Connect with us

Business

Nigeria Devalues Naira, Official Rate Now 411 To Dollar

Published

on

Nigeria let the naira weaken to a record low against the dollar on the official market on Friday, according to traders, who said this could be a move by the central bank to unify multiple exchange rates. 

Having traded within a band of 380 and 381 to the dollar since July last year, the naira hit a record low of 419.75 against the dollar on Friday. It then closed at 411.25 — the last closing rate for the naira on the over-the-counter spot market. The central bank did not respond to calls for comment and no quotes have been available on the naira’s official rate since Tuesday. It weakened further on the black market, traders said.  

“What the central bank is saying is that the (OTC) spot rate will be the official rate because that’s where the largest volumes trade,” one currency trader at a major Nigerian bank told Reuters. 

Nigeria operates multiple currency regimes, which frustrate businesses and have prompted calls from the World Bank for the rates to be unified to attract investment. Rising dollar demand has put pressure on the naira as providers of foreign exchange, such as offshore investors, exited after the COVID-19 pandemic triggered a fall in global oil prices. 

Central Bank Governor Godwin Emefiele in February said the currency was trading at 410 naira on the official market while the government has been using that rate for its business as it tries to boost earnings from crude sales, its main export. 

The World Bank has linked approval of a $1.5 billion budget support loan to currency reforms. The central bank had been trying to unify the rates and boost the dollar supply through direct interventions. It revised the futures rate on the naira upwards last month to ease pressure on the currency after quoting the 150-day futures contract at 435.81 naira, in its first dollar sales to foreign investors this year. 

The bank is due to hold its interest rate setting meeting later this month with economic data on inflation and first quarter growth figures expected from next week. It has kept rates on hold to support the economy hobbles by lower oil prices and impact of COVID-19 pandemic but dollar shortages have been contributing to rising inflation, a key source of concern for the central bank.

 538 total views,  9 views today

Advertisement
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Business

Access Bank South Africa Opens For Business

Published

on

Access Bank’s South Africa Subsidiary, Access Bank South Africa Limited has officially opened for business. This happened on Monday, June 14th, 2021.

The Chief Executive Officer (CEO) of Access Bank Plc., Herbert Wigwe said;

“The SADC region represents the strongest economy on the African continent. This means Access Bank SA is firmly seated in one of the principal geographical areas apart from Nigeria, in terms of the size of the economy, and unlocks the gateway to the entire Southern African region.”

“The opening of the South African subsidiary cements the Bank’s commitment to sub-Saharan Africa as a portal for exceptional banking opportunities across the continent.”

“The Group will continue to focus on building relationships, as a partner in both businesses and in communities it serves.”

“It’s vital that our banking solutions give clients the advantage they need to grow sustainably, with access to smart solutions that help them reach greater goals.”

“Partnerships with all our clients mean power for them to achieve their aspirations, while Access Bank’s growth brings greater advantages in the financial sector.”

“Like Bennie, I am excited to be on this path with the knowledge and experience of the continent that we share.”

“We look forward to the opportunities that present themselves with opening doors for individuals and businesses, and growing possibilities as we go.”

However, the CEO of Access Bank SA, Bennie Van Rooy said;

“It is an exciting event for the South African banking industry as well as the provision of sustainable support to existing customers and new clients with a business presence across Africa.”

“As part of the robust Access Bank family, the South African operations look forward to contributing meaningfully to the achievements and ambitions of the Group.”

“In offering a full suite of financial service products to a market we understand in depth, Access Bank SA is delighted to grow the family footprint.”

 116 total views,  20 views today

Continue Reading

Business

Access Bank Launches Initiative To Enhance Digital Loans

Published

on

Access Bank Plc, has launched what it termed the ‘Diamond Business Advantage (DBA) lite’ in a bid to increase its digital loans and enhance access to finance for young entrepreneurs.

The bank said the product which is targeted at the youths was designed to add value to micro, small and medium scale enterprises (MSMEs).

Speaking during the launch of the product in Lagos, recently, the bank’s Executive Director, Victor Etuokwu, said, entrepreneurship is essential for the growth of any nation.

He said: “DBA Lite is a product of the erstwhile Diamond bank via the Diamond Business Account (DBA) and that was one of the best products in the market but after the merger, we renamed it as DBA but this innovation; DBA Lite is targeted for the youths who are start-ups, established or growing. This innovation will bring access to digital loans for the youths because that is what we want to do with this innovation.”

Etuokwu noted that the digital loan would be in the form of N50,000 to N5 million, adding that entrepreneurs can only access the loan once they meet the requirements.

According to him, Access Bank accounts for over 50 per cent of digital loans in the industry because it is gives such loans at an average of N18,000-N20,000 daily.

“Last year, four million people accessed N100 billion and we are targeting more in 2021. We are growing and we will keep growing because our digital loans are not for the youths only but for small business owners, employees and the rest of them and I am assuring you that we will do double digit this year as that is the plan.

“As we speak, we are averaging N12 billion to N13 billion every month and so we should be somewhere around N60 billion to N70 billion and clearly, we will do more than we did last year,” he said.

Giving more insights into the product, Etuokwu noted that the features of the product includes less documentation, affordability, convenience, access to market, access to finance, access to business loans and access to payment acceptance services.

 342 total views,  20 views today

Continue Reading

Business

CBN Debunks Report On Planned Nationalisation Of Unity Bank

Published

on

emefiele

The Central Bank of Nigeria (CBN) has denied planning to nationalise Unity Bank Plc as alleged by an online news medium.

Reacting to the report, the Acting Director, Corporate Communications Department, CBN, Osita Nwanisobi, described it as, “fake news” and should be discarded in its entirety.

He said: “The report is fake news. There is no iota of truth in it.” He added that the public should disregard such news.

The report had claimed that the apex bank’s target examination of Unity Bank showed that the Tier 2 lender is in ”grave financial condition”, with Capital Adequacy Ratio (CAR) and Non- Performing Loans (NPL) ratio that breached prudential standards.

However, analysts note that just last month, the CBN’s Monetary Policy Committee ( MPC) noted in the communiqué it issued at the end of its meeting that the banking industry is in good health.

According to the communique: “the Capital Adequacy Ratio (CAR) and the Liquidity Ratio (LR) both remained above their prudential limits at 15.8 and 38.9 per cent, respectively. The Non-Performing Loans (NPLs) at 5.89 per cent in April 2021, showed progressive improvement compared with 6.6 per cent in April 2020.”

Unity Bank’s audited FY’ 2020 results showed improved performance in key parameters. For instance, the Bank’s gross loans portfolio increased by 92.9 per cent to N206.2 billion in 2020 from N106.9 billion in 2019. The bank’s total assets rose by 67.90 per cent when compared with N293.05 billion achieved in the comparative period of 2019. Also, the lender posted gross earnings of N42.71 billion compared with N44.59 billion recorded in the comparative period of 2019, reflective of its business and economic realities of the time.
Its customer deposit portfolio grew by 34.4 per cent to N356.62 billion in 2020, up from N257.69 billion posted in the corresponding period of 2019. Profit after tax stood at N2.09 billion, while profit before tax was N2.22 billion during the year under review amidst the tough macroeconomic environment where it operated. Its net operating income rose to N25.46 billion from N23.21 billion in the corresponding period of 2019, representing a 9.71 per cent increase.

This is even as the net interest income recorded a significant jump, as it rose by 7.60 per cent to N17.75 billion from N16.49 billion in the corresponding period of 2019.

Furthermore, the bank sustained the growth momentum demonstrated in its 2020 full year earnings as it recorded an impressive performance of 43 per cent in both profit before and after tax in Q1 2021.

The Bank’s unaudited Q1 results show that the retail lender profit before tax (PBT) grew by 43 per cent to N784.3million from N550.1 million recorded in the corresponding period of 2020.
The profit after tax (PAT) for the period, which also grew by 43 per cent stood at N721.5million compared to the N506.1million recorded in Q1 2020.

As an outcome of increased focus on supporting local enterprises and industry, the asset portfolio also showed significant growth in loan book of 76 per cent as net loans and advances to customers increased to N223.2 billion, from N126.6 billion recorded in the corresponding period.

The total assets of the bank for the period showed an appreciable growth of 42 per cent to close at N521.5 billion, from N366.8 billion in the corresponding period of 2020.

The balance sheet of the bank had been considerably de-risked with the non-performing loan (NPL) ratio of near-zero per cent, which it has consistently maintained over time. With this, the bank ranks topmost in risk management assessment.

The bank recorded gross earnings of N11.5 billion, representing a marginal decline of three per cent when compared to N11.9billion posted in the corresponding period of 2020. The bank has assuredly intensified its recapitalization efforts by the recent updates the lender provided to the supervisory authority and significant mileage is currently being recorded as part of its corporate transformation and renewal programmes.

 558 total views,  23 views today

Continue Reading

Trending