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Heritage Bank Resumes Forex Sales to SMEs, to Disburse N100bn Loan

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  • Heritage Bank Resumes Forex Sales to SMEs, to Disburse N100bn Loan

Heritage Bank has resumed the sale of foreign exchange to Small and Medium Enterprises and parents looking to pay their kids school fees abroad.

The announcement was after the Central Bank of Nigeria resumed sale of forex to banks in the country.

The bank is also set to disburse the N100billion set aside by the Central Bank of Nigeria (CBN), as part of proactive measures to cushion the effect of the COVID-19 and revamp the nation’s dwindling economy.

Specifically, the scheme is to provide credit to indigenous pharmaceutical companies and other healthcare value chain players intending to build or expand capacity.

Also, the CBN resumed provision of foreign exchange to all commercial banks for onward sales to parents wishing to pay schools fees and small medium enterprises (SMEs) with plans to make essential imports needed to revamp economic activities across the country.

In particular, the CBN is resuming the provision of over US$100 million per week for both categories.

Meanwhile, Heritage Bank serves as a conduit which will assess and channel the profiles of interested applicants to the CBN while using its platforms to create awareness for the scheme.

The CBN has also made complete arrangements to resume foreign exchange sales to the BDC segment of the market for business travels, personal travels, and other designated retail uses, as soon as international flights resume.

To access the N100bn loans provided by the CBN for firms in the healthcare sector, a corporate entity must submit its application to a participating financial institution (PFI) which could be either a Deposit Money Bank or a Development Finance Institution of its choice with a bankable business plan.

It stated in its latest guidelines that the PFI must appraise and conduct due diligence on the application; and upon approval by the PFI’s credit committee, the application would be submitted to the apex bank with relevant documents attached.

The CBN would process and disburse funds to the PFI for onward release to the project, it added.

The CBN stated that the PFI must receive and review applications submitted by its customers; undertake due diligence based on normal business considerations, and bear the credit risk.

They must also issue offer letters and forward qualified applications to the CBN; disburse the released funds to successful applicants; monitor the project and recover the loans from the beneficiaries, and maintain adequate records of all beneficiaries and facilities.

It requires the PFIs to register all movable assets with the National Collateral Registry; forward periodic returns in the prescribed format on the scheme to the CBN; comply with the guidelines, and carry out any other duties as the CBN may prescribe from time to time.

According to the CBN, eligible participants under the scheme comprise healthcare product manufacturers – pharmaceutical drugs and medical equipment; and healthcare service providers/medical facilities – hospitals/clinics, diagnostic centres/laboratories, fitness and wellness centres, rehabilitation centres, dialysis centres and blood banks, among others.

Others include pharmaceutical/medical products distribution and logistics services; and other human healthcare service providers as may be determined by the CBN from time to time.

Eligible activities under the scheme would include manufacturing of pharmaceutical drugs and medical equipment; establishment/expansion/upgrade of basic and specialised healthcare facilities; and medical/pharmaceutical supplies.

Others are medical/pharmaceutical research and development; distribution of medical/pharmaceutical drugs and supplies; Manufacturing of medical/pharmaceutical drugs distribution technology; and any other healthcare value chain activity as may be prescribed by the CBN.

The CBN said the term loan had a maximum of N2billion per obligor; and the interest rate under the intervention would not be more than five per cent per annum up until February 28, 2021; and that interest on the facility would revert to nine per cent as from March 2021.

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.

Appointments

Buhari Suspends Hadiza Bala Usman as MD of NPA, Appoints Koko

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Hadiza Bala Usman - Investors King

President Muhammadu Buhari has suspended Hadiza Bala Usman as the Managing Director of the Nigerian Ports Authority, according to sources quoted by Peoples Gazette.

The president immediately appointed Mohammed Koko, the director of finance to replace Ms Usman.

While Ms Usman said she was aware of her suspension, she said she has not received any formal letter or communication to that effect from the Ministry of Transport.

Ms Usman was appointed as NPA chief in 2016 and has repeatedly propagated her reform policies that sought to redirect the organisation, which is one of the top revenue-generating entities of the Nigerian government.

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FCMB Appoints Ms. Muibat Ijaiya as Independent Non-executive Director

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FCMB - Investors King

FCMB Group Plc has appointed Ms. Muibat I. Ijaiya to its Board as an Independent Non – Executive Director, following the approval of the Central Bank of Nigeria.

Muibat Ijaiya is a Strategy Development and Execution expert focused on measurable transformation and impact. She has 19 years consulting and advisory experience, working with clients across Europe, Middle East, Africa and Asia, to provide expert-led solutions that support private and public sector organisations to develop and actively implement their strategies to achieve measurable change, transformation and/or improved performance.

She holds a BSc Mathematics & Education from the University of Surrey and a Warwick Business School MSc. Management Science and Operational Research certificate. She also obtained an MBA from the University of Manchester.

Muibat Ijaiya is a partner at Strategy Management Partners, a professional services organisation focused on helping private and public organisations around the world to clarify, develop, align and execute their strategies.

Prior to this, she was a director with Palladium Group Inc (United Kingdom & Middle East) and previously worked directly with Drs. Kaplan & Norton, the co-creators of the Strategy Focused Organisation and Balanced Scorecard concepts. Other advisory experience was in Corporate Finance with Ernst and Young (UK) focused on Transaction Advisory Solutions, Restructuring, Turnaround and Commercial Due Diligence. She also worked with Robson Rhodes RSM Business Consulting (EMEA) focused on Transformation and Change Management.

Muibat continues to work in advancing the science of strategy execution, particularly for organisations in complex industries and public institutions focused on transforming key sectors, and the Board is assured that her wealth of experience would be of great impact to the FCMB Group.

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Is a ‘Tesla’ About to Eat Construction Equipment Makers’ Lunch?

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With digitalization, electrification and autonomy all set to change the industry, could construction’s established players be wrongfooted by a new market disruptor? Industry thinkers Alan Berger and Carl-Gustaf Goransson discuss who’s in the strongest position: Old guard or Newcomers.

In 2008 no one saw Tesla Motors as much other than a niche electric sports car company. Certainly not other car companies – in 2009 Tesla only made 147 cars. Fast forward 12 years and Tesla is making 500,000 cars a year and is valued higher than the top six car manufacturers combined.

Of course, much has been written about the unexpectedly and disproportionately large disruptive effect Tesla has had on the global automotive industry. Like construction equipment, the car business has been consolidating, with no significant new entrants in a long time. This raises the question as to whether the same thing could happen in the construction equipment world – could a disrupter barge into the sector and win? Indeed, the industry is trying to digest the triple challenges of digitization, autonomous operation and electrification – creating an opportunity for new players to emerge.

Central to the success of today’s OEMs is their extensive product, customer and application knowledge. But given the technical changes that are coming, is that going to be enough to save them from a digital disruptor?

Product

The new era of machines will require a completely new architecture, one that is designed around the capabilities of an electrical drivetrain. It will also be adapted from today’s equipment in order to transfer power with cables instead of belts, and shafts and hoses will enable new ways to optimize performance and productivity. Such a platform will be largely software controlled, moving a portion of feature development from relatively slow-moving mechanical changes to faster and more easily upgradable software changes. That said, by nature, construction equipment does physical work, and the working tools will remain similar to that used today. A disrupter would develop a completely new machine, while existing OEMs could do so only if they resist the temptation to take the ‘easy’ path of adapting current machines. Indeed, OEMs would be able to leverage their vast portfolio of intellectual property to speed this along. Advantage OEM.

Supply chain

Large parts of the supply chain will remain the same, as many components and raw materials of tomorrow’s machines will be like today’s. However, new components will be needed as well, particularly in the drivetrain and hydraulic systems. (If there is a hydraulic system). This has triggered a competitive scramble that is now pitting traditional engine manufacturers against transmission/axle manufacturers and hydraulic component suppliers. While this new competitive dynamic will take time to sort itself out, clearly the traditional supply base is positioning itself to offer the needed new parts. Therefore, existing OEM-supplier relationships – and access to the latest technology – will favor existing OEMs over newcomers. Advantage OEM.

Distribution network

With new, digitally enabled sales models, the traditional role of the dealer is likely to change, and a new player could greatly accelerate this. Just look at the success of Tesla’s direct selling model. That said, construction equipment requires responsive and intensive access to service, which is a vital part of the dealers’ offering. A disrupter could build a service-only network, leveraging established dealers while moving most of the sales activity on-line. This is difficult for existing OEMs and therefore the newcomer has an edge. Advantage disruptor.

Parts/service

It is well known that parts and services drive a large part of total operating income for OEMs. Simplified, software-driven machines require less maintenance and this will negatively impact the traditional business model and reduce the value of existing OEM’s captive parts distribution networks. Indeed, there is no need for a newcomer to develop their own parts network, since there are now third-party solutions such as Amazon. A newcomer can then more easily focus on other sources of high margin recurring revenues – such as offering features-as-a-service. Advantage newcomer.

Access to capital

To fund their existing portfolio and prepare for the technical transformation today’s OEMs have to balance R&D, capital expenditure and operating income – not an easy balancing act. Not so startups, whose compelling business models and few external dependencies can get access to significant capital. All they need to worry about is being focused on developing the new products, services and business. Advantage disruptor Before concluding, there is one additional and important consideration. Tesla was founded well before the automotive industry recognized the need and technology availability. Clearly, this is not the case for the construction equipment industry today. Taking all of these factors together, it seems that the existing OEMs can drive the disruption themselves if they are willing to commit to the extensive and complete transformation needed. But, if none do so, don’t be surprised if someone else decides to do it for or to them.

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