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122 Agencies to Pay Operating Surpluses, FG Targets N886bn

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  • 122 Agencies to Pay Operating Surpluses, FG Targets N886bn

A total of 122 agencies are now required to pay operating surpluses annually into the Consolidated Revenue Fund of the Federal Government.

The Chairman, Fiscal Responsibility Commission, Chief Victor Muruako, disclosed this during the appearance of the management of the Federal Radio Corporation of Nigeria before the FRC in Abuja on Tuesday.

Muruako said the Federal Government had added 92 agencies to the original 30 that were required to pay operating surpluses into the Consolidated Revenue Fund in the bid to raise the revenue profile of the government.

According to him, the administration of President of Muhammadu Buhari has set a revenue target of N886bn for the agencies through the payment of operating surpluses.

The FRC Act, 2007 requires listed government agencies to remit 80 per cent of their annual operating surpluses to the CRF.

The operating surplus is made up of revenues accruing to government agencies above what they are approved to spend at the beginning of the budget year.

Thirty agencies were originally listed in the Act. However, the addition of 92 agencies has brought the number of government organisations required to pay operating surpluses to 122.

Among the 92 agencies now included in the list are the National Drug Law Enforcement Agency, Nigerian Investment Promotion Council, Nigerian Railway Corporation, Small and Medium Enterprises Development Agency of Nigeria and the Federal Radio Corporation of Nigeria.

Muruako said the FRC, which operates the Act, had started meeting with the 92 agencies that were recently included in the list in order to intimate them with the procedure for paying their operating surpluses to the coffers of the government.

The FRC boss listed items that were not recognised for exclusion in the accounts of agencies to include donations, depreciation, bank charges, provision for doubtful investments as well as provision for bad debts.

The Director-General, FRCN, Mr. Mansur Liman, said instead of lumping all agencies together as eligible for the payment of operating surpluses, the corporation deserved more investment from the government.

He said although the services of the corporation had been commercialised, there were still a lot of services being rendered but not paid for by the government and its agencies.

Government agencies remitted a total of N687.82bn to the CRF between 2007, when the Fiscal Responsibility Act came into effect, and 2015.

Among the 30 agencies listed as qualifying to remit operating surpluses, the Central Bank of Nigeria made the highest return of N497.63bn in a period of eight years. The organisation did not remit any surplus in 2015.

Notably, the Nigerian National Petroleum Corporation did not remit any surplus within the period of nine years.

Other organisations that made zero returns to the CRF included the Bureau of Public Enterprises, Nigerian Social Insurance Trust Fund, National Environmental Standards Regulatory Agency, Nigeria Customs Service and the Nigerian Electricity Regulatory Commission.

The Securities and Exchange Commission made only one remittance of N1.93bn in 2009, while the Nigerian Tourism Development Corporation also made a remittance of N51.73m in 2013.

Similarly, the Nigerian Ports Authority made only one remittance of N6.16bn in 2013; just as the National Business and Technical Examination Board made one remittance of N14.94m also in 2013.

Apart from the CBN, other agencies that remitted comparatively high amounts of money included the Nigerian Insurance Deposit Corporation, N68.05bn; National Maritime Administration and Safety Agency, N37.16bn; Nigerian Communications Commission, N32.35bn; and the Federal Inland Revenue Service, N24.24bn.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Finance

Total Currency in Circulation Increased by N56.44bn in September

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Currency in Circulation Rose by N56.44bn in the Month of September to N2.426 trillion

The total currency in circulation increased to N2.426 trillion in the month of September, the Central Bank of Nigeria (CBN) report has shown.

In the report released on Wednesday, the apex bank said the total currency in circulation stood at N2.369 trillion as of the end of August.

The amount then rose by N56.44 billion in September to N2.426 trillion.

A further breakdown of the report revealed that currency in circulation declined by 6 percent in the first quarter of the year to N2.29 trillion, about 7.5 percent below the same quarter of 2019.

The figure stood at N2.35 trillion in May, then rose to N2.39 trillion by the end of July.

While reserve money expanded by 5.9 percent to N12.96 trillion when compared to a 20.7 percent growth recorded in April 2020.

The report also noted that at N10.61 trillion, liabilities to other depository corporations grew 70.5 percent above the previous month’s growth rate of 59.7 percent.

The report said, “The heightened uncertain outlook due to the lockdown encouraged more cash to be held by the public.

“This was evident from the increase in currency in circulation, compared with the level in the preceding month.

“Currency in circulation rose by two per cent to N2.35tn at the end of May 2020, compared with the increase of 0.5 per cent at the end of April 2020.”

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Finance

CBN Directs Banks to go After COVID-19 Financial Criminals

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Godwin Emefile

Central Bank Asks Banks to Stay Abreast Frauds and Rising COVID-19 Financial Crimes

The Central Bank of Nigeria has directed all financial institutions in Nigeria to update alert protocols in their Anti-Money Laundering/Combating the Financing of Terrorism monitoring tools, in accordance with emerging trends of rising COVID-19 related financial crimes.

In a circular titled, ‘Administrative letters to all banks and other financial institutions’ issued on Monday and signed by J.M. Gana, the Director, Financial Policy and Regulation Department, the apex bank said changes in business activities and financial transactions due to the shift caused by COVID-19 pandemic have led to the surge in financial crimes globally.

Therefore, it said financial institutions must now adapt quickly and keep abreast of the new emerging financial risks and other developments to arrest this new and emerging ML/TF.

According to the circular, this includes strategic investment in data mining and artificial intelligence software to monitor financial transactions effectively and report as quickly as possible.

The central bank said the Nigerian Financial Intelligence Unit, the central repository of suspicious transactions and other financial information, had released a comprehensive report on STRs and others.

It stated that the NFIU had identified cybercrimes, frauds, counterfeiting and substandard goods, diversion of public funds and misuse of non-government organisations funds as some of the ongoing crimes that banks across the nation need to stay abreast and report.

Other suspicious transactions and red flags identified in the report were some e-commerce companies with little or zero history or internet presence suddenly receiving multiple payments from unrelated third parties.

Similarly, it said individuals with zero or little history of financial transactions receiving multiple payments from unrelated third parties. It also noted that customers who suddenly start delaying in the supply or purchases of medical supplies and payment of goods linked to known brands, yet the beneficiary is an individual, not a corporate company should be flagged.

The measures, the apex bank said were necessary due to the rising numbers of unusual transactions from banks’ customers and unscrupulous individuals.

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Finance

Union Bank Secures US$40 Million Facility from IFC Global Trade Finance

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Union Bank Secures US$40 Million Facility from IFC Global Trade Finance

Union Bank of Nigeria Plc said it has secured a US$40,000,000 finance guarantee facility from the IFC, a member of the World Bank Group.

In a note to the Nigerian Stock Exchange, the lender said the facility would help boost access to finance for local businesses and enable increased international trade for Nigeria.

It explained that the facility “will support Union Bank to establish working partnerships with nearly 300 major international banks within the GTFP network, thereby broadening access to finance and reducing cash collateral requirements for Nigerian businesses.

“The facility will enable the continued flow of trade credit into the Nigerian market at a time when imports are critical, and the country’s exports can generate much-needed foreign exchange.

Under the IFC’s Global Trade Finance Program (GTFP) terms of the agreement, GTFP offers benefiting banks partial or full guarantees covering payment risk on Union Bank’s trade-related transactions.

Accordingly, these guarantees are transaction-specific and may vary depending on underlying instruments like letters of credit, trade-related promissory notes, guarantees, bonds, and advance payment guarantees.”

Emeka Emuwa, Chief Executive Officer of Union Bank, said, “Union Bank is pleased to join the IFC’s Global Trade Finance Program. This is a significant achievement as we continue to expand our trade financing offerings to our
customers. Even in these peculiar times, we remain focused on contributing to economic growth by developing tailored solutions that help our customers harness the teeming opportunities that still exist in the Nigerian market.

Eme Essien Lore, IFC’s Country Manager for Nigeria, said, “Keeping trade moving is essential to growth and job creation, especially during the challenging economic times we are living through today. We welcome Union Bank to IFC’s Global Trade Finance Program and value a partnership that will make a positive impact on Nigeria’s economy.

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