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Seven Banks ‘Hide N249.6b for Unknown Govt Officials’

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  • Seven Banks ‘Hide N249.6b for Unknown Govt Officials’

A Federal High Court in Lagos yesterday ordered seven banks to remit to the Federal Government $793,200,000 (about N249,659,700,000.00) allegedly hidden with them in breach of the Treasury Single Account (TSA) policy.

A vacation judge, Justice Chuka Obiozor, made the interim order following an ex parte application by the office of the Attorney-General of the Federation (AGF).

The judge warned that the remittance order would be made permanent on August 8, unless cause was shown why it should not.

The AGF, through his counsel, Prof. Yemi Akinseye-George (SAN), accused the commercial banks of illegally keeping the sums in their custody for “unknown government officials”.

Justice Obiozor ordered the banks to remit the money to the designated Federal Government’s Asset Recovery dollars account domiciled with the Central Bank of Nigeria (CBN).

The banks are United Bank for Africa (UBA), Diamond Bank Plc, Skye Bank Plc, First Bank Limited, Fidelity Bank Plc, Keystone Bank Limited and Sterling Bank Plc.

According to court processes filed by Akinseye-George (SAN), $367.4m was hidden by three government agencies in UBA; $41m was kept in a National Petroleum Investment Management Services (NAPIMS) fixed deposit account with Skye Bank.

The documents stated that $277.9m was in Diamond Bank, $18.9m in First Bank, $24.5m in Fidelity Bank, $17m in Keystone Bank, and $46.5m in Sterling Bank.

The AGF’s application was supported by a 15-paragraph affidavit deposed to by a lawyer from Akinseye-George’s law firm, Vincent Adodo.

Adodo averred that the banks colluded with Federal Government officials to hide the funds in breach of the TSA policy.

The funds, he stated, were revenues, donations, transfers, refunds, grants, taxes, fees, dues, tariffs etc accruable to the Federal Government from ministries, departments, parastatals and agencies.

Adodo said the banks failed to remit the funds to the TSA domiciled in the CBN in violation of the guidelines issued by the Accountant-General of the Federation, which fixed September 15, 2015 as the deadline for such funds to be moved.

“The 1st to 7th respondents (banks), in collaboration with and/or collusion with unknown officials of the Federal Government, conspired to disobey the relevant constitutional provisions, thereby depriving the Government of the Federal Republic of Nigeria of funds belonging to it, which are needed urgently to fund pressing national projects under the 2017 budget,” Adodo said.

Among the allegedly culpable government agencies is the National Petroleum Developing Company (NPDC).

Moving the ex parte application yesterday, Akinseye-George said it would best serve the interest of justice for Justice Obiozor to order the banks to remit the funds to the Federal Government, to prevent the funds from being moved or dissipated.

“The withheld funds are urgently required for the implementation of the 2017 budget. The budget has a lifespan of 12 months and we are already in the middle of the year.

“By hiding these hidden funds, the Federal Government is being forced to borrow money from these commercial banks at exorbitant interest rates,” Akinseye-George added.

After listening to the SAN, Justice Obiozor granted the interim orders.

He directed that the order should be published in a national daily newspaper.

The judge adjourned till August 8 “for anyone interested in the funds to appear” before him “to show cause why the interim orders should not be made permanent”.

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

Peter Obaseki Retires as Chief Operating Officer of FCMB Group Plc

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The Board of Directors of FCMB Group Plc has announced the retirement of Mr. Peter Obaseki, the Chief Operating Officer of the financial institution, with effect from March 1, 2021. He was also an Executive Director of the Group.

His retirement was approved at a meeting of the Board of the Group on February 26, 2021. This has also been announced in a statement to the Nigerian Stock Exchange (NSE) by the financial institution.

The Chairman of FCMB Group Plc’s Board of Directors, Mr Oladipupo Jadesimi, thanked Mr. Obaseki for his valuable service and excellent support to the Board for many years.

FCMB Group Plc is a holding company divided along three business Groups; Commercial and Retail Banking (First City Monument Bank Limited, Credit Direct Limited, FCMB (UK) Limited and FCMB Microfinance Bank Limited); Investment Banking (FCMB Capital Markets Limited and CSL Stockbrokers Limited); as well as Asset & Wealth Management (FCMB Pensions Limited, FCMB Asset Management Limited and FCMB Trustees Limited).

The Group and its subsidiaries are leaders in their respective segments with strong fundamentals.

For more information about FCMB Group Plc, please visit www.fcmbgroup.com.

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Banking Sector

COVID-19: CBN Extends Loan Repayment by Another One Year

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Central Bank Extends One-Year Moratorium by 12 Months

The Central Bank of Nigeria (CBN) has extended the repayment of its discounted interest rate on intervention facility by another one-year following the expiration of the first 12 months moratorium approved on March 1, 2020.

The apex bank stated in a circular titled ‘Re: Regulatory forbearance for the restructuring of credit facilities of other financial institutions impacted by COVID-19’ and released on Wednesday to all financial institutions.

In the circular signed by Kelvin Amugo, the Director, Financial Policy and Regulation Department, CBN, the apex bank said the role-over of the moratorium on the facilities would be considered on a case by case basis.

The circular read, “The Central Bank of Nigeria reduced the interest rates on the CBN intervention facilities from nine per cent to five per cent per annum for one year effective March 1, 2020, as part of measures to mitigate the negative impact of COVID-19 pandemic on the Nigerian economy.

“Credit facilities, availed through participating banks and OFIs, were also granted a one-year moratorium on all principal payments with effect from March 1, 2020.

“Following the expiration of the above timelines, the CBN hereby approves as follows:

“The extension by another 12 months to February 28, 2022 of the discounted interest rate for the CBN intervention facilities.

“The role-over of the moratorium on the above facilities shall be considered on a case by case basis.”

It would be recalled that the apex bank reduced the interest rate on its intervention facility from nine percent to five percent and approved a 12-month moratorium in March 2020 to ease the negative impact of COVID-19 on businesses.

To further deepen economic recovery and stimulate growth, the apex bank has extended the one year-moratorium until February 28, 2022.

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Finance

MTN Nigeria Generates N1.35 Trillion in Revenue in 2020

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MTN Nigeria Grows Revenue by 15.1 Percent from N1.169 Trillion in 2019 to N1.35 Trillion in 2020

Despite the COVID-19 pandemic and challenging business environment, MTN Nigeria realised N1.346 trillion in revenue in the financial year ended December 31, 2020.

The leading telecommunications giant grew revenue by 15.1 percent from N1.169 trillion posted in the same period of 2019.

Operating profit surprisingly jumped by 8.5 percent from N393.225 billion in 2019 to N426.713 billion in 2020.

This, the telecom giant attributed to the surge in finance costs due to increased borrowings from N413 billion in 2019 to N521 billion in 2020.

MTN Nigeria further stated that the increase in finance costs was the reason for the decline in growth of profit before tax to 2.6 percent.

MTN Nigeria grew profit before tax by 2.6 percent to N298.874 billion, up from N291.277 billion filed in the corresponding period of 2019.

The company posted N205.214 billion profit for the year, a 0.9 percent increase from N203.283 billion recorded in the 2019 financial year.

Share capital remained unchanged at N407 million. While Total equity increased by 22.3 percent from N145.857 billion in 2019 to N178.386 billion in 2020.

MTN Nigeria’s market price per share increased by 61.8 percent from N105 to N169.90.

While market capitalisation as at year-end also expanded by 61.8 percent to N3.458 trillion, up from N2.137 trillion.

The number of shares issued and fully paid as at year-end stood at 20.354 million.

MTN Nigeria margins were affected by Naira devaluations and capital expenditure due to the new 4G network coverage roll-out.

Margins were adversely affected by the effect of naira devaluation and expenses associated with new sites’ roll-out to boost 4G network coverage in FY’20.

“On the former, we note that MTNN expanded the scope of its service agreement with IHS Holding Limited and changed the reference rate for converting USD tower expenses to NAFEX (vs CBN’s official rate previously). Thus, over the full-year period, the company’s operating margin contracted by 1.9 ppts YoY to 31.7%,” CardinalStone stated in its latest report.

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