Some retirees under the Federal Mortgage Bank of Nigeria (FMBN) have spoken against the loss of more than 100 pensioners recently, mainly due to the alleged failure of the Managing Director of FMBN, Ahmed Musa Dangiwa to pay their pension arrears.
The pensioners also accused the bank’s MD of deliberately failing to obey a court judgement, and a directive from the Presidency, Federal Ministry of Works & Housing and the Federal Ministry of Finance instructing him to start paying the owed pensions arrears to the retirees.
Comrade Ladipo Ani, the National President of the Nigeria Union of Pensioners (NUP) Federal Mortgage Bank of Nigeria chapter, called on President Muhammadu Buhari to help them in a press statement. The statement refers to Dangiwa as an “emperor”, and accuses the Katsina native of using the President’s name to hold them captive.
Ladipo went on to cite the different directives addressed to FMBN and Dangiwa. He first mentioned a letter dated June 7, 2022 where the Minister of Finance wrote to the Minister of Works and Housing that the FMBN should liquidate all assets belonging to the inoperative Federal Mortgage Finance Limited (FMFL). The letter then advised that the judgement debt to the tune of about N4.7 billion should be paid as the accumulated terminal benefit settlement, including the 10 years outstanding pension to pensioners.
The FMBN was urged to enlist pensioners and immediately begin payment of their monthly pension, in agreement with the judgement sum of N41 million per month.
In another letter dated August 2, 2021 the Minister of Works and Housing directly instructed the Managing Director of FMBN that the bank should budget for their liability and settle agreeable procedures with the affected pensioners for the payment of their outstanding benefits.
In a third letter dated October 26, 2021, Dangiwa was reprimanded for his non-compliance to ministerial directive that he should explore all possible ways to pay the accumulated pension benefits.
Ladipo stated that in spite of these directives, the MD who pleaded for a little time to settle things with the Federal Ministry of Works and Housing has refused to succumb to requests. He also said that the pensioners’ letter of protest caused the MD to inform security agencies that they were threatening his life and planning to disrupt the activities of the FMBN.
This has caused the bank’s premises to be under surveillance and several pensioners to be closely watched by the security agencies.
Cadbury Nigeria Posts 191 Percent Increase in Profit Before Tax in 2021
Cadbury Nigeria, a food, sweets and drink company headquartered in Lagos, Nigeria, grew revenue by 20 percent in the year ended December 31, 2020.
In the company’s unaudited financial statement released on Wednesday, gross profit increased by 10 percent to N6.507 billion from N5.899 billion it closed in the same period of 2020.
The company grew results from operating activities to N578.906 million, representing a 105 percent jump from N281.824 million filed in the corresponding period.
Profit before tax also rose 191 percent to N1.186 billion from N408.065 million in the 2020 financial year.
However, the company’s income tax dragged on the firm’s profit after tax as Cadbury paid N355.920 million in tax compared to N523.762 million tax credit received in the same period of 2020.
Profit after tax dipped to N830.481 million in the period under review, 11 percent below N931.827 million recorded in 2020. Basic earnings per share also declined by 11 percent 44.22 kobo.
Cadbury history in Nigeria dates back to the 1950s when it began sourcing for cocoa and also importing bulk products and repacking it into tins for sale in the country. Later finding increasing market opportunities in the country, the group set up a manufacturing facility in January 1965.
The firm became a publicly quoted company in 1976 when Cadbury sold 20% of its interest in the firm. The firm’s investment in the integration of its supply chain led to the establishment of a sorghum conversion plant and Stanmark Industries in Ondo, a cocoa processing plant. Stanmark provides raw materials for its key product, Bournvita and is a source of foreign currency through exportation of cocoa products. In 2006, the subsidiary processed 15,000 tonnes of cocoa beans into cocoa butter, cocoa liquor and cocoa powder.
In 2006, the firm released a statement disclosing financial misstatements in a number of previous annual reports. Immediately after the disclosure, the CEO and finance director resigned their positions. The firm later announced it will be taking exceptional item charges on its balance sheet as a result of the misstatements.
Is the IMF Scared About the Future of Finance?
The IMF’s demands to El Salvador on Bitcoin show the institution to be on the wrong side of history and is bullish for cryptocurrencies, says the CEO of one of the world’s largest independent financial advisory, asset management and fintech organizations.
The damning observation by deVere Group’s Nigel Green, a game-changing crypto advocate, follow the International Monetary Fund urging the central American nation to reverse its decision to make Bitcoin legal tender.
In September, El Salvador became the first country to allow consumers to use the cryptocurrency in all transactions, alongside the U.S. dollar.
Mr Green says: “Of course, the situation in El Salvador needs to be monitored extremely carefully and every precaution must be taken to ensure the Bitcoin rollout truly benefits the population.
“But the IMF asking a pioneering sovereign nation to drop a future-focused financial policy that attempts to bring it out of financial instability and a reliance on another country’s currency shows the institution to be on the wrong side of history.
“Bitcoin is the world’s largest digital currency –- and digital is the inevitable future of money.
“This is why more and more institutional investors, household name investors, Wall Street giants and multinational corporations are all sensibly, increasing their exposure to crypto and bringing with them capital, reputational clout and expertise.
“They understand and value the key characteristics of Bitcoin and cryptocurrencies are designed for this century and, therefore, are growing in appeal.
“These include that they’re borderless, making them perfectly suited to a globalised world of commerce, trade, and people; that they are digital, making them an ideal match to the increasing digitalisation of our world; and that demographics are on the side of cryptocurrencies as younger people are more likely to embrace them than older generations.
“For the IMF not to recognise this is baffling.”
He continues: “Is the IMF scared of the future of finance? Why do they continue to want to pile on debts to poorer countries that they know are unlikely to be able to repay using traditional currencies? Is the IMF worried about the domino effect of nation-state adoption that might weaken their dominant global influence? If so, is this a warning shot to those countries?”
When El Salvador adopted Bitcoin as legal tender in September, Nigel predicted that three other countries would follow suit, perhaps as early as this year.
He said: “Low-income countries have long suffered because their currencies are weak and extremely vulnerable to market changes and that triggers rampant inflation.
“This is why most developing countries become reliant upon major ‘first-world’ currencies, such as the U.S. dollar, to complete transactions.
“However, reliance on another country’s currency also comes with its own set of, often very costly, problems. A stronger U.S. dollar, for example, will weigh on emerging-market economic prospects, since developing countries have taken on so much dollar-denominated debt in the past decades.”
The deVere boss went on to add: “By adopting cryptocurrency as legal tender these countries then immediately have a currency that isn’t influenced by market conditions within their own economy, nor directly from just one other country’s economy.
“Bitcoin operates on a global scale and therefore is impacted by wider, global economic changes.”
In addition, he noted, cryptocurrencies could also help “bolster financial inclusion for individuals and businesses” in developing countries as they “can circumnavigate the biases” of traditional banks and other financial services providers.
In regard to El Salvador’s response, a meme posted on Twitter by the president, Nayib Bukele, suggests his government is to reject the IMF’s calls.
Nigel Green concludes: “Institutions should be working with developing economies to find their way out of debt and financial instability in ways that are future-focused.
“Past methods, clearly, haven’t been as successful as they should have been.
“Therefore, it’s time to look ahead, not back.”
FG Revenue Will Rise by 15% Through VAT, Companies’ Taxes in 2022 – Agusto & Co.
A Pan-African Credit Rating Agency and Industry Research Provider, Agusto & Co. Limited has stated that Nigeria’s revenue will increase by 15 per cent in 2022.
The rise in the federation account revenue, according to Agusto & Co. will be majorly derived from Value Added Tax (VAT) and Companies’ Income Tax.
This was mentioned in the agency’s report, titled ‘Nigeria in 2022’, describing the economic outlook of the present year.
It further explained that the Federal Government’s share of the revenues and its independent revenue would, under most aggressive estimates, be N5 trillion.
Also, to increase its funds for necessary spending, the Federal Government should be able to borrow another N8 trillion.
The report noted that about N11 trillion would go for obligatory spending (interest on loans, statutory transfers and payroll & unfunded pensions). While the larger part of the remaining funds would go to capital expenditure, which it summed up to be N3 trillion.
The Credit Rating Agency further estimated that Nigeria’s local currency debts will increase to N44 trillion this year.
In view of this, the Central Bank of Nigeria, CBN will lend to the Federal Government at rates below inflation to bring down its borrowing requirements and place pressure on interest rates at the market.
“Local currency debts of the FGN [Federal Government of Nigeria] will grow to about N44tn or about 9X of its revenues. The median for key countries in sub-Saharan Africa is about 2X.
“Because of the high cost of servicing these debts at commercial rates, the Central Bank of Nigeria will continue to accommodate the FGN by lending to them at rates below inflation, thus reducing FGN’s borrowing requirement from the markets and put a downward pressure on interest rates as banks, pension funds, insurance companies and other institutional investors compete for government securities,” it said.
Hinging on getting more investors to boost resources, it said the country’s risk premium is about 5 percent in 2022 as regards its outstanding debts.
“The average yield on FGN’s 10-year US$ bonds was 7.1 percent in 2021 compared to 1.4 percent for those issued by the government of the USA. This translates to a country risk premium of 5.7 percent. We believe that this risk premium will be about 5.0 percent in 2022 as fears about COVID-19 recede and the fact that Nigeria has ample resources to service its FCY debts. However, this premium may spike if there is a flight to safety by investors,” the report stated.
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