All Posts in "Banking & Finance"

Local stock market dips further as Investors lose N71bn

By admin

 

Equities trading at the Nigerian Exchange Limited (NGX) extends negative outing into the fourth trading session of the week leaving Investors with N71 billion loss.

Basically, on Thursday, the All-Share Index dipped further by 0.32 per cent to peg the ASI at 43,108.77 basis points, bringing the month-to-date and year-to-date outings of the benchmark index to stand at 2.55 per cent and 7.05 per cent respectively.

This also pegged the Equities market capitalization at N22.494 trillion as investors lost N71 billion in the session.

Market breadth closed in favour of the bears with 24 counters in the losers’ chart pitted against 14 counters in the gainers’ chart.

Honeywell Flour Mills was the best performing stock in the session, on the back of the assurance on the recent announcement by Flour Mills of Nigeria Plc of their agreement to acquire a majority shareholding interest in the stock.

HFM was flanked by AIICO Insurance, Regal Insurance, Ikeja Hotels and University Press Limited to complete the list of the top five gainers.

From the rear of the chart, MRS Oil sheds the most weight to lead the laggards’ chart as it was flanked by CHAMS, ETI, CHI PLC, and Unity Bank to complete the top losers’ chart.

Most sectoral indices closed in the same direction with the ASI save for NGX Insurance that gained 0.64 per cent, while NGX Growth and NGX ASEM closed flat.

Market activity as measured by both volume and value of trades gained weight in the session with daily traded volume standing at 266 million units, representing a 9.43 per cent increase from a volume of 243 million units traded in the previous session.

The value of traded stocks inched up by 12.54 per cent in the session to stand at N4.216 billion as against a value of N3.747 billion recorded in the previous trading session.

Seplat dominated the volume charts as the top traded stock by volume for the trading session. This is followed by FBN Holdings, Zenith Bank, Access and Honeywell Flour Mills to complete the list of the five most traded stocks by volume.
With regards to the value of traded stocks, GTCO took the lead of the top five performers. It is flanked by Zenith Bank, Nigerian Breweries and HFM.

Claim: A national newspaper and multiple online platforms claim Brazil has adopted Yoruba as its official language and that the language would be included in primary and secondary schools curriculum.

Verdict: The claim is false. The content of the article published by these online platforms is not new; it has been recirculated several times and has been debunked.Local stock market dips further as Investors lose N71bn

Patoma Admin by — November 26, 2021 in Banking & Finance 0
NDIC Pays N11.76bn to 535, 815 Depositors of Closed Banks

 

By Sandra Adesiyan

 

The Nigerian Depositors Insurance Corporation (NDIC) has paid a total of N11.76 billion as insured sum to 535,815 depositors, while N101.666 billion was also paid as uninsured sum from 1989 to June ,2021.

The Managing Director of NDIC, Mr. Bello Hassan,made this know at Edo International Trade Fair.

Represented by the Corporation Senior Manager, Benin Zone, Mr. Udofor Ukpom, Hassan said since the establishment of NDIC in 1989 as a statutory agency of government with four broad mandates, it has been protecting depositors by providing an orderly means of resolution and reimbursement in the event of bank failures.

He listed the four mandates of NDIC as deposit Guarantee, bank supervision, distress resolution and bank liquidation, with the primary public policy objectives of contributing to financial system stability.

He said:”From inception till date, NDIC has been living up to its mandate and public policy objectives of contributing to financial system stability and has paid cumulative amount of N11.76 billion as insured sums to 535, 815 depositors of closed banks while a total of N101.666 billion had been paid as uninsured sum as at 30 June, 2021. In addition, a total of N6.159 billion had been paid as liquidation dividend to 1,955 creditors and shareholders of closed banks.”

Instructively, the corporation has declared full payment of insured and uninsured sums to depositors of 18 banks in-liquidation.”

This implies that the Corporation has realized liiquidation dividend to pay all depositors of the banks who present themselves for payment.

“Likewise, NDIC has continued to strive for a sound, safe and stable financial system which is pivotal for sustainable economic growth and in that regard, has responded to innovations in the financial system by extending deposit insurance cover to MFBS, PMBs, NIBs and MMOs and also to the recently licensed Payment service banks (PSBs) in order to engender confidence in the financial system.”

The NDIC boss advised Nigerians to remain vigilant and not disclose their ATM details and account information inadvertently and also not patronise the services of Ponzi schemes and illegal fund managers, who parade themselves as deposit taking institutions.

Earlier, the Managing Director, of Benin Chamber of Commerce, Industry, Mines and Agriculture (BENCCIMA), Mrs Aina Omo-Ojo, thanked NDIC for coming to the fair to enlighten the public on its operations and also how to make sure that as business people they don’t lose their hard earned money through banks.

Patoma Admin by — November 26, 2021 in Banking & Finance 0
CBN to publish names of agric loan defaulters

By Favour Nnabugwu

 

The Central Bank of Nigeria (CBN) has said it would soon publish in the newspapers names of loan defaulters under its Agricultural Credit Guarantee Scheme.

This is according to a document titled: “Guidelines for the Agricultural Credit Guarantee Scheme” recently released by the CBN.

The CBN also warned that borrowers who divert the funds provided under the Agricultural Credit Guarantee Scheme Fund (ACGSF) might earn a five-year jail term.

According to the CBN, the Fund aims to provide a guarantee in respect of loans granted by lending banks for agricultural purposes under the scheme, adding that in furtherance of the scheme, the bank will do what it must to recover loans from defaulters.

“The Fund, if considered necessary, will publish names of defaulters in the newspapers and report the same to the Credit Information Bureau of Nigeria,” the bank stated.

The apex bank, however, cautioned that the agriculture loans must be used for purposes for which they were obtained, as a diversion would attract a five-year jail term.

“Banks should remind prospective borrowers under the Scheme that it is an offence for which one may be imprisoned for five years, to apply the loan for purposes other than those for which they are given,” the new guidelines instructed.

The programme intends to boost the level of bank credit to the agricultural sector. Loans under the amended act include advances, overdrafts and any credit facility.

The purpose of the Fund is to provide guarantee in respect of loans granted by lending banks for agricultural purposes under the scheme with the aim of increasing the level of bank credit to the agricultural sector.

“Loan under the amended act, according to the apex bank, includes advances, overdrafts and any credit facility and should be taken as such wherever it is used in these guidelines and other circulars.

Patoma Admin by — November 25, 2021 in Banking & Finance 0
Banks’ earnings to remain fragile, loans to hit 15% at year end –Report

By admin

 

Despite the resilience of Nigeria’s banking industry amid COVID-19 and several regulatory headwinds,  banks’ earnings and asset quality are expected to remain fragile with loans rising by 15 per cent at the end of 2021.

This was the view of analysts at Afrinvest in its 2021 Nigerian banking sector report, with experts urging the Federal Government to look at ways of ending crisis in the foreign exchange (FX) and infrastructure deficit in the country.

Speaking during the launch of the 2021 banking report in Lagos on Wednesday, the Deputy Managing Director, Afrinvest West Africa Limited, Victor Ndukauba, revealed that Nigerian banks delivered a 15.6 and 6.8 per cent year-on-year (y/y) growth in total assets and profit respectively in the first half of 2021 despite elevated Cash Reserve Ratio (CRR) debits and compulsory Loan-to-Deposit (LDR) levels.

He noted that with the pandemic, the Nigerian banking sector’s vulnerability heightened and requiring swift policy responses from the Central Bank of Nigeria (CBN) which response  necessitated a real GDP growth of 13.3 per cent y/y in the financial institutions sector.

Ndukauba further explained that deposits reduction in both consumer and business segments, exposure to currency risk and increased credit default, affected Nigerian bank’s profitability.

“Consequently, aggregate gross earnings for the banks within Afrinvest’s coverage (5 Tier-1 and 8 Tier-2 banks) marginally grew by 2.8 per cent in 2020 relative to 9.9 per cent in 2019.

Meanwhile, earnings weakened as the industry’s profit before tax (PBT) fell 2.3 per cent from a growth of 13.2 per cent in 2019 with profit after tax (PAT) slightly growing by 0.4 per cent y/y compared to 13.1 per cent in 2019.

In terms of asset creation, the banks under our coverage grew loan books by 16.3 per cent y/y to N24.6 trillion from N21.2 trillion in 2019, as banks aimed to achieve the CBN’s LDR target (65.0 per cent )”, he said.

Highlighting key outlook for the sector,  Ndukauba said earnings performance will remain fragile, adding that Afrinvest expects a 15.0 per cent growth in industry loans and advances as the economic recovery strengthens and banks can drive growth in deposits.

According to him, compliance with the CBN’s LDR directive will not be a big driver for loan growth as banks place a higher premium on quality risk asset creation over the punitive measure for non-compliance.

“With the improvement in macroeconomic conditions, we expect a lesser deterioration in asset quality based on the ECL model. We note that the CBN has extended its regulatory forbearance for loan restructuring.”

However, the viability of most of the restructured loans is still questionable

Patoma Admin by — November 25, 2021 in Banking & Finance 0
CIBN raises concern over rising financial crimes

By Sandra Adesiyan

 

The President/Chairman of Council of the Chartered Institute of Bankers of Nigeria (CIBN), Dr. Bayo Olugbemi, has expressed dissatisfaction over the rising cases of financial crimes in the country’s banking sector, saying it is time the judiciary embraced new technologies for its prosecution.

He also decried the continued abuse of court processes by delinquent borrowers. Besides well-known strategies to frustrate debt recovery efforts by employing different tactics to delay court proceedings, he said there are new efforts to convert loans ostensibly obtained for business purposes into foreign currency and moved to other countries.

Olugbemi said this yesterday at the 21st National Seminar on Banking and Allied Matters for Judges in Abuja. The seminar was themed, ‘Strengthening the quality of Judicial Systems and Banking Operations through Innovations’.

He argued that if creditors were getting more and more innovative in their attempts to evade legitimate legal obligations, judicial officers and regulatory authorities such as the Central Bank of Nigeria (CBN) and Nigerian Deposit Insurance Company (NDIC) should be more innovative in responding to such antics.

The administrator, the National Judicial Institute, Justice Salis Abdullahi, said the theme of the seminar was tailored towards addressing pertinent issues affecting the financial services sector.

He noted: ‘’We cannot shy away from the fact that numerous challenges are facing the financial services sector, among which is the interplay between financial technology and traditional banking, the complexities of this interface and their attendant consequences, which need the attention of all stakeholders.’’

In his goodwill message, the Governor, Central Bank of Nigeria (CBN), Godwin Emefiele, said that a deeper understanding, coupled with technological innovations, would improve the justice system.

Patoma Admin by — November 25, 2021 in Banking & Finance 0
World Bank lists measures to put Nigeria on growth path

By admin

 

The World Bank on Tuesday listed a raft of bold measures Nigeria must undertake to put the country on a ro­bust and sustainable long-run growth trajectory.

In its latest November 2021 Nigeria Development Update (NDU) report entitled, ‘Time for Business Unusual’, it highlighted urgent policy priorities that can be implemented over the next three to six months in four key areas to achieve the desired growth.

It asked Nigeria to eliminate fuel subsidy while protecting poor and vulnerable house­holds from any inflationary im­pact; reduce inflation through a coordinated mix of exchange rate, trade, monetary and fiscal policies; catalyze private invest­ment by enhancing foreign exchange management, ease trade restrictions, and foster a better business environment; and address fiscal pressures through enhanced domestic revenue mobilisation and re­duce the reliance on CBN defi­cit financing.

According to the Nigeria Development Update, under a business-as-usual scenario, GDP per capita will continue to decline, but reforms could accelerate growth.

It said Nigeria faces a crit­ical choice: it can continue to pursue a business-as-usual poli­cy approach while its economy and job market deteriorates, or it can undertake bold measures that will put Nigeria on a ro­bust and sustainable long-run growth trajectory.

The report said the Nigeri­an government took bold mea­sures to mitigate the effects of the COVID-19 pandemic in 2020 through bold reforms, but the momentum of the reform agenda has waned, undermin­ing Nigeria’s long-term growth prospects.

It noted that the insufficient supply of foreign exchange (FX) issues related to the pre­dictability of exchange rate management, the unsustain­able subsidy on premium mo­tor spirit (PMS), burdensome trade restrictions, and the sizeable fiscal deficit financing by the Central Bank of Nige­ria (CBN) are undermining the business environment, compounding underlying con­straints on domestic revenue mobilisation, foreign invest­ment, human capital devel­opment, and the delivery of public services.

The report indicates that despite a strong initial recovery and resurgent global oil prices, Nigeria’s pre-crisis challenges threaten the post-crisis recov­ery, highlighting the need to depart from business-as-usual policies.

“Even though Nigeria’s economy exited a pandem­ic-induced recession, several challenges persist including double-digit inflation, declin­ing incomes, and rising inse­curity. While the government took bold policy measures to mitigate the impacts of the COVID-19 crisis, the reform momentum has slowed which hinders Nigeria’s ability to reach its growth potential,” said Shubham Chaudhuri, World Bank Country Director for Nigeria.

The report notes mounting fiscal pressures due to low­er-than-expected revenues in 2021 and the rising cost of the premium motor spirit (PMS) subsidy.

It said that in contrast to past periods of high oil prices, this time the government has not been able to fully benefit from the oil boom because oil production has fallen below Nigeria’s estimated capacity and the OPEC+ quota due in part to rising insecurity and the higher cost of the PMS subsidy.

“In 2022 the Federal Gov­ernment plans to spend about N3,000 (US$7) per person for health, while the cost of the PMS subsidy for next year could reach N13,000 (US$32) per person. Not only is the PMS subsidy costly, but it mainly benefits richer households. Nigeria has the opportunity to establish a ‘compact’ with citi­zens that eliminates the subsidy and uses the savings to provide targeted cash transfers to low­er-income-households, invest in job-creating programmes, and improve its fiscal position,” said Marco Hernandez, World Bank Lead

Patoma Admin by — November 24, 2021 in Banking & Finance 0
CBN, payment system operators move to fast-track e-Naira usage

The Central Bank of Nigeria (CBN), payment service providers (PSPs) and other players in financial technology (fintech) explore options for expanding the adoption of e-Naira.

At the end of the deliberation in Lagos,  the parties resolved to work together to ensure a faster rate of adoption of the central bank digital currency (CBDC).

Many stakeholders have assessed the adoption rate as sluggish. The Guardian had reported last week that a total of 488,000 consumer wallets and 78,000 merchant wallets had been downloaded across 160 countries since its launch.

Statistics from the apex Bank also showed that 17,000 transactions amounting to about N62 million, with the average transaction being about N3, 800 each had been completed.

The International Monetary Fund (IMF), last week, said the CBDC promises to improve on the dwindling remittances to Nigeria. But there are concerns about the snail rate of adoption, which many observers said could only increase with more aggressive awareness.

Speaking at yesterday’s meeting, the Director, Information Technology Department (ITD) at the CBN, Rakiya Mohammed, said the CBN was neither competing with the deposit money banks (DMBs) nor other operators in the Nigerian payment system ecosystem.

Mohammed explained that the engagement was in continuation of the bank’s strategy to bring all stakeholders on board on the journey to redefine the payments system, noting that the CBN was open to suggestions aimed at adding value to the eNaira implementation.

She also urged the payment service providers to find more innovative ways to support members of the public in the onboarding process and using eNaira as well as develop solutions for offline eNaira functions, including cards, wearables and USSD.

Mohammed disclosed that the full implementation of the eNaira, which started with the onboarding of banks, would be done in four phases, culminating in offline eNaira payments solutions, cross-border payment and interoperability of the eNaira with other CBDCs.

Going forward, the CBN team and the different stakeholder groups agreed to meet periodically to review the progress made to enable more Nigerians to access eNaira.

The different groups present at the engagement were PSB, switching and processing companies, mobile money operators, payment solution service providers, payment terminal service providers and super agents.

Also present were representatives of the Chartered Institute of Bankers of Nigeria (CIBN), Nigerian Inter-Bank Settlement System (NIBSS), Shared Agent Network Expansion Facilities (SANEF) and the Committee of eBanking Industry Heads.

Patoma Admin by — November 23, 2021 in Banking & Finance 0
Net forex inflow rose to $2.77bn July, says CBN

By Favour Nnabugwu

 

The net foreign exchange inflow into the Nigerian economy rose slightly to $2.77bn in July from $2.27bn in June, the Central Bank of Nigeria said in its report on forex flows.

It said despite the contraction in autonomous inflow, the upward trajectory in crude oil prices improved forex inflow through the bank, resulting in an overall net inflow in July.

The report said, “Aggregate foreign exchange inflow into the economy declined by 7.4 per cent and 8.7 per cent to $6.1bn, compared with the level in June 2021 and July 2020, respectively.

“The decrease reflected mainly the contraction in inflow through the autonomous sources, which fell by 33.3 per cent to $2.79bn in July 2021.

“However, foreign exchange inflow through the bank increased by 37.7 per cent to $3.31bn in July 2021, as oil-related inflow increased due to the upward trajectory in oil prices.”

The CBN said foreign exchange outflow through the economy fell by 23.0 per cent to $3.33bn in July.

It said, “The fall in outflow was due mainly to a decrease in the bank’s intervention in the foreign exchange market and lower direct payments, which reduced the outflow through the bank.

“However, outflow through autonomous sources inched up by 12.4 per cent to $0.67bn in July 2021 due majorly to the 13.2 per cent increase in payments for invisible import.

“Overall, foreign exchange flows resulted in a higher net inflow of $2.77bn in July 2021, compared with $2.27bn in June 2021.”

Patoma Admin by — November 22, 2021 in Banking & Finance 0
CBN Governor to provide 2022 economic insights at bankers’ dinner

By Favour Nnabugwu

 

The Chartered Institute of Bankers of Nigeria has concluded arrangement to host the governor of the Central Bank of Nigeria (CBN), Mr. Godwin Emefiele, at the 56th Annual Bankers Dinner.

The event is scheduled to hold on Friday, November 26, 2021, at Balmoral Convention Centre, Federal Palace Hotel, Ahmadu Bello Way, Victoria Island, Lagos by 5.00 p.m.

A statement from CIBN noted that it will be a hybrid, that is, both virtual (through Zoom teleconferencing) and physical to embrace high and quality participation across the globe

Emefiele will address the audience on recent economic and financial market developments over the past year and the economic outlook for the coming year.

Also, Mr. Babatunde Sanwo-Olu, Executive Governor, Lagos State and his Oyo State counterpart, Engr. Oluwaseyi Makinde are expected to deliver goodwill messages.

The Annual Bankers’ Dinner is a thought-led socio-economic event of the industry and being the biggest high-profile social forum organised annually by the Institute for the banking and finance industry, distinguished personalities including captains of industry, top executives of banks and non-banking institutions including CEOs and chairmen, diplomatic missions, top government functionaries, legislators, accomplished businessmen, academics and other stakeholders are usually gathered to interact and network under a pleasant social setting.

His Excellency, Ambassador Cui Jianchun, Ambassador of the People’s Republic of China to Nigeria, is expected to present the toast of the Federal Republic of Nigeria while Dr. (Mrs.) Ije Jidenma, President, Institute of Directors, Nigeria, will propose the toast of The Chartered Institute of Bankers of Nigeria

According to the statement, Dr. Bayo Olugbemi, President/Chairman of Council, CIBN, will deliver the welcome address as chief host. At the same time ‘Seye Awojobi, Registrar/CEO, CIBN, will host the Dinner.

Other top dignitaries expected at the occasion include: Senator Ahmed Lawan, Senate President; Rt (Hon) Femi Gbajabiamila, Speaker, House of Representatives; Mrs. Zainab Ahmed, Hon. Minister of Finance; Alhaji Aliko Dangote, President/Chairman, Dangote Group; Mr. Fola Adeola, Chairman, Fate Foundation, Dr. Jim Ovia, Chairman, Zenith Bank Plc; Dr. Lamido Yuguda, DG, SEC; Dr. Tony Elumelu, Chairman, Heirs Holdings; Mr. Hassan Bello, Managing Director/Chief Executive, NDIC; all-states’ Commissioners of Finance; all Deputy Governors and Directors of Central Bank of Nigeria; all Chairmen and Managing Directors/CEOs of banks; among others.

This year’s dinner, according to CIBN, promises to be unique as the Organising Committee, under the leadership of the Managing Director/Chief Executive Officer of Wema Bank Plc, Mr. Ademola Adebise, has introduced several new initiatives to make it a night to celebrate, recognise, impact and inspire within the industry.

One of such initiatives is to honour deserving individuals who stepped up beyond the call of duty in the fight against Covid-19, who ensured business continuity despite the pandemic’s scourge and promoted the banking industry’s values and ideals.

At the event, over 2,500 participants worldwide are expected to participate both physically and virtually.

President Muhammadu Buhari Friday at State House Abuja urged the MTN Group to make the available top-of-the-range service to its Nigerian subscribers…

In spite of the huge investment in the water sector by the government and international organisations, water scarcity has grown to become a perennial nightmare for residents of Abeokuta, the Ogun State capital. Uzodinma sacks General Manager of OCDA, names replacement  Uzodinma sacks General Manager of OCDA, names replacement  Uzodinma sacks General Manager of OCDA, names replacement  Uzodinma sacks General Manager of OCDA, names replacement.

Selfies, video calls and Chinese documentaries: The things you’ll meet onboard Lagos-Ibadan train

The Lagos-Ibadan railway was inaugurated recently for a full paid operation by the Nigerian Railway Corporation after about a year of free test-run. Our reporter joined the train to and fro Lagos from Ibadan and tells his experience in this report…

Patoma Admin by — November 22, 2021 in Banking & Finance 0