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21 Banks Borrow N4.06tr From CBN in Three Months

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CBN

Banks have been frequenting the Central Bank of Nigeria (CBN) Window to borrow cash to boost their liquidity positions, according to the CBN Economic Report for the second quarter, released yesterday.

Twenty-one commercial banks borrowed N4.06 trillion from the CBN’s Window in the first quarter- between April and June.

The figure, the report said, was by far higher than N560.8 billion borrowed in the first quarter- from January to March this year, the report released yesterday showed.

The funds came through the Standing Lending Facility (SLF), which is an overnight CBN credit available on banking days between 2 pm and 3.30 pm, with settlement done on same day value. Funds were sourced mainly from time, savings and foreign currency deposits, as well as accretion to unclassified assets. The funds were used, largely, to extend credit to the private sector and payment of claims on demand deposit.

The CBN attributed the huge borrowing figure by banks to foreign exchange illiquidity in the system, which it said, hindered the smooth running of the foreign exchange inter-bank market and this led the bank to float a special foreign exchange auction.

The apex bank said the settlement of these transactions drained liquidity in the money market. Consequently, inter-bank money market rates spiked and the trend in standing facilities reversed as there was more patronage at the Standing Lending Facilities (SLF) than the Standing Deposit Facility (SDF).

The regulator said provisional data indicated that total value of money market assets outstanding at the end of the second quarter of 2016 stood at N10.46 trillion, showing an increase of 6.7 per cent, compared with the level in the first quarter. The development reflected the 8.09 per cent and 2.73 per cent growth in Federal Government of Nigeria bonds and treasury bills, respectively.

The report, posted on the CBN’s website, said developments at the CBN standing facilities window in the review quarter indicated higher patronage at the SDF window, during the first two months of the review quarter.

The trend, however, reversed with the settlement of a large volume of foreign exchange purchased at the special auction conducted on June 20.

“Total request for Standing Lending Facility (inclusive of Intraday lending facilities converted to overnight repo) during the review period amounted to N4.06 trillion, with N1.46 billion in interest earned, compared with SLF of N560.80 billion and interest earned of N0.28 billion in the preceding quarter,” it said.

This amounted to N3.50 trillion and N1.18 billion increase in SLF and interest earned, respectively, from the levels in the first quarter of this year. It said the total deposit at the SDF window during the review period was N6.01 trillion with a daily average of N100.22 billion, compared with N6.61 trillion in the first quarter of this year.

The report said the cost incurred on SDF in the review quarter stood at N1.74 billion, compared with N1.08 billion, in the preceding quarter.

It said the commencement of the new foreign exchange policy on June 20 influenced the direction of the financial market thereafter.

CBN data also showed that the total assets and liabilities of the commercial banks stood at N31.23 trillion at the end of the preceding quarter of 2016, representing an increase of 9.6 per cent over the level at the end of the preceding quarter.

The funds, it said, were sourced, mainly, from time, savings and foreign currency deposits, foreign liabilities and unclassified liabilities. The funds were used, mainly, to increase claims on private sector, acquire foreign and unclassified assets.

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Insurance

Heirs Insurance Group Unveils Revolutionary Website for Seamless Insurance Experience

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Heirs Life Assurance- Investors King

Heirs Insurance Group has launched a website designed to revolutionize the insurance experience for its customers.

With a focus on simplicity, accessibility, and personalized service, the new website aims to streamline the process of obtaining insurance coverage and empower customers to make informed decisions about their insurance needs.

The website boasts a range of innovative features that make navigating insurance options easier than ever before.

From simple and intuitive navigation menus to personalized insurance recommendations, the website is designed to guide customers through every step of the insurance process quickly and efficiently.

According to Ifesinachi Okpagu, the Chief Marketing Officer of Heirs Insurance Group, the new website embodies the company’s commitment to delivering exceptional customer service.

“Today’s customers want simplicity, and this new website delivers on that request,” Okpagu said. “We are empowering customers to take control of their lives, their businesses, assets, and their most cherished people.”

One of the key features of the website is its personalized insurance experience, which takes customers through a short journey to help them identify the best insurance plan for their needs.

Whether customers are looking for coverage for their home, car, business, or loved ones, the website provides tailored recommendations to ensure they find the right insurance solution quickly and easily.

With its user-friendly interface and innovative features, the new website from Heirs Insurance Group sets a new standard for the insurance industry, making it easier than ever for customers to protect what matters most to them.

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Banking Sector

Safaricom, Access Holdings Forge Partnership to Revolutionize Remittance Corridor in Africa

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Access bank

Safaricom, the leading telecommunications company in Kenya, has entered into a strategic partnership with Access Holdings, spearheaded by Aigboje Aig-Imoukhuede.

The collaboration aims to revolutionize the remittance corridor between East and West Africa, marking a significant step towards enhancing financial inclusion and empowering millions of individuals across the continent.

The partnership comes on the heels of Access Holdings’ recent acquisition of the National Bank of Kenya Limited, signaling the company’s ambitious expansion into the East African market.

Leveraging Safaricom’s extensive network and expertise in mobile money through M-Pesa, which currently dominates the mobile money market in Kenya, the alliance seeks to create seamless and efficient channels for remittance transactions.

Aigboje Aig-Imoukhuede, the driving force behind Access Holdings, expressed enthusiasm about the collaboration, highlighting its potential to transcend traditional boundaries and foster greater economic connectivity between East and West Africa.

He highlighted the fusion of collective expertise and resources between the two entities, underlining their shared commitment to driving financial inclusion and empowerment across the continent.

The partnership holds promise for addressing the challenges faced by millions of Africans in accessing affordable and reliable remittance services.

By connecting more than 60 million customers and 5 million businesses across eight countries, the collaboration aims to facilitate over $1 billion in daily transaction value, significantly boosting the flow of remittances within and outside Africa.

With the first phase of the collaboration focusing on key markets such as Nigeria, Kenya, Ghana, and Tanzania, stakeholders anticipate a transformative impact on the remittance landscape, paving the way for greater intracontinental trade and economic integration in line with the objectives of initiatives like the African Continental Free Trade Area (AfCFTA).

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Banking Sector

EFCC Urged to Repatriate Recoveries to NDIC for Depositors’ Relief

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The Nigeria Deposit Insurance Corporation (NDIC) has made a fervent plea to the Economic and Financial Crimes Commission (EFCC) to expedite the repatriation of recovered funds to its coffers to facilitate the timely reimbursement of depositors affected by bank failures.

During a recent meeting between the Managing Director of NDIC, Bello Hassan, and the Executive Chairman of the EFCC, Ola Olukoyede, at the NDIC headquarters in Abuja, Hassan stressed the importance of enhanced collaboration between the two agencies in recovering depositors’ funds lost due to bank failures.

Hassan emphasized that the return of recoveries made by the EFCC on behalf of the NDIC would significantly contribute to the prompt reimbursement of affected depositors.

He commended the EFCC for its unwavering efforts in combating corruption and financial crimes, highlighting its crucial role as a key member of the Taskforce on Implementation of the Failed Banks Act chaired by the NDIC.

The NDIC boss also highlighted the existing partnership between the two organizations, which led to the establishment of the NDIC Help Desk at the EFCC in 2022.

He disclosed that several high-profile cases referred to the EFCC were currently under investigation.

In response, Olukoyede reiterated the EFCC’s commitment to collaborating closely with the NDIC to combat financial crimes and safeguard the integrity of the Nigerian banking sector.

He pledged to intensify efforts to repatriate recovered funds promptly, acknowledging the interconnectedness between criminal activities and bank failures.

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