Connect with us

E-Financial

CBN to Cut Naira Supply Next Year Ahead of 2015 Polls

Published

on

Kindly share this post

Central Bank of Nigeria (CBN) may further reduce money supply next year under her new tighter monetary policy for the 2014 fiscal year, in a bid to check the excessive pressure on prices due to the 2015 general elections.

Rising from Monetary Policy Committee (MPC) meeting in Abuja, the apex bank also warned against depleting the Excess Crude Account (ECA) and urged Fiscal Authority to step up buffers.

The 12-member MPC committee had met on Monday and Tuesday at the CBN headquarters to review the global and domestic economic environment from January to October 2013.

It also re-assessed the short-to medium-term risks to inflation, domestic output and financial stability and the outlook for the rest of the year.

Sanusi Lamido Sanusi, CBN governor told journalists at the end of the MPC meeting that the erosion of the fiscal buffers through the depletion of the ECA has further exposed the economy to vulnerabilities.

“Clearly, the major risk on the fiscal side at present is not one of escalation of spending, but loss of revenue from oil exports,” Sanusi warned.

He said, “It further noted the positive impact of monetary policy in engendering a stable exchange rate regime and attracting portfolio investment, thus driving the strong recovery of asset prices on the Nigerian Stock Exchange.

“The outlook for 2014, however, portends some potential headwinds that may lead to further tightening in monetary conditions. It is also the year in which election spending is likely to take place domestically, thus bringing more pressure to bear from the fiscal side.

“As a result, the MPC is of the view that we are not yet at the end of the tightening cycle and may need to tighten further in response to these eventualities next year.”

The committee, Sanusi said, also noted that while the Federal Government’s overall spending in 2013 had not been significantly higher than in 2012, oil revenues had continued to decline in spite of the relative stability in oil price and output.

As a result of declining oil revenue, the committee said the Excess Crude savings had fallen from about $11.5bn at the end of 2012 to less than $5bn on November 14, 2013.

External reserves, he noted, had remained in excess of $45bn only because of a massive inflow in portfolio funds.

He said the implication of this was that “financial markets are extremely fragile and susceptible to external shocks.”

He added, “The MPC again calls on the fiscal authorities to rebuild buffers in the Excess Crude Account, and this can be done by blocking fiscal leakages in the oil sector and increasing oil revenues.

“Clearly, the major risk on the fiscal side at present is not one of escalation of spending but the loss of revenue from oil exports.”

The committee also adopted an inflation target of between six per cent and nine per cent for 2014.

Sanusi said since the ECOWAS heads of state had set a five per cent target at the Convergence Council, the MPC would ensure that Nigeria moved firmly into being a low-inflation environment in the medium term.

“However, the MPC recognises the high cost of rapid adjustment and plans to make the transition gradually,” he added.

On the country’s Monetary Policy Rate, Sanusi said the committee decided to leave the rate unchanged at 12 per cent.

This is the 13th consecutive time the MPR is left untouched by the committee.

The private sector Cash Reserves Requirement was also left unchanged at 12 per cent; public sector CRR at 50 per cent and Liquidity Ratio at 30 per cent.

Sanusi said the decision was taken after considering the success of monetary policy in attaining price and exchange rates stability; the potential headwinds in 2014; the ultimate goal of transiting to a truly low-inflation environment; and the need to retain portfolio flows in view of the erosion of fiscal reserve buffers.


Kindly share this post

Nigeria CommunicationsWeek believes that technology makes life more exciting and helps improve the lives of people around Nigeria and indeed the world. So since 2007, we have devoted our energy to independent reportage of technology and how they affect lives.

Continue Reading
Comments

E-Financial

FG Sacked IST Members over Fraud- Ahmed

Published

on

Kindly share this post

Mrs Zainab Ahmed, minister of Finance Budget and National Planning, has said the Federal Government sacked some past members of the Investments and Securities Tribunal (IST) as they indulged in corruption.

FG Sacked IST Members over Fraud- Ahmed

Inaugurating the new members, the minister charged the new members to eschew corruption and be forthright.

Bar. Azi Amos Isaac was appointed as Chairman for a five year term and Bar. Nosa Smart Osemwengie, was re-appointed as member for a second term of four years.

“The problem with the tribunal has been infighting amongst members, lack of industrial harmony and series of complaints bordering on maladministration.

“This has been the bane of the tribunal and a source of embarrassment not only for the Ministry of Finance but for the government in general,” Ahmed said.

The new chairman, Azi, assured the finance minister that, “the teething issue of restiveness has been addressed since he assumed duty,” adding that, “The place is calm and the staff have become very supportive.”

Azi said since 2003, the tribunal has “given judgment in the value of assets worth over N844 billion and that from 2017 to date, they have given decisions in monetary value totalling over N28bn.

“It has not failed in its adjudicatory responsibility.

“It has carried out its assignment with candour and integrity and intends to improve on what has been on ground.”

 


Kindly share this post
Continue Reading

E-Financial

CBN Bans Customer-to-Customer Forex Transfer

Published

on

Kindly share this post

Central Bank of Nigeria (CBN) has banned transfer of foreign exchange (forex) from one customer to another.

CBN Bans Customer-to-Customer Forex Transfer

According to the apex bank, forex cash lodgements into domiciliary accounts can only be done by the account owners henceforth.

An internal memo available in the media space explains that the new guidelines are necessary to review the utilisation of inflows into customers domiciliary accounts.

The circular states: “Forex inflows cannot be credited to customers until the legitimacy of funds is established.

“They can have unfettered access by telegraphic transfers up to a limit of $40,000 monthly for payment of medical bills, school fees, subscription to professional bodies subject to existing CBN guidelines.

“Transfers from one customer to another is prohibited. Transfer within related companies is allowed subject to a limit of $50,000 per month.”

It recommended that proceeds from non-oil exports should be sold to banks, used for repayment of dollar term loans, and self-utilisation for trade transactions for LC, bills and Form A.

Also oil export proceeds from E&P companies are to be used to pay contractors and service providers employed by the oil companies in addition to the recommended uses for non-oil FX proceeds.

Offshore forex inflows from other Nigerian banks and internal account to forex transfers sourced from offshore inflows are to be used for trade transactions subject to eligibility for E-Form M.

“Upon confirmation of the legitimacy of the inflows, customers can have unfettered access, subject to a maximum of $50,000,” the document read.

“Utilisation for trade transactions subject to processing of eligible trade transactions using E-Form M. Payment for services must be backed with demand note from offshore beneficiary and other regulatory documents.

“Related party transfers are allowed to the maximum of the inflow received. The transfer request should be backed by a signed instruction from the account holder.” Payment of government fees and levies are also allowed to the maritime, oil and gas, aviation. government parastatals and export processing zones.

 


Kindly share this post
Continue Reading

E-Financial

Stanbic IBTC, Standard Bank, Listed Among Top African Corporate Brands

Published

on

Kindly share this post

Stanbic IBTC Holdings PLC and its parent company, Standard Bank, have emerged amongst the top winners of the 2020 Tech Times’ Africa LinkedIn Corporate Brand Awards.

The Stanbic IBTC Group emerged the second position in the category, with total votes of 3,515, out of 24 firms nominated for the award. Standard Bank placed the fourth 2,494 votes.

Nominations for this award opened to the public on July 1, 2020 and closed on July 14.

Shortlisted nominees were announced on August 24 while voting commenced immediately and voting ended on September 8, 2020.

The Corporate Brand Awards was instituted by Tech Times’ Africa, an online platform for leading technology, innovation, and startup stories.

Expressing his delight on the awards, Dr Demola Sogunle, Chief Executive, Stanbic IBTC Holdings PLC, said that both Stanbic IBTC Holdings PLC and Standard Bank had been deliberate and consistent in making a remarkable impact in Africa’s financial sector.

“Our sincere appreciation goes to the organisers of the Africa Corporate Brands Awards and to every member of the public who voted. This is a reflection of the high level of trust and confidence that the public has reposed on us,” he added.

Dr Sogunle further said that Stanbic IBTC Holdings PLC would remain relentless in portraying the organisation as one of the most influential corporate brands in Africa.

He stated: “Stanbic IBTC Holdings PLC and Standard Bank have relentlessly contributed to driving the growth and development of the African financial ecosystem. These awards affirm our efforts, and we are encouraged to raise the bar continually.”

The Africa Corporate Brand Award is designed to identify and recognise outstanding companies. It also projects their achievements and impacts on African society and the world at large.


Kindly share this post
Continue Reading

Trending