- CBN Opens Special Forex Window for SMEs
The Central Bank of Nigeria on Monday said it had opened a special foreign exchange window for the Small and Medium Enterprises.
The window would enable them to import eligible finished and semi-finished items not exceeding $20,000 for an enterprise per quarter.
The Acting Director, Corporate Communications of the CBN, Mr. Isaac Okorafor, who disclosed this in a statement, explained that the apex bank’s special intervention was necessitated by its findings that a large number of the SMEs were being crowded out of the forex space by large firms.
Under the special arrangement, he said enterprises with staff strength of between 10 and 199 and asset base of between N5m and N500m would be offered the opportunity to import eligible items within the approved threshold.
Meanwhile, the Central Bank of Nigeria is planning to sell shorter-dated dollar forwards to inject liquidity into the official market and try to support the naira.
The local currency weakened on both the official and black markets. The naira fell to 328.50 on the official market but later gained some ground to close at 306.15 after the CBN intervened, Reuters reported.
However, the local currency closed at 405/dollar on the black market.
In a statement on Monday, the Acting Director, Corporate Communications, Mr. Isaac Okorafor, said, “In the weeks ahead the (central bank) will sustain its intervention through the sale of foreign exchange to all segments of the market.
“The bank will sell short-tenured forwards of seven-day to 30-day maturity to meet demand of manufacturers and all other foreign exchange users.
“These significant injections of foreign exchange into the market should reassure all foreign exchange users of our determination to continue to meet all legitimate FX demand in the market while striving to achieve exchange rate stability in the market.”
On Monday, traders said the bank would auction $100m to be settled between one week and 30 days, as against 60-day contracts it had written previously.
The CBN had auctioned $418m at N310 on Friday to airlines, agricultural firms, petroleum and raw material importers in addition to $350m it sold last week to individuals with certain foreign expenses.
The CBN has been battling naira volatility brought on by low oil prices, which has plunged the economy into a recession.
The multiple exchange policy has masked the pressure the currency is under and made it difficult to attract inflows as investors struggle to price naira assets, Reuters reports quoting analysts.
Last week, the International Monetary Fund said the naira was overvalued by around 10 to 20 per cent, and called for changes to Nigeria’s exchange rate policy.
Insider Dealing: Paul Miyonmide Gbededo Adds Another 612,326 Shares of Flour Mills to His Stake
Paul Miyonmide Gbededo, the Group Managing Director, Flour Mills of Nigeria Plc bought an additional 612,326 shares of the company.
The management stated this in a disclosure statement sent to the Nigerian Stock Exchange on Monday.
The managing director purchased the shares at N27.75 per share on November 20, 2020 at the Nigerian Stock Exchange in Lagos, Nigeria. Meaning, Gbededo has invested another N16,992,046.5 into the company.
This was in addition to the 3,284,867 shares valued at N91,642,269 and 4,200,852 shares worth N117.62 million purchased by Gbededo earlier in the month of November. Bringing his recent purchases to 8,098,045 million shares worth N226,254,315.5. See the details of the latest transaction below.
FCMB Reports 16.4 Percent Increase in Profit After Tax in Q3 2020
FCMB Group Plc, one of the leading financial institutions in Nigeria, reported a 16.4 percent increase in profit after tax for the third quarter of the year.
In the unaudited financial statements released through the Nigerian Stock Exchange (NSE), the lender’s profit before tax grew by 10.2 percent year-on-year to N4.8 billion while profit after tax increased by 16.4 percent to N4.2 billion.
FCBMB Group Plc expanded gross earnings by 4.8 percent to N48.3 billion during the period under review. Similarly, the bank’s net interest income rose by 30.03 percent year-on-year to N22.7 billion.
The strong performance continued across the board as net fee and commission income increased by 0.29 percent to N5.2 billion. Net trading income rose by 39.4 percent year-on-year to N1.82 billion.
Personnel expenses dropped by 7.9 percent to N6.9 billion during the quarter while general and administrative expenses declined by 7.52 percent year-on-year to N7.6 billion. Largely due to the COVID-19 lockdown.
Loans and advances to customers rose by 10.8 percent to N793.14 billion between December 2019 and September 2020. Total desposits from customers during the same period grew by 26.7 percent to N1.2 trillion.
The bank’s total assets increased by 22.12 percent to N2.04 trillion.
Stanbic IBTC Obtains Approvals, License to Establish Life Insurance Subsidiary
Stanbic IBTC Holdings Plc on Friday announced that it has obtained all required Regulatory Approvals and a license from the National Insurance Commission to establish a wholly-owned Life Insurance subsidiary, Stanbic IBTC Insurance Limited (SIIL).
In a statement signed by Chidi Okezi, Company Secretary, Stanbic IBTC and released on Friday, the bank said “The establishment of this new subsidiary essentially complements the bouquet of product offerings by Stanbic IBTC as it continues its goal of being the leading end-to-end financial solutions provider in Nigeria. In this regard, SIIL will aim to facilitate long term insurance for already financially included individuals and will seek to become the preferred Insurer in the Life Insurance Business.
“Stanbic IBTC Holdings PLC, a member of Standard Bank Group, is a full-service financial services group with a clear focus on three main business pillars – Corporate and Investment Banking, Personal and Business Banking and Wealth Management. The group’s largest shareholder is the Industrial and Commercial Bank of China (ICBC), the world’s largest bank, with a 20.1% shareholding. In addition, Standard Bank Group and ICBC share a strategic partnership that facilitates trade deals between Africa, China and select emerging markets. Standard Bank Group is the largest African financial institution by assets. It is rooted in Africa with strategic representation in 21 countries on the African continent.
“Standard Bank has been in operation for over 158 years and is focused on building first-class, on-the-ground financial services institutions in chosen countries in Africa; and connecting selected emerging markets to Africa by applying sector expertise, particularly in natural resources, power and infrastructure.”
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