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INEC Chairman Seeks Approval to Withdraw N5.2 Billion From Special INEC Fund

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INEC Seeking Approval to Withdraw N5.2 Billion

According to Electoral Act 2010, the Special INEC Fund was created to enable the commission save a certain percentage of its allocations for rainy days and emergencies. There has been no withdrawal since the inception of the special fund in 2010.

The chairman, Prof Yakubu said INEC had no problem with 2019 budget, however, the global health pandemic has disrupted the plans and strategies of the commission which led to some financial challenges in the 2020 budget.

N40 billion was proposed as INEC budget for 2021, this budget was expected to cover electoral expenses, litigations and overhead cost amidst growing personnel cost. However, the budget has been reduced to N36 billion as a result of the budget cut caused by the negative effect of COVID 19.

But what has happened now is our budget for 2020 dropped to N40 billion from N45.5 billion in 2019. And as a result of the 10 percent COVID cut, it further dropped to N36 billion in the middle of the year when we had already made preparation for expenditure, and therefore, since that fund is made for the rainy days, I informed the committee that the rainy day has come. So we are taking part of the fund to balance our budget for this year.” Prof Yakubu explained.

The cut in budget prompted the commission to seek Senate’s approval to withdraw N5.2 billion from the INEC SPECIAL FUND.

The Commission cannot be independent unless it is financially independent. There are some activities that happen that are time bound or bound by some specific provisions of the constitution that the Commission has to undertake,” he said to the media.

“So, the fund was established to allow the Commission to discharge those responsibilities. It was established in 2010 but there was no cause to spend from it, and from the last five years this Commission did not spend from it”, he further stated.

He further revealed the legal challenges faced by the commission on pre-election and post-election court cases from general elections held in 2019.

For instance, if we have a case for governorship election before the Supreme Court, it is a maximum of N4.5 million, but because of the number of cases, we are almost getting close to 1,700 pre-election and post-election cases in 2019 alone”.

“Every day you hear people going to court and joining INEC, but we will continue to do what we can within available resources”, he added.

Thereafter, he directed the INEC chairperson to, report back on specific legislative issues and restructuring of salary structures for the commission within the next three months.

Finance

CBN Maintains 11.5 Percent Monetary Policy Rate, Leaves Other Ratios Unchanged

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The Central Bank of Nigeria led Monetary Policy Committee (MPC) has left the interest rate unchanged at 11.5 percent to further stimulate activities in the real sector of the economy.

Godwin Emefiele, the Governor of Central Bank of Nigeria disclosed this at the end of the MPC meeting on Tuesday in Abuja.

He said other parameters, the Cash Reserve Ratio (CRR), Liquidity ratio, and asymmetric corridor, were left unchanged.

According to the Governor, the committee voted unanimously to maintain the current monetary policy and attributed the surge in inflation to structural policies, the increase in pump price and the recent #EndSARS protest.

Highlights of CBN-MPC’s  Decision

  • MPR was kept at 11.50%
  • The asymmetric corridor of +100/-700 basis points around the MPR
  • CRR was retained at 27.5%
  • Liquid Ratio was also kept at 30%

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Finance

Unity Bank Grew Gross Earnings by 8 Percent to N34 Billion in Nine Months

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Unity Bank Plc grew gross earnings by 8 percent despite COVID-19 and other headwinds that hurt the profitability of most businesses in the first nine months of the year.

A break down of the bank’s unaudited financial results for the period showed gross earnings rose by 8 percent to N33.91 billion for the nine months ended September 30, 2020, up from N31.26 billion posted in the same period of last year.

The lender’s total assets rose by 44 percent from N293.05 billion in the corresponding period of 2019 to N420.87 billion in the period under review.

Unity Bank grew profit before tax from N1.61 billion in 2019 to N1.71 billion in the period under review, while profit after tax expanded from N1.48 billion in the corresponding period to N1.57 billion in 2020.

Customers’ deposits stood at N332.36 billion during the period under review, up from N257.69 billion posted in 2019.

Commenting on the performance, Mrs. Tomi Somefun, the Managing Director/Chief Executive Officer, Unity Bank Plc, expressed delight at the strong growth recorded across the bank’s balance sheet, especially from both the liability and assets side of the business and across key indices.

She said, “even as the bank continues to innovate in its e-business product bouquet to target and support value chain business with robust technology and thus diversify its earnings base.”

Somefun said, “One of the areas that will define our strategic direction going forward is investment in alternative channels, leveraging further deployment of resources in technology.

“COVID-19 gave us a chance to test the integrity and scalability of our technology, the IT infrastructure, and the electronic banking channels, and provided us an opportunity to see where we needed to improve and strengthen, knowing that the future of sustainable banking business is in alternative channels.”

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Finance

Financial Sector Grew by 6.8 Percent in the Third Quarter

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The finance and insurance sector that comprises of both the financial institutions and insurance subsectors grew by 5.91 percent year-on-year in nominal terms in the third quarter (Q3).

According to the National Bureau of Statistics (NBS) latest report, the financial institutions’ subsector accounted for 88.89 percent of the sector in real terms in the quarter under review while the insurance subsector contributed the remaining 11.11 percent.

During the third quarter of 2020, the financial institutions’ subsector grew by 6.8 percent in Q3 2020 from 28.41 percent in Q2 2020 and 0.61 percent in Q3 2019 despite COVID-19 and a tough operating environment. The insurance subsector, however, contracted by -18.67 percent in Q3 2020 from -29.53 percent in Q2 2020 and 3.96 percent in Q3 2019.

On a quarterly basis, the sector declined by 24.76 percent.

In terms of contribution to GDP, the finance and insurance sector contributed 2.46 percent in Q3 2020, higher than the 2.40 percent it represented a year ago and lower than the contribution of 3.76 percent achieved in the previous quarter.

The economy contracted by 3.62 percent in the third quarter following a 6.10 percent decline posted in the second quarter. Nigeria is officially in the second economic recession in four years.

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