- CBN Targets Youths in New Loan Policy
The Central Bank of Nigeria (CBN) and the Bankers’ Committee have agreed to set up a committee headed by Chief Executive Officers (CEOs) of commercial banks to create a strategy that will stimulate lending in the domestic economy.
CBN Governor Godwin Emefiele broke the news yesterday at the end of the 10th Annual Bankers’ Committee retreat in Lagos.
The committee is to ensure that lenders deploy key intervention funds, including the N210 billion Small and Medium Enterprises (SMEs) fund, N60 billion SMEs fund from five per cent annual contribution from banks’ profits, N500 billion Export Stimulation Fund, among others, to promote credit access.
Emefiele said the move was to find ways to improve access to credit by Nigerians, especially the youths.
The CBN boss also said that where the need arises, the youths maybe asked to deposit their National Youth Service Corps (NYSC) discharge certificates, degree certificates with the banks to enable them have access to the loans.
He said: “We need to create a strategy that makes it easy for businesses to access credit. That will also make it easy for reporters to earn foreign exchange and that is why we will be setting up the committee headed by bank CEOs.”
According to him, the CBN and the Bankers’ Committee have been working closely to ensure that youths, who are doing well in the entertainment industry, information technology and software development, get access to credit.
He said the planned take-off of the National Microfinance Bank is meant to help in the disbursement of the intervention funds to borrowers.
“The National Microfinance Bank is expected to make it easier for borrowers to access loans. We want to create independent challenges from where the funds will go out from. The Microfinance banks are doing their best but they are not lending at single digit interest rate,” he said.
Continuing, he said the borrowers under the new arrangement will pay back to enable other benefit.
Emefiele went on: “We will make it easy for the youths to access the loans. They will work under the co-operative/ cluster arrangement to ensure they payback.
“Improving access to finance and addressing infrastructural impediments faced by companies geared towards the export market will confer a string benefits on the economy.
“First, it will enable firms expand their capacity, as they seek to serve a larger external market. It will also help foster inclusive growth in the economy. As you may know, the oil and gas sector currently accounts for one per cent of total employment in the country.”
He said the drop in Nigeria’s export earnings arose from reliance on crude oil, which exposed the fragility of the country’s domestic economy in 2016.
He said the development reinforced the view within the CBN and Bankers’ committee on the need to revise the country’s growth strategy as a nation.
“At certain points in our nation’s history, non-oil export represented over 90 per cent of our foreign exchange earnings. In the 60’s Nigeria was a major exporter of cocoa, palm oil, cotton, groundnut, rubber, hides and skins.
“With the discovery of crude oil, Nigeria began to rely more on oil exports as a major source of its foreign exchange, and its hare of non-oil export witnessed a precipitous decline.”
The CBN boss said that the banks needed to support the economy by lending to promote economic growth.
“We need to move money to the real sector and make credit available to those at the grassroots to foster sustainable economic growth,” he said.
Ecobank Partners NiDCOM to Mobilise Nigerians Abroad for National Development
In a bid to fulfill it’s objectives and mandate, the Pan African Bank has promised to support Nigerians living and working abroad through it’s partnership with NiDCOM.
The Managing Director, Ecobank Nigeria, Patrick Akinwuntan has stated that the bank is privileged to work closely with the Nigerians in Diaspora Commission, (NiDCOM) and will continue to pursue one of its key mandates of helping to enhance the economic development and integration of Africa through its support to Nigerians living and working abroad.
Speaking at the maiden edition of the Diaspora Quarterly Lecture Series with Ecobank as the sole banking partner which took place on Saturday, 8th May 2021, he noted that Ecobank remains a critical bridge for Nigerians abroad, as it has made huge investments in the necessary platforms to enable them connect with home seamlessly. The event held online and had over 2000 participants from across all the continents in attendance.
“Nigerians in the diaspora play a major role in nation building, their contribution goes a long way to catalyse economic development. For us at Ecobank, we are a pan-African institution positioned to foster the economic growth and integration of our continent, so we are particularly pleased to work closely with the Nigerians in Diaspora Commission (NiDCOM), ably led by the Chairman/CEO, Hon Abike Dabiri-Erewa”.
“We are committed to ensuring that every Nigerian living abroad is able to remit home seamlessly and affordably, access viable investment opportunities and as the financial institution of choice for Nigerians abroad, we have deployed the necessary resources to actualise this.” He stated.
The Minister of Interior, Ogbeni Rauf Aregbesola, who was also present, reiterated the readiness of the government to collaborate with Nigerians in the diaspora, highlighting the new processes put in place to facilitate passport issuance, noting that all backlog of passport applications would be cleared by the end of May 2021.
Also speaking, the Hon. Minister of State, Foreign Affairs Amb. Zubairu Dada said harnessing the human capital and material resources of Nigerians in the diaspora towards the socio-economic, cultural, and political development of Nigeria can no longer be ignored. He pointed out that the Nigerian diaspora community is well educated, resourceful, skilled, and exposed to global best practices.
The NiDCOM Chairman/CEO, Hon. Abike Dabiri- Erewa explained that the Diaspora Quarterly Lecture Series is projected to be a major aspect of national discourse, where Nigerians abroad can be kept abreast of the government’s policies, programmes and projects.
Increase in Price Boosts Revenue of Dangote Sugar by 41.5 Percent in Q1 2021
Revenue of Dangote Sugar Refinery Plc rose by 41.5 percent to N67.394 billion in the first quarter (Q1) of 2021 from N47.643 billion recorded in the same quarter of 2020.
According to the leading sugar manufacturer, the increase in revenue was a result of the increase in the price of sugar in the first quarter. The company claimed price adjustment was necessary to mitigate the negative effect of inflation and depreciation on the company.
Volumes only rose by 5.7 percent during the quarter despite a 41.5 percent increase in revenue, meaning the increase in price was the main sales catalyst.
In the company’s unaudited financial statements, gross profit grew from N12.721 billion in Q1 2020 to N18.044 billion in Q1 2021.
Similarly, operating profit stood at N15.884 billion, up from N10.747 billion posted in Q1 2020.
Finance cost more than double from N1.353 billion in Q1 2020 to N3.412 billion in Q1 2021.
Dangote Sugar’s profit before tax rose from N9.509 billion recorded in the corresponding quarter to N11.949 billion in the quarter under review.
The company paid N3.646 billion in income tax, slightly higher than N3.137 paid in the same quarter of 2020.
Profit for the period grew from N6.372 billion in Q1 2020 to N8.302 billion in Q1 2021.
Commenting on the company’s performance, Dangote Sugar said “EBITDA increased by 34.7% to N17.02 billion (2020: N12.64 billion) on account of increased earnings. Group profit after taxation for the period increased by 30.3% to N8.30 billion (2020: N6.37 billion) reflecting management’s unrelenting drive to deliver consistent shareholder value.”
On price increase, the company hinged it on series of devaluation carried out in 2020 by the Central Bank of Nigeria (CBN), escalating inflation, port congestion and rising in price of global sugar. Dangote Sugar said its imported raw sugar from Brazil under Federal Government’s backward integration plan.
“We have continued to witness high cost of raw materials, energy costs and other input costs due to rising inflation and FX rate fluctuation. Further cost escalation is anticipated in the year as inflationary pressure mounts,” the company said.
FBN Holdings Suffers 39 Percent Drop in Profit to N15.6 Billion in Q1 2021
FBN Holdings Plc profit after tax declined by 39 percent from N23.140 billion recorded in the first quarter (Q1) of 2020 to N15.6 billion in the first quarter of 2021.
In the leading financial institution’s unaudited financial statements released through the Nigerian Exchange Limited, gross earnings declined by 14.5 percent to N137 billion in the period under review, down from N160 billion filed in the previous quarter.
Similarly, net interest income declined from N60.253 billion achieved in Q1 2020 to N52.793 billion.
Net interest income after impairment charge for losses also dipped from N50.547 billion in Q1 2020 to N39.619 billion in Q1 20201. While net fee and commission income rose from N20.773 billion in Q1 2020 to N28.427 billion in Q1 2021.
Profit before tax declined by 34 percent to N18.906 billion in the quarter under review, down from N28.680 billion posted in the corresponding quarter of 2020.
FBN Holdings paid N3.285 billion in income tax in the first quarter of 2020.
Therefore, profit for the period stood at N15.621 billion. While Net Assets contracted from N765.2 billion to N764.8 billion.
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