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Displaying items by tag: Central Bank of Nigeria (CBN)

Saturday, 22 September 2018 06:15

Skye Bank’s operating licence revoked by CBN

The operating licence of Skye Bank has been withdrawn, Governor of the Central Bank of Nigeria (CBN), Godwin I. Emefiele, CON, announced on Friday evening in Abuja, the nation’s capital.

He told the media: “You will recall that on 4th July 2016, we took a regulatory action on Skye bank Nigeria PLC. Specifically, this action led to the resignation of the Chairman, all Non-Executive Directors on the Board as well as the Managing Director, Deputy Managing Director, and the two longest-serving Executive Directors on the Management Team

“At that time the proactive action was informed by unacceptable corporate governance lapses as well as the persistent failure of Skye Bank PLC to meet minimum thresholds in critical prudential and adequacy ratios, which culminated in the bank’s permanent presence at the CBN Lending Window.

“The focus of the action then was to save depositors’ funds and to ensure that the bank continued as a going concern, being a systemically important bank. Part of our intention was also to stem the imminent job losses to staff if a liquidation option had been adopted. These objectives have been fully achieved and the bank has been able to meet customer obligations, having curtailed the liquidity haemorrhage and restored depositor confidence. 

“Indeed, the bank’s performance has improved considerably compared to the pre-July 2016 era.

“The result of our examinations and forensic audit of the bank has, however, revealed that Skye bank requires urgent recapitalisation as it can no longer continue to live on borrowed times with indefinite liquidity support from the CBN. The shareholders of the bank have been unable to recapitalise it.

“As a responsible and responsive regulator and in consultation with the Nigerian Deposit Insurance Corporation (NDIC), we have decided to establish a bridge bank, Polaris Bank, to assume the assets and liabilities of Skye bank. The strategy is for the Asset Management Company of Nigeria (AMCON) to capitalise the Bridge Bank and begin the process of sourcing investors to buy out AMCON. By this decision, the licence of the defunct Skye Bank is hereby revoked.

“We wish to assure all depositors that under this arrangement, their deposits shall remain safe and that normal banking services shall continue in the new bank on Monday, 24th September, 2018, to enable customers to transact their businesses seamlessly.

“Thus, all customers of Skye Bank shall be automatic customers of the new bank and their accounts and records duly purchased by Polaris Bank.

“Given the good performance of the board and management, the CBN shall retain them.  In addition, all employees of Skye Bank shall be absorbed by Polaris Bank under a new contract unless any employee decides to opt out.

“We wish to assure the general public that the Nigerian banking industry remains safe and resilient and that the CBN will continue to live up to its responsibilities of promoting stability in the banking and financial system.”

Source News Express

Published in Bank & Finance
Friday, 21 September 2018 07:16

Naira Depreciate To N363.27/$ In I&E Window

The Naira, yesterday, depreciated to N363.27 per dollar in the Investors and Exporters (I&E) window even as the volume of dollars traded rose marginally by 257 percent.
 
Data from FMDQ showed that the indicative exchange rate for the window rose to N363.27 per dollar yesterday from N362.97 per dollar on Wednesday, indicating 30 kobo depreciation of the naira.
 
The volume of dollars traded on the window yesterday rose by 257 percent to $401.69 million from $112.66 million traded on Wednesday.
 
However, the naira yesterday was stable at N359 per dollar in the parallel market.
 
 
The Guardian
Published in Bank & Finance
The Central Bank of Nigeria (CBN) said it was reviewing the information provided by Nigeria’s telecommunication giant, MTN Nigeria, and four banks it recently sanctioned over illegal repatriation of funds.
 
The CBN disclosed in a statement by its Director of Corporate Communications, Isaac Okoroafor.
 
Recall that the CBN had on August 29 sanctioned MTN Nigeria and four banks – Standard Chartered Bank, Stanbic-IBTC, Citibank, and Diamond Bank – for allegedly issuing irregular Certificates of Capital Importation (CCIs) on behalf of some offshore investors of MTN.
 
The CBN had ordered MTN to refund a sum of $8.13 billion it repatriated, while the four banks were slammed a total of N5.87 billion, which it later deducted from their accounts.
 
The apex sanctioned Standard Chartered Bank the highest fine of N2.4 billion, while Stanbic IBTC Nigeria received a fine of N1.88 billion. Citibank Nigeria was ordered to pay a sum of N1.2 billion and Diamond Bank was penalized in the sum of N250 million for violating extant rules.
 
However, the telecommunication company and the four banks in separate statements denied wrongdoing.
 
But according to the statement by the CBN, it was engaging and reviewing additional information provided by the four banks owing to concerns raised over the sanctions it imposed on the banks.
 
“The recent sanctions on the banks arose due to irregularities with respect to repatriations made on behalf of MTN Nigeria Limited and were not in any way designed to restrict access to investor returns.
 
“In response to the recent regulatory actions, the Banks and MTN are engaging the CBN and have provided additional information which is currently being reviewed with a view to arriving at an equitable resolution,” it stated.
 
CBN assured all investors that the integrity of the CCI regime remains sacrosanct and there shall be no retroactive application of foreign exchange rules and regulations.
 
It also added that “some of our recent innovations and reforms of the Foreign Exchange regime such as the introduction of the NAFEX window, are designed to simplify foreign exchange regulations.
 
“Furthermore, the delegation of the issuance of CCIs to commercial and merchant banks some years ago was done to instill confidence in the investor community and encourage the flow of foreign direct and portfolio investments into the Nigerian economy.”
 
 
Vanguard
Published in Telecoms

The Federal Government has sold its 21 percent stake in the Nigeria Security Printing and Minting Company (NSPMC) to the Central Bank of Nigeria (CBN).

The instrument to transfer 12.69 billion Federal Government’s shares in the NSPMC to the apex bank was signed by the CBN Governor, Godwin Emefiele, and the Director-General of the Bureau Public Enterprises (BPE), Alex Okoh, on Tuesday at the Presidential Villa in Abuja.

Speaking at the signing ceremony, Vice President Yemi Osinbajo, who is also the Chairman of the National Council on Privatization (NCP), said the sale was to create a synergy between the public and the private sectors.

“Security printing has taken new dimensions; it is no longer what it used to be. As a matter of fact, there are those who think that today there is more of technology than merely security printing.

“If you look at some of the cards that are being printed today, that in the chips are not just security they are actually technological assets.

“So, there are new assets, there are new dimensions and there are new ideas and it’s just the private sector that can really be at the cutting edge of technology and innovation,” he said.

Osinbajo noted that over 140 publicly-owned companies had been privatised in the past 30 years, explaining that government’s divestment of its interest in the companies was to bring in the needed expertise to run them

“Government should stick to its regulatory role and its incentivizing role and allow the private sector to do business, allow the private sector to take the risk where possible,” Osinbajo added.

In his reaction, Emefiele, said the capacity of the mint has increased, adding that it now produces all the currency that is needed in the country and also in the West Africa region.

“The mint capacity has been expanded to where it has ideal capacity that can produce for other ECOWAS countries.

“We intend to embark on aggressive marketing to see to it that not only produces for itself but also produces for other important stakeholders that may require its services in the area of currency printing,” Emefiele said.

 

Vanguard.

Published in Business

The Central Bank of Nigeria (CBN) said it will impose N10,000 ($28) fine per item for every failed NIP transaction caused by any financial institution operating in the country.

It said the implementation of the sanction, which would be effective from October 2, 2018, would be monitored using complaints from senders and/or beneficiaries.

The CBN said the sanction would be placed on any Instant (Inter-Bank) Electronic Funds Transfer (EFT) service provider that fail to reverse such payment within 24 hours.

Instant (Inter-Bank) service provider are any financial institution licensed by CBN to carry on the business of facilitating electronic funds transfer services in partnership with sending and receiving entities.

The CBN, in its Regulation on Instant (Inter-Bank) EFT Services in Nigeria released during the weekend, said the policy was in furtherance to its mandate for the development of electronic payments system in the country.

Also the financial regulator also said delayed application of inward NIP into beneficiary’s accounts beyond four (4) minutes would also attract another N10,000 ($28) fine per item.

The apex bank however advised any stakeholder to the instant EFT service willing to propose an amendment to the regulation to formally forward such proposal to the office of its Director, Baking and Payments System Department for consideration.

Instant (Inter-Bank) EFT also known has instant EFT or instant payment means a system between two distinct entities when delivery from the sending entity to the receiving entity takes place within one (1) minute.

 

The Ripples.

Published in Bank & Finance
Wednesday, 12 September 2018 03:51

No Paris Club refund for states owing salaries – FG

The Federal Government said states owing workers’ salaries would not have access to the remaining $2.69 billion Paris Club refund.

It said such states must clear backlogs of salaries and other related staff arrears to get approval for the funds, which would be made in phased tranches to the states.

The Director of Information, Federal Ministry of Finance, Hassan Dodo, made this known in a statement on Tuesday.

According to Dodo, “The Debt Management Office (DMO) led the reconciliation process under the supervision of the Federal Ministry of Finance. The final approval of 2.69 billion dollars is subject to some conditions.”

The conditions given to the state governments before the fund could be accessed, according to the statement, include; “Salary and staff related arrears must be paid as a priority; Commitment to the commencement of the repayment of Budget Support Loans granted in 2016, to be made by all States.”

Others include, “Clearing of amounts due to the Presidential Fertiliser Initiative, Commitment to clear matching grants from the Universal Basic Education Commission (UBEC) where some States have available funds which could be used to improve primary education and learning outcomes.”

The issue of Paris Club loan over-deduction had been a long standing dispute between the Federal Government and the State Governments, dating back to 1995.

Responding to the dispute, President Muhammadu Buhari had directed that the claims of over-deduction should be formally and individually reconciled by the DMO. This reconciliation commenced in November 2016.

As an interim measure to alleviate the financial challenges of the states during the 2016 recession, the President had, between 1st December, 2016 and 29th September, 2017, approved that 50 percent of the amounts claimed by states be paid to enable the states clear salary and pension arrears.

Published in Bank & Finance

MTN Nigeria has dismissed allegations by the Central Bank of Nigeria (CBN) over illegal repatriation of shareholders’ dividends amounting to $8.1 billion by the company between 2007 and 2015.

The telecommunication company said all dividends it paid to its shareholders were approved by CBN as required by law.

The telco made this known in a statement on Thursday in response to the claim by the financial regulator.

“MTN Nigeria strongly refutes these allegations and claims. No dividends have been declared or paid by MTN Nigeria other than pursuant to CCIs issued by our bankers and with the approval of the CBN as required by law,” the statement read in part.

It said the company would engage with the relevant authorities and vigorously defend its position on this matter and provide further information when available.

MTN Nigeria has been bedeviled with penalties over failure to comply with government’s regulations.

In 2015, the Nigerian Communications Commission (NCC) had slammed the telecommunication company with a $5.2 billion (N1 trillion) fine for violating SIM card registration regulations directing telcos to deactivate unregistered lines.

Also, the fine was imposed on MTN for not disconnecting about 5.1 million improperly registered lines in its network within the stipulated deadline.

Although, NCC had threatened not to reduce the fine, it however slashed it to $1.65 billion (N330 billion) after several appeals and negotiations including diplomatic intervention by the South African government.

 

Vanguard..

Published in Business
Friday, 31 August 2018 04:40

Nigerian economy is quite diversified -—NBS

The Statistician-General of the National Bureau of Statistics (NBS), Yemi Kale, said the Nigerian economy could be regarded as a diversified economy based on the Q2 2018 Gross Domestic Product (GDP) figures released recently.

Kale made this disclosure while answering questions on the effectiveness of the Federal Government’s diversification policy in a tweet chat on Thursday.

The NBS boss said the services sector grew by over 50 percent in the second quarter of the year, adding that the performance was the first since the 2016 economic recession.

According to him, the 1.50 percent real GDP growth recorded in Q2 was largely driven by the services sector.

“The best assessment of any plan or policy of government is to look at the underlying statistics. If you look at the GDP numbers for Q2 2018 published early this week by our Office, you will observe that the economy is quite diversified.

“The services sector accounts for over 50% of our economy, and for the first time since the recession, the services sector posted positive numbers and was mainly responsible for the growth recorded during the quarter,” Kale said.

He, however, said the benefits of diversified growth would become more evident and impacting on the citizenry if the government could provide incentives to support domestic production and stimulate consumption.

The NBS had released the GDP report for Q2 2018 on Monday, the report noted that the rate at which the Nigerian economy grew in the quarter slowed to 1.50 percent when compare with 1.95 percent recorded in the previous quarter.

Despite the sluggish growth, the non-oil sector of the economy grew by 2.05 percent from 0.76 percent in Q1 2018, while the oil sector contracted by -3.95 percent from 14.77 percent in Q1 2018.

The Minister of Budget and National Planning, Sen. Udoma Undo Udoma, had said the growth in the non-oil sector was an evidence that the implementation of the targeted policies and programs of the Economic Recovery and Growth Plan (ERGP) by the Federal Government was yielding positive results.

The ERGP is a four-year medium term strategic blueprint of the Federal Government aimed at diversifying the economy away from dependence on the oil and gas sector.

The plan covers 2017 to 2020 and focuses on human capital investment, restoration of economic growth, and building a competitive economy.

The Ripples

Published in News Economy
The nation’s foreign exchange reserves have dropped below $46 billion, available data from the Central Bank of Nigeria (CBN) showed on Wednesday.
 
The reserves, which stood at $47.79 billion as of July 5, fell to $45.98 billion on August 27, the lowest level in five months.
 
According to the CBN data, the external reserves rose from $45.65 billion on March 23 to $46.04 billion on March 26. The increase was sustained as the reserves grew up till $46.79 on May 10 from $46.75 recorded on May 9.
 
Thereafter, the movement in the reserves became inconsistent but reached a high of $47.79 billion on July 5 and had been on steady decline, shedding $1.81 billion in less than two months.
 
Last week, the National Bureau of Statistics (NBS) released the capital importation data which saw the total value of capital imported into the country between April and June this year fell by $790 million to $5.51 billion.
 
An analysis of the data by our correspondent showed that the value dropped by 12.53 percent, making the $790 million depreciation the highest since the first quarter of 2016 when the nation’s economy was at the brink of recession.
 
Analysts at FSDH Research, in a Monthly Economic and Financial Markets Outlook, attributed the drop in the nation’s foreign reserves in July which extended to August to the exits of foreign investors from the Nigerian market and the increase in demand of foreign exchange.
 
“The external reserves recorded persistent drawdown in July 2018. This was due to the foreign investors’ pull-back from the Nigerian market and the increase in demand at the foreign exchange market,” the analysts said.
 
Two days ago, the Nigerian Stock Exchange (NSE), in its monthly Domestic and Foreign Portfolio Participation in Equity Trading for July 2018, had said there was a decrease of 64.68 percent in total foreign transactions from N102.41 billion in June 2018 to N36.17 billion in July.
 
Meanwhile, the CBN, yesterday, injected $210 million into the inter-bank foreign exchange market to meet customers’ requests in various segments of the market.
 
Consequently, the naira maintained its stability, exchanging at an average of N361/$ in the Bureau De Change segment of the foreign exchange market.
 
The CBN Acting Director, Corporate Communications Department, Isaac Okorafor, said $100 million was offered to authorised dealers in the wholesale segment of the market, while the Small and Medium Enterprises segment received the sum of $55 million.
 
He said the customers requiring foreign exchange for tuition fees, medical payments and Basic Travel Allowance among others, received $55 million.
 
Okoroafor stressed that the apex bank would continue to intervene in the interbank foreign exchange market in line with its desire to sustain liquidity in the market and maintain stability.
 
Recall that the CBN had last week injected a total sum of $543.22 million and 63.21 million Chinese Yuan into the inter-bank foreign exchange market.
 
 
Source: The Ripples
Published in Bank & Finance

The Central Bank of Nigeria (CBN) has imposed sanctions totalling N5.87 billion on four banks for wrongly assisting MTN Nigeria to repatriate funds.

The banks allegedly issued irregular certificates of capital importation (CCIs) on behalf of some offshore investors of MTN Nigeria Communications Limited.

The affected banks are Standard Chartered Bank, Stanbic-IBTC, Citibank, and Diamond Bank.

Announcing the decision of the bank in Abuja on Wednesday, Director, Corporate Communications of CBN, Isaac Okorafor, said the decision of the financial regulator became necessary following allegations of remittance of foreign exchange with irregular CCIs issued on behalf of some offshore investors of MTN Nigeria and subsequent investigations carried out by the apex bank in March 2018.

According to him, the CBN has asked the managements of MTN Nigeria to immediately refund the sum of $8,134,312,397.63 illegally repatriated by the company to the coffers of the apex bank.

The CBN slammed Standard Chartered Bank the highest fine of N2.4 billion, while Stanbic IBTC Nigeria received a fine of N1.88 billion.

Citibank Nigeria was ordered to pay a sum of N1.2 billion and Diamond Bank was penalized in the sum of N250 million for violating extant rules.

The CBN spokesman said investigations revealed that the sum of $3,448,119,321.72 was repatriated by Standard Chartered Bank on the basis of the illegally issued CCIs.

similarly, he said the sums of $2,632,005,623.78, $1,766,263,212.75 and $348,914,501.30 were repatriated by Stanbic IBTC Nigeria, Citibank Nigeria and Diamond Bank Plc, respectively between 2007 and 2015.

He added that the CBN had directed the affected banks to immediately refund the respective sums to the CBN.

Okorafor, therefore, advised all banks and multinational companies in the country to adhere strictly to the provisions of all extant laws and regulations of Nigeria in their foreign exchange transactions.

This will be the second heavy sanction MTN would be facing from Nigerian regulators in three years after the $5.2 billion fine it received from the Nigerian Communications Commission (NCC) in 2015.

The telecommunications company, which only just finished paying the reduced fine of $3.2 billion, will see this as another huge challenge posing a serious threat to its corporate existence in Nigeria.

Published in Telecoms
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