Connect with us

Business News

Banks in Race to Meet $5bn Forex Demand

Published

on

Central Bank of Nigeria CBN
Share

By Mathew Dadiya, Abuja

Money Deposit Banks in Nigerian face shortage of foreign exchange as they struggle to close $5 billion demand gap especially with the reopening of the economy and resumption of local flights operations.

One of the global rating agencies, Moody’s in its latest forecast, said that the shortage in foreign currency is caused by decrease in the nation’s oil revenue, poor remittances and unstable foreign inflows.

The rating firm in its July 2020 foreign exchange appraisal report titled “Renewed Foreign Currency Shortages Highlight Vulnerability for Nigerian Banks,” Moody’s said the current economic condition might trigger a new wave of the foreign exchange liquidity crisis that beset Nigerian banks during the oil crash of 2016-2017.

It affirmed that around 49 per cent of banks’ $7 billion foreign currency borrowings would mature in 12 to 18 months from now, inducing funding pressure in the face of slowing dollar deposit flows and bigger market funding costs.

“Lower dollar inflows at a time when foreign currency borrowing will likely be more expensive for Nigerian banks will strain their foreign currency funding, despite substantial improvements compared to 2016.

“Our moderate scenario where foreign-currency deposits decline by 20 per cent, while loans remain constant, would increase rated banks’ funding gap to N1.5 trillion ($3.8 billion), and to N1.9 trillion ($5.0 billion) under our severe-case scenario of 35 per cent foreign-currency deposit contraction, creating acute funding challenge,” said Peter Mushangwe, analyst at Moody’s.

Dearth of dollar supply is projected to rise in 12 to 18 months should low oil prices continue, setting in motion the foreign currency liquidity crisis that resulted in acute dollar rationing during the last oil crash.

Moody’s however, observed that the Nigerian banks it rated had strengthened their dollar deposit bases and liquid assets since 2016 even though there were notable vulnerabilities in the overall foreign currency system.

“Nevertheless, they remain vulnerable to an acute liquidity crunch if dollar deposits reduce by 20 per cent or more,” the report stated, adding that accessibility of foreign currency would shrink further.

Moody’s foresaw that foreign-currency borrowing would come at a higher cost given that banks had to refinance nearly 50 per cent of their borrowings.

The country’s credit default swap spread, which represents sentiment on Nigeria’s credit, had risen significantly due to the recent oil price slum, it added.

Business News

NELFUND Loan Improves Graduate’s GPA to 3.50

Published

on

Share

A graduate of the University of Maiduguri, Shianya Ebwaseh, said the Nigerian Education Loan Fund (NELFUND) helped improve her Grade Point Average (GPA) to 3.50 through financial support that enabled her to concentrate on her studies.

Ebwaseh, who graduated from the Department of Zoology, Faculty of Life Sciences, said this in an interview on Monday in Maiduguri.

She said financial difficulties had previously affected her academic performance, as she struggled to meet her daily needs while pursuing her degree.

The graduate said she resorted to selling fried chips and groundnuts on campus to support herself, sometimes missing lectures because of the time and energy required to run the business.

According to her, the introduction of NELFUND’s student loan scheme relieved her financial burden through tuition support and a monthly N20,000 upkeep allowance.

“Before NELFUND, I struggled with my GPA because of financial challenges. I sometimes missed lectures after spending hours frying and packaging chips for sale.

“But when NELFUND came, I stopped the business and concentrated on my studies. My GPA improved to 3.50, which is Second Class Upper,” she said.

Ebwaseh said the financial support also enabled her to attend lectures regularly, purchase learning materials and prepare adequately for tests and examinations without constant worries about money.

She added that her examination scores improved significantly after she began receiving the support, attributing the change to increased concentration and financial stability.

The graduate, who said she accessed the scheme in her third year, described the application process as simple and encouraged other eligible students to apply.

She also said the programme had helped financially disadvantaged students remain in school, particularly those whose parents could not afford tuition fees and upkeep.

Ebwaseh appealed to the Federal Government to sustain the initiative, emphasising that withdrawing the support could expose many students to financial difficulties and possible dropout.

She said the scheme had given beneficiaries an opportunity to pursue their academic ambitions with fewer financial distractions.(NAN)

Continue Reading

Business News

FG Seeks Synergy Among Housing Agencies to Boost Housing Delivery

Published

on

Share

The Minister of Housing and Urban Development, Dr Muttaqha Darma, has called for synergy among government agencies in the housing sector to improve coordination and accelerate housing delivery.

Darma made the call in Abuja on Monday at the stakeholders’ conference on the proposed National Real Estate Regulatory Authority (NRERA).

The conference, themed “One vision, One Ecosystem, One National Housing and Real Estate Plan”, was organised by the Office of the Speaker, House of Representatives, and the House Committee on Housing and Habitat.

The minister said the lack of coordination among government agencies had affected the effective delivery of houses to Nigerians, noting that institutions in the sector operated independently.

“The players within the industry, all of us, operate in silos.

“Federal Housing Authority (FHA) does not even know what the Federal Mortgage Bank of Nigeria (FMBN) is doing. FMBN does not know what the Ministry of Finance Incorporated (MOFI) is doing,” he said.

According to him, the various institutions must work together towards a common goal rather than operate independently.

“Our target is to build houses for Nigerians. We are wasting our time because if we fail, it is us who fail, not the President,” he said.

The minister expressed support for the establishment of NRERA, saying the proposed authority would address the regulatory gaps in the real estate sector.

He said the ministry had reviewed the proposed legislation and recognised its potential to improve the sector.

Darma also disclosed that abandoned housing projects funded by the Federal Mortgage Bank of Nigeria (FMBN) across the country were worth about N38 billion.

He said a survey conducted by the ministry revealed abandoned FMBN-funded housing developments in every state of the federation, including the Federal Capital Territory.

“We realised about N38 billion of contributors’ money, your own money, all the Nigerian workers’ money. N38 billion is wasted,” he said.

He said that the poor management of workers’ contributions could discourage Nigerians from contributing to the National Housing Fund.

The minister urged the committee handling the proposed legislation to ensure that state governments were included in the regulatory framework.

He also called for safeguards to protect homebuyers, tenants, developers and mortgage lenders, including mandatory escrow accounts for buyers and standardised tenancy agreements.

The Managing Director and Chief Executive Officer of the Ministry of Finance Incorporated (MOFI), Dr Armstrong Takang, said effective regulation was necessary to restore investor confidence in Nigeria’s real estate sector.

Takang said the sector contributed 12.71 per cent to Nigeria’s Gross Domestic Product (GDP) as of June 2026, but remained largely unregulated.

He said the absence of a national licensing system had allowed unqualified individuals to operate as estate agents and developers without adequate accountability.

“Anyone can sell land, anyone can collect off-plan payments, run into tens of billions and get away with it. There are very few countries in the world where these are allowed,” he said.

He called for mandatory licensing of real estate operators and the protection of buyers’ funds through designated project accounts.

“An operator must be licensed with the authorities. No one should be operating in the real estate sector without a licence, no matter which part of the value chain they are involved in,” he said.

He added that buyers’ funds should be kept in protected project accounts and released to developers based on evidence of progress on construction.

Takang said effective regulation would attract domestic and foreign investment, protect citizens and support the Federal Government’s one-trillion-dollar economy target.

He urged the National Assembly to ensure the passage of the proposed legislation, describing it as critical to bringing order and transparency to the real estate sector.

Continue Reading

Business News

OPay Provides Update on Planned NYSE IPO, Reaffirms Normal Business Operations

Published

on

Share

From Tony Nwachukwu, Lagos

Fintech company OPay has announced the postponement of its planned public offering on the New York Stock Exchange (NYSE), following careful consideration of an ongoing inquiry by a regulatory authority.

The company said the decision to postpone the offering was taken in the best interests of the business and its customers.

In a statement shared with DAILY ASSET, OPay explained that the ongoing inquiry does not affect the services it provides to customers or how it operates in Nigeria and its other business markets.

The company also reassured customers, merchants, agents and other business partners that its operations would continue as usual, with all services remaining fully available.

“Customers can continue sending and receiving money, making payments and saving without interruption,” the statement noted.

OPay expressed appreciation to its customers, merchants, agents, business partners, employees and other stakeholders for their continued trust and support.

The company also reiterated its commitment to making financial services more inclusive through technology

Continue Reading

Advertisement

Top Stories

NEWS40 minutes ago

2027 Elections: CAN Disowns Man Claiming its General Secretary

ShareBy Laide Akinboade, Abuja The Christian Association of Nigeria (CAN) on Wednesday, disassociate itself from Archbishop Chivir Chianson and the...

POLITICS41 minutes ago

INEC Seeks UN Partnership in Tackling Disinformation on 2027 General Elections

ShareThe Independent National Electoral Commission (INEC) has called for the partnership of the United Nations in combating disinformation in the...

NEWS47 minutes ago

2025: NDLEA Arrests 1,200, Seizes 30 Tonnes of Drugs in Edo – Marwa

ShareThe National Drug Law Enforcement Agency (NDLEA), arrested 1,200 suspects and seized more than 30 tonnes of illicit substances in...

NEWS49 minutes ago

JAIZ Bank Denies Involvement in N104m Investment Fraud in Jos Branch

ShareBy Tony Obiechina, Abuja Jaiz bank has denied involvement of alleged N104m fraud in its Jos branch. In a statement...

NEWS51 minutes ago

Trump-backed Republican Senate candidates pay the price

SharePresident Donald Trump asked voters to pretend he was on the ballot in the midterm elections and handpicked Republican candidates...

NEWS53 minutes ago

Court to Deliver Judgment in El-Rufai’s N10bn Rights Suit

ShareThe Federal High Court in Abuja has fixed Dec. 8 for judgment in a N10 billion rights suit filed by...

NEWS54 minutes ago

Women and Land: Why Nigeria’s Land Administration Cannot Afford to Leave Half the Nation Behind

ShareThe ongoing conversations on land reform in Nigeria tend to focus on speed, cost and documentation. Seemingly disregarded is the...

NEWS57 minutes ago

Caverton Revenue Rises to N20.74bn

ShareBy Tony Obiechina, Abuja Caverton Offshore Support Group Plc recorded a 1.4 per cent increase in revenue to N20.74bn for...

NEWS1 hour ago

Tinubu Slashes External Loan Request to $7.7bn, Seeks Senate Nod

ShareBy David Torough, Abuja President Bola Tinubu has revised the Federal Government’s 2026 external borrowing proposal, seeking Senate approval to...

NEWS1 hour ago

Senate Criminalises Hospitals’ Rejection of Emergency Patients

ShareBy David Torough, Abuja The Senate has advanced a bill seeking to criminalise the rejection or neglect of patients requiring...