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E-Financial

CBN’s N2.9Trillion Intervention Saves Banks, Power Sector from Collapse- Report

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The lifeline by the Central Bank of Nigeria (CBN) through various intervention funds may have saved Deposit Money Banks(DMBs) and the power sector from imminent collapse, according to the Sun.

CBN’s N2.9Trillion Intervention Saves Banks, Power Sector from Collapse- Report

Some industry observers insisted that the backing of Deposit Money Banks (DMBs) by the CBN in the take over of some Distribution Companies(Discos) and the roles being played by the apex bank to ensure their shares are successful transferred to new investors remained a leeway for the financial and power sectors.

Without the action, most of the stakeholders submitted that collapse of some banks as well as massive job losses would have remained inevitable.

The experts, who also noted that the apex bank’s backing of the takeover saved the country from economic catastrophe, noting that recovering government loans as well as that of commercial banks remained critical for the nation’s financial sector even as government intervention in the sector now stands at N2.9 trillion.

A power sector analyst, Adetayo Adegbemle, noted that the CBN role in protecting the collapse of the bank from power sector loan remained sacrosanct, adding that the indebtedness of the power sector to the bank would have led to the collapse of banks.

“I love the fact that CBN came into the power sector, not just to save the power sector. Don’t forget that, even though they have roles to play in the sector but they came in to save their own banking sector.

“The loans that the power sector took from the banks have become bad and if you do not do anything it is going to be on the books of the banks. So CBN backing the banks to take-over the shares is a good thing for CBN,” he said

Energy lawyer, Madaki Ameh, had stated that there was need for the total overhaul of the sector, insisting that the overhaul is long overdue and the takeover of the DisCos remained legally justified under the terms of the agreement, which brought them into the Nigerian Electricity Supply Industry (NESI).

He said the DisCos have not met any of the minimum thresholds set for them by government since privatisation despite the huge investment the government has continued to make in the sector.

“If you compare happenings in the power sector with the telecoms sector, you will see clearly that there were structural defects with the implementation of the privatisation policy in the power sector and that nothing short of a total take over of the DisCos and some of the non-performing GenCos would deliver the sort of efficiency required to transform the Sector in Nigeria,” Ameh said.

Backed by the apex bank, DMBs had taken over five DisCos amidst poor performance and inability to pay back loans, a development which is already putting some banks on the edge of collapse.

With indications that the government’s intervention fund to the power sector now hover around N2.9 trillion since the sector was privatized in 2013, stakeholders insisted that the total collapse of the power sector would have had serious implications, not only for the banks but the entire economy.

In what has been described as poor financial performance, Abuja DisCo, Ibadan DisCo, Kano DisSo, Kaduna DisCo and the Benin Electricity Distribution Companies (BEDC) have been at loggerhead with the banks in a move backed by the CBN, Nigerian Electricity Regulatory Commission (NERC) and Bureau of Public Enterprises (BPE).

Coming amidst a fresh $500 million loan by CBN to improve the capacity of the distribution companies, the development is happening at a time of global energy crisis where diesel now hovering around N850 per litre, as government spend heavily to subside Premium Motor Spirit (PMS).

A report by CSL Stockbrokers Limited, (CSLS) titled; “The continued rise of bank loans to power sector”, had last week stated that the power sector owed N836.08 billion to Deposit Money Banks (DMBs).

The payback loans notwithstanding, the DisCos are indebted heavily despite huge stimuli from the Federal Government and interventions from the Central Bank of Nigeria (CBN).

Prior to takeover, CBN had directed the Deposit Money Banks to take charge of the collection of electricity bill payments as a circular signed by Hassan Bello, director of banking supervision had linked the move to the recommendation of the Power Sector Coordination Working Group to improve payment discipline in the Nigerian Electricity Supply Industry (NESI).

BPE had disclosed last week that it is working with CBN to ensure that banks, which took over the DisCos exit in six-month as the Director-General of the BPE, Alex Okoh said the banks were not expected to hold the shares in perpetually.

“In fact, in conjunction with the CBN, we have given them a deadline of six months within which to sell those shares to credible operators approved by the BPE and NERC and should they not be able to meet that deadline, they can be given a maximum extension of another six months. So in one-year maximum, they should be out of the DISCOs.”

Recall that the Distribution Companies (DisCos) are responsible for the sector’s revenue collection. While there was clamour for an increase in tariff, the sector’s inability to improve on the collection and reduce losses, a basic part of DisCos Key Performance Indicators, as well as inability to make remittance to the Bulk Electricity Trading Company remained serious concern for the sector.

President of the Nigerian Consumer Protection Network, Kunle Olubiyo said the takeover has helped in averting massive job losses and prevented imminent collapsed of the banking Industry due to toxic loans.

According to him, those who were the pioneer investors in the DisCos are Nigerian, who meant well but lack the requisite technical requirements of the original financial bidding benchmarks and technical bidding benchmarks as originally set out as thresholds for financial diligence as well as the technical due diligence .

“What is most important is our ability as a nation to rally round indigenous investors with the rightfinancial muscles, who in turn can put together an assemblage of individuals professionals with collective cognate experiences of working in the business of management of power generation, transmission and distribution value chain to apply and take over. I am quite sure that in the next one, the present crop of receivers managers would have learnt a lot from the multifaceted sector wide learning curves,” he said.

Partner, Nextier Power, Emeka Okpukpara, had earlier noted that the initiatives by the apex bank is reducing financial liquidity in the sector, and introduced transparency, which enabled players in the sector to have access to information.

According to him, aside from offering visibility to the sector’s finance, the efforts ensured payment of debts as first-line charges.

Okpukpara said: “The financial discipline allows visibility of what DisCos are collecting. It allows debts such as generation, services, and other charges to be settled first before operating expenses.

“Transparency, in most cases, increases trust in a system. Therefore, I would recommend that the collection figures are made public since DisCos are custodians of market funds, rather than the owners.”

While electricity consumers pay for the inefficiencies of the sector under a Service Based Tariff arrangement, stakeholders are miffed that the current takeover by the banks remained pointer to poor corporate governance, technical and commercial losses as well as the dismal technical regulations in the power sector.

Recall that none of the DisCos, except Eko is currently able to meet minimum remittance order set by NERC, none of them has declared profit for eight years, none of them have also met the Key Performance Indicators (KPIs) set by the sector, leaving consumers to pay for minor repairs and maintenance due to the country’s energy situation.

 

 


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E-Financial

UBA Expands to More African Cities, Stamps Footprint  in Saudi Arabia

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United Bank for Africa (UBA) has announced strategic expansion into more African countries even as it plans to open a new office in Saudi Arabia, marking a significant milestone in its mission to connect Africa with key global markets.

UBA Expands to More African Cities, Stamps Footprint  in Saudi Arabia

Oliver Alawuba, GMD/CEO, UBA group,

This emerged during the Group’s Half Year Business Review held at its global headquarters in Lagos, where Oliver Alawuba, group managing director/CEO, UBA group, met with senior executives overseeing UBA’s 24-country footprint.

The meeting reaffirmed the bank’s pan-African strategy while outlining bold new steps into global markets.

Alawuba highlighted UBA’s continued growth outside Nigeria, with more than 51.7% of Group revenues now generated from its ex-Nigerian operations.

He described the Saudi expansion as a move that positions UBA to support cross-border trade, attract investment flows, and better serve the African diaspora.

“UBA’s vision is clear—we are building a truly global institution anchored in Africa, but serving customers across continents. Our entry into Saudi Arabia signals confidence in new opportunities and commitment to supporting economic connectivity between Africa and the Middle East,” he said.

The Saudi expansion adds to UBA’s international presence, which currently includes the United Kingdom, United States, France, and the United Arab Emirates. Alawuba also disclosed that the bank is upgrading its operating licence in France to further strengthen its European operations.

“In Europe, UBA has operations in the United Kingdom and is upgrading its licence in France, expanding its capacity to serve cross-border trade, investment flows, and the African diaspora, complementing our over 40-year presence in New York,” Alawuba noted.

Since launching its pan-African journey with an entry into Ghana in 2004, UBA has expanded rapidly across 20 African countries, establishing itself as a leading driver of financial inclusion, innovation, and regional integration.

 

 

 

 

 

 


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E-Financial

Ecobank Plans to Raise $250m Capital Through Private Placement

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Ecobank Transnational Incorporated announced its plan to raise up to $250m in Additional Tier 1 capital through a private placement of contingent convertible notes.

In a statement filed on the Nigerian Exchange Limited recently, the capital raise was approved by shareholders at the company’s Extraordinary General Meeting held in Lomé, Togo. The private placement offer was launched on July 9 and will run for ten days.

“Following the approval of the shareholders at its Extraordinary General Meeting held on May 28, 2025, in Lomé, Togo, to raise up to $250m in additional Tier 1 capital qualifying instruments via a private placement of contingent convertible notes, Ecobank Transnational Incorporated announces the launch of the AT1 effective July 9, 2025, for ten days. Renaissance Capital Africa has been appointed as the transaction adviser to ETI.”

The move is an initiative aimed at strengthening Ecobank’s capital adequacy, enhancing financial resilience, and supporting its long-term growth ambitions across its diversified pan-African banking platform.

Additionally, Madibinet Cisse, Ecobank’s Company Secretary, said, “This proposed capital raise represents a critical step in our efforts to fortify the bank’s financial foundation and support sustainable growth across Africa.”

It would be recalled that Ecobank Transnational Incorporated, the parent company of the Ecobank Group, has raised an additional $125m through a Eurobond tap, bringing the total size of its 2029 notes to $525m.

 


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E-Financial

EFCC Recovers Funds Lost to CBEX Fraud

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Ola Olukoyede, chairman, Economic and Financial Crimes Commission (EFCC), has announced that the body has recovered lost funds from the CBEX fraud scheme.

EFCC Recovers Funds Lost to CBEX Fraud

Olukoyede did not announce the amount recovered, but he assured Nigerians that the EFCC is taking action against the promoters of the scheme.

The EFCC Chairman emphasised that the suspects found are facing prosecution.

“We have found a lot of people culpable. Those who promoted that scheme are within our jurisdiction and have been arrested. So, at this moment, they are being prosecuted. And we can also say that money has been recovered, even though the process is still ongoing for us to finally forfeit it,” he said.

Olukoyede also urged Nigerians to exercise caution when investing their resources into online platforms.

“Ponzi schemes remain one of the most pervasive threats facing unsuspecting investors. The CBEX case is a clear example. We all remember the outcry that followed the collapse of the scheme, but these unfortunate situations are preventable. Nigerians must begin to conduct due diligence before committing their resources to such platforms,” Olukoyede said.

He also stressed that the body remains committed to fishing out the culprits and recovering the lost funds.

“It was only when the bubble burst that people wanted EFCC to perform magic and recover their money. In the case we investigated in Lagos, which we dubbed Operation Flush, we arrested a large number of foreigners involved in various cybercrimes, including CBEX. I want Nigerians to know that as of today, we have secured close to 150 convictions. Some of them are already serving their jail terms. And when they are through with that, we are going to send them back to where they came from. So we are monitoring them,” he added.

He urged the public to stay vigilant, assuring them that the body will see the case to the end.

“We are no longer the EFCC that drops cases halfway. Whatever we start, we will finish. Nigerians should trust us and believe in our capacity to do justice. Some of these cases are complex and may require cross-border investigations, but we are up to the task,” he said.


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