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Banks Reject Deposits From Politically Exposed Persons

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  • Banks Reject Deposits From Politically Exposed Persons

Many commercial banks no longer accept deposits from Politically Exposed Persons (PEPs), it was leant yesterday.

A PEP, who is entrusted with a prominent public function, generally presents a higher risk for potential involvement in bribery and corruption by virtue of his position and the influence that he may hold.

Banks’ stoppage of taking hard-sought deposits from PEPs followed the rising regulatory surveillance and high risks involved with such transactions. Lenders had, in many cases, suffered huge monetary losses whenever illicit funds are traced to them.

The Group Chief Conduct and Compliance Officer of Access Bank Plc and President, Compliance Institute of Nigeria (CIN), Pattison Boleigha, who confirmed the development during a meeting with reporters in Lagos, said banks, had adopted global best practices against money laundering and corruption.

“We have placed ourselves on the pedestal of compliance. If you want to do business with international community today, you must ensure you are compliant in fighting corruption and money laundering. Each bank operates a defined structure. So, when these foreign investors come to Nigeria, they know the structure each bank has put in place,” he said.

“We want to ensure that foreign investors realise that when they come to Nigeria, it is a very good ground for professionalism. When they do that, they have the assurance that when they do business in Nigeria, they are dealing with credible organisations.”

Also speaking, a Bank Examiner with the Central Bank of Nigeria (CBN), Buhari Isa, said many banks mortgage compliance issues by setting unrealistic targets for their staff .

He said there was need to look at why bank staff bring in bad deposits into lenders’ vaults. “For example, we are talking about integrity. If you see someone that does not have integrity, there is nothing you can do about it. But you can make sure there are controls that discourage such behaviours in an organisation. For example, you can conduct research on how some staff, connive with high net-worth individuals to bring in deposits without carrying out due diligence,” he said.

Isa, who is also the Vice President of CIN, said a bank staff will provide reasons why he is conniving with a PEP to bring in huge deposits. That, he said, may arise from the bank’s dysfunctional policy.

“For example, you set unrealistic target for bank staff insisting that within the next one week such staff should bring N1 billion deposit. A PEP who collected bribe of N100 million comes to the bank staff, such target will make the staff to quickly take the money without doing proper Know Your Customer for the depositor,” he said.

In Isa’s view, addressing the high deposit target set for bank staff will help boost compliance.

Boleigha disagreed. The Access Bank Group Chief Compliance Officer spoke of the challenges faced by lenders. He said that banks do not commit crime but the people within the bank commit crime.

“The targets were not set so that people will go and commit crimes. Unfortunately, whether you like it or not, financial institutions will receive good money, and they will also receive bad money. There is really nothing you can do about it because that’s where the money should pass through. In fact, if this bad money is not kept in the banks, it will be more difficult for government authorities to track people that are committing these crimes,” he said.

To Boleigha, it is good to have all Nigerian financial transactions pass through the financial system so as to have financial record of all bad monies. He said that although bank staff have targets, that should not stop them from complying with set rules. “So, if you know that you are bringing a customer that is high risk, of course you should know, the first thing to do is to conduct a risk assessment of the customer.

There are some banks that even said they will not bank PEPs. So, if you decide you are going to bank PEPs, you must have risk management structure that will enable you manage those PEPs,” he said.

“And those risk management structures are crafted from the rules and regulations of the CBN. There are CBN’s guidelines on how to manage PEPs. If you follow the rules, it means that when bad money comes, account officers of the banks should be able to know that it is bad money.

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

Sterling Bank Approves Audited Financial Statements for 2020

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Sterling Bank

Board of Sterling Bank Approves 2020 Audited Financial Statements

The Board of Sterling Bank Plc said it has approved the audited financial statements for the year ended 31, December 2020.

The lender said the approval was done at a meeting held on 23rd February 2021.

Details of the financial statements will be released upon approval of the Central Bank of Nigeria (CBN), Sterling Bank stated in a statement filed with the Nigerian Stock Exchange on Thursday.

It said “We are pleased to inform our shareholders and other stakeholders that the Board of Sterling Bank Plc at its meeting of 23rd February 2021 approved the audited Financial Statements for the year ended 31st December 2020 subject to the approval of the Central Bank of Nigeria (CBN).

“Kindly note that details of the Financial Statements will be communicated to you upon approval of same by the CBN.

“Consequently, the closed period for trading in the shares of the Bank by its insiders which commenced from 8th February, 2021 will continue until 24 hours after the Audited Financial Statements for the year ended 31st December, 2020 are released on the floor of the Nigerian Stock Exchange.”

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Banking Sector

CIBN, NIBSS Introduce e-Payment Certification Programmes

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CIBN, NIBSS Introduce e-Payment Certification Programmes

The Chartered Institute of Bankers of Nigeria (CIBN) in collaboration with Nigerian Interbank Settlement Systems Plc (NIBSS) have introduced professional certification programmes on electronic payments for financial service providers and institutions.

Both organisations disclosed that the programme was designed to enhance the electronic payment skills and knowledge of financial practitioners in order to equip them with efficient tools and information required to upscale innovation and services.

Speaking to journalists at a media briefing in Lagos, yesterday, the Chief Executive Officer, Chartered Institute of Bankers of Nigeria, Mr. Seye Awojobi, said the initiative is an international programme, well grounded in the local realities of the Nigerian e-payment industry and captures the current dynamics, as well as aspects of digital financial services practices.

“This programme would set the standards for e-payment expertise in Nigeria; foster a category of high performing professionals in the industry and build a resilient, safe and secured payment technology driven platform.

“The curriculum for the programme adequately covers recent methods required, which are in line with global practices.

“The introduction of the scheme cannot be more timely than now considering the COVID-19 pandemic, which created serious disruptions in our professional and personal lives,” he added.

On his part, Chief Executive Officer, Nigerian Inter-Bank Settlement Systems Plc, Premier Oiwoh explained that the introduction of the programme would determine the capacity and work experience criteria required to recognise beginners, intermediate and advanced.

“It would create a growth roadmap for fledging e-payment workers, including the unemployed who has the desire to make a career in the electronic sector.

“Also, it would enable us continue to tackle the issue of insecurity within the financial technology payment and banking space,” he added.

The institutions also noted that in order to maintain a certification credential, the practitioners must earn some recertification credits over a three year span and valid for three years after it has been issued.

The CIBN last week has reintroduced its mentoring scheme. The initiatives aims at up-scaling the leadership capacity and productivity of workers within the financial and banking sector.

Speaking during the virtual forum, Director General, Securities and Exchange Commission, Lamido Yuguda, had explained that mentoring schemes are essential for the sustenance and development of the sector as it is built upon values such as trust and professionalism.

“These values can be taught. But are reinforced when practiced by the senior co-workers and emulated by junior colleagues. Such initiatives enable workers to avoid being distracted by the material, prestigious and monetary incentives the space presents.

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Finance

Stanbic IBTC Offers Low-Interest Agric Loans

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Stanbic IBTC Bank

Stanbic IBTC Offers Low-Interest Agric Loans

Stanbic IBTC Bank Plc has reaffirmed its commitment to the growth of Nigeria’s agriculture sector by supporting farmers and other players in the agricultural value chain.

As the demands on agribusinesses change seasonally, the financial institution provides financing solutions for agricultural enterprises to suit their requirements.

A statement explained that the needs range from availability of resources, to farming equipment, as well as enhancement of seasonal cashflow, amongst others.

Stanbic IBTC Bank offers various low-interest credit facilities across the agricultural sector that will help clients to cushion the impacts of the Covid-19 pandemic.

Speaking on this, Head, Agribusiness, Stanbic IBTC Bank, Wole Oshin, said the agribusiness financial solution was geared towards ensuring that players in the agriculture space are not hindered by lack of finance.

He said: “The bank’s suite of agribusiness solutions minimises risks, ensures maximum control and optimises profits associated with international trade by making transactions smoother, simpler and safer for all parties involved.

“Some benefits of the Stanbic IBTC Agribusiness Finance include: availability of gap-funding for unforeseen financial needs, maintenance of cash flow and flexibility of repayment terms based on the type of funding. This facility is also versatile and can be utilised for funding resources, vehicles and farming equipment.”

Oshin noted that agricultural enterprises could access overdraft to finance their short-term cash flow and working capital needs.

“With quick and flexible processes, funds are available when needed and interest is paid only on funds utilised, not on the full amount on which the limit is set,” he added.

He further reiterated that the asset finance solution could aid in the financing of all farming vehicle and implement needs, with a wide range of packages to suit business’ cash flow and tax requirements.

“Vehicles and assets such as tractors, harvesters, irrigation equipment and so on, to enhance production,” he said.

Other available facilities are Business Revolving Credit Loan, Agricultural Production Loan and Medium-Term Finance.

These are suitable for grain farmers, individual farmers, groups and entities in the agricultural sector. Our loans are designed to accommodate the purchase of various agricultural inputs (like seeds, fertilizers etc), livestock, agriculture-related products and asset acquisition.

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