the area of access to business credit”.

    Would this really make the difference? “It is important to make access to credit to improve and encourage sustainable development. First, we need to create a friendly and conducive environment. Interestingly, the micro and small business make up the economy of the country but they are usually short of funds. So we need to do a number of field surveys to better understand the nature and barriers to accessing credit. Implementation of the project began with the conduct of a survey amongst 112 enterprises located in Abuja, Benin, Enugu, Lagos, Uyo and Warri.”

    The next step would therefore be to share the findings of the survey, review the draft policy position as well as solicit for inputs on policy reforms and recommendations.”

    For Fayo Williams of NEWW, it is important to reach out to women business owners, especially those in the micro and small business category and other stakeholders such as financial institutions, related government MDAs who are responsible for policy formulation and implementation regarding the female gender and commerce, and the media in order to create awareness and seek their support for the success of the Project.

    “The mission of the Coalition is to improve and encourage sustainable entrepreneurship development among women through advocacy in the six geo-political zones of the country.”

    She adds that: “Our objectives include enhancing the capacity of members to achieve optimum entrepreneurship development. We shall advocate for women in business, create an effective voice for business and professional women in Nigeria as well as create proper methods of information dissemination in business”. We would also create partnership with members of primary associations to link women-owned businesses to sources of business funding.

    On her part, Toki Mabogunje, vice president of the Lagos Chamber of Commerce and Industry informed that due to some challenges women entrepreneurs are limited in their capacity to borrow and have therefore become completely excluded from the credit market.

    The bespectacled woman goes on to talk that “the women surveyed recently were all educated and aged between 20 and 60 while their business spanned a variety of business sectors. The challenges faced in loan application process include unreasonable criteria for eligibility, unwholesome bureaucracy, inability to provide collateral as well as very high interest rates.”

    Mabogunje adds that: “Negative mindset of banks in lending to small businesses, length of time required to run an account to be eligible for a loan, hidden charges and unreasonable payment terms all make things difficult for women in business”.

    Omowunmi Gbadamosi, the country Director of The Centre for International Private Enterprise (CIPE), states that “Democratic consolidation is not achieved through simply holding elections, establishing a free press, and recognising human rights (although these remain necessary components). Functioning democracies require opportunities between election cycles for the public to participate in the policy process. Functioning democracies also require a private sector that is capable and willing to provide an outside voice in the democratic policy process”.

    She explained that: “countries need to build market-oriented and democratic institutions simultaneously, as they are essentially two sides of the same coin. Without a functioning market system, democracies will remain weak. Likewise, without a democratic process, economic reforms are unlikely to succeed.

    To support the private sector as a leading advocate for market-oriented reform and democratic governance, CIPE works through a partner network to support grassroots networks in developing countries, capacity building programs, and technical assistance through field offices.

    “Our work is unique in that it employs transparency, accountability, fairness, and responsibility in institutional reform, laying the foundation for democracy at all levels of society. This institutional approach to development recognizes that changes will not occur overnight and a long-term commitment is needed for reforms to succeed.

    Long after a country or a region disappears from the headlines, important work remains to prevent reforms from being overturned at the first sign of difficulty.”

    We recognise that successes in one region may provide a model approach for another. That is why CIPE and its partners continue to apply lessons learned across regions, creating new approaches in countries at various stages of democratic reform .CIPE brings a wealth of knowledge from 30 years of experience conducting over 1,300 reform programs in more than 100 countries around the world.

    Democracy in Nigeria is still to deliver democratic dividends to Nigerian women. Nigerian women are marginalised in all aspects of the Nigerian society. At the national, regional, and local levels of government, their participation in policymaking is minimal and does not reflect their contribution to the Nigerian economy. A lack of fair democratic representation is the reason that Nigerian women’s basic rights are not enshrined in the country’s constitution.

    Paradoxically, Nigerian women dominate the small and medium-sized enterprise sector (SME), which accounts for approximately 80% of commercial activities in the country. However, Nigerian women account for 65% of the Nigerian population that lives below the poverty line. Additionally, Nigerian business women contend with an unfavorable business environment characterised by critical barriers such as a lack of access to finance, and discriminatory cultural and social norms, which curb their potential engagement and contributions to society.

  • Fatima Shema gets credit

    Fatima Shema gets credit

    The Constitution of the Federal Republic of Nigeria may not have spelt out responsibilities for first ladies, but a few of them who know how influential the position can be do not just sit back and watch their husbands toil in the search for a better society. One of the first ladies who wear the task of helping humanity like a garb is the wife of the Governor of Katsina State, Hajiya Fatima Ibrahim Shema.

    Hajiya Fatima has many cards up her sleeve when it comes to humanitarian activities. Easy going and intelligent, she is one the African women immensely blessed with the milk of human kindness, upon which she was recently conferred with the Most Valuable Governor’s Wife in the North-West award.

    She has not only made her humanitarian impact felt in the capital city of Katsina, she and her team have in the last six years taken arduous trips across the length and breadth of Katsina to give hope to the hopeless and empower thousands of rural women and unemployed youths.

  • Institute hosts Nigerian credit industry award

    Institute hosts Nigerian credit industry award

    Institute of Credit Administration (ICA) is set to host the third edition of its annual Nigerian Credit Industry Awards on Saturday, December 14th 2013, at Protea Hotel, Ikoyi, Lagos, by 10.am.
    According to the organisers, the awards, which is part of activities to mark ICA’s quarterly Credit Professionals Networking Luncheon, is to recognise the great performances of the nation’s credit business industry from top chief executive officers and their executive directors who have measured up in professionalism and in their area of core competence, especially credit management operational processes domiciled in the various departments of their organisations.
    Besides, this year’s awards which are classified into 10 categories namely: Credit Management Supported Chief Executive Officer of The Year, Executive Director Credit Management of The Year, Credit Employer of The Year, Credit Professional of The Year, Credit Grantor of The Year, Successful Credit Risk Management of The Year, Best Use of Credit to Sell More of The Year, Internal Credit Administration Process Compliance of The Year, Sound Credit Industry Supporter of The Year and Outstanding Credit Process Supervision of The Year respectively.

  • Credit to private sector hits N15.6tr

    Credit to private sector hits N15.6tr

    Banking credit to the private sector stood at N15.6 trillion at the end of the second quarter, the Central Bank of Nigeria (CBN) has said.

    According to the CBN Economic Report, the figure represents an increase of 2.8 per cent from the first quarter performance.

    It attributed the development to the three per cent rise in claims on the core private sector. Relative to the level at end-December, 2012, banking systems credit to the private sector rose by 3.6 per cent.

    The report said foreign exchange (FOREX) inflow into the country in the second quarter of the year was $9.44 billion, the CBN has said.

    In its quarterly Economic Report, the CBN said forex sales to authorised dealers stood at $10.77 billion, compared to $4.65 billion in the preceding quarter, adding that the development reflected the fall in banks’ foreign assets, which suppressed the growth in their domestic credit and other assets.

    According to the report, the money in circulation is N1.42 trillion, indicating a drop by 5.6 per cent. It dropped by 7.6 per cent at the end of the preceding quarter. The development was attributed, to the 9.3 per cent decline in currency outside the banks.

    It said total deposits at the CBN amounted to N6.1 trillion, indicating a decline of 10.2 per cent, compared to the decline of 8.3 per cent at the end of the preceding quarter. The development reflected, the 24.6 and 21.9 per cent fall in deposits of banks and Federal Government, respectively.

    Also, the government’s total expenditure for the period was put at N1.2 trillion. The report said at fiscal operations of the Federal Government resulted in an estimated deficit of 4.8 per cent of estimated nominal Gross Domestic Product (GDP) for the review period, compared with the quarterly budget deficit of 3.1 per cent of estimated GDP.

    It said Nigeria’s crude oil production, including condensates and natural gas liquids, was estimated at an average of 1.93 million barrels per day (mbd), or 175.63 million barrels for the quarter. Crude oil export stood at 1.48 mbd, or 134.68 million barrels for the quarter, while deliveries to the refineries for domestic consumption remained at 0.45 mbd, or 40.95 million barrels.

    Also, the average price of Nigeria’s reference crude, the Bonny Light, fell by 8.8 per cent below the level in the preceding quarter. The average exchange rate of the naira against the dollar at the Wholesale Dutch Auction System (WDAS) window, remained unchanged at N157.30 per dollar, but appreciated marginally by 0.03 when compared with the level in the corresponding period of 2012.

    CBN data indicated mixed developments in banks’ deposit and lending rates. The spread between the weighted average term deposit and maximum lending rates widened by 1.34 per cent in the preceding quarter. Also, the margin between the average savings deposit and the maximum lending rates, also widened by 0.43 percentage point, while the weighted average inter-bank call rate rose by 0.34 percentage point in the second quarter of 2013, reflecting the liquidity condition in the inter-bank funds market.

    The report said provisional data indicated that the value of money market assets outstanding for the quarter, increased by 5.9 per cent, in contrast to the decline of 0.6 per cent at the end of the preceding quarter. The development was attributed, largely, to the 5.6 per cent rise in Federal Government of Nigeria Bonds outstanding.