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Banks to Provide Single-digit Interest Loans to Creative Sector

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  • Banks to Provide Single-digit Interest Loans to Creative Sector

The Bankers Committee of the Central Bank of Nigeria on Thursday agreed to provide more funding for the development of the creative sector of the economy.

The decision was made at the end of the committee’s meeting held at the CBN headquarters in Abuja.

Present at the meeting were chief executives of all the Deposit Money Banks in Nigeria as well as other top officials of the apex bank.

Addressing journalists shortly after the 342nd meeting of the committee, the Director, Banking Supervision Department, CBN, Mr Ahmed Abdullahi, said that the decision to support the creative industry was born out of the committee’s conviction that the sector held the key to job creation, poverty reduction and inclusive growth.

He was accompanied at the media briefing by the Director, Development Finance Department, CBN, Mr Mudashiru Olaitan; the Managing Director, Access Bank Plc, Herbert Wigwe; the Managing Director, Unity Bank Plc, Mrs Tomi Somefun; and the Director of Corporate Communication Department of the CBN, Mr Isaac Okorafor.

Abdullahi said the committee was implementing programmes aimed at improving access to finance and reduce the level of poverty in the country.

Speaking further on the initiative, Wigwe said that the committee had identified four key focal areas under the creative sector to channel more funding at a single-digit interest rate.

According to him, the areas are movie, music, fashion and information technology.

He said one of the major objective of the committee in adopting the initiative was to use the sectors to make Nigeria a major tourist destination in the world.

He said the banks had agreed that the sectors would be given all the needed support both financially and technically to generate jobs, create wealth and stimulate economic growth.

He said that the banks would develop the right infrastructure and shared facilities to support the sector.

Wigwe also stated that technology hubs would be developed to support Nigerians who had business ideas to pursue in the IT sector.

He said the music sector would see the banks establishing a music academy to nurture talents for the production of good music.

He said the Bankers Committee would, before the beginning of the second quarter, start implementing the initiatives with collaboration from international institutions.

He said, “The Bankers Committee after a lot of research identified the creative and IT sector as a critical sector to support social and inclusive growth in Nigeria.

“We’ve basically found out that the sector would generate a significant amount of employment given how Nigerians involved in the creative sector have done well in music and others.”

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.

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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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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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