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CBN to Move Against Banks Over Poor Services

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  • CBN to Move Against Banks Over Poor Services

The Central Bank of Nigeria (CBN) has warned the nation’s banks against poor services, asking them to shape up or close shop.The caution followed a series of complaints by customers of frustrations in completing their transactions at various branches or at Automotive Teller Machines (ATMs), most associated with system failures or poor network connectivity.

The Director of Banking and Payment System Department of the CBN, Dipo Fatokun, threatened to sanction any bank found wanting. He urged the public not to withhold such complaints, but speak out against inefficiencies.

Refusing to condone the excuse of system failures, Fatokun told The Guardian in a conversation: “Yes, there could be system issues, but it should be the exception and not the norm.”

As it is, the banking industry operations may soon be laden with the challenges of either malfunctioning of core banking software, inadequacy of the software, lack of trained personnel to operate them or negligence. This is because customers are increasingly turned down from updating their accounts except they go to the branch of domicile, on the grounds that it cannot be done through the unified core banking system. In other instances, funds transfers from one account to another, even within the same bank, are not completed, and may take up to one month or more, depending on the level of efficiency of the banks to return the funds to the owner’s account.

Reacting to the development, the CBN described such inefficiencies as unacceptable. With regard to money transfers, Fatokun said it was one of the simplest banking transactions. “After six minutes, the receiving account should be credited, if not, the bank should give a reason. Also the refund in the event of uncompleted transaction for one reason or another, should also take minutes not weeks or months.”

The developments, observed in major banks’ branches, have raised concerns over the availability of skilled personnel to carry out the operations, given the recent downsizing in the industry.

The situation has also raised questions over the functionality of the deployed banking software, as well as the validity of several claims by the operators of acquisition of sophisticated software aimed at ensuring the efficiency of the unified banking system.

Specifically, these banks were not able to update customers’ accounts that were previously opened in another branch as they failed to access the details. Officials of these banks claim it can only be done at the branch of domicile, a situation that appears strange given the level of the country’s payments system.

A customer of one of the top five banks, after going through the process of updating her account which lasted for more than one hour, was finally referred back to the branch of domicile.

Another customer confided in The Guardian that he too was referred to his branch where the account was opened in Kaduna, even as the account continues to hold on to huge cash as well as receive lodgements.

The CBN described such development as contrary to the modern banking industry.According to Fatokun, as long as there is no network failure, every account in a bank can be accessed from any of the same bank’s branch, which is the reason people make transactions across the country.

“It is not acceptable and no bank should give such an excuse. It is a setback to the progress recorded in our payment system. Please report such bank and branch to CBN for necessary action,” he said.

The ordeals of two customers from two different banks caused further inquest by The Guardian, which led to the discovery of similar complaints by customers from other banks.

Reiterating the importance of knowledge in the effective discharge of duties, Fatokun urged banks to train their personnel further in their specific areas of operations to stem inefficiencies.

The dilemma remains whether the situation is a matter of one branch integration challenge or a fast-spreading problem that may soon take the industry by surprise.

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.

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Loans

Increase in Banks’ Bad Loans Caused by Construction Sector

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The banking industry saw a 13.6 percent MoM (month on month) increase in bad loans to N2.76 trillion in August 2021, and the Central Bank of Nigeria attributed the increase to the rising loan defaults in the country’s construction sector.

The construction industry is touted to be under intense pressure due to the rise in the prices of building materials.

The Central Bank of Nigeria said this in its August Economic Report, stating that the NPL (Non-Performing Loans) ratio of the banking industry went up to six percent in August, one percentage point more than the five percent regulatory limit.

According to data from the apex bank, the total credit to the domestic economy went up by 2.2 percent to reach N46 trillion in August, from the N44.99 trillion recorded in July. This suggests that the NPL (bad loans) went up to N2.76 trillion in August from N2.43 trillion seen in July, a N330 billion or 13.6 percent increase.

The big rise in NPLs was explained by the CBN as a result of increased loan defaults in the construction sector, which accounted for about 4.7 percent or N905 billion of credit owed to other sectors in August, going up from 4.6 percent of N879 billion back in July.

The apex bank said the increase in the construction sector’s non-performing loans was due to the increase in process of building materials, which made it more difficult for contractors to meet their debt obligations.

Regarding this development, the Managing Director of Built2Suit Limited – a firm of architects – Ibukun Odu, said that apart from the increase in loan defaults, construction firms may have to turn to layoffs in order to reduce overhead cost.

Odu lauded the correctness of the CBN report, stating that a lot of contractors were finding the period extremely difficult. Odu stated that all the main components have witnessed increases of between 75 – 90 percent. He mentioned cement, which used to be sold at N2500 but is now sold between N4000 and N4200.

 

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Banking Sector

FirstBank DecemberIssaVybe: Showing Kindness as You Vybe

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The roof is already getting raised with #FirstBankIssaVybe, #DecemberIssaVybe campaigns. With FirstBank, it is always a total experience of being woven into the fabric of society from banking at its finest, to music, fashion, arts, and sports. Across the spectrum of human endeavour, FirstBank stands tall behind its over 32 million customers and counting. 

As FirstBank makes every day a vybe every December, it is also passionate about ensuring that everyone vybes with kindness. This is in sync with the words of Maurice Elias, Professor of Psychology, “without kindness, our communities, families, schools, and classrooms become places of incivility.” As we get the blast of the season, the 127 years strong banking brand in furtherance of its kindness campaign has created a simple calendar to ease your ability to create a SPARK in the lives of people around you.

At FirstBank, SPARK stands for Start Performing Acts of Random Kindness. The SPARK initiative was launched 4 years ago to make a difference in the nation by seeking to inspire and institutionalize kindness. By encouraging kindness, empathy and consideration for others, SPARK is placing FirstBank at the forefront of the social impact space. The unique way FirstBank is amplifying kindness is through its different directorates and departments. This way the Bank is reaching more communities, touching more lives, and spreading kindness.

The FirstBank kindness drive stands on three (3) pillars of compassion, civility, and charity. Compassion and charity readily come tops when we think about kindness, and FirstBank is championing the cause to also promote civility through the SPARK initiative. Civility covers the aspects of kindness that does not cost you anything to use in igniting the world around you. Imagine as you get to the venue of the next FirstBank’s DecemberIssaVybe show, and you give up a parking lot closer to the event hall to the car behind you?

The global head of marketing and corporate communication of FirstBank, Folake Ani-Mumuney says “At FirstBank, we spend every waking moment working to create meaning in the lives of our customers and publics. We are inspiring kindness because it brings meaning to lives and creates a happier society. So, as you vybe this Yuletide, vybe with kindness.”

Kindness does not have to cost you a kobo, so click here to download and share your kindness calendar for those simple tips to start performing acts of random kindness every day this December.

The need to promote kindness in our homes, schools, fun places, and the society at large cannot be over-emphasized especially with the increased incidence of bullying prevalent around us. In promoting the need for kindness in education and ‘cyber kindness’, FirstBank sponsored two impactful webinars during its corporate responsibility & sustainability week in July 2021. You can click here to access the Zoom recordings of the webinars.

Kindness should be a way of life, and FirstBank is at the forefront. Join the kindness train, vybe with kindness this Yuletide and always!

 

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Banking Sector

Stanbic IBTC Emerges Most Outstanding Commercial Bank Brand in Nigeria

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Stanbic IBTC Bank PLC, a subsidiary of Stanbic IBTC Holdings PLC, was named the “Most Outstanding Commercial Bank Brand in Nigeria” at the 2021 edition of the BrandCom Awards which was held recently.

The awards, organised by Brand Communicator Magazine recognised brands, organisations and personalities. It took cognisance of their outstanding contributions to the growth and development of the Nigerian economy.

Wole Adeniyi, Chief Executive, Stanbic IBTC Bank, appreciated the organisers for the award, and noted that Stanbic IBTC Bank has over the years provided unparalleled services and designed products tailored explicitly towards meeting the needs of its customers. 

Wole noted that the award would spur the organisation to continue providing excellent services to its clients. The awards reaffirm the organisation’s commitment to providing world-class financial services to its network of clients.

The Stanbic IBTC Bank Chief Executive said: “We are delighted to have emerged the Most Outstanding Commercial Bank Brand” at the BrandCom Awards. This award confirms that we prioritise our customers’ interests because they are the reason we are in business. We pledge to continue developing innovative products and services that are customer-centric, just as we are committed in our quest to continue fulfilling the financial needs of our customers at all times.”

Wole added that Stanbic IBTC would strive to continue exceeding its customers’ expectations.

Stanbic IBTC remains committed to providing a simplified customer-friendly experience that enhances customer satisfaction and exposes them to new trends in the financial services industry.

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