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Banks Agree on N105Bn Sinking Fund to Clean Up Banking Mess

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Deposit Money Banks (DMBs) in the country have agreed to set aside some N105 billion for a sinking fund to cover the cost of cleaning up the system after the 2008-2009 banking sector crisis and further consolidate on the system’s post-crisis stability gains achieved in the industry over the last three years.

They consequently have signed the Resolution Cost Trust Fund Deed which requires them to contribute 0.5 per cent of their total assets and 33 per cent of their off-balance sheet items to the Asset Management Corporation of Nigeria’s (AMCON’s) sinking fund.

The Central Bank of Nigeria (CBN) and banks had in 2011 signed a memorandum of understanding (MoU) on the establishment of the sinking fund, having realised that funds under AMCON’s management and eligible bank assets might not be enough to meet the resolution cost of restoring financial stability.

Going by the DMBs’ total assets which stand at N21 trillion, the sum to be set aside would amount to about N105 billion from the banks to help cover the cost of the banking crisis of two or three years ago.

Mrs. Agnes Tokunbo Martins, CBN director, banking supervision, addressing journalists after the Bankers’ Committee meeting in Abuja yesterday, explained that what had hitherto existed to mitigate the devastating effects of the crisis in the sector was a memorandum of understanding between the CBN and the DMBs on how to clean up toxic loans from their balance sheets, adding that with the signing of the deed, they have now formally agreed on the percentage and other ratios to be used in contributing to the sinking fund.

She said: “One major event that took place today was the signing of the Resolution Cost Trust Fund Deed. This deed is between the banks and, basically, the intention is to cover the cost of the banking crisis that we had about two or three years ago.

“Initially what we had in place was a memorandum of understanding where the banks on their own agreed to contribute 0.3 per cent of their total assets to clean up the banking system at that time.

“But today the deed has been signed and what is in the deed is that the banks have agreed on their own to contribute 0.5 per cent of total assets and 0.5 per cent of 33 per cent of their off-balance sheet assets to the sinking fund.

“The whole intention that is to ensure that going forward the banking system is safe and there is no incidence whereby we have to fall back on tax payers’ money.”

Godwin Emefiele, group managing director, Zenith Bank Plc, Mr.  said the committee would monitor the policy and step up efforts to ameliorate the impact on the economy.

He said the committee was not unaware of the fact that the increase on the CRR would hike both lending and deposit rates but assured customers that the trend would be reversed through renewed deposit mobilisation by banks.

Emefiele said the financial institutions were left with no other option, than to mop up deposits from the private sector, particularly the yet-unbanked segment.

He argued the 50 percent hike on CRR on public funds became necessary to ensure stability in the foreign exchange market as well as avoid the depreciation of the naira.

Also speaking on the cashless policy, Mr. Philip Oduoza, group managing director/chief executive, United Bank for Africa (UBA), said the initiative was on course, adding the banks had continued to reduce the cost of doing business in the banking halls.

He said following the introduction of the cashless policy, electronic transactions had improved significantly to N13.6 billion as at July from about N8.3 billion when the policy commenced.


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E-Financial

Kekere-Ekun, CJN Blames Reliance on Telecom Services for Online Banking Glitches

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Kudirat Kekere-Ekun, chief Justice of Nigeria and chairman of the Board of Governors, National Judicial Institute Justice has blamed telecommunications companies for the glitches experienced in the country’s banking sector.

Kekere-Ekun, CJN Blames Reliance on Telecom Services for Online Banking Glitches

Kudirat Kekere-Ekun, chief Justice of Nigeria

Kekere-Ekun said this in her keynote address at the 2024 National Workshop for Justice and Judges on Legal Issues in Telecommunications with the theme, ‘The Role of the Judiciary in Accelerating Digital Transformation in Nigeria.’

The blame on telcos comes in the wake of multiple glitches in online services. On August 14, 2024, customers reported that the Guaranty Trust Bank (GTBank) website was down, leading to speculation that it had been cloned and customer data intercepted.

The CJN said, “I will like to quickly bring our attention to two issues which I consider to be pivotal and which revolve around cyber security and the attendant challenges of exploring the digital space.

“The first is the increased risk of the personal data of consumers being misused or compromised by unscrupulous persons, thus necessitating the need for improved strategies and innovation for consumer protection in the telecommunications sector.

“Also, worth noting are deficiencies in the Banking Sector and which are attributable to reliance on digital services provided by the Telecommunications Sector. There is for instance the major challenge posed by electronically backed transactions which is commonplace in the Banking Sector.”

The CJN said these glitches have led to several issues including hacking of online banking platforms as well as banks being compromised.

“Concerns in this regard include the spate of customers whose online banking platforms have been hacked, as well as banks being compromised due to technological glitches not factored into their day-to-day operations. Consequently, these and several other challenges have resulted in a number of disputes which frequently require adjudication,” she said.

Kekere-Ekun said the deployment of technology in telecommunications plays a pivotal role in the advancement economic system of any country.

She, however, said there is a need to proffer solutions to legal issues arising from digital services provided by the telecommunications sector.

“It is also my expectation that the forum will equip Judicial Officers with the technical skills required for adjudicating disputes arising from the sector and keep them abreast with global standards and best practices,” she added.


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E-Financial

Ecobank Serves Customers Notice of Planned Service Disruption

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Ecobank Nigeria has alerted its customers to an upcoming brief service disruption due to scheduled system maintenance on its card services.

Ecobank Serves Customers Notice of Planned Service Disruption

The maintenance is set to occur from 11:00 p.m. on Thursday, November 7, 2024, until 1:00 a.m. on Friday, November 8, 2024.

In a notification to customers, the bank explained that during the maintenance window, cardholders might experience intermittent issues when using Ecobank cards on other banks’ channels.

However, the bank said all its specific channels, including ATMs and POS terminals, will remain operational.

Additionally, other digital platforms—such as the Ecobank Mobile App, USSD *326#, Ecobank Online, Omni Lite, and Omni Plus—will be fully accessible throughout the maintenance period.

The bank expressed apologies for any inconvenience, reaffirming its commitment to providing seamless banking experiences across Africa.

 

 

 

 

 

 

 


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E-Financial

Zenith Bank Commends Customers After Successfully Unveiling Upgraded Enhanced Tech infrastructure

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Zenith Bank Plc has announced that it now boasts the best technology infrastructure in the banking industry, positioning itself to provide an exceptional customer experience and superior service delivery moving forward. This upgrade follows a recent comprehensive technology enhancement.

The bank expressed its heartfelt gratitude to customers for their support and patience throughout the upgrade process, while also extending apologies for any inconveniences experienced during this time.

This announcement was made in a social media post on Wednesday, signed by Dame Dr. Adaora Umeoji, OON, the Group Managing Director/CEO.

In her message, the GMD/CEO emphasized the bank’s commitment to delivering an unparalleled service experience, stating, “We undertook this upgrade to ensure we can offer our customers the best possible service.”

Umeoji pledged that Zenith Bank will continue to innovate, ensuring that customer needs are met swiftly, safely, and conveniently.

The post read in part: “On behalf of the Board, Management, and Staff of Zenith Bank PLC, I would like to thank you for your patience and support during our IT infrastructure migration to a new and more robust operating system.

“We are truly grateful for the trust and confidence you have placed in us. The primary reason for undertaking this extensive endeavor was to better position Zenith Bank PLC for improved service delivery to all our valued customers and to create memorable banking experiences at all our touchpoints.

“While I regret the inconveniences and challenges you faced during and immediately after our migration, I am pleased to inform you that Zenith Bank PLC now has the best technology infrastructure in the industry. We are committed to ensuring you experience superior service delivery going forward.

“Rest assured, you remain our top priority, and Zenith Bank will continue to innovate and offer value-added products and services to meet all your banking needs quickly, safely, and conveniently.”


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