BUSINESS
Going Forward with CBN, Emefiele’s 5-Year Roadmap
By Tony Obiechina, Abuja
The Governor of the Central Bank of Nigeria (CBN) Mr Godwin Emefiele, on Monday 24th July, 2019 unfolded the policy direction of his new five-year tenure which will terminate in 2024.
Addressing a World Press Conference at the CBN corporate headquarters in Abuja, the governor promised to facilitate access to financial services to 95 per cent eligible Nigerians as well as “continue to work to safeguard the stability of our financial system, while supporting the development of a payment system infrastructure that will improve access to credit for all eligible Nigerians”.
“Over the next five years, this will be the task for the Central Bank of Nigeria under my leadership, and we intend to do our very best to achieve these objectives”, he had assured.
Although Emefiele acknowledged that much was still left to be achieved from a similar agenda set in July 5, 2014, when he was first appointed, he said he was confident the bank will meet the expectations of Nigerians in the next five years.
Reviewing the achievements and challenges of the CBN in his first tenure, the governor pointed out that “with increased consultation and cooperation with the fiscal authorities and other interest groups, the agenda will be realised”.
In driving this vision, Emefiele expects that the bank under his management for the next five years, will work closely with the fiscal authorities to target a double digit growth; bring down inflation to single digit; and accelerate the rate of employment”.
“Put succinctly, our priorities at the CBN over the next five years are the following; First, preserve domestic macroeconomic and financial stability; Second, foster the development of a robust payments system infrastructure that will increase access to finance for all Nigerians thereby raising the financial inclusion rate in the country; Third, continue to work with the
Deposit Money Banks to improve access to credit for not only small holder farmers and MSMEs but also consumer credit and mortgage facilities for bank customers. Our intervention support shall also be extended to our youth population who possess entrepreneurship skills in the creative industry,” he had said.
Even as the governor promised to encourage the Deposit Money Banks to direct more focus in supporting the education sector, grow the country’s external reserves, and support efforts at diversifying the economy through CBN intervention programmes in the agriculture and manufacturing sectors, the apex bank may have concluded plans to raise the banks’ minimum capital base from the present N25 billion to over N200 billion.
“In the next five years, we intend to pursue a programme of recapitalising the banking Industry to position Nigerian banks among the top 500 in the world.
“Banks will therefore be required to maintain higher levels of capital, as well as liquid assets in order to reduce the impact of an economic crisis on the financial system,” he said.
On macro-economic stability, he said over the next five years, emphasis would be on supporting improved gross domestics product (GDP) growth and greater private sector investment.
According to him, the CBN intends to leverage monetary policy tools in supporting a low inflation environment, while seeking to maintain stability in our exchange rate.
He said decisions by the Monetary Policy Committee on inflation and interest rates will be dependent on insights generated from data on key economic variables.
He also said the CBN would also strive to continue to sustain a positive interest rate regime and that monetary policy measures, will be geared towards containing inflationary pressure and supporting improved productivity in the agricultural and manufacturing sectors.
To bring down the cost of food items, which have considerable weight in the Consumer Price Index basket, Mr Emefiele said the bank will work with other interest groups towards that objective.
“Our ultimate objective is to anchor the public’s inflation expectation at single digits in the medium to long run. We believe a low and stable inflationary environment is essential to the growth of our economy because it will help support long term planning by individuals and businesses,” he assured.
On Exchange Rate Stability, Mr Emefiele said the bank will continue to operate a managed float exchange rate regime, to reduce the impact the continuous volatility in the exchange rate could have on the country’s economy.
He the CBN will support measures to increase and diversify Nigeria’s exports base and ultimately help in shoring up the country’s foreign reserves.
Nigeria, he said, remains committed to a free trade regime that is mutually beneficial; but, particularly aimed at supporting our domestic industries and creating jobs on a mass scale for Nigerians.
Consequently, he said, the CBN intends to aggressively implement its N500 billion financial support facility to boost the growth of the non-oil exports and improve non-oil export earnings.
To achieve Financial System Stability, Mr Emefiele said a resilient and stable financial system was imperative for continued growth of the country’s economy given the intermediation role of financial institutions, to support the needs of individuals and businesses.
“In the next five years, we intend to pursue a programme of recapitalising the banking Industry to position Nigerian banks among the top 500 in the world.
“Banks will therefore be required to maintain higher levels of capital, as well as liquid assets in order to reduce the impact of an economic crisis on the financial system,” he said.
Reacting to the development. the Chairman, Charteted Institute of Bankers (CIBN), Abuja Chapter, Prof Uche Uwsleke said Ememefie’s five year policy thrust “is a good development with a lot of positive impact on the economy”.
In an interview with Daily Asset on Tuesday, Uwaleke, professor of Capital Market said, “The recapitalization of banks will strengthen financial system stability and put our banks in a stronger position to finance big projects needed for development as well as play in the global scene”.
“The planned introduction of a Trade monitoring system that reduces the length of time it takes to process export documents from one week to one day will surely boost exports.
“Also commendable is the plan to scale up the Anchor Borrower Programme and target for massive funding support 10 commodities that consume a lot of foreign exchange to import.
“This will help conserve Forex, grow external reserves, reduce food prices and possibly create job opportunities. The plan to build a robust payment infrastructure including through promoting payment service banks, shared agent networks, mobile money will go a long way in helping to achieve the target of 95 percent financial inclusion by the year 2024.
“Similarly, the boost in the Collateral Registry where over N400 billion worth of assets have been registered as well as the NISRAL microfinance bank will no doubt improve access to finance by micro and small businesses.
“The major risk I see in the pursuit of price and monetary stability which is the core function of the CBN is the volatility in crude oil price given our dependence on the sector. The CBN is therefore advised to have a plan B in its five year plan.
“It is also vital to get the cooperation of the fiscal authorities especially when it comes to the task of achieving double digit growth because on this very score, the CBN cannot clap with one hand”, he argued.
On capitalization, the university don’t however advised the CBN to raise the banks’ capital base to N100 billion, up from N25 billion.
“The N25 billion is already eroded when you look at our exchange rate. It is better to have 10 healthy banks than 20 that will be giving CBN headache. The tier two banks are also the most exposed banks to NPLs. The big five, are not giving CBN much problem like the others”, he argued.
“Bigger banks can easily bankroll larger businesses. So, if we are one of the 500 banks in the world, we can play comfortably in the international league. Bigger banks have better corporate governance and monitoring by CBN is much easier. Fewer stronger banks will invest in the right technology to deliver better services”, Uwaleke further pointed out.
In his reaction, CIBN President, Dr Uche Olowu, said there was no need for panic among bankers as the Nigeria financial system remains stable stressing that the whole idea of recapitalisation was to continue to sustain that stability in order to expand the scope of banks to do bigger businesses.
Olowu however advised the boards of the banks to go back to the drawing board and restrategise ahead of the CBN’s impending reapitalisation, assuring that the system will take care of itself with adequate planning.
Seplat Energy, an independent indigenous energy company, on Tuesday, said it had paid two billion dollars tax contribution to the Federal Government of Nigeria since its listing on the Nigerian Exchange Ltd.(NGX) in 2014.
Mr Roger Brown, Chief Executive Officer(CEO), Seplat Energy, revealed this while delivering a speech at the Closing Gong ceremony in Lagos.
The event was to commemorate the company’s 10 years anniversary of dual listing on the Premium Board of the Nigerian EExchange Ltd.
(NGX) and the Main Market of the London Stock Exchange (LSE).Brown stated that the oil and gas company, Seplat, also contributed 2.8 billion dollars as tax to the federal government over the past 13 years, after its establishment in 2009.
He explained that the company paid 1.54 billion dollars as royalty to the government, 329 million dollars as Petroleum Profits Tax, 273 million dollars as Value Added Tax, and 259 million dollars as Witholding Tax.
According to him, the energy firm also paid a tax of 276 million dollars to the Nigerian Delta Development Commission (NDDC) and others as well as 126 million dollars as Pay-As-You-Earn(PAYE).
The CEO stated that at post Initial Public Offering(IPO) of the firm, it generated 1.7 billion dollars in Free Cash Flow(FCF) and invested 1.6 billion dollars in Capex.
He also said that the company had paid dividends worth 575 million dollars between 2014 when it became listed and the financial year ended 2023.
Brown noted that the business of the energy firm continued to generate strong cashflows, reflected in its strong FCF and NCFO generation.
He said: “Similarly, we have generated a cumulative 3.3 billion dollars in net operating cash flow post IPO.
“Our strong cash flow generation has supported our ambitions to expand our business, which has seen us spend an aggregate of 1.6 billion dollars in capital expenditure.
“In over 10 years, we invested 57 million dollars in community projects on health, education and empowerment as strong commitment to community development.
“As a leading supplier of gas to Nigeria’s domestic Gas-To-Power Market, at times Seplat gas powered 20 to 30 of Nigeria’s domestic grid in 2023.”
He expressed delight over the feat, reiterating Seplat Energy’s commitment to leading Nigeria’s energy transition.
According to him, the power of indigenous companies is to bring growth and prosperity to their home countries and the people.
“One example of how Seplat Energy is making an enduring difference to Nigeria and host communities where we operate is that nearly 50 million dollars had been invested by our Joint Venture partnerships in communities since our inception to date,” Brown said.
“Truly, Seplat Energy has delivered significant value by enhancing strategic, operational and financial achievements in 10 years as a listed company,” he added.
In his comments, Mr Temi Popoola, Chief Executive Officer (CEO), NGX Group, emphasised the significance of Seplat Energy’s decade of dual listing.
He said, “If we were to look back to our market and tried to find landmarks, the last major landmark you will find in the last ten years is this transaction that we are celebrating today, and the market is very grateful for that.”
Congratulating Seplat Energy on this milestone, in his welcoming remarks, Alhaji Umaru Kwairanga, NGX Group Chairman, highlighted the importance of partnerships between the NGX and companies like Seplat Energy in driving economic growth and development.
He stated that “Seplat’s journey symbolises resilience, innovation, and a commitment to excellence, making them a beacon of corporate governance and operational expertise.
“Seplat Energy has emerged as a leading indigenous energy company, deeply integrated into Nigeria’s economic landscape and the NGX Group remains committed to supporting companies like Seplat Energy as they drive economic growth and contribute to our nation’s prosperity.”
Reflecting on the significance of the decade of dual listing, Mr Udoma Udo Udoma, Board Chairman, Seplat Energy, remarked, “Seplat Energy is committed to driving Nigeria’s transition to sustainable and affordable energy, harnessing its power to improve lives by transforming the economy.
“We have ambitious goals. We are investing in Nigeria. We will support the federal government’s energy transition policy, and we will partner with FG in whatever area they want us to do.
“That is our commitment. We will grow Seplat while also maintaining the highest standard of corporate governance.”
Also commending Seplat Energy on the decade of listing, Mr Jude Chiemeka, Acting CEO, NGX, stressed the importance of the capital market in helping companies raise funds and create wealth for all.
Chiemeka said, “Seplat Energy was listed at N576 at listing and yesterday it closed at 3,370, which is an increase of over 484 per cent.
“The figures show that in the last 10 years, the company has paid out 575 million dollars in dividend payments to shareholders in Nigeria and London where they are also listed.
“So, this company has given investors a huge opportunity to really participate in wealth creation.
“Reports show that Nigeria would be among the top 20 countries in the next 25 years, and I think Seplat is poised to be one of the institutions driving growth, prosperity, and inclusion in our nation.”
Also, gracing the Closing Gong ceremony was Sen. Heineken Lokpobiri, Minister of State, Petroleum Resources (Oil), who commended the company on it laudable achievements.
“I am happy to be part of today’s celebration and Seplat’s exceptional performance in the last ten years and as Minister of State, Petroleum Resources,
“I assure you that we will partner with Seplat to expand their investments, not only for the benefit of its shareholders, but also for Nigeria.
“The least the government can do anywhere in the world is to create an environment where companies like Seplat continue to thrive.”(NAN)
No Fewer than 34 states in the country failed to honour invitation to attend the just-concluded 35th Enugu International Trade Fair.
Reports says that only the Federal Capital Territory (FCT), Abuja; Ebonyi State and the host state, Enugu State, graced the 11-day international goods, services and idea showcasing fiesta.
The fair, which began on April 5 and ended on Monday, April 15, was themed: “Promoting made-in-Nigeria products for global competitiveness.
”Reacting, the Director-General of Enugu Chamber of Commerce, Mr Uche Mbah, said that the chamber followed due diligence in the invitation of all states to the fair.
Mbah noted that official letters were sent and official follow-up on the letters were made to ensure their presence and availability.
According to him, “we did everything to get them to add colour and increase the showcasing of products from different parts of the country and their investment viability.
“We did put in spirited efforts to see that all states participated, as most of them do previously.
“But it is unfortunate that many did not respond after receiving official letters, phone calls and interpersonal follow-ups were made.
“We got clear assurances from Kano State but they did not show up.
“We pushed harder to get Abia State but in the end, we were told that the governor did not approve,” he said.
Reports says that over 100 organisations were at the fair, which included: over 50 private companies as well as over 45 Federal and State government ministries, agencies and departments. (NAN)
Fidelity Bank Plc has recorded a profit before tax of N124.3 billion for the year ended Dec. 31, 2023, indicating 131.5 per cent increase from N53.7 billion posted in the 2022 finacial year.
The bank disclosed this in its 2023 full year audited financial statement issued to the Nigerian Exchange Ltd.
(NGX) on Tuesday in Lagos.Fidelity Bank said it would also be paying investors a final dividend of 60k per share and total dividend of 85 kobo per share for the reporting period.
This represents a 70 per cent increase compared to the 50 kobo per share paid to its shareholders in the previous year.
The financial institution stated that this led to an increase in Return on Average Equity (RoAE) of 26.
5 per cent in the year under review, from 15.6 per cent in the corresponding year.According to the financial statement, the bank grew its gross earnings by 64.9 per cent year-on-year, to N555.83 billion.
The bank stated that this was driven by 81.6 per cent growth in net interest income which increased from N152.7 billion in year 2022 to N277.37 billion in the 2023 financial year.
This led to a profit after tax of N99.45 billion, representing a 112.9 per cent annual growth.
Commenting on the performance, Dr Nneka Onyeali-Ikpe, Managing Director, Fidelity Bank, said that the financial institution closed the financial year with strong double-digit growth across key income and balance-sheet lines.
Onyeali-Ikpe stated that the bank’s performance in 2023 was an attestation of its capacity to deliver superior returns to shareholders despite the difficulties in our operating environment.
She said: “A review of the financial performance showed that the bank grew its net interest income by 81.6 per cent to N277.4 billion.
“This was driven by a 55.5 per cent increase in interest income, thus reflecting a steady rise in asset yield throughout the year.
“The average funding cost dropped by 20bps to 4.4 per cent due to increased low-cost funds that grew from 83.6 per ent in 2022 to 97.4 per cent in 2023.
“The combination of higher asset yield and lower funding cost led to an increase in Net Interest Margin (NIM) of 8.1 per cent from 6.3 per cent in 2022 financial year.”
According to her, the total customer deposits crossed the N4 trillion mark, as deposits grew by 55.6 per cent from N2.6 trillion in 2022.
She noted that the increase was driven by 81.1 per cent growth in low-cost funds.
Onyeali-Ikpe explained that despite the challenging operating environment, the bank reaffirmed its devotion to helping individuals grow and inspiring businesses to thrive.
She said the bank also committed to empowering economies to prosper by increasing net loans and advances to N3.1 trillion from N2.1 trillion in 2022 financial year.
The managing director stated that despite the growth in its loan portfolio, regulatory ratios were maintained well above the required thresholds.
Onyeali-Ikpe noted that the bank liquidity ratio stood at 45.3 per cent in the year ended 2023, from 39.6 per cent in the year 2022, while capital adequacy ratio rose to 16.2 per cent, compared to the minimum requirement of 15.0 per cent.
“We recognise the changing dynamics in the Nigerian banking space and the need to monitor and proactively manage evolving risks.
“The proposed final dividend of 60 kobo per share reflects our commitment to strong value creation and returns to our shareholders.
“Fidelity Bank has consistently paid dividend since 2006,” she said.(NAN)
Disability Act: Stakeholders Worry Over Delayed Domestication in Benue
ShareBy David Torough, Abuja Stakeholders have expressed concern over delay in the domestication of Disability Act in Benue state and...
Enugu Embarks on Inspection of Smart Schools, Healthcare Projects Across State
ShareFrom Sylvia Udegbunam, Enugu Governor of Enugu State, Peter Mbah has charged contractors and the site engineers handling construction of...
Benue Govt Abandoned Foreign Exchange Programme Due to N3mn Bursary – DG BEQA
ShareFrom Attah Ede, Makurdi The Director-General, Benue State Education Quality Assurance Agency, BEQA, Dr. Terna Francis, on Thursday, said the...
Tinubu Establishes National Education Data System
SharePresident Bola Tinubu has approved system-wide policies to comprehensively overhaul the education sector to improve learning and skill development, increase...
ADAS Programmes Set to Establish Digital Structure, Database for Farmers, Farmlands
ShareFrom Yagana Ali, Yola The Adamawa State Agribusiness Support Programme ADAS-P has concluded arrangements to establish standard & digital structure/database...
Absence of Diplomacy Responsible for Secessionist Agitations in Nigeria – INM
ShareFrom Marcel Duru, Owerri Igbo National Movement, a sociopolitical pressure group, has said that absence of diplomacy is responsible for...
N20m Bounty on Kidnappers: Wike Fulfills Promise to FCT Police Command
ShareBy Laide Akinboade, Abuja The Commissioner of Police, FCT, CP Benneth C. Igweh, expresses heartfelt gratitude on behalf of the...
Presidential Amnesty: Bank Accepts Responsibility for Stipends Delay
ShareFrom Mike Tayese, Yenagoa One of the Bank offering services to the Presidential Amnesty Programme (PAP) has explained the reason...
Enugu State Justice Reform Team Commends Mbah, Calls for Enhance Justice System
ShareFrom Sylvia Udegbunam, Enugu The Enugu State Justice Reform Team (ESJRT) has commended the administration of Dr. Peter Ndubuisi Mbah...
I Didn’t Abandon Mandate – LP Candidate
ShareFrom Marcel Duru, Owerri The Labour Party Candidate in the 2023 general elections for Mbaitoli-Ikeduru Federal Constituency, Rt Hon Uche...