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CBN Okays Operations of 4,106 BDCs, 76 Finance Houses

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  • CBN Okays Operations of 4,106 BDCs, 76 Finance Houses

The Central Bank of Nigeria (CBN) yesterday confirmed operations of 4,106 bureaux de change (BDCs) and 76 finance houses.

The report on approval, posted on CBN website, also showed that the apex bank confirmed the operations of 1,028 microfinance banks (MfBs), two regional banks, three banks with Holding Company structures, five merchant banks, one non-interest bank and 19 commercial banks.

CBN regulation requires BDCs to meet N35 million mandatory capital base to stay in operation.

The CBN had previously returned N35 million cautionary deposit for BDCs to the operators, a circular signed by CBN Director, Financial Policy & Regulation, Kelvin Amugo said.

The apex bank had refunded the mandatory caution deposit of N35 million each to all BDC operators but retained the N1 million licencing fee paid by each of the operators.

Likewise, Finance Houses are expected to meet N100 million capital base for the subsector as stipulated by the regulator.

The CBN director said the finance companies sub-sector was envisioned to operate at the middle tier of the financial system, largely to cater for the financial needs of the Micro, Small and Medium Enterprises (MSMEs).

They are also expected to leverage on the resources from the banking system among other sources of funding. The CBN had in a bid to sanitise the sub-sector, revoked the licences of 208 finance companies and cancelled the approvals-in-principle of 462 others due to the distress in the sub-sector.

By 2012, there were 116 finance companies in the records of the CBN; 51 licences were revoked by the CBN in September, 2012 thus leaving a balance of 65 FCs with valid licences.

The idea is to have finance companies that are strong and virile to perform the functions they were set up to perform. The objective of shareholders in the operation of finance companies is to make profit, but for the CBN, it is to have stable and strong finance companies.

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 long experience in the global financial market.

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Access Bank in Talks to Acquire Cavmont Bank

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Access Bank to Acquire Cavmont Bank in Zambia

Access Bank Plc on Wednesday announced that its wholly-owned subsidiary in Zambia, Access Bank Zambia Limited (Access Bank Zambia) is in talks to acquire Cavmont Bank Limited, a subsidiary of Cavmont Capital.

According to the statement signed by Mr. Sunday Ekwochi, Company Secretary, Access Bank and released on the Nigerian Stock Exchange website on Wednesday, the ongoing discussions is to acquire 100 percent of Cavmont Capital’s interest in Cavmont Bank.

However, the lender said “there can be no certainty that a transaction will be agreed, nor as to the terms of any such agreement.

“The completion of a transaction would be subject to formal regulatory approvals. Access Bank will be updating the market as appropriate and in accordance with its disclosure obligations.”

The lender, therefore, advised shareholders to exercise caution when dealing in Access Bank’s securities.

Investors King Ltd note: This announcement further threw more lights on the recent purchases of Access Bank’s shares by Herbert Wigwe, the Chief Executive Officer and Managing Director, Access Bank.

The CEO/MD purchased 7.532 million of Access Bank‘s shares in the last one month.

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Mohammed Umar is the New Acting Chairman of EFCC

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Buhari Appoints Mohammed Umar as EFCC Acting Chairman

President Muhammadu Buhari has appointed, Mohammed Umar, the director of operations at the Economic and Financial Crimes Commission (EFCC), as the new Acting Chairman of the agency, according to the NAN.

A top official of the commission confirmed to NAN that Umar has taken charge of the agency following the suspension of Ibrahim Magu, the former acting Chairman.

Ibrahim Magu was suspended by the President on Tuesday following series of allegations bordering on frauds, financial misappropriations and abuse of power.

 

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CBN Spends $11.5bn in Q1 2020 to Support the Economy and Dwindling Naira

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CBN Injects $11.5bn Into the Economy in the First Quarter

The Central Bank of Nigeria (CBN) injected a combined $11.5 billion into the nation’s foreign exchange market to stabilise the economy and support the Naira value in the first quarter of the year.

According to the latest report from the apex bank, the central bank injected $2.96 billion into the nation’s forex market in the month of January. Another $3.39 billion was used to support the economy in February while $4.7 billion was supplied in the month of March, the very month the economy was locked and all operations grounded to curb the spread of COVID-19.

A further breakdown of the report revealed that the Investors and Exporters’ foreign exchange window, Small and Medium enterprises and Invisible segments received a total of $7.23 billion of the $11.5 billion, the Bureau De Change segment received $3.6 billion while the Interbank and WDAS/RDAS got the rest in the first quarter.

The report noted that the apex bank injected a total sum of $14.72 billion and $28.55 billion into the economy in 2018 and 2019, respectively.

Meanwhile, the central bank is yet to commence the sales of forex to the bureau de change following the March suspension.

But has commenced partial sales to all commercial banks for onward sales to parents and small businesses across the country.

Mr Isaac Okorafor, the Director, Corporate Communications, CBN, had said, “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.”

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