CBN sells $180 million forex to boost liquidity

The Central Bank of Nigeria (CBN) yesterday released additional $180 million to the forex market to further ease business transactions in the country.

The intervention was done in two phases – an $80 million offer for Personal Travel Allowance (PTA), school fees and medicals at the inter-bank market and $100 million Wholesale Forwards Market sell, which by the new policy, is reduced to maximum of 60-day tenor.

CBN reintroduces charges on cash deposits, withdrawals

The Central Bank of Nigeria on Thursday announced the reintroduction of bank charges on certain categories of cash deposits and withdrawals, three years after it stopped the charges.

The reintroduction of the charges was contained in a circular to all Deposit Money Banks posted on the website of the CBN.

Sterling Bank’s N100bn commercial paper’ll boost market confidence

The registration of the Sterling Bank Plc’s N100bn commercial paper programme will boost confidence in the Nigerian financial market, according to FMDQ OTC Securities Exchange.

The CP, which was signed on the FMDQ platform, came barely after the listing of the Wema Funding SPV Bond.

This registration followed the due approval of the FMDQ Board Listings, Markets and Technology Committee and served to further instil confidence in the Nigerian financial market, given the current economic climate, the FMDQ said in a statement.

The statement added, “An FMDQ quotations service avails, among others, credibility for quoted CPs and global visibility via the FMDQ website and the FMDQBloomberg Trading System (E-Bond).”

Having successfully commenced and developed its listings and quotations process, FMDQ said it had contributed to the growth and competitiveness of the Nigerian fixed income market.

The firm added, “The timely and efficient registration of the Sterling Bank CP programme is a validation of one of the core mandates of FMDQ towards revolutionising the Nigerian debt capital market.”

Sickly six-year-old raises €1m from nail-varnish dare

A terminally ill Dutch six-year-old boy, who hoped to raise a few hundred euros for other sick children by daring people to paint their nails in garish colours, had raised more than one million by Friday.

Tijn Kolsteren, who was diagnosed with brain cancer in May, launched the appeal only two days ago but it has quickly fired the imagination of the Dutch public who had donated more than 1,270,000 euros ($1,326,000) at the last count.

“Paint your nails, make a donation and then challenge three of your friends to do the same,” dares the donation page, which invites participants to share their pictures on social media using the hashtag #lakaan (meaning “the polish is on”).

“Most poor children diagnosed with pneumonia don’t live until the age of five,” said the young boy on the site. “That’s why we have to put up a fight.”

Celebrities, politicians, presenters and actors have been among thousands of people who have posted pictures of their painted nails online, with far-right politician Geert Wilders plumping for deep red.

“I got really emotional when I heard the story about this little guy — it made a really big impression on me,” Prime Minister Mark Rutte said at his weekly press conference.

The appeal is part of a traditional event in The Netherlands where radio DJs lock themselves away for several days without food or drink to raise money. This year, proceeds are going to the Red Cross.

Although Tijn’s cancer was diagnosed on May, it was only last week that his family learned that a course of chemotherapy had failed to reduce its size.

“Despite this bad news, we wanted to do something for children who won’t maybe even make it to six,” his father Gerrit told public television channel NOS.

“We came up with the idea together: Tijn had already painted his nails with a friend and liked it. I wanted to do something similar to the Ice Bucket challenge and men painting their nails is a bit taboo,” he added, referring to the internet craze that raised millions.

The Dutch press hailed the boy as a hero, with the tabloid AD putting a picture of him dressed as a superhero under the headline “SuperTijn.”

AFP

According to an expert, Nigerians borrow more as domestic debt of banks hit N13.8trn

Borrowings by individuals and corporate entities from banking institutions have increased due to the economic recession, according to data from the National Bureau of Statistics.

Many now find it difficult to purchase their usual consumables, leading to increased demand for personal loans.

Topping the list of the increased borrowing are housing and personal loans to support basic necessities like feeding, school fees, repairs and other household miscellaneous.

“Households’ demand for house purchase lending, unsecured credit card lending and unsecured overdraft/personal loans increased in Q3. Corporate lending also increased across all firms’ sizes. These are expected to increase further in the Q4,” the report said.

Secured loan performance, as measured by default rates worsened in Q3, with attendant losses to banks and expectations of improvement in Q4.

Meanwhile, the oil and gas sector’s indebtedness to the banks increased from a N3.2 billion level during the first quarter of 2015 to N4.9 billion in the third quarter of 2016.

This is just a part of private sector indebtedness to the banking sector in the period under review.

The NBS, in its third quarter 2016 Private Sector Banking Credit, showed that banking debt portfolio at the end of the third quarter (Q3) of 2016 is N13.8 trillion. Power and energy industry and services, which are currently struggling to fund their projects, are also increasing their respective obligations.

Private sector credit flow represents the net amount of liabilities (for the instruments debt securities and loans) that have been incurred in various sectors.

Specifically, the oil and gas industry indebtedness rose by N3.6 billion, while the service segment increase was put at N1.2 billion in the period under review. Other high-profile debt increases include the manufacturing, N2.2 billion; mining and quarrying, N27.3 million; construction, N631.5 million; trade/general commerce, N973 million; and real estate, N760.2 million.

Finance, insurance and capital market debt recorded N933.4 million; education N89.3 million; information and communication, N957 million; and transport and storage, N459.2 million.

For example, about 15 energy companies in the country collectively owed bank a total of N380.76 billion, which has translated to a non-performing loan.

Speaking on his company’s indebtedness to banks, the Managing Director and Chief Executive Officer, Egbin Power Plc, Dallas Peavey Jr., said the company owes banks $325 million (N99.13 billion).

He noted that the scarcity of dollars had continued to take a toll on the company’s operations.

Speaking on the implication of such bank exposure to the oil and gas companies, an economic expert and Director-General of Lagos Chamber of Commerce and Industry (LCCI), Muda Yusuf yesterday said that the credit risk outlook for these two sectors were not positive due to attacks on oil installations.

The LCCI chief noted that the recovery of the oil and gas sector would depend largely on the progress made in the curbing of the attacks on oil installations as well as the outlook for oil price.

Professor of Economics and Director, Centre for Petroleum, Energy Economics and Law, University of Ibadan, Adeola Adenikinju, blamed the power sector’s indebtedness to banks on the technical and economic losses that remained unacceptably high in the sector.

The don maintained that many government agencies, powerful individuals and organisations were also indebted to the power companies, thereby, worsening the plight of the industry and limiting their ability to meet their obligations to the banks.

Naira recorded marginal appreciation against dollar

The Naira on Monday in Lagos appreciated marginally against the dollar at the parallel market, gaining N2. The currency exchanged at N468 to the dollar as against N470 it traded on Friday. The Pound Sterling and the Euro closed at N565 and 510, respectively. At the interbank market, however, the naira depreciated against the dollar, eroding the gains of Friday in that segment. It shed N4.31 to close at N308.81from N304.50 posted on Friday. Trading at the Bureau De Change (BDC) window showed that the currency closed at N385 to the dollar, while the Pound Sterling and the Euro traded at N564 and N504, respectively. A BDC operator, Mr Abubakar Adamu, expressed optimism that the naira would appreciate further in the coming days.

Naira shortage pushes interbank rate to 150%

Two days after commercial banks placed funds with the Central Bank of Nigeria to participate in last Friday’s currency forward auction, overnight interbank rate was quoted at a record high of 150 per cent on Tuesday.

Traders said few deals were done on Tuesday due to a shortage of naira on the money market, with banks unwilling to place funds among themselves until the result of Friday’s currency auction was published.

On Friday, the CBN held a two-month dollar forward auction to clear a backlog of demand from airlines, manufacturers and other companies, as the exchange rate crisis deepened.

Traders said the banks were later directed by the CBN to re-submit bids again on Monday.

It was learnt that rates spiked because banks were barred from the CBN’s repo window before any currency auction. The CBN had not announced result of the auction as of Tuesday.

“Most banks are not quoting rates because they are still waiting for the result of the FX auction,” one trader said.

The regulator has been tightening liquidity and intervening directly with dollar sales to banks to support the ailing naira, hit by the fall in oil prices, the nation’s economic mainstay.

Overnight rates closed at 128 per cent on Monday after they opened at 100 per cent, up from 14 per cent on Thursday.

The money market ended with no deals on Friday as lenders held onto naira to be able to participate at the auction.

The overnight interbank lending rate soared to a record high of 128 per cent on Monday on naira cash shortages after commercial banks  funded their account with the Central Bank of Nigeria to participate in last Friday’s currency forward auction.

Overnight rates opened at 100 per cent on Monday, traders said, after the money market ended on Friday with no deals as commercial lenders held onto naira to be able to participate in the auction, Reuters reported.

Overnight money had traded at 14 per cent on Thursday.

Patience Jonathan’s cash: Houseboy, driver’s names used to open $15m accounts

The Economic and Financial Crimes Commission has arrested four domestic servants, including a driver and a houseboy, whose names were used to open bank accounts for Mrs Dame Patience Jonathan, the wife of former President Goodluck Jonathan.

Sources within the anti-graft agency said on Sunday that the companies’ accounts were opened at Skye Bank.

The companies are Pluto Property and Investment Company Limited, Seagate Property Development and Investment Company Limited, Trans Ocean Property and Investment Company Limited and Globus Integrated Service Limited.

The four companies’ accounts, which have since been frozen by the EFCC, have a balance of about $15m while another account, which bears Patience Jonathan’s name, has $5m.

Mr. Sammie Somiari, who deposed to an affidavit on behalf of the ex-President’s wife, said the former First Lady was the owner of the money in the accounts.

She had revealed that she gave millions of dollars to the then Special Adviser to the President on Domestic Affairs, Waripamowei Dudafa, to open accounts for her.

Somiari, however, claimed that Dudafa opened five accounts for Patience and that only one of the accounts was in her name, while the other four were opened in the names of companies belonging to Dudafa.

A detective at the EFCC, however, revealed that Dudafa used his domestic servants’ names to open the four other accounts and then deposited the money into the accounts.

The operative added, “We were investigating Dudafa when we stumbled on those four companies’ domiciliary accounts opened at Skye Bank with a balance of about $15m. On further investigation, we were able to identify the directors of the companies.

“When we detained the directors, we found out that they were Dudafa’s domestic servants. One of them was a houseboy while another one was a driver. Their photographs were used in opening the accounts and their signatures were forged.

“We found out that these domestic servants were completely innocent because they had no access to the accounts. We have since released them. The sole signatory to the accounts was Patience Jonathan and she was issued with a special card, which is accepted worldwide. She has a separate account, which was opened in her name and has a balance of $5m.”

The detective said a lawyer, Amajuoyi Briggs, who allegedly helped Dudafa to perpetrate the fraud, would also be arraigned.

It was learnt that two Skye Bank executives, Demola Bolodeoku and Dipo Oshodi, who helped Dudafa to open the accounts on March 22, 2010, were also being investigated.

The detective added, “This is a clear case of fraud and there is no way the bank officials will say they did not know what was going on. They are under investigation and those found culpable will be arraigned.”

The EFCC operative said he could not immediately confirm if the transaction was reported to the Nigeria Financial Intelligence Unit.

He explained that the commission had discovered a trend which politicians used in laundering and concealing funds, saying it was becoming more rampant due to the operation of the Bank Verification Number which links all accounts owned by an individual.

He added, “What we have noticed is that in order to conceal funds, what politicians and top civil servants do is to open bank accounts in the name of family or friends and then make themselves the sole signatory to the account.

“Don’t forget that we traced about 17 bank accounts to the immediate past Chief of Defence Staff, Air Chief Marshal Alex Badeh (retd.).

“Often times, they do this in connivance with bank officials and that is why the EFCC Chairman, Mr. Ibrahim Magu, has said henceforth, whenever we are investigating a bank official, we will probe the entire bank as well because these officials usually act under the instruction of their superiors.”

Jonathan’s wife has, however, sued Skye Bank for freezing her bank accounts and giving the EFCC vital information about her finances.

She also wants the court to order Skye Bank to pay her damages in the sum of N200m for what she termed a violation of her right to own personal properties under Section 44 of the 1999 Constitution.

(PUNCH)

Why Ireland's Government Doesn't Want Apple's Money

Ireland’s finance minister is so angry that he’s willing to fight the European Commission all the way through the courts for the right not to collect the taxes that Apple supposedly avoided over the last 12 years. Darn it, he’s already spent over 670,000 euros ($750,000) of taxpayers’ money in fighting the Commission. Why the ingratitude?

It’s not like his voters or his cabinet colleagues don’t want the money. After six years of austerity imposed as part of Ireland’s 2010 bailout, Ireland’s public sector in particular is gasping for it.

Moreover, Noonan is going to get it in the neck from his rivals if he doesn’t take the money. Pearse Doherty, the finance spokesman for Sinn Fein, which preaches an idiosyncratic cocktail of nationalism and left-wing populism, called on the government not to appeal the ruling, telling the newspaper Anphoblacht: “There’s an irony here when we see an Irish Government challenging the European Commission when they actually bowed down to the same Commission during the period of austerity and bank bailouts.”

“Many people will be mindful that they themselves will be taken before an Irish Court because of their failure to pay water charges, yet this same Government are willing to go to court to defend Apple,” Doherty said.

Sinn Fein would love it to be that simple. However, even its Marxist old guard would probably have to accept that the ruling is a devastating blow to a country that has thrived for decades on attracting foreign investment through its favorable tax regime: the stock of foreign direct investment in Ireland at the end of 2014 was 311 billion euros ($350 billion), or 165% of GDP. Facebook and Google and many others have their European headquarters in Ireland, due mainly to its 12.5% headline rate of corporate income tax—the lowest in the EU.

If Noonan now enforces the Commission’s ruling, it will send a chilling message to other companies that have either invested in Ireland in the past, or were thinking of doing so in the future.

Small wonder that Noonan told state broadcaster RTE that: “It is important that we send a strong message that Ireland remains an attractive and stable location of choice for long-term substantive investment.” He said a challenge was needed “to defend the integrity of our tax system, to provide tax certainty to business, and to challenge the encroachment of the EU state aid rules.”

That second half of Noonan’s statement is important. For although the Commission zeroed in on what it thought it to be a very specific abuse of Ireland’s tax code, the Irish government is clearly afraid that this ruling will be the thin end of a wedge that ends in its complete loss of sovereignty over setting its own tax rates.

Until this year, such sovereignty hadn’t seemed in danger: after all, the government had successfully resisted the attacks on its tax code during the 2010 bailout negotiations, when it was at the mercy of France and Germany. The two countries had the best opportunity in years to stop Ireland luring away investment—and budget revenues—by “racing others to the bottom.” At that time, the government of Taoiseach Enda Kenny had successfully argued that its tax code was the only thing keeping the Irish economy alive—and thus the only way the creditors would ever see their 78 billion euros in bailout loans again (to say nothing of another 130 billion euros and more lent to Irish banks by the ECB at the height of the crisis).

But times change. And even though it happened years after the alleged offense, the U.K.’s decision to leave the EU puts today’s ruling in an entirely different light. As long as the U.K. was part of the EU, it was a waste of everyone’s time and energy to even propose the greater centralization of powers over tax in Brussels. With the Brits gone, the Irish have lost their biggest protector. What was impossible becomes possible (at least if France and Germany agree on an approach that somehow suits them both, which admittedly remains a tall order).

The Commission’s press release itself contains a hint of where the first attack on Ireland’s tax sovereignty could come from.

“In fact, the tax treatment in Ireland enabled Apple to avoid taxation on almost all profits generated by sales of Apple products in the entire EU Single Market. This is due to Apple’s decision to record all sales in Ireland rather than in the countries where the products were sold. This structure is however outside the remit of EU state aid control. If other countries were to require Apple to pay more tax on profits of the two companies over the same period under their national taxation rules, this would reduce the amount to be recovered by Ireland.”

In other words, the Commission is inviting other member states to calculate how much they may have lost in tax revenue as a result of the alleged violations, and to claw it back from Ireland. That alone is good reason for Noonan to challenge the ruling. The last thing he or any Irish government wants is to establish that kind of precedent.

At least Noonan’s Fine Gael party has some support from Fianna Fail, the party that has ruled Ireland for most of the last century (perhaps unsurprisingly, given that a string of Fianna Fail governments devised and presided over the said scheme for years).

“The Commission has opened the door to other countries including the U.S. to seek a slice of the 13 billion euros,” finance spokesman Michael McGrath said in a press statement. “It would be deeply unwise of Ireland to make any plans for funds that may not even materialize in reality.”

Rules That Will Make You Rich

 

Work Hard

Nothing comes easy, and behind every success are hours of plain hard work. Remember that It's hard to beat a person who never gives up.

Buy Only Things You Need

You should buy only those things you can afford. Did you know that rich people sometimes afford themselves less than poor? You shouldn't buy a new iPhone or laptop if you earn less they cost.

Improve Yourself Every Chance You Get

Self-improvement is an investment of time and energy instead of an investment of money, but both pay excellent returns. It can improve your health, your emotions, your career, and your financial state.

Spend less Than You Earn

This could sound boring, but you should leave something on your account as the month ends. The more money you make, the more you're inclined to spend. But if those extra purchases are wants, not needs, you're better off banking that money for a future need—retirement or a down payment on a home—instead of spending it on things you won't even remember later.

Have Some Patience

As soon as your efforts start bringing the first results there will be a desire to award yourself and to have a ball. Have patience and remember that it's always easier and quicker to slide down, than to climb up the mountain.

Use an App

 Life is busy and the days fly by. Before you know it the month is almost over, and oops, that bill was due last week. Schedule at least the minimum payments on your bills, so if you forget, you won’t be penalized with a late fee. Plan out your monthly bills in advance, and take advantage of free bill pay if your bank offers it. Automate your savings so you don’t have the opportunity to weigh whether or not you really can save that amount this month.

Start Early

You might not be thinking about your 60s in your 20s - but you should. The earlier you start saving - the more you will save. Contributing a few percent of your pay may sound painful, but it will actually end up being a much smaller burden than you expect, one that’s lifted up by the pleasure of knowing that you’re securing your retirement.

Build An Emergency Fund

If you do not have a cash emergency fund just sitting in a savings account at a local bank somewhere, this should be your number one priority. Cash is king for solving all of the problems that life throws at you. You can start building an emergency fund by setting up an automatic weekly or monthly transfer from your checking account to your savings, then leaving the savings alone until an emergency beckons.

Set Big Goals And Keep Reminding Yourself Of Them

What is it that you want for your future? It’s a difficult question, but it’s one that can provide incredible motivation and direction for the things you do in your everyday life, encouraging you to take better steps. Do you want a secure early retirement? Do you want to start a business? Do you want to travel around the world? Do you want to find a new job you love? Whatever your goal is, keep it in mind all the time. Fill your life with reminders of your big goal so that you make better choices in line with that goal when it comes to all of those little decisions in your life.

Find and Work Toward Your True Passions

the people that succeed in a particular career path are the people who are able to tap into their natural passions and aim that fire hose into their professional life.

Stop Trying to Impress Other People

If you always have the latest gadget, you’re spending money to impress other people. If you buy a car that’s flashy rather than focusing on one that gets the job done as efficiently as you can find, you’re spending money to impress other people. Don’t play socially by the tired old rules that revolve around needing to impress people. Spend your time on things that bring real value to you – and give real value to others.

The bottom line: Money is simple-people make it complicated. Following these rules won't make you a millionaire, but not following them will surely interfere you on the way of becoming one.