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MTN Denies Illegally Repatriating $8.1bn

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MTN
  • MTN Denies Illegally Repatriating $8.1bn

MTN Nigeria has denied its involvement in the alleged illegal repatriation of dividends worth $8.1bn between 2007 and 2015.

This came as the shares of MTN Group plunged by 25 per cent to a nine-year low on Thursday, a day after the Nigerian arm of the business was ordered to return the funds that the Central Bank of Nigeria said was illegally repatriated with the help of its bankers.

The telecoms company through its Public Relations Manager, Funso Aina, on Thursday, acknowledged the receipt of a letter from the CBN regarding the allegations on August 29, 2018.

The company said it only declared and paid dividends with the Certificates of Capital Importation issued by its bankers with the approval of the CBN.

“MTN Nigeria Communications Limited (MTN Nigeria) received a letter on August 29, 2018 from the CBN alleging that the CCIs issued in respect of the conversion of shareholders’ loans in MTN Nigeria to preference shares in 2007 had been improperly issued. As a consequence, they claimed the historic dividends repatriated by MTN Nigeria between 2007 and 2015 amounting to $8.1bn needed to be refunded to the CBN,” he said.

He added, “MTN Nigeria strongly refutes these allegations and claims. No dividends have been declared or paid by MTN Nigeria other than pursuant to the CCIs issued by our bankers and with the approval of the CBN as required by law.”

The company said the issues regarding the CCIs were object of investigation by the Senate in 2016, adding the findings by the Committee on Banking, Insurance and other Financial Institutions indicated that it did not contravene forex laws.

MTN Nigeria stated it regretted the re-emergence of the issue, saying, “It damages investors’ confidence and, by extension, inhibits the growth and development of the Nigerian economy.”

“In September 2016, the Senate mandated the Committee on Banking, Insurance and other Financial Institutions to carry out a holistic investigation on compliance with the Foreign Exchange (monitoring and miscellaneous) Act by MTN Nigeria & Others.

“In its report issued in November 2017, the findings evidenced that MTN Nigeria did not collude to contravene the foreign exchange laws and there were no negative recommendations made against MTN Nigeria,” the statement said.

According to the Aina, the company is committed to good governance and will abide by the extant laws of the Federal Republic of Nigeria.

The company promised to engage with the relevant authorities, vigorously defend its position on the matter and provide further information when available.

Meanwhile, Reuters reported on Thursday that the MTN shares closed down 19.41 per cent at 86.50 rand, after touching 80.61 rand, a level last seen in 2009.

The money is more than half of the MTN’s market capitalisation, and analysts said the demand risked further undermining Nigeria’s efforts to shake off an image as a risky frontier market for international investors.

The CBN also alleged that MTN used improperly issued certificates to convert shareholders loans in its Nigerian unit to preference shares in 2007.

As a result, dividends paid by MTN Nigeria to the parent company between 2007 and 2015 – amounting to $8.1 billion – were deemed illegal, and should be returned.

This sanction on the telecommunication company with the highest market share in Nigeria came two years after MTN agreed to pay more than $1bn for three years to end a dispute in Nigeria over unregistered SIM cards.

The company also agreed to list on the Nigerian Stock Exchange, which its executives said would be concluded by the end of the year if market conditions are appropriate.

Diamond Bank Plc, in a statement signed by the Company Secretary, Uzoma Uja, said it was in touch with the CBN to ensure amicable resolution of the issue and that it would not in any way affect its banking operation.

Uja said, “We note that these foreign exchange transactions occurred between 2001 and 2006 and currently, we are cooperating with the apex regulator to ensure that this matter is resolved.

“This development does not impact your ability to continue to do business with the bank. We want to assure all stakeholders that the bank complies with all regulatory policies issued. Updates on any new development will be made available to all stakeholders.”

Stanbic IBTC Holdings Plc also said in a statement that it had been informed by its banking subsidiary – Stanbic IBTC Bank Plc − that penalties had been imposed on it by the CBN, pursuant to a review of transactions relating to the remittance of foreign exchange on the basis of certain “irregular” capital importation certificates issued to MTN Nigeria.

It said the bank was holding further engagements with the CBN in relation to the issues raised.

The Group Company Secretary, Stanbic IBTC, Chidi Okezie, assured its customers “that the above does not impact on your ability to continue to conduct your various business and corporate transactions with Stanbic IBTC Holdings or any of its subsidiaries, including the bank.”

While the Standard Chartered Bank Nigeria said “we are unable to provide additional information at this time due to our ongoing engagement with the regulator; we look forward to a rapid resolution and satisfactory outcome to this matter,” the Citi Bank declined to say anything concerning the issue.

Speaking on the development, the Head, Department of Finance, Nasarawa State University, Prof. Uche Uwaleke, said beyond the fines imposed on the affected banks, it was necessary that the Economic and Financial Crimes Commission be involved to fish out those who compromised the system to perpetrate the use of fake Certificates of Capital Importation.

This, he noted, would help to provide credible evidence that would be used to prosecute individuals or firms that aided the banks to perpetrate the illegality.

He said, “By sanctioning the affected banks, the CBN has demonstrated that the country’s financial markets have laws which must be complied with by all participants. The scale of the infraction could not have been possible without collaborators both from within the deposit banks and the CBN.

“So, beyond the fines imposed on the banks, it is vital that the EFCC is involved to fish out the culprits with a view to prosecuting individuals or professional services firms that aided these banks to perpetrate the use of fake Certificates of Capital Importation, fraudulent conversion of investors’ loans to preference shares and rendering false returns to the CBN.”

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

Finance

With Giants Campaign, FirstBank is Truly Woven Into The Fabric of Society

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Olusegun-Alebiosu-MD,CEO Firstbank

In its usual creative conjecture, 13O-year-old FirstBank, has hit the airwaves and other media outlets with various visuals to articulate its new campaign ‘The Giant in You’. Breaking down the central message, ‘there is a giant in you’ the campaign stylishly reminds the bank customer that ‘FirstBank Puts You First so you can’ before giving the match order, ‘Live the Giant-Life.

For a bank that settles for the big ‘elephant’, as logo and has remained strong for 130 years, worlds like giant, tall and strides, used in the various visuals are simply validations of its robustness, endurance, doggedness and tall ambition. As part of the ways to convey the bank’s message to its array of patrons, SO&U, the creative agency behind the campaign cleverly selected its cast and buildings, including FirstBank’s corporate headquarters, to reflect the bigness, the tallness and the boldness of the 130-year-old financial institution to rule the world as far as banking and business support are concerned.

Unraveling the ‘Giant’ strides…

Among other reasons, the new campaign must have been conceptualized to position FirstBank as a ‘giant’ and ‘future-ready’ institution that is dependable, innovative and proactive in supporting its customers and stakeholders win in the race to the future and be in a position to take advantage of the opportunities and possibilities of that emerging future.

Driven by the conviction that  consumers want to turn their big dreams into giant successes, the new campaign reminds the consumer that in today’s world of constant disruptions and integrated experiences, the customer needs a strong, stable and supportive partner, with the appropriate platforms, innovative solutions and networks to not only support their aspirations but also be responsive and adaptive enough to anticipate their needs and empower them to success.

Looking through the visuals and the television commercial, it’s easy to conclude that the campaign narrative is not about the brand but the customer. For instance, the creative path illustrates the world as it moves and changes at lightning speed, the customer is reminded that just like the world, everything within it is also changing, from economies to businesses and even opportunities.
“We recognise that to be in sync with the world will require a forward thinking and future ready mindset …and we have created the atmosphere, products and services to help our customers,” the bank stated.

To underscore ‘the big idea’ and the ‘bringing out the Giant in you’ theme, key visuals speak to the essence of the campaign and are accompanied with long and straight legs in a demonstrative form to take the purported giant step. Here the messages are passed under the following; ready to take giant strides?, strides into the future, let’s take giant strides together, stand tall, stand out, think giant solutions, among others.

Facts and figures…

Like Coca-Cola, the world number one brand, one other thing that has consistently worked for the FirstBank brand is that the promoters have never, for once allowed complacency to set in. The implication of this is that the bank is not only the oldest, but also one of the most digitally compliant banks.  Currently, First Bank stands tall via First Bank digital solutions, employs market-leading digital platforms and solution driven products and services. Besides, the use of AI and Robotic Process Automation (RPA) by the bank enables the financial brand to initiate 85 percent of its transactions via digital platforms leading to quick responses to customers’ needs and satisfaction. In this regard, FirstBank has been recognised by Interswitch as the first financial institution in Nigeria to achieve 100 million sustained monthly transactions in electronic payment and it has hit N1 trillion transactions through the FirstMonie Agent network.

Speaking during the unveiling of the new thematic brand campaign, Head, Brand and Stakeholder management at FirstBank, Yinka Ijabiyi, reiterated that FirstBank came up with the new campaign because of its belief that there is a ‘giant’ in every customer, every employee and every stakeholder.

He said, “This campaign was informed by our belief that there is ‘giant’ in every stakeholder a giant dream, a giant possibility, a giant idea, a giant life and a giant future waiting to be birthed. Our commitment is therefore to provide all necessary business support, financial know-how and platforms to bring out the giant in every customer.”

Ijabiyi further pointed out that the campaign was conceptualised by the bank in a bid to show customers in its 130 years, that it has been supporting and creating giants and that it has no plan to stop anytime soon.

He said the bank, in its celebration of its 130 years in business, came up with a campaign that speaks to the business essence of its brand which is making giants of its customers.

“We have always done it and the fact we have been around for such a long time means good to everybody as we have been supporting businesses, individuals and government in those years. “We are making giants and there is no business that interacts with us that does not see the benefits in their business. We are making giants in our customers and we will not stop.

“We are the partner with tailored solutions for every customer, employee, and stakeholder. We have what it takes to turn dreams into giant successes. FirstBank’s services are designed to help customers “giant-size” their dreams, offering businesses the platforms and solutions needed to grow, innovate, and achieve remarkable success.” Ijabiyi added that the array of products, solutions and services offered by FirstBank cannot be compared with any financial services in Nigeria.

For its customers, the bank said “We would enable, inspire and support you with our world of financial services to help you to giant-size your dreams and live your best life”. It also said it “would give businesses and business owners the right platforms and solutions they need to grow, initiate and execute bold ideas.

Meanwhile, the creative agency behind the campaign has hinted to the media that the unveiled materials were mere ‘tip of the iceberg’ as efforts are ongoing to domesticate the same campaign in local languages to connect with customers across the major ethnic groups in Nigeria.

A peep into the past…

When the promoters said First Bank was “truly the first, many grudgingly agreed. But deep inside its competitors – the possible grudging camp – is the truth regarding the extreme distance the bank has given others in performance and people relevance of its operations! They knew the bank was not bluffing. Not only has it rediscovered itself, but the ability to shed its ancient mindset in terms of operations and blend with modern trends in banking have left many agreeing that perhaps, the saying that the older the wine the better it gets in taste actually applies to FirstBank. To this end, it’s not by accident that First Bank has produced at least two former governors of the CBN and a Finance Minister, including Chief Joseph Sanusi and the current Emir of Kano, Sanusi Lamido Sanusi.

Perhaps the current campaign is an offshoot of a story-telling Television Commercial, by the bank to reflect the beginning of modern banking and how the bank has consistently grown with Nigeria’s enterprises through partnership and innovation.

The referenced TVC says it all: A combination of historical renaissance and quite prescient validation of the innovation that usually drives its bewitching communicational ads. From the groundnut pyramids of the north, which was the symbol of the regions commercial edge and the cocoa bean mountains of Western Nigeria to the rubber plantations of the East and Mid-eastern region, First Bank has applied its new campaign to remind its decades-old patrons, customers, and even competitors, that the beat has refused to abate.

Throughout the campaign, FirstBank subtly registers itself in the minds of the banking public that it’s entirely Nigerian – past, present, and the future. The well-crafted historical simulation captures how FirstBank opened its first branch in Lagos in 1894 and started helping merchandise and local traders to grow their businesses. The excitement and enthusiasm on the faces of the bank’s early customers after getting their cash books from the Lagos office say it all. Like someone who has gotten a glimpse of what the future holds with banking, the customers express surprises and happiness. The commercial captures the mood and goes back in memory lane on how the bank has helped many people succeed in their ventures. Subtly, the narrator takes viewers to Kano and reveals how the then richest men in the commercial city were making their deposit of 20 bags of Silver in an atmosphere that looks like the first operational day of the bank.

Perhaps the beauty of the commercial lies more in the way it strikes a balance between the ancient and the modern days through setting and swapping of background colours. This was cleverly explored in referencing the way the bank transformed into an online haven, driven by technology. While reminding the patrons of the bank’s transformation and technological advancement, the narrator is quick to talk about the expansion of the bank beyond the shores of Nigeria to the West-African region and beyond. The TVC also positions FirstBank as a socially responsible brand by touching on various initiatives it has embarked on. Specifically, First Bank’s contribution to Sports through its support for football and athletics is captured very well.

The ‘Giant in You’ is another chapter as the bank begins a fresh journey after operating for 130 years.

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Banking Sector

Jaiz Bank Boosts Chairman’s Income to N24m Amidst Strategic Expansion

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Jaiz Bank

Jaiz Bank has announced a 20% increase in its chairman’s annual income to N24 million.

This decision was unveiled in a recent statement filed with the Nigeria Exchange Limited, highlighting the bank’s commitment to rewarding leadership amidst its expansion plans.

The bank, renowned for its pioneering role in non-interest banking in Nigeria since 2012, also approved a remuneration package of N20 million for each non-executive director.

The announcement was made by the bank’s secretary, Mohammed Shehu, highlighting the importance of competitive compensation for board members who provide crucial oversight and strategic guidance.

Shareholders at the Annual General Meeting (AGM) expressed confidence in the board’s leadership by approving the resolution on directors’ fees.

This move aligns with Jaiz Bank’s ongoing efforts to enhance its capital base to N70 billion by the end of 2024.

The bank also announced a dividend of 4 kobo per share, which will be distributed to shareholders on July 16, 2024.

This dividend declaration was welcomed as a testament to the bank’s operational success in a challenging economic climate.

Also, the AGM saw the re-election of Muhammadu Indimi and Muhammad Abdulmutallab as non-executive directors, reaffirming shareholder trust in their leadership capabilities.

Jaiz Bank’s financial performance has been impressive, with a 67% increase in profit before tax, reaching N11.1 billion in 2023.

Gross earnings also rose by 42% to N47.2 billion from the previous year, showcasing the bank’s successful growth strategy.

As Jaiz Bank continues to expand its services, the enhanced remuneration package signals a commitment to maintaining strong governance and leadership, paving the way for future achievements in ethical banking.

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Finance

ARISE IIP and Africa Finance Corporation Launch US$ 100M Capital Pool for African Entrepreneurs

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ARISE IIP, the pan-African developer and operator of world-class industrial parks, and Africa Finance Corporation (AFC), the leading infrastructure solutions provider in Africa, today announced the signing of a Memorandum of Understanding to establish a dedicated US $100 million capital pool for African entrepreneurs who are establishing operations within any of the Arise IIP Special Economic Zones (SEZ) in Africa. 

At the heart of this partnership is a shared vision to uplift African entrepreneurs by providing them with much needed financing and advisory services to catalyse growth.

AFC will also actively seek financing from Export Credit Agencies (ECAs), local and regional financial institutions to mobilise funding to support these companies.

This concerted effort underscores ARISE IIP and AFC’s commitment to fostering industrialisation, job creation and economic prosperity in Africa.

Under this partnership, AFC’s comprehensive suite of financial services will extend beyond financing to include financial advisory support for corporate finance, equipment financing and market entry including assisting with joint ventures and technical partnerships for sponsors that may require it, to ensure they are well-equipped to seize opportunities and thrive within the SEZs.

By tapping into AFC’s extensive network and expertise, ARISE IIP aims to cultivate a vibrant ecosystem that nurtures entrepreneurship and drives sustainable economic development across the continent.

Gagan Gupta, CEO of ARISE IIP said about this partnership: “ARISE IIP is about empowerment. By empowering our customers, and ensuring they have the robust financial support needed to meet their operational objectives, this collaboration with Africa Finance Corporation, our long-lasting partner, takes us one step closer to realising our vision of an industrialised and prosperous Africa.

Samaila Zubairu, President & CEO of AFC said: This partnership marks a significant milestone in our commitment to offer strategic financial advisory and corporate finance services to firms focused on value capture and import substitution projects in Africa. By collaborating with our investee company Arise IIP and African entrepreneurs in our Special Economic Zones, we aim to foster an ecosystem that will increase trade, create jobs, and drive economic advancement on the continent.

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