All Posts in "CBN"

CBN  Stops  Credit Guarantee Companies From Accepting Deposits

The Central Bank of Nigeria (CBN) has barred Credit Guarantee Companies (CGCs) from accepting deposits in the country.
This was contained in its guidelines for regulation and supervision of CGCs in Nigeria.
The apex bank explained that its efforts to stimulate lending to Micro, Small and Medium Enterprises (MSMEs) facilitated the development of guidelines for the establishment and operation of CGCs in Nigeria.
According to the guidelines: “On non-permissible activities, a CGC shall not carry out the following: Provision of guarantee to entities outside Nigeria; Provision of guarantee to entities within its holding company structure and to connected entities; guarantee loans of any institution it is indebted to; acceptance of demand, savings and time deposits or any other deposits; provision of credit to customers; and management of pension funds or schemes.”
On permissible activities it stated: “A CGC may provide guarantee for risk assets of participating financial institutions; Render advisory services for financial and business development; Invest surplus funds in government securities; Partake in other investments as may be approved by the CBN; Provide technical assistance to lenders and borrowers on credit and business Development; Maintain and operate various types of accounts with banks in Nigeria; and Other activities as may be prescribed by the CBN from time to time.”
The bank disclosed  that the objectives of the credit guarantee scheme include to improve access to credit for MSMEs; reduce credit risk in lending by providing guarantees to Participating Financial Institutions (PFIs); stimulate lower interest rates on loans; promote flexible collateral requirements by PFIs.
Others are to encourage new business formation, development and expansion; accelerate economic growth and decrease unemployment; foster sustainable and inclusive growth, and improve risk management in the financial system.
Main Admin by — March 31, 2022 in Banking&Finance 0
CBN Boosts Economic Recovery With N3tn Loans, Explains Involvement in InfraCo

The Governor of the Central Bank of Nigeria, Godwin Emefiele, said on Monday that the bank in conjunction with other financial institutions granted over N3tn in intervention loans to aid economic recovery and job creation.
He  said the current focus of monetary policy was macroeconomic stability – “to build a strong, stable and resilient economy that is self-sustaining and able to weather unanticipated shocks.”
The CBN governor, represented by the Deputy Governor, Corporate Services, Edward Adamu, spoke in a lecture titled, ‘The role of central banks in managing economic downturns’ that he delivered at the 40th anniversary/convocation lecture at the Ekiti State University, Ado Ekiti.
He said, “Specifically, under the Anchor Borrowers Programme, we have disbursed N948bn to 4,478,381 smallholder farmers who cultivated 5.2million hectares of farmland across the country, thereby creating 12.5 million direct and indirect jobs.
“Under our Targeted Credit Facility, which was meant to help households and businesses that suffered significant losses during the pandemic, we have disbursed N368.79bn to 778,000 beneficiaries comprising 648,052 households and about 130,000 SMEs.
“We have also disbursed N1.452tn to 337 large real sector projects in agriculture, manufacturing, services, and mining under our Real Sector Support Facility. In healthcare, 122 major healthcare projects have been funded to the tune of N115.36bn.”
According to him,“So far, the CBN, working with the DMBs and participating financial institutions has granted over N3tn in intervention loans that have undoubtedly aided economic recovery and employment generation.”
Meanwhile,Governor of Central Bank of Nigeria, CBN, Godwin Emefiele, has given further insight into the purpose and operations of the Infrastructure Company Limited (InfraCo) few months after the commencement of operations.
He spoke at the  32nd edition of the Finance Correspondents and Business Editors Seminar in Akure, Ondo State.
He stated: ‘‘To our conviction that the banking sector must pay attention to providing long-term finance for infrastructure development in the country, InfraCorp has been established by the Central Bank of Nigeria in partnership with African Finance Corporation and the Nigerian Sovereign Investment Authority. ‘‘InfraCorp would enable the use of mostly private capital to support infrastructure investment that will have a multiplier effect on growth across critical sectors.’’
Emefiele said the apex bank  has always been enthusiastic about InfraCo, Infrastructure Company Limited (InfraCo) citing that the strategic projects it would fund would speedily foster economic activities and inclusive growth.
admin by — March 29, 2022 in Banking&Finance 0
CBN Explains Introduction Of PAVE,Justifies Naira Stability 

The Governor, Central Bank of Nigeria, Mr Godwin Emefiele, said his bank is introducing initiatives to encourage Nigerians to consume what they produce and also export.
 He spoke  at the opening of its 32nd seminar for finance correspondents and business editors in Akure, the Ondo State capital, on Thursday,explained that such a drive made the  apex bank introduced  the Produce, Add Value, and Export initiative.
He  said, “Produce, Add Value and Export is expected to make Nigerians consume what they produce, add value to it, and even export the surplus. “It is an initiative akin to South-East Asia’s much referenced export-led industrialisation policy which changed the economic fortunes of countries such as South Korea, Taiwan, Malaysia, and Singapore. “PAVE is designed to be the key for fast-tracking a bucket of substitutes to crude oil export. It encourages backward integration for the local production of select items.”
He said  that the COVID-19 pandemic was one of the biggest crises that had faced mankind in recent history, impacted economies, and disrupted business activities globally.
He added that  Nigeria like most commodity-dependent countries was not spared the dangerous  impact of the pandemic, given the dependence on crude oil export as a major source of revenue and foreign exchange.
He also revealed that the apex bank has marshalled a cocktail of programmes and policies, which have helped keep the local currency stable.
He noted that the apex bank’s demand management policy was one of the rafts that made the naira remain largely stable at the import and export (I & E) window, particularly since the discontinuation of foreign exchange  allocation to Bureau De Change operators along with the convergence between the CBN and NAFEX rates.
“Banks are now able to meet the demands of their customers seeking forex for SMEs, school fees, medical and PTAs. “Our current account deficit has narrowed significantly due to a surplus position in the goods account.
The surplus position in the goods account is occasioned by a reduction in imports, increase in crude oil and gas export receipts, and improvement in remittances. Remittance inflows have been supported by our ‘Naira for Dollar’ scheme, and we have seen a surge in remittance inflows
admin by — March 25, 2022 in Banking&Finance 0
CBN Justifies Interventions In Real Sector

The  Central Bank of Nigeria (CBN),says the positive outcomes of the various interventions in the real sectors of the economy have justified the approach.
The CBN Governor, Mr. Godwin Emefiele, disclosed  this at the opening of the 32nd seminar for Finance Correspondents and Business Editors, in Akure, on Thursday.
He said: “Being a developing economy, our approach to monetary policy must incorporate context. We do this by innovating around the use of available instruments.We understand that monetary policy must coordinate well with fiscal policy towards addressing the numerous developmental challenges our nation faces.
“Fortunately, the enabling statute envisages this and empowers us to intervene where and when necessary. Under my watch, the Bank has done this through various development finance initiatives.And with the benefit of hindsight now, we can safely say that the outcomes have so far justified our approach.”
 Meanwhile,the CBN governor has said that Nigeria has improved its fertiliser blending plants by at least 41 since President Muhammadu Buhari assumed office in 2015.
The Governor of the Central Bank of Nigeria, Godwin Emefiele, disclosed this on Tuesday at the commissioning of the Dangote Fertiliser Plant in Lagos.
He attributed the feat to the effort of the nation’s top fertiliser team set up by the President in a bid to ensure food sufficiency in the country.
“Prior to Mr President assuming office in 2015, Nigeria imported virtually all its fertiliser products to support its agricultural sector,” the CBN chief informed the audience at the event. “In response to this situation, Mr President inaugurated the Presidential Fertiliser Initiative chaired by the Governor of Jigawa State, (Abubakar) Badaru, and checked with us to resolve this fertiliser shortage problem.
“I am delighted to note that their work and the continued support of Mr President has resulted in a significant increase in our nation’s blending capacity from seven plants in 2015, to over 48 active fertiliser blending plants today.”
President Buhari inaugurated the multi-billion dollar facility at an event well attended by many political, traditional, and religious leaders, as well as key members of the private sector from various parts of the country.
Among them were the Senate President, Ahmad Lawan; Speaker of the House of Representatives, Femi Gbajabiamila; Chairman of the Nigeria Governors’ Forum, Kayode Fayemi; Governor Badaru, and President of Dangote Group, Aliko Dangote.
Speaking, Emefiele revealed that Nigeria has produced over 35 million bags of blended fertiliser in the last five years.
He also spoke  some of the benefits of having more fertiliser blending plants to the nation’s economy.
“Our import bill on fertiliser has not only declined significantly, but we are also witnessing rising investment in the fertiliser industry, such as the one being commissioned today by the Dangote Group,” the CBN chief said.
“Today, Nigeria is self-sufficient in the production of urea, and we are also leading in the production of urea on the African continent.
“There is no doubt that improving access to fertiliser will contribute to significant improvement in productivity of our local farmers but probably, more importantly, it will enhance our nation’s drive to improve food security and ensure we consume what we produce in Nigeria, thereby fulfilling another key promise and vision of the administration.”
Main Admin by — March 24, 2022 in Banking&Finance 0
CBN Retains Benchmark Interest Rate At 11.5% As Reps Seek Reinforcement Of Coins Use

 The  Central Bank of Nigeria’s Monetary Policy Committee has retained the Monetary Policy Rate (MPR) at 11.5% .
The apex bank kept all other parameters unchanged.
CBN Governor Godwin Emefiele made the announcement while addressing journalists .
He said:“MPC remains concerned that the global situation on rising prices may continue in the near term but may begin to moderate if deliberate and urgent actions are taken by both monetary and fiscal authorities to correct rising inflation.On another hand, the committee was satisfied that the use of the bank’s discretionary CRR policy should be deployed more aggressively to control the level of money supply in the economy.
“In addressing the issue whether to tighten, rein in the rising price level, MPC was of the view that given the fragile state of the current GDP growth and the potential external and domestic headwinds from Russia and Ukraine war, a contractionary policy stance will stifle the expected investment expansion needed to drive growth and absorb the shock in Nigeria.
“The MPC also feels that not only will tightening reverse the steady improvement recorded in credit expansion, it is also of the view that tightening would not necessarily tame the inflation.In the case of whether to loosen, the committee feels that loosening will trigger further liquidity surfeit and fuel inflationary pressure as available funds outstrips the economy’s absorptive capacity or domestic capacity utilisation.
“MPC also feels that loosening will trigger FX demand pressure as the excess liquidity would exact demand pressure on the FX market and trigger a naira depreciation, which will also fuel inflation.”
Meanwhile,the House of Representatives has urged the Central Bank of Nigeria (CBN) to reinforce the use of coins on Nigerians.
House of Reps made the call during Tuesday’s plenary session in Abuja.
The lawmakers want the “use of coins as a legal tender and ensure that Banks comply with the use of coins to the fullest.”
The resolution came after a motion moved by Muda Umar, a lawmaker representing Toro Federal Constituency, Bauchi State.
Main Admin by — March 23, 2022 in Banking&Finance 0
CBN Says Bank Customers Get Over N95bn Refund

The Central Bank of Nigeria  said cumulative refund by banks to customers as at December ending 2021 stood at N95.2 billion.
This is contained in data released by the bank at the opening ceremony of the bank’s 2022 fair held in Jalingo, Taraba State.
It  urged the public to always lodge complaints with banks over service-related issues, adding that cumulative complaints from customers as of December 2021 was 27,080
The bank disclosed  that 25,483 complaints were successfully resolved.
Branch Controller of CBN in Jalingo, Mr. Idris Dagona,who  spoke  at the fair said, the Fair was aimed at having an enlightened public and receiving feedback that would enrich future policy reviews and developments.
“The sensitization will also highlight the position of the Bank as a dynamic organisation with a view to promoting confidence in the economy, improve the standard of living for all Nigerians, thereby making CBN a proactive regulator.
Meanwhile,the Governor, Central Bank of Nigeria, Mr Godwin Emefiele, has said that 23 banks Chief Executive Officers, representing 35 per cent banks’ leadership are women.
He disclosed this while addressing participants at a webinar organised by the Deputy Governor in charge of the Financial System Stability Directorate, Mrs Aishah Ahmad, as part of activities to commemorate the 2022 International Women’s Day at the CBN.
He said  the bank, in an effort to increase representation of women in the industry, had been using the gender diversity model as part of the criteria for approving the membership of boards of institutions under its regulatory purview.
He added  that such gender mandates was necessary to break the bias in the Nigerian banking industry, and that; ‘eight out of the 23 bank chief executive officers, representing 35 per cent, were women, which was way above the global average.”
According to him, 32 per cent of the CBN’s total workforce are female, which surpasses affirmative action.
He also said that the bank has issued gender-mandated regulations to pave way for gender diversity and inclusiveness at the top management levels in the Nigerian banking industry.
The CBN, he noted, had also issued a policy that requires a minimum of 30 per cent of female representation on boards and 40 per cent at the top management level in the banking industry.
Main Admin by — March 19, 2022 in Banking&Finance 0
CBN Pegs N1m Limit For Cash Collection Centres

The Central Bank of Nigeria has pegged the minimum transaction limit for corporate and individuals transacting with Bank Neutral Cash Hubs at N1m and N500,000 respectively.
The banking regulator disclosed this in a guideline for the registration and operation of Bank Neutral Cash Hubs in Nigeria released on Monday.
The bank said the threshold for eligible transactions at a BNCH shall be  a minimum transaction value of N500,000 for individuals; a minimum transaction value of N1m for corporate entities.”
The bank said it launched the Nigerian Cash Management System in a bid to reduce cost and improve operational efficiency in the country’s cash management value chain in collaboration with the Banker’s Committee.
It said one initiative towards the goal is the Bank Neutral Cash Hubs. The CBN said, “BNCHs are cash collection centres to be established by registered processing companies or Deposit Money Banks based on business needs.
“They will be located in areas with high volumes of commercial activities and cash transactions. The hubs will provide a platform for customers to make cash deposits and receive value irrespective of the bank with which their account is domiciled.”
 It added that the guideline aims to provide minimum standards and requirements for BNCH registration and operations for effective supervision.
The apex bank said one of the key objectives for setting up the BNCH is to reduce the risks and costs borne by banks, merchants, and huge cash handlers in the course of cash management activities; deepen financial inclusion; and leverage on shared services to enhance cash management efficiency.
It added, “A BNCH may carry out the following: Receipt of naira denominated deposits on behalf of financial institutions from individuals and businesses with high volumes of cash.
“High volume cash disbursement to members of the public on behalf of financial institutions; any other activities that may be permitted by the CBN.BNCH shall not carry out investing or lending activities; receive, disburse, or engage in any transaction involving foreign currency; undertake any other transaction which is not prescribed by this guideline; sub-contract another entity to carry out its operations; any other activities that may be prohibited by the CBN.”
Main Admin by — March 15, 2022 in Banking&Finance 0
CBN To Manufacturers :Don’t Take Dollar Loans

…Says Agric is Nigeria’s Saving Grace
The Central Bank of Nigeria (CBN) has urged Nigerian manufactures whose revenues are naira- denominated to  shun  dollar loans.
It promised  to continue to provide naira funding, advising that where the revenue stream is in naira, dollar loans should be avoided.
The CBN Governor, Godwin Emefiele spoke during a facility tour of Tolaram Group projects manager of the Lagos Sea Port under construction.
He added:“So, for any entrepreneur that wishes to do business in Nigeria, we will provide naira funding and will always advise that particularly if your revenue stream is in naira, such company should avoid taking dollar loans. Take cheap naira loans at single digit interest rate with two years moratorium”.
He assured that  the CBN will continue to  encourage people to take advantage of such loans to drive industrialisation in Nigeria and get a manufacturing business back alive again.
He  disclosed that the bank has provided N100 billion intervention fund to Tolaram Group under the Differentiated -Cash Reserve Ratio or through the Commercial Agriculture Credit Guarantee Scheme, which represents only 10 per cent of the N1 trillion, which is about $2 billion, project embarked by the company. “You can see we have sown a seed and we have also given support through making foreign exchange available for them to bring in the equipment to get the Lagos Port operation to work.
“The Tolaram Group has clearly demonstrated that it is one of the largest manufacturing companies with 19 factories in the country. We will not rest on our oars to the extent that we must make sure that whatever you need either Naira loans through our interventions or dollars to import your equipment and plants and the rest of them, we will continue to accord you priority.”
Emefiele also disclosed that Infrastructure Corporation of Nigeria Limited (InfraCorp), Lagos state government and Federal Government will collaborate and begin engagement meant to ensure easy movement of goods out of the Lagos Free Trade Zone. The N15 trillion InfraCorp is co-owned by the CBN, the African Finance Corporation (AFC) and the Nigerian Sovereign Investment Authority (NSIA). “The InfraCorp is chaired by the Central Bank of Nigeria. Its board has been formally constituted, with  a CEO in InfraCorp and as soon as we leave this meeting, I will be calling on InfraCorp to begin engagement,” he said.
“I will also be involved in engaging the Lagos state government, as well as the Federal Government as well as the Federal ministry of works see what can be done on evacuating goods out of Lagos, as well as decongesting the traffic for people living around Lekki port axis. I want to give assurance that this is something that would be dealt with. This would be a middle-to-long-term plan. We are happy that this port infrastructure is here and will improve ease of doing business, reduce congestion at the Lagos Tin Can and Lagos Apapa ports.”
He said the apex bank would work with the Lagos Free Zone by having a dedicated export desk that would make it easy for goods to be exported out of the Lagos Port.  “That is a very essential thing that we need to deal with, because again talking in a very selfish mode, we need a foreign exchange.  If we export, we earn foreign exchange, and I am going to start working with them to ensure that we designate the Lagos Free Zone as an export zone,” he said.
Meanwhile,Governor, Central Bank of Nigeria (CBN), Mr Godwin Emefiele,has  expressed satisfaction on the tremendous impact agriculture and the huge role agriculture has played in revitalizing the country in the last six years.
Emefiele disclosed this to  journalists during an inspection tour of the palm plantation at Odighi village in Ovia North East Local Government Area of Edo state at the weekend.
He wondered what would have happened to Nigeria if the agriculture sector had not been revamped, vis a vis the rising cost of food items across the globe.
The CBN Governor expressed  satisfaction that the Bank has assumed a pivotal role since 2015 upon the pronouncement by President Muhammadu Buhari that “we produce what we eat and eat what we produce” by coming up with several initiatives aimed repositioning the sector with a view to creating employment opportunities as well as growing the the gross domestic product (GDP) of the country.
On his assessment of the farm, an elated Emefiele, expressed joy in the blooming maize and cassava, stating that in the next 12 months, harvests would have commenced.
Acknowledging the significant role played by Edo state Government, thanked Governor Godwin Obaseki immensely for matching words with action by making sure that arable land is made available to those who are genuinely interested in agriculture. He also appealed to other state Governors to emulate Edo state which has So far, made available about 70 per cent of the promised arable land.
He spoke on the socio-economic impact of the CBN interventions, Emefiele singled out the Anchor Borrowers Programme (ABP) among other interventions schemes, which revolutionized agricultural practice whereby small holder farmers who hitherto could not approach commercial banks for loans, are now being granted credit facilities in the forms of inputs like seedlings, fertilizer and herbicides. Those small holder farmers can now cultivate and produce enough for their families and sell produce as loan repayment with ease, thereby generating employment, improving living standards and creating wealth simultaneously. Emefiele also commended the efforts of the promoting company, Agri-Allied Resources and Processing Limited and its parent company, Tolaram Limited for heeding to clarion made by the CBN to source their critical raw materials locally. He noted that the company has painstakingly embraced backward integration principle by acquiring farmland to the tune of 18,000 hectares for cultivation of oil palm, cassava and maize which are the critical raw materials used by the group.
Main Admin by — March 8, 2022 in Business 0
CBN  Considers Fresh Funding  For Lagos Free Zone 

Governor, Central Bank of Nigeria (CBN), Godwin Emefiele said the bank is ready to give more financial support to the Lagos Free Zone after already committing up to N100 billion in to the project.
 He announced this in Lagos on Saturday after a tour of the 850 hectares project which is meant to turn around the economic of the country.
He said the CBN offered the N100 billion through its Differentiated Cash Reserves Requirement (DCRR) Regime.
He  added:”We are ready to provide Naira and Dollars funding to assist you. I will advise that you do Naira loan because it is cheaper since you will spend the money here. We will continue to support businesses that have the potential to create more jobs for  Nigerians”.
The DCRR is a regime where deposit money banks interested in providing credit financing to greenfield (new projects) or brownfield (new/expansion projects) in the real sector (Agricuture/Manufacturing) may request for the release of their funds from their Cash Reserve Ratio (CRR) to finance the projects subject to the banks providing evidence that the funds shall be channeled towards projects approved by the CBN.
He spoke on the Lekki Deep Sea Port which is part of the Lagos Trade Zone projects, saying  he will be glad to see the port act at the hub for Nigeria’s export drive.
“I believe with the port, we will see ease in exportation. Goods will be exported  through the port and we will make forex available to manufacturers”.
Main Admin by — March 5, 2022 in Banking&Finance 0