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BDCs Partner NIBSS to Automate Operations

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  • BDCs Partner NIBSS to Automate Operations

Bureau de change operators under the aegis of the Association of Bureaux De Change Operators of Nigeria are collaborating with the Nigeria Inter-bank Settlement System Plc to automate their operations for online real time returns rendition.

The Acting President, ABCON, Alhaji Aminu Gwadabe, made the disclosure in Lagos, a statement by the association indicated.

Gwadabe also said that ABCON had established the naijabdcs.com, a live rate engine room to be rolled out soon, as part of its strategy to enhance transparency, price discovery and attracting of billions of dollars through Diaspora remittances.

According to him, the association is working with the Central Bank of Nigeria to maintain naira stability.

The ABCON chief noted that foreign investors, who invested billions of dollars in the equities market, might exit the market ahead of the 2019 elections.

As a result, he said the negative implication of exit of portfolio investors from the local bourse raised major concern on naira’s continued stability.

According to him, there will be further external sector imbalances in the run-up to the 2019 elections even as equity market imbalance is likely to increase.

The statement quoted Gwadabe as saying, “The development in the stock market and its closeness to elections is worrisome. It raises a lot of concerns on the relatively stable foreign exchange market. The investors in the stock market are largely portfolio investors from international markets and will at any given time decide to dump their holdings and take huge dollar from the economy as they repatriate both capital and their profits to other lucrative destinations.”

He described the portfolio investors as capitalists driven solely by profits.

Gwadabe explained, “The build up to 2019 election campaign and politicking is also an albatross to the naira’s continuous sovereignty. Besides, the inaction of regulators and policymakers to address the multiple exchange rates will continue to endanger the achieved stability in the foreign exchange market.”

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.

Finance

Kenya Bankers Association (KBA), Huawei Ink Partnership Agreement to Promote Tech-Driven Financial Inclusion, Fintech Capacity Building

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Partnership seeks to promote tech-led financial inclusion as well as Fintech ICT Capacity; The two organizations have convened a summit on ICT and financial inclusion.

The Kenya Bankers Association (KBA) has signed a collaboration agreement with tech-firm Huawei-Kenya that seeks to deepen financial inclusion in the banking sector through further deployment of technology and building fintech capacity.

In the partnership, KBA will work closely with Huawei-Kenya to spearhead industrywide capacity building initiatives aimed at promoting knowledge on financial technology innovation, digital transformation, and other ICT-related programmes in the banking industry.

Under the partnership, KBA and Huawei will also aim to promote financial inclusion activities in line with the KBA Strategic Plan for the period 2020 to 2023. Launched last year, the Plan seeks to promote access to affordable financial services through tech-aided operational efficiency.

Speaking during the signing of the agreement, KBA Chief Executive Officer Dr. Habil Olaka said the cooperation would go a long way in promoting the delivery of efficient banking services in Kenya through knowledge-sharing programmes that will be organized by the two institutions.

“This partnership will further focus on research and knowledge-sharing activities, which will supplement the research initiatives that continue to be spearheaded by the Association’s Centre for Research Financial on Markets and Policy®. In this regard, the collaboration will certainly augment KBA’s and member banks’ knowledge base in engagements with diverse stakeholders from a fact-based perspective,’’ Dr. Olaka added.

The partnership comes on the heels of the the 2020 edition of the Huawei-KBA Online FSI Summit slated for 30th September this Year. The forum is among the initiatives Huawei and KBA are jointly implementing to promote the delivery of efficient banking services through technology under the cooperation agreement.

Huawei-Kenya Chief Executive Officer Mr. Will Meng welcomed the partnership, saying technology will remain a core driver towards enhancing convenient access to financial services in light of disruptive occurrences such as the ongoing Coronavirus Disease pandemic.

‘’The theme of the upcoming summit is ‘’Building Banking Core Competence through Digital Transformation to Accelerate Inclusive Finance’’. It is one of the initiatives we are rolling out in Kenya in partnership with the Association to ensure we optimally leverage on technology to achieve affordable and accessible financial services in the regional economy,’’ said Mr. Lee.

The summit comes at a time when the global economy is coping with the impact of the Coronavirus Disease. Dr. Olaka noted that the banking industry has continued to tap into the potential of technology to uphold business continuity and supporting customers, a culmination of efficient deployment of technology by the banking sector during this period.

“Beyond the COVID-19 disruption, we see technology as an invaluable enabler of financial inclusion. I have no doubt that the summit along with the KBA-Huawei collaboration will play a significant role in our collective efforts to entrench technology in our operations and sustain our contribution to the national development agenda,’’ Dr. Olaka said.

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CBN Pursues Expansionary Monetary Policy to Boost Output and Moderate Inflation

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CBN Says it Lowered Interest Rates to Use Expansionary Monetary Policy Boost Output and Moderate Rising Inflation

Following the shocking reduction in the monetary policy rate by 100 basis points to 11.5 percent, the Central Bank of Nigeria has explained the reason for such a decision after months of saying no.

The Governor of the apex bank, Godwin Emefiele said the central bank is pursuing an expansionary monetary policy to abate pressure, up economic productivity and then use expected improved in aggregate supply to moderate the rising inflation rate.

Emefiele said this was necessary to address likely recesssion and contain the rising inflation rate.

He said, “The committee was therefore of the view that to abate the pressure, it had no choice but to pursue an expansionary monetary policy using development finance policy tools, targeted at raising output and aggregate supply to moderate the rate of inflation.

“At present, fiscal policy is constrained and so cannot, on its own, lift the economy out of contraction or recession, given the paucity of funds arising from weak revenue base, current low crude oil prices, lack of fiscal buffers and high burden of debt services.

“Therefore, monetary policy must continue to provide massive support through its development finance activities to achieve growth in the Nigerian economy.

According to the governor, Monetary Policy Committee members were confronted with a policy dilemma after the economy contracted by 6.10 percent in the second quarter and expected to dip again into recession in the second quarter.

It is, therefore, of the view that, if a recession occurs in Q3, the committee would be confronted with proposing policy options in a period of stagflation,” he added.

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Unity Bank Projects Loss After Tax of N1.80 Billion for Q4, 2020

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Unity Bank Predicts N1.80 billion Loss After Tax and N1.66 Billion Pretax Loss for Q4, 2020

Unity Bank Plc said it is expecting to lose N1.80 billion in loss after tax in the fourth quarter of 2020.

While the lender said it is targeting N4.98 billion in gross earnings for the quarter, it is projecting a pretax loss of N1.66 billion, according to a recent earnings forecast released on the Nigerian Stock Exchange’s website.

In its fourth-quarter earnings forecast, the bank said it was also targeting N3.36 billion in interest income.

Unity bank earnings rose by 11 percent to N22.8 billion in the first half of 2020, up from N20.55 billion recorded in the same period of 2019.

In the first half, the bank grew profit before tax by seven percent to N1.12 billion from N1.05 billion in the corresponding period of 2019. While profit after tax also rose by seven percent from N967.51 million in H1 2019 to N1.03 billion in H1 2020.

Similarly, Unity Bank posted earnings of N11.01 billion in the first half, representing a 5 percent increase from the N10.50 billion recorded in the same period of 2019.

The bank asset expanded by 48 percent from N293.05 billion in H1 2019 to N445.95 billion in the same period of 2019. While the lender’s loan book grew by 53.7 percent from N70.62 percent in Q2 2019 to

Also, Unity Bank grew deposit by 19 percent from N257.69 billion recorded as of December 2019 to N306.47 billion.

Speaking on the performance, Mrs. Tomi Somefun, the bank’s Managing Director/Chief Executive Officer, said “Despite the inclement economic conditions occasioned by the global pandemic, which almost paused or at best put activities at a slower pace in virtually all sectors of the economy, the bank has been able to ride the waves to maintain its growth trajectory looking at the key performance indicators.

“The assessment, therefore, is that the repositioning efforts which have taken root before the headwinds are equally able to withstand shocks.”

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