Entertainment, Politics

CBN explains why it can’t prosecute Obi Cubana, others for abuse of Naira

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Following reports of Central Bank of Nigeria (CBN) failing to sanction violators of the country’s currency, the apex bank has disclosed that it has no power to take such action.

Conversation about the abuse of naira grabbed headlines in July after Nightclub businessman, Obi Iyiegbu popularly known as Obi Cubana, and his friends were captured violating the currency during his mother’s burial in Oba, Anambra State.

Ripples Nigeria had reported that Section 21 of CBN Act of 2007 frowns against the spraying of naira and stomping on it. The law states that any person caught violating the currency will be imprisoned for six months, with an option of fine – or both penalties will be meted on such individual.

However, the Acting Director of CBN’s Corporate Communications, Osita Nwanisobi, contradicted the CBN rule, stating that the financial regulator is not a law enforcement agency.

Nwanisobi, who spoke at an interactive session with the organised labour in Calabar, Cross River state over the weekend, where he represented CBN Governor, Godwin Emefiele, said, “CBN is not a law enforcement agency. But we completely frown at such an attitude where the national currency is not accorded its due respect as other nationals do their currencies.”

He said so much capital goes into the production of the naira, and this cost is passed on to Nigeria eventually.

This statement contradicts the CBN Act of 2007, which empowers the CBN to take action against abusers of naira. According to the act:

(1) A person who tampers with a coin or note issued by the Bank is guilty of an offence and shall face imprisonment for a term not less than six months or to a fine not less than N50,000 or to both such fine and imprisonment.”

Business

CBN bars PSBs from accepting foreign currency, granting loans

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The Central of Nigeria (CBN) has released the guidelines for the operation of Payment Service Banks (PSBs) in Nigeria.

In a document released by the apex bank on Friday, the PSBs were barred from granting any form of loans, advances, and guarantees (directly or indirectly) to customers.

Also, the PSBs are not expected to accept foreign currency deposits, deal in the foreign exchange market, insurance underwriting or undertake other transactions which are not prescribed by the guidelines.

In addition, the banks were restrained from accepting closed scheme electronic value (e.g. airtime) as a form deposit or payment; establish any subsidiary except as prescribed in the CBN regulation on the scope of Banking and Ancillary Matters, No 3, 2010.

However, the regulator allows the PSBs to grant loans to their employees in line with their established loan policy and subject to the Board approval, accept deposits from individuals and small businesses, which shall be covered by the deposit insurance scheme and carry out payments and remittances (including inbound cross-border personal remittances) services through various channels within Nigeria, among others.

The document read: “This framework hereby provides a set of regulations that are targeted at streamlining operations of PSBs, ensuring transparency in their operations as well as ensuring adequate customer protection.

“The framework focuses on corporate governance, risks management of the PSBs and safety of funds to the consumers of the PSBs’ products.

This framework also aims to ensure that sound risk management practices are embedded in the operations of the PSBs.”

The CBN stressed that PSBs were required to comply with relevant extant regulations and prudential guidelines and circulars which were issued periodically.

“They shall use the words ‘Payment Service Bank’ in their names to differentiate them from other banks.

“However, the name of a PSB shall not include any word that links it to its parent company or promoter,’’ it added.

The apex bank also declared that the banks shall operate mostly in the rural areas and unbanked locations targeting financially excluded persons with not less than 25 percent financial service touchpoints in such areas as defined from time to time.

They are to enter into direct partnership with card scheme operators. Such cards shall not be eligible for foreign currency transactions.

“Deploy ATMs in some of these areas; deploy Point of Sale devices, and be at liberty to operate through banking.

“Rollout agent networks with the prior approval of the CBN; use other channels including electronic platforms to reach out to its customers; establish coordinating centres in clusters of outlets to superintend and control activities of the various financial service touchpoints and banking agents,” the document stated.

Business

CBN to print currency for Gambia

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The Central Bank of Nigeria (CBN), says it is ready to help the Central Bank of The Gambia (CBG) to print its legal tender, the Dalasi.

The CBN Governor, Godwin Emefiele agreed to the currency minting proposal from the Governor of the Central Bank of The Gambia, Buah Saidy, who led a delegation on a two-day visit to him on Tuesday.

The CBG had approached CBN for a possible partnership to tackle acute currency shortages among other currency management challenges in the country.

Speaking on the proposal, Emefiele said Nigeria has a lot of capacity in currency printing as she has been minting since the 1960s and “we are willing to assist in printing your currency. We can be extremely competitive in terms of cost.”

Saidy informed the CBN governor that relying on its current printer, De La Rue of London, for its currency needs was expensive and unsustainable.

He explained that it costs the bank about £70,000 to lift printed currencies from Sri Lanka to the Gambia.

Emefiele assured his visitors that the CBN has a competitive advantage to undertake the currency printing for Gambia, adding that the Nigerian Security Printing and Minting has a lot of idle capacity to satisfy the demand of the CBG.

“Our colleagues from Liberia who were there two months ago were fascinated by the facilities we have at the Nigerian Security Printing and Minting,” he said.

On its part, the Nigerian Security Printing and Minting Company Plc said it is ready if both parties come to a deal.

Business

CBN to launch own digital currency by year end

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The Central Bank of Nigeria (CBN) is planning to launch its own digital currency by the end of 2021, the bank’s IT specialist Rakiya Mohammed said.

Mohammed’s disclosure follows the conclusion of the Bankers Committee meeting on Thursday in Lagos state.

According to her, the apex bank has for over two years been exploring the technology and has made tremendous progress.

“Before the end of the year, the Central Bank will be making a special announcement and possibly launching a pilot scheme in order to be able to provide this kind of currency to the populace,” she said.

This follows concerted efforts by the CBN to crack down on cryptocurrency operations in Nigeria.

The regulator had in February ordered banks to shut down any accounts linked to crypto transactions.

Mohammed said when eventually operational, the currency would complement cash notes.

The official said another reason the apex bank plans to come up with digital currency is to make remittances travel easier from abroad to Nigeria.

She said that digital currency would accelerate the ability to meet the target, regardless of one’s country of residence.

The specialist also said that CBN would be exploring various technological options and engaging various industry players as well as moving to the next stage of proof of concept to pilot the scheme.

Mohammed said that CBN considered the architecture, accessibility issue and privacy of the currency before going into it.

Other issues discussed at the bankers’ committee meeting include launch of digital cards as well as foreign exchange availability in banks.

Business

Spray naira notes and go to jail – CBN warns Nigerians

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The Central Bank of Nigeria (CBN), has reiterated its warning that anyone caught spraying Naira notes will be prosecuted.

This directive is a bid by the apex bank to curb the rate at which Nigerians ‘mutilate, deface, squeeze and even spray and sell’ the naira notes during memorable occasions such as weddings and birthday parties.

An Assistant Director at CBN Currency Operations Department, Aladeen Badejo made this known during the commencement of the CBN two-day sensitisation fair held in Abeokuta, Ogun state on Thursday, June 10.

Abuse of the currency attracts a penalty of not less than six months or a fine of not less than N50,000 or both,” Badejo said at the event

Business

Honeywell tackles CBN over loan default claim

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Honeywell Flour Mills has questioned a statement by Godwin Emefiele, Governor of Central Bank of Nigeria (CBN) that it defaulted on its loan from First Bank of Nigeria.

CBN on Thursday had instructed Honeywell to repay within 48 hours its loan obligations to First Bank.

“The insiders who took loans in the bank, with controlling influence on the board of directors, failed to adhere to the terms for the restructuring of their credit facilities which contributed to the poor financial state of the bank,” CBN said in a statement announcing the sack of board members of First bank and FBN holdings.

The insider is believed to be Oba Otudeko, one of the sacked board members and owner of Honeywell Flour Mills.

The apex bank also threatened, it will take appropriate regulatory measures to ensure it is paid.

However, in a statement on Friday signed by its company secretary Yewande Giwa, the food and the agro-allied company said the outstanding loan with the bank is based on agreed terms.

With reference to the credit facility with First Bank of Nigeria (FBN); over many decades, the company has had a long standing, mutually beneficial credit relationship and continues to fulfill all its obligations to the Bank, and all its facilities are fully performing,” the statement reads.

The statement which was submitted to the Nigerian Exchange Limited, also noted that the company has adequate security to cover its loan exposure and has not defaulted or shown signs of distress.”

“The terms of the loan with FBN have been fulfilled in line with industry standards and in accordance with agreed terms throughout its course and the Company expects to continue to do so.

We remain committed to complying with regulations governing our industry and our obligations to First Bank and our various financial counterparts”, it said.

Business

CBN sacks all First Bank directors

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The Central Bank of Nigeria (CBN) has fired the entire members of the board of First Bank of Nigeria Limited.

The apex bank also reinstated Sola Adeduntan as the managing director and chief executive officer of First Bank of Nigeria Limited.

CBN Governor, Godwin Emefiele made the announcement in a press briefing on Thursday.

The CBN had faulted the appointment of Abdullahi Ibrahim as deputy managing director, as well as the appointment of Ini Ebong, Segun Alebiosu, Seyi Oyefeso and Bashirat Odunewu, as executive directors.

Details later…

Business

CBN extends grace period on intervention loans for one-year

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The Central Bank of Nigeria (CBN) has extended its forbearance on intervention loans obtained from the apex bank. A new regulatory directive was issued following the expiration of the previous deadline.

In March 2020, CBN offered businesses COVID-19 palliatives in form of reduced interest rates on its intervention funds to companies from 9 percent to 5 percent per annum.

This was meant to assist businesses affected by the government’s measures against COVID-19 outbreak, and clear their financial constraint.

The reduced interest rate was meant to last for a year, same as the moratorium which was tied to the intervention loans. The low interest rate and the moratorium expired at the beginning of March 2021.

However, the CBN won’t enforce payment of debt, as the regulatory body extended the palliative by twelve months, until February 28, 2022.

But the grace provided by CBN won’t affect all debtors, only businesses that obtained CBN loans in Deposit Money Banks and credit facility from Bank of Industry (BOI).

Following the expiration of the above timelines, the CBN hereby approves as follows: 1) The extension by another twelve (12) months to February 28, 2022 of the discounted interest rate for the CBN intervention facilities; 2) The roll-over of the moratorium on the above facilities shall be considered on a case by case basis.” CBN said in a statement on Wednesday.

Business

Bitcoin is catalyst for change, US SEC nominee disagrees with CBN

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The nominee for United States’ Securities and Exchange Commission (SEC), Gary Gensler, has described bitcoin as a catalyst for change.

Gensler said while SEC under his leadership will protect investors, the commission also intends to support the usage of bitcoin.

Gensler’s comment on bitcoin has given the cryptocurrency some weight following criticism from the Central Bank of Nigeria (CBN), which said cryptocurrency is used for criminal activities.

The CBN governor, Godwin Emefiele and the apex body, had stated that no serious and credible investor wants to associate with cryptocurrency, but the statement of Gensler has proven otherwise.

Gensler spoke of his plan for cryptocurrency during the US Senate confirmation hearing.

He said bitcoin and other cryptocurrencies have redefined financial inclusion as the digital assets provided new method for payment. With the high level of risk investors are exposed to, Gensler said investors protection will be a priority.

“These innovations have been a catalyst for change. Bitcoin and other cryptocurrencies have brought new thinking to payments and financial inclusion, but they’ve also raised new issues of investor protection that we still need to attend t,” he said.

In curbing the risk cryptocurrency poses to investors, Gensler said, “I’d work with fellow commissioners to both promote the new innovation, but also at the core, ensure for investor protection.

If something were security, for instance, it comes under the securities laws, comes under the SEC. If there are exchanges that trade those, to ensure that there’s the appropriate investor protection on those exchanges, so promote technology but still stay true to our core values of investor protection and capital formation,” Gensler said.

Business

CBN hands over National Theatre renovation to firm partly-owned by Lagos

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The Central Bank of Nigeria (CBN) has concluded plans to renovate the National Theatre, with three contractors chosen to conduct the reconstruction work.

One of the firms is partly-owned by the Lagos State government with chieftains of the ruling All Progressives Congress (APC) as directors in the company.

The three contractors chosen are Nairda Limited, which is the Electrical Sub Contractor; VACC Limited, the Mechanical Sub Contractor, and Cappa & D’Alberto Limited, which is the Main contractor of the National Theatre renovation project.

According to findings by Ripples Nigeria, Cappa & D’Alberto Limited is partly-owned by the Lagos State government, through Ibile Holdings Limited, which is an investment company of the state government.

Ibile – which is the acronym of the first letter from names of the five administrative divisions of Lagos State; Ikorodu, Badagry, Ikeja, Lagos Island and Epe – is a substantial shareholder of Cappa & D’Alberto Limited.

Cappa & D’Alberto constructs residential and commercial buildings, and Ibile Holdings is its third largest shareholder with 18.56% as at July 25, 2019, checks by Ripples Nigeria confirmed.

On Cappa & D’Alberto board of directors, are two All Progressive Congress (APC) chieftains, Adedamola Seriki, current Nigerian ambassador to Spain and Abayomi Kiyomi, former Speaker of the Lagos State House of Assembly.

Cappa & D’Alberto will be in charge of the renovation – which will cost the CBN and bankers committee N21.89 billion – as the main contractor, with renovation expected to be completed in the next 18 months, while CBN will run the entertainment site until 2042.

Cappa & D’Alberto were previously listed on the Nigerian Stock Exchange (NSE), but chose to delist after an Annual General Meeting (AGM) in 2009.

The company was eventually delisted by NSE in 2015 due to its failure to comply with listing requirements.

Prior to the decision to delist, Cappa & D’Alberto shares traded at above N100 per share, but dropped to N90.72kobo after the announcement.

The construction firm now operates as a private company.

Politics

Atiku slams Nigerian govt, CBN for banning cryptocurrency transactions

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Former Vice President and presidential candidate in the 2019 election, Atiku Abubakar, has slammed the Federal Government as well as the Central Bank of Nigeria (CBN), over its order to banks to shout down cryptocurrency operations.

Atiku, in a statement on Saturday, faulted the apex bank over the policy, noting that with the present economic downturn in the country, Nigerians need all the help they can get to get out of the present economic quagmire.

In a statement titled, “We Need To Open Up Our Economy, Not Close It,” Atiku said the policy came at a very wrong time.

“This is definitely the wrong time to introduce policies that will restrict the inflow of capital into Nigeria, and I urge that the policy to prohibit the dealing and transaction of cryptocurrencies be revisited,” he said.

“The number one challenge facing Nigeria is youth unemployment. In fact, it is not a challenge, it is an emergency. It affects our economy, and is exacerbating insecurity in the nation.

“What Nigeria needs now, perhaps more than ever, are jobs and an opening up of our economy, especially after reports by the National Bureau of Statistics indicating that foreign capital inflow into Nigeria is at a four year low, having plummeted from $23.9 billion in 2019, to just $9.68 billion in 2020.

“Already, the nation suffered severe economic losses from the border closure, and the effects of the COVID-19 pandemic.

“It is possible to regulate the sub sector and prevent any abuse that may be inimical to national security. That may be a better option than an outright shutdown.

“There is already immense economic pressure on our youths. It must be the job of the government, therefore, to reduce that pressure, rather than adding to it.

“We must create jobs in Nigeria. We must expand the economy. We must remove every impediment towards investments. We owe the Nigerian people that much.”

Politics

Reps quiz DPR, NNPC, CBN over missing crude oil worth $20bn

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For seven years, crude oil lifted from Nigeria between 2005 to 2012 worth over $20 billion was unaccounted for according to the House of Representatives.

Chairman, Ad-hoc Committee on Crude Oil Theft, Hon. Peter Akpatason disclosed this on Wednesday, during the resumed hearing with top officials from the Department of Petroleum Resources in Abuja.

Akpatason also noted that the same trend of infractions were observed between 2016 and 2019.

“Forensic analysis of the data revealed a very wide margin between what was reported produced and what was lifted. We need an explanation from stakeholders involved.

“DPR is the agency of government saddled with the responsibility of monitoring crude oil production and lifting. The Committee requested and obtained schedules of crude oil produced and lifting between 2005 to 2019.

“Forensic analysis of the data revealed a very wide margin between what was reported produced and what was lifted. Between 2005 and 2012, DPR reported production of 1,746,621,167 barrels from four sampled oil terminals of Egeravos, Bonny, Forcados and Bonga.

Out of these production volumes, only 1,417,200,848 barrels were accounted for, as having been lifted officially. A whopping volume of 329,420,319 barrels, valued at over $20 billion, could not be accounted for. The same trend of infractions was observed in the years 2016-2019″, he revealed.

In defense, DPR Director/CEO, Sarki Auwalu, blamed the crude theft on third party interference, especially at the land terminals.

“I will like to use this opportunity to give a brief on how we will account for hydrocarbon in this nation. I think that will provide a better view of this committee as well as Nigerians. The process starts with well, because every crude oil comes from well, and you cannot drill a well without knowing the capacity of that well to produce.

“Most of the thefts, they are coming from land terminals because the land producers, they have to use pipelines to transport the crude into the terminals for export. In the process, you have a lot of third party interference in which those points of theft were there; small volumes that account for the larger volume are being taken and they are being stolen”.

Auwalu explained further that most of the discrepancies in production and export, you can easily calculate the theft volume. And the theft volume, if not all, come from the land terminals. But the offshore terminals, it is actually practically impossible to steal crude from offshore terminals, since it is from the bottom of the sea.

Department of Petroleum Resources appearance on Wednesday before the committee will be followed by Nigeria National Petroleum Corporation and the Central Bank of Nigeria on Thursday and Friday respectively

Business

CBN holds monetary policy rate at 11.5%

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The Central Bank of Nigeria (CBN) on Tuesday kept its Monetary Policy Rate (MPR) unchanged at 11.5 percent after two days of its Monetary Policy Committee (MPC) meeting in Abuja.

This will not come as a surprise as analysts in the financial services sector had predicted the CBN will maintain the status quo following an uptick in inflation rate and weak growth.

Nigeria’s inflation rose to 15.75 percent in December from 14.89% percent in November 2020 according to data from the National Bureau of Statistics (NBS).

By unanimous decision, Members of the MPC of the CBN also retained the Cash Reserve Ratio (CRR) at 27.5 precent, Liquidity Ratio at 30 percent as well as the Assymetric Corridor around the MPR at +100/-700 basis points.

Business

BUSINESS ROUNDUP: Naira falls against dollar; CBN threatens defaulters of diaspora remittance regulations

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Hello, and welcome to Business Roundup this week. Here, we bring you highlights of events that happened during the week -from the capital market to the mainstream business activities, while not forgetting the tech/economy build up.

Here are the Headlines:

  • CBN threatens to shut accounts of diaspora remittance regulations defaulters
  • Nigeria’s active telephone subscribers hit 208m
  • Discos get N14.35bn loan from CBN for 263,860 Meters
  • Naira falls against dollars on Wednesday

Summary:

The Central Bank of Nigeria (CBN) threatened to shut the accounts of operators who continue to violate diaspora remittance regulations as well as withdraw their operating licences.

In a circular signed by the Director, Trade & Exchange Department of the CBN, Dr. O. S. Nnaji, on Friday, the apex bank said it would no longer tolerate the clear “contravention of its directive that all remittances be paid to beneficiaries in dollars.

The Nigerian Communications Commission (NCC) has confirmed that the number of active telephone subscribers has hit the 208 million mark across the country.

At a press briefing the Commission held in Abuja on Thursday to usher in the new Permanent Secretary of the Federal Ministry of Communications and Digital Economy, Festus Daudu, the NCC Executive Vice Chairman, Umar Danbatta said third generation (3G) and fourth generation (4G) base transceiver stations deployment in Nigeria had also increased from 30,000 to 53,460. 

The Federal Government said on Thursday it had approved and disbursed the sum of N14.35 billion to the Distribution Companies of Nigeria (DisCos) to procure at least 263,860 meters for electricity customers.

The disbursement was under the National Mass Metering Programme (NMMP), initiated by the federal government to put an end to estimated billing of electricity consumers by DisCos.

This was disclosed on Thursday, via the official twitter handle of the presidency @NGRPresident. 

Naira put up a poor performance against the dollar at the Investors and Exporters (I&E) window on Wednesday as trading closed at N394.17k per dollar.

This represents a 0.21 percent drop or 82 kobo loss when compared to the N393.35k per dollar that it exchanged for on Tuesday, according to data from FMDQ Securities Exchange Plc.

Although, at the black market, Naira remained steady in value to the dollars at N475/$ after two days trading. 

On NSE ROUNDUP: Stocks investors lose N81.59bn in one week

Stock investors in Nigeria lost about N81.59billion in the third trading week following increased activities of profit takers.

At the end of today’s trading, the market depreciated by -0.24% to close at 41,001.99 basis points as against -0.12% depreciation recorded previously.

The All Share Index dropped by -0.42% to close the week on the negative while the market capitalisation came down to N21.448trillion as against the week’s high N21.530 trillion. 

MEANWHILE, on the tech scene, latest development around Sim Shagaya’s edutech product, uLesson, led amongst stories for the week, especially as it concerns Nigerian tech ecosystem.

Nigerian auto-tech company Autochek joined the league of Nigerian startups with footprints in Ghana. Also during the week, we recorded the launch of a new product, Avocat, built, by Rimotli Technologies, to facilitate legal services online.

 

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