…Parallel market sold N345
Stories by Blaise Udunze
Naira slumped 30 per cent against the dollar yesterday as the Central Bank of Nigeria (CBN) flagged off the new flexible trading at the Interbank foreign exchange market.
Yesterday’s rate at the interbank was sharply weaker than the N197 peg maintained by the CBN for the past 16 months.
Bids submitted by banks prior to the auction ranged between 210-290 naira to the dollar.
Daily Sun findings showed that uncertainty and nervousness about foreign exchange liquidity led to very low demands for dollars among end-users, as not more than $1 million changed hands in the market mid-day.
This was as concerns over backlogs of unmet demands of about $10 billion as against the $4 billion, prompted the CBN to extend trading by 2 hours.
A source from the industry, however, told Daily Sun, that there were some correspondence banks that were yet to submit their returns to CBN for claims on the Letter of Credits, which are expected to further balloon the unmet obligations to about $10 billion.
But the apex bank held special auction on Monday to sell more to the 21 participating banks to reduce the backlog of hard currency orders, and injecting $530 million for spot trading at N281 to the dollar.
But in the parallel, currency dealers sold N345 to the dollar, up to 10 percent stronger than N355 on Friday on expectations that more forex liquidity on the interbank market would reduce demand on the street.
Responding to developments in the exchange market, an analysts with UBS Wealth Management, Jonas David, said, “they have the room for discretionary forex interventions, and we don’t know how active they are in the market today, so the next days will show where the real equilibrium is. We should not be surprised by further weakening.”
Meanwhile, the Association of Bureau De Change Operators of Nigeria (ABCON) has called on the Central Bank of Nigeria (CBN) to grant it one out of the Forex Primary Dealership (FXPD) licences to be issued by the regulator.
ABCON President, Alhaji Aminu Gwadabe, said the interbank rate was not too encouraging because of the uncertainty in the market trading.
Gwadabe, who disclosed the group’s position yesterday, said as a major and critical stakeholder in the forex business, it would be against standard business practice to exclude bureaux de change (BDC) operators from the workings of the new CBN forex policy.
The BDC demand came as the CBN appointed 15 commercial banks as primary forex dealers.
The dealers include: Stanbic IBTC Bank, Standard Chartered Bank, Citibank, Zenith, Access, UBA, Sterling Bank, FCMB.
Others include, Diamond, Wema, Ecobank, Fidelity and Guaranty Trust Bank.
The Ag. Director Corporate Communications, Mr. Isaac Okorafor, said last night that the CBN was happy that the objectives to clear the FX demand backlog, perform its role as strictly a market intervention participant; and re-launch a functioning and efficient inter-bank market, were being met.
He said that “the CBN, in line with its desire to promote a transparent, liquid and efficient market, and in order to engender market confidence and ensure credible price formation, intervened in the market through a special Secondary Market Intervention Sales (SMIS) addressing the issue of the FX demand backlog by clearing $4.02 billion through spot and forward sales. This served in no small way to stimulate price discovery, with the determination of a marginal rate of $/280.00 through the Special SMIS process.
“So, we can state to you categorically, that the FX demand backlog has now been cleared and behind us for good,” he added.
He further assured the market participants and the general public that the bank was resolutely committed to making the Nigerian FX market globally competitive, credible, transparent, liquid, and efficient. He lauded market participants that collaborated in their conduct to achieving these feats and looked forward to another successful and historic day on June 27, 2016, when the market launches its innovative hedging product, the Naira-settled OTC FX Futures.
BoI explains EFCC’s investigations over mgt of cement fund
•As fund grows to N13.2b
The Bank of Industry (BoI) yesterday explained that the investigations by the Economic and Financial Crimes Commission (EFCC) over the allegation of misapplied funds belonging to the Cement Technology Institute of Nigeria (CTIN) had since been resolved.
According to the bank’s management, parties to the transaction have addressed the concerns raised with the new terms reached on how to manage the funds which have grown from N9 billion to N13.2 billion as at last week Friday.
BoI was appointed as the Fund Manager by the Federal Government in 2009 to administer the funds contributed by cement manufacturers for the development of human capacity to drive growth in the Nigerian cement industry.
“While the CTIN was yet to be established, the funds were released to stakeholders in the cement value-chain for on-lending, specifically for investment in risk assets in cement manufacturing value-chain sector. Between 2011 and 2015, the Federal Government transferred N9.6 billion to BoI based on earlier approved agreement.
“With the establishment of CTIN, a request was made to the BoI for the release of the funds for which the bank defaulted but had since remedied by applying eight per cent interest on the funds thus accruing to N12.3 billion as at February 2016. The management of the bank had since met and agreed with the Chairman of the Board of CTIN and President of Dangote Group, Alhaji Aliko Dangote on further utilisation of the fund, based on agreement by the two institutions.
“Going forward, the parties have agreed to an interest rate of nine per cent on the fund as well as subsequent investment of the accrued N13.2 billion in the money market. The fund was not misapplied as stated in the petition to the EFCC. The EFCC is dealing with an issue that has already been addressed.”
Mobile banking security tips when using internet
Access to the Internet is now ubiquitous and so its popularity as a medium to make financial transactions is beyond doubt. Such popularity also means the online banking system is constantly prone to attacks.
As Internet’s rogue citizens design inventive ways to steal sensitive information and access your money online, it is imperative that you secure your online accounts. A little effort and some basic knowledge of computers and the Internet can help you stay safe.
Emails can send out convenient alerts when your balance is getting low or you are approaching your credit limit. To increase your mobile banking security while using emails, remember not to ever share personal information over an email. It should raise a red flag if anyone asks for it via an email as banks will never ask for this information.
On-Screen Keyboard: This would be the easiest way to protect your password from being recorded by key-loggers, especially at public terminals. All banks have this option available to input username and password.
A key-logger, which can be hardware or an application installed on the computer, records and passes on information about the keyboard taps you make. Using this information, it would be easy to find your username and password. While software loggers are hard to spot, hardware loggers will have to be an attachment to the terminal. However, know that an on-screen keyboard is not fool-proof by itself.
RANDOM PASSWORDS (CLICHE BUT VITAL):
Use a combination of random letters and numbers as words, names and phrases are what cracking program check for. Also, make sure to change your password from a secure terminal after you use a public terminal.
DO NOT FOLLOW LINKS:
Always type in the web address (URL) to access your bank’s website. Never click on a link from an e-mail you get. That is how ‘phishers’ work, they re-direct you to a malicious site resembling your bank’s portal and use the information provided by you to access your account.
The login pages of bank websites are secured through an encryption process, so a locked padlock or unbroken key symbol should appear in your browser window when accessing your bank’s site.
Also, the beginning of your bank’s internet address will change from ‘http’ to ‘https’ when a secure connection is made. Be wary of suspicious pop-ups that appear during your banking session. Log out immediately. Don’t, in response to any mail, provide your banking user ID, passwords or credit and debit card numbers.
A CLEAN CACHE:
Browsers save pages you have viewed on your computer so that it can be accessed quicker if you wish to view it again, such as when you use the ‘back’ button. By clearing your cache after visiting your net banking account, you make sure no one else can view the confidential information you have viewed.
Also, don’t select the option on the browser that stores or retains user name and password, i.e. auto complete. It wouldn’t take too long for a program to get that information from your browser.
SDGs: FG, CIBN task banks on funding productive sectors
The Federal Government and Chartered Institute of Bankers of Nigeria (CIBN) want financial services industry to be strategic in lending to productive sector to enhance Nigeria’s Sustainable Development Goals (SDGs).
They identified sustainability in the banking operations as part of the global challenges, which need attention, especially with switch to a new development goal agenda- SDGs.
SDGs, also known as “global goals”, developed by the United Nations, contain 17 focus areas, including end to poverty, inequality, planet and prosperity for all, among others, but require government and private sector, particularly financial institutions to reach the goal.
The Minister of Environment, Mrs. Amina Mohammed, while delivering a lecture at CIBN’s yearly lecture titled “SDGs and Financial Services Sector: The Meeting Point”, said development is about capital allocation and that should be the core of financial market activity.
She noted that financial institutions interact with the environment in a number of ways through investment, innovative products, risk and returns valuations, pollutions and at most times, victims of the environment.
The Minister, represented by the Executive Director, Forestry Research Institute of Nigeria, Dr. Adesola Adepoju, reiterated that there is a huge potential to reinforce the link between environmental performance and financial performance through the use of economic instruments like taxes.
“There should be focus on the environmental impacts of financial products rather than mere impact of internal operations and the country should lead the flow of environmental information that are relevant to the financial market.
The President/Chairman of Council, CIBN, Prof. Segun Ajibola, in his address, said it was obvious that the financial services sector would play fundamental roles in the achievement of these goals.
“The banking sector, in particular, by virtue of its financial intermediating function receives deposits from the public and in turn lends out the funds for productive purposes. This intermediating function makes funds available to government and entrepreneurs who channel the funds into sectors such as education, health, energy, infrastructure, and manufacturing,” he explained.
According to him, it is important to strike a balance between the need to provide financial services and products to the over 30 million financially excluded adults in the country as a way of reducing poverty and simultaneously ensure the preservation of the environment.
CBN, Heritage Bank to empower 1,547 with N3bn YIEDP
Heritage Bank’s partnership with the Central Bank of Nigeria (CBN) in the N3 billion Youth Innovative Entrepreneurship Development Programme (YIEDP) to empower young graduates entered into its second phase with the invitation of over 1,500 applicants for a training workshop recently.
The inauguration of the initiative by the CBN and the subsequent launch of a business application portal by Heritage Bank in March this year, saw more than 4,000 applications submitted.
Out of this number, 1,547 candidates, representing the first batch of possible beneficiaries of soft loans for their business ideas, have been shortlisted to report for a three-day business development training workshop, which will be conducted across CBN Enterprise Development Centres in the six geopolitical zones. After the training workshop, which is to herald the third phase of the programme, each participant will be required to write a comprehensive and viable business plan, submit on the application portal for the Business Review Committee to screen, review and select the eligible and viable business for YIEDP funding.
A capacity building consultant and Chief Executive Officer, Africa Leadership Forum (ALF) Dr. Olumide Abimbola Ajayi, who spoke at the workshop in Lagos said training is important to entrepreneurship development and job creation.
He called on other financial institutions to join forces with CBN in funding the young people that have undergone the entrepreneurship development training, as CBN alone cannot provide funding for all participants.
“If the banks are doing this, by now the unemployment rate would have reduced. Nigeria has great potential to take over the whole of Africa and we will do it through entrepreneurship development,” he stated.
He said the programme is an initiative of the CBN, Heritage Bank and the National Youth Service Corps to help young graduates pick entrepreneurial skills that will enable them start their own businesses and become employers of labour rather than become job seekers.
Commenting on the welcome development, the Managing Director of the bank, Mr. Ifie Sekibo, restated that the aim of Heritage Bank being in the forefront of youth empowerment is to emancipate the latent entrepreneurial spirit in the teeming youths, by providing adequate and affordable loans to execute their business ideas and, hopefully, migrate them to successful Small and Medium Enterprises (SMEs), thereby, providing the mechanism of stimulating growth, reducing unemployment as well as addressing youth restiveness in the economy.
Sekibo added that, “the bank’s passionate interest in the programme also arises from the fact that the initiative aligns very much with the vision of the bank, which is to help partners create, preserve and transfer wealth across generations.”
To be eligible for the YIEDP funding, youths must be within the age bracket of 18 and 35 year old, serving National Youth Corps members or non-NYSC members with not more than five years of post-service.
The apex bank had selected Heritage Bank as its pilot partner bank to unveil, administer and manage the laudable project, which will focus on dependable job-creating sectors such as agricultural value chain (fish farming, poultry, snail farming), cottage industry, mining and solid minerals, creative industry (tourism, arts and crafts), and Information and Communications Technology (ICT).