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Banks’ Outrageous Lending Rate Killing Businesses

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  • Banks’ Outrageous Lending Rate Killing Businesses

The Minister of Agriculture and Rural Development, Chief Audu Ogbeh has condemned the lending rate currently being charged by banks in the country, pointing out that with the development, it would be difficult for businesses to survive in Nigeria.

Ogbeh made the remark in Abuja at the 2016 annual conference of the Business and Professional Women (BPW) of Nigeria with the theme: ‘Leaders Growing Leaders’.

Ogbeh said while there had been arguments that the lending rate cannot be lower than the inflation rate, the development was not good for the economy.

His words: “Nigeria is a tough environment to do business in. One of the issues that I have always complained about is the outrageous interest rate, which banks charge today.

“For the last 30 years, it has become nearly impossible for small and medium businesses to survive. The interest rate has been hovering around 18 per cent to 22 per cent and now to 30 per cent.

“But for some strange reasons, it has been impossible to change it. The argument has always been interest rate cannot be lower than inflation rate and yet we expect this economy to grow. We have imaginary dreams of growth because what has been growing is poverty.”

He said his ministry as part of efforts to make funding available for farmers has pegged interest rate on loans given by the Bank of Agriculture at seven per cent.

He urged the professional and business women to embrace agriculture, adding that the ministry would make rice mills available to them in any location of their choice.

He said the renewed commitment of the federal government to importation of food had started yielding result with the country seeing gradual reduction in food import bills.

Ogbe added: “We have always been importing all types of things and we have been making the world very happy.

“But since the dollar has dried up. I have received delegation from as far as Iceland. Prime ministers have arrived and come to my office to complain that Nigeria has stopped buying their goods.”

The National President, BPW, Mrs. Angela Ajala said the conference with theme “Leaders growing leaders” would enable them brainstorm on some of the qualities needed to succeed in a dynamic environment to like Nigeria.

She said: “The leadership model for women to excel in their assignments has changed from what we know. Some leadership styles and practices that served us well in times past are no longer suited in today’s world.”

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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Nigeria Appoints Four Global Banks To Oversee Eurobonds Issuance

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Nigeria on Wednesday appointed four global lenders, JPMorgan, Citigroup, Standard Chartered and Goldman Sachs as book-runners for its forthcoming Eurobond issue, according to the Debt Management Office (DMO).

The debt office also appointed Chapel Hill Denham as Nigerian bookrunner and FSDH Merchant Bank as a financial adviser.

It said in a statement that the Transaction Advisers emerged from an Open Competitive Bidding Process as outlined in the Public Procurement Act, 2007 (as amended).

According to the debt office, 38 institutions jostled for the transaction advisers but chose to select eight after “rigorous evaluation to ascertain the technical capacities of the responders to execute the Transaction.”

The Eurobonds are aimed at raising the external borrowing portion of the N5.6 trillion deficits in the 2021 budget put at N2.34 trillion.

“Whilst the government expects a successful outing, it will be mindful of costs and risks in terms of tenor and pricing in determining the amount of Eurobonds to issue,” the DMO said.

The DMO said proceeds from the bond sale will be used to fund various projects in the budget with the resultant inflow of foreign exchange into the country which will boost Nigeria’s dollar reserves and support the naira.

Nigeria had planned a Eurobond issue early last year after its sixth sale in 2018 where it raised $2.86 billion. But it decided to defer the 2020 sale due to the turmoil caused by the COVID-19 pandemic.

The National Assembly last month approved the external borrowing of about $6.2 billion through the issuance of a Eurobond.

The government has said it wanted to moderate debt servicing costs by accessing relatively cheaper funds abroad, as global interest rates fall below 2020 levels while local rates rise.

Nigeria emerged from its second recession since 2016 in the fourth quarter of last year, but growth is fragile.

The government expects a 2021 budget deficit of N5.6 trillion to be financed largely from foreign and local borrowings in equal proportion.

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Appointments

Nestle Nigeria Plc Appoints Two New Directors

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Nestle Nigeria Plc has appointed Mrs Adebisi Lamikanra and Mr Ibukun-Okun Ipinmoye as non-executive director and executive director respectively.

According to a statement signed by the Company Secretary, Bode Ayeku, Lamikanra, whose appointment was approved by the board, has over 30 years of professional experience providing advisory and consulting services to various public and private sector entities within and outside Nigeria.

The statement said before her appointment, Lamikanra was the head of the advisory practice of KPMG Nigeria consisting of management consulting, deal advisory, technology advisory and risk consulting business units. She had also led the financial services sector across Africa.

Lamikanra has a degree in economics and is a fellow of the Institute of Chartered Accountants of Nigeria. She attended various leadership programs over the years at Instead, Lagos Business School, Harvard Business School, Kellogg and many others.

She is currently the co-chair of Women Corporate Directors in Nigeria and the thematic leader for the non-banking sector for the Nigerian Economic Summit Group. She is a promoter of an NGO which focuses on providing employability training to Nigerian graduates.

On his part, the statement said Ipinmoye was currently the factory manager at, Agbara factory. He is a certified professional coach and a fellow of the Institute of Management Consultants.

He had joined Nestle Nigeria as a graduate trainee in 1993 and was appointed in 2016 to be the factory manager, Flowergate Factory, where he effectively built and sustained a high-performing culture at the factory.

He holds an M.Sc degree in biochemistry from the University of Ilorin and an M.Sc degree in management from Commonwealth Open University, United Kingdom.

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Brands

FrieslandCampina Re-Launches Olympic, Coast Milk Brands

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FrieslandCampina WAMCO, Nigeria’s foremost dairy company and makers of Peak and Three Crowns milk, has re-launched Olympic, Coast, and Nunu milk brands into the Nigerian market through the ‘Word twist’ campaign.

The new ‘Word twist’ campaign requires consumers to compose meaningful sentences with Coast, Olympic, and Nunu for a chance to win fantastic prizes.

For example, “You can now Coast to natural goodness like the fastest man alive cruises to Olympic medals with one Nunu milk a day in your meal.”

Omolara Banjoko, marketing manager, FrieslandCampina disclosed that the campaign became necessary following FrieslandCampina WAMCO’s acquisition of PZ Nutricima and its brands; Olympic, Coast, and Nunu.

“These brands have an existing portfolio across different formats with varied strengths in the different regions of the country. Hence, with this campaign, we plan to strengthen the perception of the brands leveraging FrieslandCampina WAMCO’s strong heritage” Banjoko said.

She further explained that FrieslandCampina is committed to bringing affordable and readily available quality dairy products to Nigerians and with the acquisition, it will be able to meet the growing demands of its consumers.

“Coast Milk promises natural goodness and therefore it is a perfect match that will work well with consumers who wish to stick to natural-made products.

“Adults have a myriad of responsibilities to attend to daily and with Olympic milk, they are assured of getting the right nutrients that will cater to their energy needs and active lifestyle,” she said.

“Nunu offers nutrient-rich milk that can conveniently be used by consumers and businesses looking to upgrade their everyday meal and intermediate products. Olympic, Nunu, and Coast milk are back like they never left and we encourage people to look out for the brands in their neighborhood” Banjoko added.

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