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Banks Borrow N764.32bn From Pension Fund

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  • Banks Borrow N764.32bn From Pension Fund

Nigerian banks borrowed N764.32bn from the total pension funds under the Contributory Pension Scheme as of the end of September this year.

Figures obtained by our correspondent from the National Pension Commission revealed that the amount translated to 19.16 per cent of the total pension assets, which stood at N8.34tn.

According to the report, the amount the Pension Fund Administrators invested in the banking sector was N409.48bn in January 2017.

Under the Pension Reform Act, the PFAs are required by law to administer the funds, while the Pension Fund Custodians keep custody of the assets.

The commission said the operators had invested a substantial part of the pension funds in the Federal Government’s bonds, treasury bills and state government securities.

The PenCom report stated that some of the money was invested in agency bonds, supra-national bonds, commercial papers, foreign money market securities, and open/close-end funds.

Other investment portfolios where the operators invested the funds are real estate investment trusts, private equity funds, infrastructure funds, cash and other assets.

PenCom also revealed that the number of contributors grew by 312,291 from 7.89 million in December 2017 to 8.27 million as of September.

The acting Director-General, PenCom, Aisha Dahir-Umar, said the CPS had facilitated a pool of pension funds which had consistently accumulated since its inception.

She said there was enormous potential for the growth of Nigerian pension funds to account for a significant proportion of the Gross Domestic Product.

Dahir-Umar said it planned to expand the coverage of the CPS to the underserved sectors of the economy through micro-pension and renewed enforcement of compliance.

“Our objective in this direction is to attain at least 20 million contributors by the year 2019,” she added.

The commission noted that the Pension Reform Act established a mandatory CPS for the employees of the Federal Government, the Federal Capital Territory and the private sector organisations with three or more employees.

According to it, unlike the former Defined Benefits Scheme, the CPS is contributory in nature, fully funded, managed and kept in custody by licensed private operators (the PFAs and PFCs) and is based on individual portable accounts, which are the Retirement Savings Accounts.

The commission noted that available statistics showed that the CPS had greatly improved access to retirement benefits for employees in both the public (Federal Government) as well as the private sectors.

PenCom added that it had also helped to improve the issue of funding even though more work was still needed in that regard.

The commission said it had released the guidelines on micro pension.

“This is the first step in giving effect to Section 2(3) of the Pension Reform Act (PRA), 2014 which provides that employees of organisations with less than three employees as well as the self-employed persons shall be entitled to participate in the CPS in accordance with the guidelines issued by the commission.”

According to the commission, there has been an appreciable progress in the implementation of the CPS, 14 years after its inauguration.

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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