The Nation Newspaper

Tag: strengthen

  • Petrodollars from IOCs strengthen naira

    Petrodollars from IOCs strengthen naira

    Rising dollar inflows from international oil companies (IOCs) last week boosted the naira. It appreciated as the IOCs pumped petrodollars into the local market, pushing the currency to 0.2 per cent rise to N157.25 to a dollar on Friday, data from the Central Bank of Nigeria (CBN) website showed. The naira gained for a second week by less than 0.1 per cent.

    However, the naira is expected to come under pressure next year, a year before the 2015 general election, Director, Africa Economist, Citi, David Cowan, has warned.

    Speaking at the EuroFinance conference in Lagos, Cowan, who spoke on the theme: Global economic update: Europe casts a long shadow, added that oil price will also weaken in 2014, a development which will put pressure on the naira.

    He said increased fiscal spending pressure will grow in 2014, adding that there is need to strike a balance between the urban inflation rate and the rural inflation rate in the country.

    A Fixed Income & Currencies analyst at Ecobank Nigeria, Olakunle Ezun, said on the short run, the naira will likely continue to trade on the interbank market within the CBN’s three per cent band either side of N155 to a dollar.

    He said the steady rise in reserves to $46.9 billion, which is around 10 months equivalent of imports, provides a large cushion to support the naira in the months ahead. The foreign reserves rose $46.9 billion on February 20, and might be stable in the near term.

    The government’s borrowing costs fell for a fourth monthly bond auction last week after the CBN forecast that inflation slowed in January. The Debt Management Office (DMO) sold N105 billion ($667 million) in securities, it said in a statement on its website.

     

    Inter-bank rate

     

    The inter-bank rate rose 90 basis point to 14 per cent on, reflecting CBN’s effective liquidity management efforts. The CBN’s aggressive liquidity mop-up re-emphasised its monetary policy stance and it is supported by the circular issued last August reviewing its guidelines for how banks access its Standing Lending Facility window.

    Call and overnight and seven-day money market rates rose 14 per cent and 14.4 per cent. The three-month Nigeria Interbank Offered Rate (NIBOR) also rose 15.4 per cent though less activity is done on the tenor. The secured lending (Open Buy Back) rose 13.7 per cent for deposit money banks and 14 per cent for discount houses.

     

    Sustainable banking

     

    The CBN has called on banks to pursue and implement issues itemized in the Nigerian Sustainable Banking Practice (NSBP).

    In a circular to banks, Special Adviser to the CBN Governor on Sustainable Banking, A’sha Mahmood explained in a statement to banks that the policy involves integration of social and environmental considerations into banks’ operations, services, procedures and strategies.

    According to the CBN guidelines on the policy, the environmental and social policies as well as decision-making processes will also be integrated into the operations of discount houses and development finance institutions.

    The sustainable banking practice, it said aims at minimising or mitigating the negative impacts of financial institutions’ operations on the environment and local communities in which they operate.

    It captures the Nigerian sustainable banking principle on agric sector, power sector and the oil and gas sector.

    According to the regulator, for the successful implementation of the principles the institutions would be required to develop a management approach that balances the environments and social (E&S) risks identified with the opportunities to be exploited through their business activities.

     

    e-Clearing

     

    Electronic clearing (e-clearing), which is currently implemented only at banks’ headquarters will be extended to all banks’ branches across the country once the Central Bank of Nigeria (CBN) gives its approval.

    The policy, which became effective last August, could not be fully decentralised to all the banks’ networks because of poor technical know-how and infrastructure needed for seamless take-off in those units.

    An executive of Sybrin Systems Limited, Daniel Parreira, who confirmed this development in an interview, said provision of sophisticated payment solutions, adoption of fully integrated management systems and anti-fraud mechanisms by banks will enable them achieve the feat. Decentralisation to branches, he added would further reduce the pressure on the clearing centres.

    Sybrin Limited, a software technology firm based in South Africa, provides e-clearing services and other payment solutions to Africa’s leading banks, clearing houses and corporations. The firm is in Lagos to seek partnership with banks and regulators of the financial system on effective implementation of e-payment solutions.

     

    Cashless

     

    Transactions recorded by the Nigerian Inter Bank Settlement System (NIBSS) under its NIBSS Instant Payment (NIP) and Nigerian Electronic Fund Transfer (NEFT) have increased significantly to about N40 billion daily.

    NIP and NEFT are products used by corporate organisations to make payment for huge transactions electronically, in line with the cash-less policy. Data gathered from NIBSS also shows that as a result of the cashless policy, cheques, Point of Sale (PoS) and Automated Teller Machines (ATMs) use have continued to rise in volume and value.

    Head, Shared Services at the CBN, Mr Chidi Umeano, said the cash-less project has continued to record huge success, adding that the initial challenges associated with the alternative channels are being tackled.

    “Banks have continued to roll out more innovative electronic payment platforms to meet customers’ expectations. The cash-less policy has been very successful in Lagos considering when we started and how far we have gone in terms of PoS deployment. When we started the cashless Lagos, we had less than 10,000 PoS in Lagos, but currently we have over 150,000 PoS machines in the state alone,” he said.

     

    Revenue

     

    The Federal Government earned N2.4 trillion in the fourth quarter of last year, according to the Central Bank of Nigeria (CBN) Economic Report released last week.

    The report, published on the CBN website said the revenue, represents a decline of 0.4 when compared with earnings in the preceding quarter. However, the figure shows an increase of 101.1 per cent above the receipts in the corresponding period of 2011.

    At N1.82 trillion, oil receipts, which constituted 75.6 per cent of the total revenue, exceeded the budget estimate and receipts in the corresponding period of 2011 by 9.91 and 151.2 per cent. But the oil earnings declined by 5.8 per cent below the receipts in the preceding quarter.

    “The increase in oil receipts relative to the budget estimate was attributed largely to the rise in the receipts from petroleum profit tax, royalties and domestic crude oil and gas sales during the period,” it said. The report said that the Federal Government retained revenue for the fourth quarter was N821.24 billion, while total expenditure was N1.2 trillion, leading to a N420.81 billion deficit in fiscal operations of the Federal Government.

     

    Visa

     

    Visa, a global electronic payments company, has reiterated its commitment to unlocking trade and tourism potential within sub-Saharan Africa. In a statement, Ade Ashaye, Country Manager for Visa in West Africa, said: “Visa plays an active role in travel and tourism and its research in the tourism industry provides key insights into the trends. We believe that continued engagement in the industry is important.”

    He also announced the firm’s partnership with Future Group and its Nigeria-based partners, Tradeblazers Limited, to sponsor the BT Africa, conference holding in Lagos in March. Ashaye said Visa is committed to consolidating its position in the travel industry throughout sub-Saharan Africa. He said the company has been instrumental in reshaping the payment landscape in West Africa with the introduction of several products, including the Visa Corporate card, for enabling secure and convenient cashless transactions within the region.

     

    Debt

     

    Banks’ top 50 customers’ total obligations amounted to N2.39 trillion, representing 30 per cent of the total N7.87 trillion owed the banking sector, the CBN Financial Stability report for June 2012 had shown.

    The report, endorsed by both the CBN Governor, Sanusi Lamido and Deputy Governor, Financial System Stability, Kingsley Moghalu, said the banking sectors’ total credit was N7.2 trillion at the end of December 2011.

    It noted that the top 100 obligors accounted for 39.1 per cent of the gross credit, indicating a high level of loan concentration within the banking sector. The ratio of non-performing loans (NPLs) to gross loans declined by 0.6 per cent from 4.9 per cent, but fell within the regulatory threshold of five per cent.

     

    Finance Houses

     

    The implementation of reforms in the finance houses sub-sector of the economy is being hindered by bureaucracy, among which is the pending Central Bank of Nigeria (CBN) governor’s assent, The Nation learnt.

    An insider at the Finance Houses Association of Nigeria (FHAN) explained in confidence that stakeholders approvals have been secured in critical areas, especially in the drive to raise the sectors’ capital base from the N20 million to about N100 million.

    This, he said, will ensure that only seriously minded operators are allowed to carry on the businesses of finance houses in the country. The source said that stakeholders are expectant of the new reform, which is expected to be unfolded by the CBN before the end of this quarter. It is also expected that the reforms will expand the funding structure of the subsector to allow new investors into it.

     

    Banks’ credit

     

    Credit by banks is expected to rise by 20 per cent within the year, Renaissance Capital (RenCap), an investment and research firm, has said. In an emailed report obtained by The Nation, RenCap said banks excite it most within the Europe, Middle East and Africa (EMEA) banks context this year. According to the firm, with the country’s growth expectations for Gross Domestic Product (GDP) of 6.7 per cent, the Nigeria market should benefit from accelerating top-down trends.

    It also said West to East African banks are also viable performers within the year, with the Kenyan elections a potential headwind. RenCap said Equity Bank remains its pick of the bunch on a relative basis.

     

    Bank to bank report

     

    First Bank of Nigeria last week toured the University of Lagos (UNILAG) campus in a new campaign that promotes its FirstNaira MasterCard termed ‘expressions on card’. The product gives existing customers the opportunity to upload personal pictures of choice depicting memories, smiles and any others experiences on it.

    The bank’s Head, e-Business, Mr Chuma Ezirim, explained that the bank is giving customers, especially the youth and youth at heart, the flexibility to express themselves through images captured on the card. “We want people to carry along memories, smiles and any other thing that is personal to them on their FirstNaira MasterCard. It gives customers the opportunity to upload a picture of their choice on the bank’s existing naira MasterCard,” he said.

    Union Bank of Nigeria Plc said it had to continue the transfer of legacy pension for post 2005 pensioners to their Pension Fund Administrators (PFA) in line with the Pension Reform Act (PRA) 2004.

    In a statement, the bank said the PFAs will consequently take over full responsibility for pension payments for affected pensioners, excluding pre-2006 pensioners, with effect from February 2013. The affected pensioners have been informed through letters and test messages. The bank also said it has set up a contact centre on the fourth floor in the Head office (Stallion Plaza), which can be reached by concerned pensioners.

    Ecobank Foundation has donated cash to the Kanu Heart and Lumina foundations as part of the bank’s corporate social responsibilities reaching out to communities where Ecobank does business in Africa.

     

  • Youths strengthen good character campaign

    Youths strengthen good character campaign

    Something remarkable is happening among the youth. They are showing profound interest in the campaign to make character count in the country. That campaign is championed by Good Character Development Initiative (GCDI), a non-profit organisation with a vision to stimulate national development through a new moral order.

    GCDI drives this crusade across secondary schools in the country, incorporating good conduct and citizenship modules in the curricular.

    The authorities of these schools alongside staff have helped the campaign by inculcating the GCDI message in the pupils.

    But the students themselves are proving to be even more enthusiastic. At Oxbridge College, Ikeja, they were the good character leaders teaching junior colleagues, many of who drawn from various institutions in the state. They guided their classes through the GCDI pillars of good character, namely, trustworthiness, respect, responsibility, fairness, caring and citizenship.

    In the Responsibility Class, Miss Chinaza Eze, 16, and Yvonne Udeagha, 17, both Advanced Level students of the college, were exemplary. They placed jars, rice and tennis balls on desks and asked the pupils to fill the containers with the items in minutes. The pupils, divided into three groups, struggled with the task, one of them managing to fill their jar with the grains and tennis balls and closing it within the stipulated time. As the stand-in instuctors explained, the jar-rice-balls exercise represented daily life experiences and priorities. While some have clearly-identified goals and work diligently towards achieving them, others have misplaced priorities and waste precious time in pursuit of trivial interests.

    Yvonne and Chinaza made the point confidently, convincingly and in flawless English.

    They also showed the students an illustration of a guy whose multi-coloured outfit had various words and phrases written on it. Such wprds included homework, clean room, help others, think before you act, plan ahead, never give up, always do your best, work hard, set goals, stand up for excellence, a person of character meets demands of duty, among others.

    There was also something to lift their spirits. A short video showed a man with neither arms nor legs. The man drew tears from his audience not because of his physical challenges but because he made the point that if you are down, you have to try and try again to “get back up”, as he put it.

    The youths said the entire exercise was worth their while.

    “Good values will get you far in life,” said 17-year-old Advanced Level student who, alongside a partner, also sank home the imperatives of good citizenship in his class.

    Prince Nnagozie Ochi, chief executive of GCDI, encouraged the students to make character count in their respective schools, homes and environments.

    The good character vision is a new Nigeria that is strong in morals, where priority is on proper conduct as opposed to material acquisition or influential position.

    GCDI is seeking to have “a critical mass of Nigerians” on the side of good character whose contribution will make a crucial difference in the moral profile and growth of the country.

    Former High Commissioner to the United Kingdom, Dr Christopher Kolade, chairs the GDCI board of trustees.

     

  • Approved oil benchmark to strengthen exchange rate

    The exchange rate for the naira will be strengthened by the approved oil benchmark, analysts have said. The FBN Capital, an investment and research firm explained in a report that if the oil price remains stable, which is expected, a lower threshold strengthens the defences and underpins the naira exchange rate.

    The naira at the weekend, advanced after investor inflows into a Nigerian bond auction pushed yields to a record low. The naira rose 0.2 per cent to 157.5 a dollar and has gained 3.1 per cent this year, the second best performance of African currencies tracked by Bloomberg.

    Managing Director, Blue Wall Bureau De Change (BDC), Lucky Aiyedatiwa said the naira hans been relatively stable since the beginning of the year and is expected to maintain that status in 2013.

    However, higher budget threshold would reduce the transfers to the excess crude account (ECA) and the sovereign wealth fund (SWF), which are expected to provide sufficient buffers for the economy. The National Assembly on Thursday approved an oil price threshold of $79 per barrel for the term of the 2013 to 15 medium term expenditure framework. The legislators approved a N4.98 trillion budget for next year, raising the Executive’s N4.92 trillion proposal by N63 billion.

    President Goodluck Jonathan had sent a N4.92 trillion Appropriation Bill to the lawmakers. “The House of Representatives had previously argued for $80 per barrel and the Senate for $78 per barrel. The FGN had assumed a threshold of $75 per barrel in its proposals for 2013. This was an increase from the level of $72 per barrel in the 2012 budget, an unusual step by the executive which we attributed at the time to its determination to secure a relatively swift passage into law of the finance bill,” FBN Capital said.

     

    Interbank

    Ezun Olukunle, Fixed Income & Currency Analyst, Ecobank Nigeria, said inter-bank rate fell 20 basis points to 10.5 per cent on December 19, despite provisions made for Central Bank of Nigeria (CBN’s) Wholesale Dutch Auction System (WDAS), treasury bills and the monthly government bonds auction.

    According to him, recent rise in interbank rate was due to ongoing CBN’s liquidity management adding that Open Market Operations (OMO) bills of N273.1 billion were sold between 10 and 13 December. He said the CBN’s liquidity management remains active and supported by the circular issued on 1 August tightened currency and the MPC’s decision to leave the MPR unchanged at 12 per cent on 20 November. However, call/overnight and 7-day money market rates fell 10.5 per cent and 10.95 per cent respectively while the 3-month Nigeria Interbank Offered Rate (NIBOR) also fell 12.87 per cent, though less activities were done on the tenor.

     

    SWF

    Nigeria’s $1 billion sovereign wealth fund will start making investments in March after receiving board approval. “We’ll start all the securities investing by March” for the Fiscal Stabilization Fund and the Future Generations Fund, Uche Orji, chief executive officer of the Nigeria Sovereign Investment Authority, told Bloomberg. For the Infrastructure Fund, “we’ll start investing in the second half of 2013.”

    Nigeria set up a wealth fund in May last year to invest savings made from the difference between budgeted oil prices and actual market prices. Africa’s most populous country of more than 160 million people relies on crude exports for more than 90 per cent of foreign income and about 80 per cent of government revenue, making it vulnerable to swings in prices.

    The wealth fund will help meet budget shortfalls in the future, provide dedicated funding for development of infrastructure and keep some savings for the future generation, according to the law establishing it.

     

    Fraud control

    Come next year, the Central Bank of Nigeria (CBN) in collaboration with the Nigeria Electronic Fraud Forum (NeFF) will be introducing industry-wide software that will assist banks control frauds.

    Speaking at the NeFF Annual General Meeting held in Lagos, CBN governor, Sanusi Lamido Sanusi said taming frauds in the banking system is critical to development of the sector adding that the Forum was set up for that purpose. Sanusi, who was represented by CBN Director, Banking and Payment Systems, ‘Dipo Fatokun said the software will be domiciled at Nigeria Interbank Settlement System (NIBSS) adding that the software is the regulator’s way of achieving a proactive tactics in addressing frauds.

    “The Neff is a collaborative effort. The purpose of this forum is to reduce frauds in the banking system. The CBN is working with NIBSS and other operators to ensure that come next year, we will have a software that is domiciled at NIBSS that will proactively, address the issue of fraud in the entire industry. It will not only be preventive but proactive. We want industry-wide software to address frauds,” he said.

     

    ATM charges

    Deposit Money Banks last week, stopped all interbank charges for Automated Teller Machines (ATMs). The CBN had last month, agreed to put a stop to all charges associated with the use of ATMs. The agreement was the highpoint of a meeting between the Bankers Committee made up of Chief Executive Officers of commercial banks, directors and top officials of the CBN and NDIC. Before now, account holders had been made to pay a flat rate of N100 per withAdrawal any time they used other banks’ ATMs.

    Some of the banks visited by The Nation last week had complied with the directive. At Ecobank Nigeria, FirstBank, Diamond Bank, Access Bank, Guaranty Trust Bank, branches in Lagos there were full compliance.

     

    Unified currency

    The central banks of West and Central Africa are considering combining their currencies, Lucas Abaga Nchama, governor of the Bank of Central African States, has said.

    According to the West African and Central African CFA francs are currently separate currencies that are both pegged to the euro. Merging them would boost trade and help fight money laundering, Nchama said. The franc zone covers 14 African countries, Benin, Burkina Faso, Cameroon, Central African Republic, Chad, Congo Republic, Equatorial Guinea, Gabon, Guinea-Bissau, Ivory Coast, Mali, Niger, Senegal and Togo.

    Six other West African nations namely Nigeria, Ghana, Sierra Leone, Gambia, Guinea and Liberia — plan to enact a common currency, known as the Eco, by January 2015, 12 years behind an initial target, Temitope Oshikoya, chief executive officer of the West African Monetary Institute, said.

     

    Tenure for audit committee

    The tenure for audit committee should be increased from one year to three years of two terms to achieve better result and promote continuity, National Coordinator, Independent Shareholders of Nigeria (ISAN), Sir Sunny Nwosu has said.

    He spoke at the 2012 Annual Audit Committee Roundtable held in Lagos. According to him, those elected into the audit committee should report to the shareholders adding that some companies discourage people that can interpret account statements from joining the committee where there are sinister motives.

    He also said that the Companies and Allied Matters Act (CAMA) needs to be amended to address pressing issues that hinder auditors from carrying out their responsibilities effectively

    Chairman, Audit Committee Institute of Nigeria, Christian Ekeigwe also said that CAMA has to be reviewed to check management excesses and protect the interest of all shareholders and other stakeholders.

    He advised investors to be careful in choosing companies to invest in, saying they should choose those companies that have developed the right governance environment. “Good governance is a control against fraudulent financial reporting. Firms with good governance would have enterprise risk management framework that helps deter and detect fraudulent financial reporting,” he said.

     

    Agric funding

    The Nigerian agricultural sector has attracted $8 billion foreign direct investment (FDI) in the last one year, Minister of Agriculture and Rural Development, Adesina Akinwunmi has said.

    Speaking at a workshop on Financing Nigeria’s Agricultural Revolution organised by the Securities and Exchange Commission (SEC), he said that agricultural lending is promising and has moved from one per cent to over three per cent in the last one year.

    He said there is need to unlock the potentials in the agricultural sector adding that banks should see agricultural financing as a serious business that can impact positively on their balance sheets.

    He said that public equity funds also need to increase their stake in agricultural financing.

    He said that Nigeria Incentive Based Risk Sharing for Agricultural Lending (NIRSAL) which allows bank to share the risk associated with lending to the sector as provided by the Central Bank of Nigeria (CBN).

    The apex bank is equally considering an intensive performance rating for all commercial banks to determine their effectiveness of lending to agriculture. To achieve this, the apex bank has set aside, N75 billion allocated for the full implementation of the NIRSAL project.

    The CBN has also recently set new rules for lending to the agricultural sector of the economy. The apex bank took the decision after reports from banks and discount houses indicated that lending to the subsector remains a high-risk, which should be followed with caution.

     

    Cashless policy

    With an estimate of N3.5 trillion circulating yearly within the unbanked and under-banked (constituting over 10 million traders), the Institute of Chartered Accountants of Nigeria(ICAN) has urged the Central Bank of Nigeria to extend the cashless policy outside Lagos to bring more cash into the system.

    In addition, the institute said spreading the policy outside of Lagos will help the government in its anticorruption and anti-money laundering campaign. Addressing the institute’s 17th Association of Accounting Technicians (AAT) annual conference, ICAN President, Mr Adedoyin Owolabi said when cash remains outside the banking system ,the ability of banks to create credit and supply productive capital to the economy will diminish.

    His words: “Bringing cash into the banking system produces an equal increase in bank reserves, enabling banks to facilitate more consumer and commercial loans, thereby stimulating consumption and business growth.”He stressed that the institute supports the cashless policy not only because it can promote transparency of transactions through the provisions of audit trails but also because it can increase the size of the informal economy and access by government to loanable funds.

     

    Bank to bank report

    First Bank of Nigeria Limited (FirstBank) assured its customers of enhanced services across its networks nationwide. In a customers’ forum held in Lagos, the bank had highlighted its new products and services, including e-business services, alternative channels, and the various transformational initiatives of the Bank over the past one year.

     

  • Tight monetary stance, rising reserves strengthen naira

    Tight monetary stance, rising reserves strengthen naira

    The naira has appreciated 2.8 per cent this year over Central Bank of Nigeria (CBN’s) tight monetary stance and rising foreign reserves. The CBN aims to keep the naira at a rate of about three per cent above or below N155 a dollar.

    The local currency firmed on inflows for purchases of fixed-income securities after the CBN held its benchmark interest rate at a record high last Tuesday to check inflation and stabilize the local currency. The naira gained 0.1 per cent to N157.9 a dollar after weakening 0.1 per cent the last week.

    The naira’s appreciation could be traced to tight monetary conditions, improved supply of foreign exchange to the market by oil companies and increased inflows from portfolio investors, CBN Governor Sanusi Lamido Sanusi said.

    The nation’s foreign-currency reserves have risen 32 per cent this year to $43.45 billion as of November 16, according to data on the CBN’s website, an exercise that has further strengthened the naira.

    Inflation, which accelerated for the first time in four months to 11.7 per cent in October on widespread flooding of farms, is still above the bank’s target of less than 10 per cent. Also, Nigerian bond yields remain attractive to offshore investors, with the inflows boosting dollar supply.

    “An interest rate of 12 per cent will check excess money supply and demand for dollars,’’ Wale Abe, chief executive officer of the Financial Market Dealers Association, which groups lenders trading in the money market, said.

     

    Agency Banking

     

    Framework that would define the mode of operation for Agency Banking will be out by the middle of December this year, the Governor, Central Bank of Nigeria (CBN), Sanusi Lamido Sanusi has said.

    Speaking at the Enhancing Financial Innovation and Access (EFInA) forum held in Lagos, he said that the CBN Committee of Governors is already fine-tuning the draft exposure the agency banking, which will be issued soon.

    He said issues relating to number of agents, type and nature of agents including considerations for super agents are critical areas being considered in the draft exposure. He said all the processes for this line of banking to become functional in the country will be finalised by this year-end.

    He said there have been a lot of improvements in the Nigerian payment system, including the drive for financial inclusion. The apex bank boss said lenders have to address the need for special products that consider women and the handicapped to ensure that everyone is carried along.

    He said that the agency banking provides financial services to the widely dispersed population at affordable price and has assisted some countries in decongesting existing customers from crowded branches, and will equally serve same purpose in Nigeria.

     

    Third quarter earnings

     

    The five biggest banks in the country earned $1.6 billion as at September 2012, four times the $400 million they achieved in 2005, the Managing Director, Access Bank Plc, Aigboje Aig-Imoukhuede, has said. This was contained in a report by the Oxford Business Group Update released at the weekend. “The Nigerian banking system is poised for a new era of competition,” he said.

    In a September report on the sector, Lagos-based Cordros Capital noted that the 12 banks it surveyed – including the top five – all posted revenue growth of more than 20 per cent in the first half of 2012.

    The United Bank for Africa (UBA), announced in unaudited results that its gross earnings grew to N168.2 billion, up 21.4 per cent on N138.5 billion in the same quarter of 2011. Total assets rose 11.1 per cent year-on-year to N1.95 trillion and profit before tax surged 376.25 per cent to N44.86 billion.

    The figures represent a turnaround after the prolonged effects of the 2008/09 crisis, when 10 banks accounting for 40 per cent of the system were signalled out by the CBN for auditing and were subsequently sold off, nationalised or recapitalised.

     

    LCCI

    The Lagos Chamber of Commerce and Industry (LCCI) has expressed concern over the implications of Monetary Policy Committee (MPC) retention of a tight monetary policy stance.

    LCCI Director-General, Muda Yusuf said the current economic and business conditions will escalate unemployment crisis, decline profit margins, weaken consumer demand and lead to prohibitive interest rates.

    He also said the MPC decision to retain Monetary Policy Rate at 12 per cent will decelerate economic growth and lead to high mortality rate of small businesses. “These conditions call for policy choices that would stimulate the economy, even at the risk of inflation. Boosting economic activities would increase output and invariably moderate inflation. The MPC decision to retain a regime of tightening is ill advised and insensitive,” he said.

    According to Yusuf, the apex bank’s concern about inflation, exchange rate stability and the preservation of foreign reserves are noted but given the present socio-economic conditions, stimulating the economy should be paramount at this time.

     

    Contracts

     

    The Federal Government must respect and fulfill terms and conditions it signed with both local and foreign investors that won power sector bids, Governor, Central Bank of Nigeria (CBN), Sanusi Lamido Sanusi has said.

    Sanusi who spoke at the weekend during the 46th Annual Bankers’ Dinner organised by the Chartered Institute of Bankers of Nigeria (CIBN) in Lagos, said investors will not take government seriously if by any reason, it reneges on keeping its own side of the contracts.

    “Government must respect contracts signed on power. Under no circumstance should these contracts be revoked and I am happy that the power reforms contracts have not been revoked,” he said.

    Data provided by the Bureau of Public Enterprises (BPE) showed the assets for privatisation include 11 distribution companies (Discos) and six generation companies (Gencos) from the unbundled Power Holding Company of Nigeria (PHCN).

     

    ATM Charges

     

    The Nigeria Deposit Insurance Corporation (NDIC) and CBN will be sending examiners to banks to see if the lenders are complying with N100 waiver on other banks’ Automated Teller Machines (ATMs).

    Managing Director, NDIC, Umaru Ibrahim, disclosed this during a media workshop held in Jigawa. He said the regulators are committed to ensuring that all banks comply with the directive to ensure that CBN’s policy on financial inclusion is achieved.

    The apex bank had early last week, finally agreed to put a stop to all charges associated with the use of ATMs. The agreement was the highpoint of a meeting between the Bankers Committee made up of chief executive officers of Deposit Money Banks, directors and top officials of the CBN and NDIC. Before now, account holders had been made to pay a flat rate of N100 per withdrawal any time they used other banks’ ATMs.

    He said the decision to stop the charge would help to increase the patronage of ATMs, thus deepening the financial inclusion strategy.

     

    Asset seizure

     

    The managing director, DataPro, Abimbola Adeseyoju, has called for the implementation of the asset seizure, confiscation and forfeiture policy of Economic and Financial Crimes Commission (EFCC) to check money laundering in the country.

    Speaking at the DataPro inaugural lecture series held in Lagos, he said that the anti-money laundering /combating the financial terrorism (AML/CFT) initiative was instituted by the Central Bank of Nigeria (CBN) to ensure that financial crime perpetrators were punished to ensure they do not benefit from their crimes.

    He advised that an acceptable framework that tallies with ‘Recommendations Four of the Financial Action Task Force 2012 Principles’ which is on asset seizure, confiscation and forfeiture as one of the deterrents to money laundering and terrorists financing.

    He said that government should ensure that competent authorities have powers to freeze or seize and laundered property or proceeds including instrumentalities used or intended to be used for money laundering or terrorism financing.

     

    World Bank

     

    World Bank report says the African continent would also generate an extra $20 billion in yearly earnings if its leaders can agree to dismantle trade barriers that blunt more regional dynamism. The report was released on the eve of an African Union (AU) ministerial summit in Addis Ababa on agriculture and trade.

    In a statement, the bank says that Africa’s farmers can potentially grow enough food to feed the continent and avert future food crises if countries remove cross-border restrictions on the food trade within the region.

    The report urges African leaders to improve trade so that food can move more freely between countries and from fertile areas to those where communities are suffering food shortages. “The World Bank expects demand for food in Africa to double by the year 2020 as people increasingly leave the countryside and move to the continent’s cities,” it said.

    According to the new report, Africa Can Help Feed Africa: Removing barriers to regional trade in food staples, rapid urbanization will challenge the ability of farmers to ship their cereals and other foods to consumers when the nearest trade market is just across a national border.

     

    Taxation

     

    The President of the Chartered Institute of Taxation of Nigeria (CITN), John Sunday Jegede, has said that taxation, and not oil, remains the engine-room for sustainable economic development in the country. He said oil and gas will in the very near future dry up but taxation will always remain a source of revenue for countries.

    Jegede disclosed this during CITN’s 27th induction ceremony in which 546 new members were inducted. According to him: “It is no longer news that what is needed to drive our economy and assist in the realisation of vision 20-2020 and the transformation agenda of the Federal Government is the diversification of the economy with emphasis on taxation”.

     

    Bank to bank report

     

    The Fidelity Helping Hands Programme (FHHP), a staff funded volunteer initiative, has renovated and handed over Sought After Foundation Orphanage Home in Lekki, Ajah to its management.

    The bank’s Executive Director, Shared Services, Mrs Ugochukwu Chijioke, who was represented by the General Manager of Operations, Mr Sam Obijiaku, said the renovation was done in the spirit of giving back to the society where it operates.

    As part of activities planned to mark 15 years of a rewarding partnership, UBA in conjunction with MoneyGram, has donated a fully branded crèche for the Oncology Pediatric ward of the Lagos University Teaching Hospital (LUTH) in Nigeria.

    The ward branch was handed over to senior management of LUTH at a colorful ceremony within the hospital premises.

    The Product Manager, Stella Okojie, said that as part of bank’s incentive to reward customers during the UBA/MoneyGram 15th Year Anniversary, the Bank plans to execute hospital-based corporate social responsibility (CSR) projects.

    Standard Chartered Bank Nigeria has officially opened its new branch located in Apapa, Lagos. In a statement, the lender said the opening of the branch is in line with its strong business growth and strategic expansion drive in the country.

    It said Lagos presents it with tremendous opportunities in a country which is central to its business footprint in Africa. “The strength of the Nigerian market has been reflected in our business growth which has been exponential,” it said.

    Regional Head for Consumer Banking in the Middle East, Pakistan and Africa, Raheel Ahmed said: “Lagos is an extremely important state in Nigeria. It has always played a pivotal role in the development of the country and whatever happens in Lagos usually gets replicated positively in other parts of the nation,” he said.