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Senate Queries N5.6Bn to AMCON, Says Company is a Failure

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The Senate yesterday, lamented the failure of the Asset Management Company of Nigeria (AMCON) and demanded a probe of the N5.6 trillion pumped into the Company by the Central Bank of Nigeria (CBN) since inception.

This is coming on the heels of the recent call by the International Monetary Fund (IMF) on Nigeria to wind down AMCON.

The senators who alleged ineffective use of the huge sum sunk into the company, also said, that AMCON has failed to live up to its objective of recovering toxic debts owed by some commercial banks after some three years in business.

The Senators waxed worriedly during the consideration of a bill to amend the AMCON Act, which scaled second reading in the Senate yesterday.

The Bill tagged  “Act to Amend Asset Management Corporation of Nigeria Act 2010,” among others, seeks to establish a corporate entity with a well constituted Board of Trustees drawn from CBN, eligible financial institutions, National Deposit Insurance Corporation (NDIC) and Ministry of Finance to make regulations for the supervision and management of AMCON fund..

But the Senate mandated its Committee on Banking, Insurance and other Financial Institutions chaired by Senator Bassey Otu, to find out the exact amount CBN had pumped into AMCON and how effectively it was used in the execution of its mandate as well as how much it has recovered so far.

Senator Ita Enang, chairman, Rules and Business Committee, said the sum exceeded Nigeria’s yearly budget with the allegation that since the company commenced operations, it has failed to recover up to 15 per cent of the entire money.

He advised the committee to examine the functions and operations of AMCON, adding that it was “disheartening that the organisation appeared to be failing because the amount committed to it by CBN was not free money but a loan meant to be paid to the Federation Account.”

Leading the debate, Senator Otu, said the bill seeks to prohibit any board member or an employee of AMCON from being directly or indirectly involved in the purchase of assets acquired by the corporation.

He also said the amendment bill sought to empower AMCON to acquire assets that are already subject to litigation if there is no valid court order restraining it from doing so.

David Mark, Senate president,  noted that if the toxic debt that AMCON was mandated to manage was not yielding any fruitful result and the Federal Government was now asked to subsidise it, those found culpable in the fruitless exercise must be punished.

The committee is expected to report back to the Senate in two weeks.


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E-Financial

Nigerian Manufacturing Sector Contracts for 5th Consecutive Month – CBN

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The Manufacturing Purchasing Managers’ Index (PMI) in September stood at 46.9 index points, indicating a contraction in the Nigerian manufacturing sector for the fifth month.

This was disclosed by the Central Bank of Nigeria (CBN) in its September PMI report released last week.

According to the report, four out of the 14 sub-sectors surveyed reported expansion (above the 50 per cent threshold) in September.

It listed the expansion order as electrical equipment; transportation equipment; cement and nonmetallic mineral products.

It said the remaining sub-sectors reported contractions in the following order: petroleum & coal products; primary metal; furniture & related products; printing & related support activities; food, beverage & tobacco products; textile, apparel, leather & footwear; chemical & pharmaceutical products; fabricated metal products and plastics & rubber products; while the paper product sub-sector was stable.

Production

At 47.3 points, the production level index for the manufacturing sector indicated contraction in September for the fifth consecutive month.

Of the 14 sub-sectors surveyed, five recorded increased production level, one reported same level of production, while eight recorded declines in production.

New Orders

At 46.4 points, the new orders index also contracted in September for the fifth consecutive month. Six sub-sectors reported expansion in new orders, while the remaining eight recorded contraction in the month.

Supplier Delivery Time

The manufacturing supplier delivery time index stood at 53.5 points in the month, indicating a faster supplier delivery time for the fifth time.

Six of the 14 sub-sectors recorded improved suppliers’ delivery time, five reported same level, while three recorded slower delivery time

Employment Level

The employment level index stood at 44.1 points, indicating contraction in employment level for the sixth consecutive month.

Of the 14 sub-sectors, two recorded growth in employment, three recorded same level of employment, while the remaining nine recorded lower employment level in the review month.

Raw material Inventories

The manufacturing sector inventories index also contracted for the sixth consecutive time in September to 43.0 points. Four of the 14 sub-sectors recorded growth in inventories, while the remaining 10 recorded lower raw material inventories.


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FG Sacked IST Members over Fraud- Ahmed

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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.”

 


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CBN Bans Customer-to-Customer Forex Transfer

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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.

 


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