The naira plunged to 418 against the dollar at the parallel market on Tuesday as scarcity of foreign exchange continued to weigh on the official interbank and black market.
The local currency, which closed at 414 against the greenback on Monday, traded at 415 in Lagos, 417 in Abuja and 418 in Kano, foreign exchange dealers said.
Foreign exchange analysts believe the lingering scarcity of forex has been exacerbated by the banning of eight commercial banks from the forex market by the Central Bank of Nigeria.
The CBN last week Tuesday banned nine lenders from forex transactions for failing to remit the Nigerian National Petroleum Corporation’s $2.334bn into the Treasury Single Account.
The United Bank for Africa Plc, one of the nine lenders, was later re-admitted after it remitted its share of the funds to the TSA.
A day after the CBN banned the nine banks from the forex market, the local currency depreciated to 402/dollar, down from 397 it closed against the greenback on Tuesday.
The local currency has continued to depreciate gradually. Forex dealers maintained that the demand pressure on the dollar, mounted by summer travellers and parents paying schools fees of their children studying overseas ahead of resumption in September, was exacerbated by the CBN’s forex ban on the nine lenders.
The naira, which hit a fresh record low since the CBN floated the currency on the official interbank market in June, first touched 400/dollar at the black market this month.
Meanwhile, the CBN sold around $1.5m at the interbank forex market on Tuesday to support the local currency and ensure the closing rate stabilised, Reuters reported, quoting currency traders.
The naira closed at 305.50 to the dollar on the interbank market, same level it had traded since last week, having touched 325.50 a dollar intraday, but gained after the CBN’s intervention.
Traders said the naira had consistently closed around 305.5 to the dollar since August 22, an indication that the CBN was concerned about a particular price range for the local currency.
On Monday, the forex market registered $327m worth of trades, about six times more than its usual volume.
This included a single $270m transaction at 345 naira per dollar, by foreign investors buying local currency bonds.
Average trading is around $50m a day on normal days; it may reach $100m on days the CBN intervenes in the currency market.
According to traders, dollar shortage remains a major concern in the market even with the daily intervention by the central bank and a pocket of flows from offshore investors.
The naira traded at a fresh record low of 418 to the dollar on the black market, against 414 a dollar on Monday, traders said.
Oil-producing States Receive N35bn Allocation as FG, States, LGs Share N699bn in December
The sum of N699.824 billion was allocated to the three tiers of government in December, 2021, the Federation Accounts Allocation Committee (FAAC) says.
It further disclosed that the oil-producing states in the country received N35.297 billion as 13 percent derivation revenue.
A communiqué issued at a virtual meeting of FAAC for January 2022 revealed the above.
In its breakdown, the federal government got the sum of N279.457 billion, the state governments received N221.190 billion, and the local government councils were given N163.879 billion which amounted to N699.824 billion.
The North-east Development Commission (NEDC) also got an allocation of N5.796 billion.
According to the communique, the total distributable revenue of N699.824 billion is made up of distributable statutory revenue of N507.267 billion, distributable value-added tax (VAT) revenue of N187.409 billion, and exchange gain of N5.148 billion.
The FAAC recorded an increase of N5.080 billion in December as its gross revenue obtained from the value-added tax was N201.255 billion compared to the N196.175 recorded in November.
“The sum of N5.796 billion allocation to the North-east Development Commission (NEDC) and N8.050 billion cost of the collection were deducted from the N201.255 billion gross VAT revenue, resulting in the distributable VAT revenue of N187.409 billion.
“From the N187.409 billion VAT revenue available for distribution, the federal government received N28.111 billion, states got N93.705 billion, while the local government councils received N65.593 billion,” it stated.
The statement further showed records of an increase in companies’ income tax (CIT) and value-added tax (VAT), while petroleum profit tax (PPT) and oil and gas royalties clearly decreased. Also, it was recorded that import and excise duties decreased marginally.
It explained that the Federal government got N2.461 billion from the total exchange gain revenue of N5.148 billion; states received N1.248 billion; local government councils received N0.962 billion while N0.477 billion was shared to oil-producing states as 13 percent derivation revenue.
Fidelity Bank Enriches Customers, Holds Second Draw of GAIM 5 Promo
Leading African financial institution, Fidelity Bank PLC, has announced the second set of millionaires in its Get Alert in Millions Season 5 promo (GAIM 5) which held recently in Victoria Island, Lagos.
The event was witnessed by representatives of regulatory organisations which include: Ms Oyinkan Kusamotu, Senior Legal Officer, Lagos State Lotteries & Gaming Authority; Mr Tanko Mohammed, Head, Monitoring & Enforcement, Lagos State Lotteries and Gaming Authority; Mrs Susie Onwuka, Head, Lagos Office, Federal Competition & Consumer Protection Commission (FCCPC) and Ms Chioma Amanoh, Lagos Office, National Lottery Regulatory Commission (NLRC).
Since the commencement of the fifth season of the promo in November 2021, the bank has enriched over 460 customers with various cash prizes. So far, 10 lucky customers have been rewarded with a million naira each. This month, Fidelity Bank has continued its tradition of rewarding loyal customers which has seen Ajoma Rachel, Stanley Sunday, Musbahu Kabiru, Usman Abdulkadir, John Uchechukwu, Oluwatayo Oladipupo, Esther Eloho, Sophia Sefera, Amarachi Sarah Anyacho, and Obi Chinelo emerge as the next set of millionaires in the promo.
Commenting on the event, Dr. Ken Okpara, Executive Director overseeing the Bank’s Lagos and Southwest Directorate, stated that, “As a bank that places our customers at the centre of everything we do, we are always looking for opportunities to help our customers grow. Two months ago, we kicked off the GAIM 5 promo to reward our customers and demonstrate our commitment to improving their lives and wellbeing. Today, we are excited at how happy we have made some of our most loyal customers. We remain committed to providing rewarding experiences and best-in-class services for our clients.”
Also speaking at the event, the Divisional Head, Product Development, Osita Ede stated that: We have earmarked the sum of N125million for total cash rewards this season which we would be giving out in weekly, monthly and grand draws till the campaign ends in July 2022. We encourage our customers to save up to increase their chance of winning and those yet to open an account to do so today. At the end of the campaign season, we want to celebrate customers who make savings second nature.
Fidelity Bank is a full-fledged commercial bank operating in Nigeria, with about 6million customers who are serviced across its 250 business offices and digital banking channels. The bank is known for exceptional customer service and digital innovation.
Loan Default: AMCON Takes Over IBEDC
Further to the judgment of the Federal High Court on the 8th of September 2021, the Asset Management Corporation of Nigeria (AMCON) has announced its takeover of the Ibadan Electricity Distribution Company (IBEDC).
This is following the electricity distribution company’s default in a loan servicing agreement executed with Polaris Bank.
“AMCON has been appointed receiver/manager over all the Assets of Integrated Energy Distribution and Marketing Limited as stipulated in the instruments executed in favour of AMCON by virtue of the Loan Purchase and Limited Servicing Agreement executed with Polaris Bank Limited dated 30th November 2018 and a Notice of Appointment of the Receiver/Manager dated August 6th, 2021, which was duly stamped by the Commissioner for Stamp Duties”, a statement from AMCON reads.
AMCON further revealed that it has appointed Osayaba Giwa-Osagie to take over the entire undertakings on the IBEDC, including the assets, shares and interests in related companies and entities, and also monies kept in any of the 25 banks in Nigeria.
Investors King gathered that AMCON’s takeover might also not be unconnected to some crisis inside the power company, a development which has reportedly affected its service delivery to customers.
IBEDC’s Chief Operating Officer (COO), Engineer John Ayodele however allayed the fears of the IBEDC staff.
“I hereby wish to inform all staff that there is no cause for alarm. We are assured of job security which entails our position/duties in the company, being entitlements to our salaries and other benefits etc.”, he said.
Investors King recalls that the IBEDC, during a stakeholders’ meeting in May 2021 had disclosed that it secured N4.2billion from the Central Bank of Nigeria (CBN) to improve power supply to its numerous customers in Ogun State.
According to Ayodele, the facility would be channelled into building lines to improve power/electricity supply to the communities. He had also revealed that 80 percent of the money collected by IBEDC goes for other services, adding that the company has lost over N3billion in estimated billing.
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