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FG to Finance 11% of 2017 Budget With Recovered Loot

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  • FG to Finance 11% of 2017 Budget With Recovered Loot

The Federal Government said on Monday it would use a fraction of the looted funds recovered so far to finance part of the 2017 budget.

The Minister of Budget and National Planning, Sen. Udoma Udo Udoma, said this at the 2017 budget breakdown in Abuja.

He said the total revenue projected was N5.08tn, with 11 percent coming from the recoveries made.

“On recoveries, we are being extremely conservative; what is in the budget is what we know about already.

“So if more comes, we will use it.

“Know that recoveries of looted funds are not the most dependable way to finance the budget because of the legal processes that have to be concluded before it can be spent.

“So, the money quoted in the budget is the one we have already recovered and in our pocket to spend as we wish.’’

He said the total revenue projected exceeded the 2016 projection by 30.26 percent, adding that oil revenue projection was put at 41.7 percent compared to 19 percent in 2016.

Udoma added that the high revenue expectation from oil was driven by Joint Venture Calls (JVC) cost reduction, higher production and price, exchange rate as well as additional oil-related revenues.

According to him, Company Income Tax (CIT) will contribute 15.9 per cent, Value Added Tax (VAT) 4.8 per cent, Independent Revenue 15.9 per cent and others 5.2 per cent.

He also said the projected budget deficit which stood at N2.36tn remained relatively low at 2.18 percent of the Gross Domestic Product (GDP).

“This is within the 3 percent threshold stipulated in the Fiscal Responsibility Act (FRA).

“The budget is to be financed mainly by borrowings which have been projected at N2.32tn.

“Of this amount, N1.07tn is intended to be sourced externally, while N1.25tn will be sourced domestically.”

Udoma stated that N35bn is expected as revenue from the outright sale of government property and privatisation of state-owned enterprises.

He said to generate the projected revenue, the Federal Inland Revenue Service (FIRS) and Customs had been challenged to improve their efficiency and broaden their reach to achieve the set targets in the 2017 budget.

He said the Federal Government would strive to maximise the revenues it could generate from the oil and gas sector because the foreign exchange generated from the sector was critical for plans to diversify to the non-oil sectors.

“It is important that we use what we have to get what we need and want and what we have is oil.

“It is important that we make sure there is peace in the Niger Delta so that we can achieve the maximum from that resource,” he said.

The N7.44tn budget was signed into law by the Acting President, Prof. Yemi Osinbajo, on June 12, a month after it was passed by the National Assembly.

Referred to as the ‘budget of recovery’, the budget was first presented on Dec. 14, 2016, to the two chambers of the National Assembly by President Muhammadu Buhari at an estimate of N7.30tn.

The lawmakers, however, increased it by N143bn.

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.

Banking Sector

CBN to Extend Credit Risk Management System to OFIs

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In an effort to curb growing bad debt, the Central Bank of Nigeria has said it will extend its Credit Risk Management System to Other Financial Institutions (OFIs) operating in Nigeria to protect them from bad debtors.

According to the apex bank, this is important following the successful implementation of the credit risk system in other lending institutions operating in Nigeria.

The bank disclosed this in a circular titled ‘Credit Risk Management System: Commencement of enrolment of all Development Finance Institutions, Microfinance Banks, Primary Mortgage Banks and Finance Companies’ and signed by Kelvin Amugo, the Director, Financial Policy and Regulation Department, on Monday.

In part, the circular read, “As part of efforts to promote a safe and sound financial system in Nigeria, the CBN introduced the CRMS to improve credit risk management in commercial, merchant and non-interest banks as well as to prevent predatory borrowers from undermining the banking system.

“With the successful implementation of the CRMS in deposit money banks, it has become expedient to commence the enrolment of Other Financial Institutions on the CTMS platform.

“Accordingly, all DFIs, MfBs, PMBs and FCs are required to report all credit facilities (principal and interest) to the CRMs and to update same on monthly basis.

“OFIs shall note the Bank Verification Numbers and Tax Identification Numbers are the only basis for regulatory renditions”.

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Banking Sector

BoI Grows Assets by 78.8% to N1.86 Trillion

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The Bank of Industry Group concluded the 2020 financial year with a 78.8 per cent growth of assets from N1.04tn to N1.86tn between 2019 and 2020.

A statement by the bank on Monday said the increase was driven to a large extent by the successful debt syndication of €1bn and $1bn that were concluded in March and December 2020 respectively.

BoI stated that the group’s financial statement demonstrated resilience and strength, noting that the period had significant challenges in the operating environment on account of the impact of COVID-19 pandemic on the economy.

“It also indicates synergy with the various interventions developed by the Federal Government, the Central Bank as well as other strategic partners towards ameliorating the impact of the pandemic on Nigerian enterprises,” the statement said.

The group’s total equity increased by 14.8 per cent from N293.08bn in the previous year to N336.48bn in 2020.

It added that as a reflection of the adverse impact of the challenging operating environment on growth of new facilities, loans and advances grew marginally in 2020 by 1.3 per cent to N749.84bn from the 2019 position.

The bank explained that this was largely due to the economic slowdown in the year as well as the various interventions and support initiated by the bank for its customers.

“The bank reviewed and restructured all its managed projects under the CBN intervention programme with interest rate reduction from nine to five per cent per annum for a period of one year and moratorium extension of three months (with a possible extension up to 12 months),” it said.

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Banking Sector

TAJBank Deploys NQR Solution To Ease Customer Transactions

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TAJBank, Nigeria’s non-interest bank, has announced the deployment of the NQR Payment solution, an indigenous Quick Response Code (QRC) by the Nigeria Interbank Settlement Scheme (NIBSS), for merchants and customers as the newest addition to its innovative e-business channels.

The NQR Payment solution is a secure QR-code-based payments and collections platform developed for merchants and customers to receive and make payments for goods and services in a quick, easy, contactless and secure manner.

A statement signed by the Founder/Chief Operating Officer of the bank, Mr. Hamid Joda, indicated that the ingenious solution would further drive TAJBank’s culture of innovation and create a seamless payment experience for its rapidly growing individual and corporate customers in their banking transactions.

“We are excited to have this payment channel introduced into the nation’s financial system as an addition to other innovative solutions we have deployed over the past few months.

This is a proof that, as we have said in our communications signature line, TAJBank’s interest is always in our customers”, Joda enthused.

In his remarks, the non-interest lender’s Chief Marketing Officer/Co-Founder, Mr. Sherif Idi, also maintained that the deployment of the NQR payment solution would revolutionize the e-payment experience and open new frontiers for small, medium and large scale businesses who are major stakeholders of the bank.

Since it commenced operations in the non-interest banking segment of the financial services industry, TAJBank is noted for its impeccable track record of growth and innovation, rendering exceptional quality services to customers.

The lender’s NQR solution is open to all customers of the bank, both merchants and individuals, across all its branches and digital channels globally.

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