CBN dismisses allegation of operating secret bank account

The Central Bank of Nigeria (CBN) has dismissed allegations that it is operating secret foreign bank accounts. In statement issued Friday and signed by the Director, Corporate communications department, Ugo A. 

Okoroafor, the bank said, “The attention of the Central Bank of Nigeria (CBN) has been drawn to publications in the media over allegations at the public hearing of the Senate Joint Committee on Petroleum Resources (Downstream) and Appropriation and Finance, that the CBN operates a secret foreign bank account. 

 “As banker and financial adviser to the Federal Government and its Ministries, Departments and Agencies (MDAs), the actions and activities of the Central Bank of Nigeria, fall within the principles of banker-customer relationship. “The CBN does not and cannot open any account for Government and its agencies, unless and until clear and specific instructions, approvals or mandates are issued by the appropriate authorities. 

We wish to state clearly, the following facts regarding the accounts in question: “That the CBN/NNPC Crude Oil & Gas Account was opened on 16th May, 2002, on the express instruction of the Accountant-General of the Federation (OAGF) vide a mandate ref: No; CS/5385/S.23/94/DDF, dated 15th May, 2002. “That the CBN/NNPC Gas Account was opened on 3rd February, 2009, following a similar instruction from the Account-General of the Federation, vide mandate ref. No.; FD/5385/S.71/1/178/DF, dated 28th January, 2009.

 “That the two accounts, which were opened as domiciliary accounts, are backed by the appropriate mandates of the OAGF. “That in operating the said Accounts, the NNPC on monthly basis issues instructions to the CBN on how much should be paid as Joint Venture Cash Call (JVC) and how much should be monetised and transferred to the Federation Account for distribution to the three tiers of government. A minimum balance of USD10m is always left in the revenue account.

 “That on the CBN/NNPC Gas Account, the NNPC issues monthly mandates to enable the CBN monetise and transfer the balance in the account to the Federation Account, leaving a minimum balance of USD5 million. “That all movements of funds out of the accounts are duly authorised by NNPC.

 “That the role of the CBN, as banker to Government and MDAs, is limited to the following: Ensuring that lodgments/deposits into the accounts are consistent with their requisite mandates;Providing customers with the statements of accounts. In the case of the accounts in question, NNPC and OAGF are provided the statements of account on a weekly basis; Ensuring that accounts are reconciled regularly.

 In the case of the said accounts, this is done with with both JP Morgan Chase and NNPC while the OAGF is availed with monthly reconciliation reports on the accounts. “Above all, it is important to reiterate for the purposes of clarity, that: Mandates to open the accounts were duly authorised by OAGF; NNPC remains the sole signatory to the accounts; NNPC issues and authorises the mandates for movement of funds out of the accounts and CBN acts only in accordance with mandates issues by NNPC on these accounts. “The CBN wishes to reiterate that in light of these verifiable facts presented above, there was no truth in the allegation insinuating that the CBN is maintaining secret foreign accounts.”

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Military intelligence uncovers plot to bomb INEC, CBN hqtrs, Transcorp Hilton

Following the tension generated by the forthcoming governorship elections in Adamawa and Bayelsa states scheduled for 4 and 11 of next month, respectively, authorities of the Military Intelligence and Defence Intelligence Agency have secured top secret reports showing that plans are afoot to bomb the Independent National Electoral Commission, INEC, headquarters; Transcorp Hilton hotel and the Central Bank headquarters, all in Abuja.

Military sources told Vanguard that though the bombings and attacks would be blamed on Boko Haram sect, painstaking analysis of the intelligence material had narrowed those behind the plots to ‘do-or-die’ politicians.

The bombing of INEC headquarters was planned to happen ‘soon’ before the first of four governorship elections rescheduled for this year involving two front runners, Brig-General Buba Marwa(rtd) of Congress for Progressive Change, CPC, and Vice Admiral Murtala Nyako(rtd) of Peoples Democratic Party, PDP, in Adamawa State on February 4.

Boko Haram connection

Further bombings on the headquarters of CBN and Transcorp Hilton Hotel, which are to take place simultaneously or at intervals, the source added, were meant to give a semblance of coordinated attacks on national assets, with a pre-arranged plan by a fake Boko Haram spokesman to announce through foreign media, that the Islamic sect was responsible for the bombings.

As a result of these findings, NEWSMEN gathered, a security alert had been placed on the FCT with INEC, CBN and Transcorp Hilton hotel getting more military protection.

Consequently, the Nigerian Army has deployed more combat personnel to all entry and exit points in Abuja, including Gwagwalada, Keffi, Suleija and Zuba, while new mobile electronic bomb-detecting devices had been deployed at Airport Road, Zuba, Keffi and Aso Rock in Abuja.

While the plot to bomb the headquarters of INEC might not come as a huge surprise to political watchers in Adamawa and Bayelsa states, Vanguard recalls that the governorship candidate of CPC, Marwa only a fortnight ago, raised alarm that violence and killings of Christians by gunmen in Adamawa State, were politically-motivated by political opponents who did not want the election to hold for fear of losing out.

Since then, the election has been shifted twice by INEC, from January 14 to January 21 and finally to February 4th, based on reports that the state was unsafe to conduct the governorship election.

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Nigeria Central Bank recovers 200 houses from former bank chiefs

The Central Bank of Nigeria (CBN) has recovered 200 houses in the United Arab Emirates, United States and South Africa belonging to the chief executive officers of the failed commercial banks in Nigeria.

Making the disclosure Wednesday at an interactive session with members of the Senate Committee on Banking, Insurance and other Financial Institutions, CBN Governor, Malam Sanusi Lamido Sanusi, said the houses were recovered when operatives took offshore its searchlight for the assets of the deposed bank chiefs.

Although, he did not give further details regarding the recoveries, Sanusi, in an apparent reaction to the criticisms of shareholders against the intervention of the apex bank in the former banks, queried: "Where were the shareholders when over N300 billion of depositors' funds were being stolen? These are the shareholders that we are talking about, where were they?"

Giving further impetus to the apex bank's role in nationalising the three banks in September, said his primary responsibility was to defend the interest of depositors and not shareholders.

He said: "It is my job to protect depositors. If you go and buy shares, you are taking a risk. The banks paid dividends, you took the dividends. Share prices went up; you sold and tripled your money. Those that sold made money. Those that didn't sell lost. It is a risk you took.

"The depositor did not go to lose money. We told them don't put your money in the pillow, go and put it in the bank. Whoever puts his money in the bank expects to get that money on demand. My obligation is to make sure that every depositor gets his money. I have no obligation to the shareholders. It is not my job.

"I am serving depositors. Shareholders are not happy with me. I understand that and I accept it. I am happy that they are not happy because that means that I am doing my work."

Sanusi said when he set the September 30 deadline for banks to recapitalise; many critics said it was not possible, adding, however, that he insisted because of his realisation that "in many cases, this would have been concluded earlier".

He accused the shareholders of the liquidated banks of "playing games", saying: "You are a shareholder; you appoint a board and management; your management throws away bank assets, giving bad loans and losing the money. We (CBN) seized the bank; we find your partner by going to court to take all sorts of injunctions."

The CBN boss, however, said that now that the banks had been rescued "some shareholders are talking about their rights, not about the right of the depositors".

He told the senators that his business as the boss of the apex bank was not to protect shareholders who lost millions of naira in investment in the failed banks.

Also at the interactive session with the lawmakers, Sanusi appealed to the Senate to back the proposed bill seeking the injection of additional N500 billion to the Assets Management Corporation of Nigeria (AMCON).

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Naira appreciates by 3.4% after CBN intervention

The naira strengthened on Tuesday, gaining 3.4 per cent at the inter-bank market a day after an aggressive interest rate hike by the Central Bank of Nigeria.

Naira increased slightly, yesterday, after the aggressive Central Bank of Nigeria’s, CBN, hike in interest rate.

The naira opened at N158.60 against the dollar on the interbank market, up 3.4 per cent from Monday’s close of N164.20 and five per cent firmer than the record low of 167.8 plumbed shortly before Monday’s unscheduled Central Bank meeting.

Naira, which gained three per cent after the CBN tightening measures, was the world’s best performing currency on the day, and the unit stood at N158.95.

 The naira opened at N158.60 against the dollar at the inter-bank market, representing an increase of 3.4 per cent from Monday’s close of N164.30.

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Central Bank approves merger of First City and Finbank

The Central Bank of Nigeria (CBN) has approved the merger of First City Monument Bank (FCMB) and Finbank. Both banks had signed a Transaction Implementation Agreement (TIA) a fortnight ago which culminated in concrete merger talks between both institutions.

Finbank company secretary, Nkechi Ezeako, who confirmed the approval, said both parties would continue the merger process as required. "The financial advisers are working on it and we are working towards making the CBN deadline. We are very optimistic that we will meet the deadline."

With this regulatory approval, the merger talks would proceed to process of scheme arrangement which entails the valuation of each company's worth and what each shares would exchange for, all subject to shareholders' approval, the CBN, Securities and Exchange Commission, the Nigerian Stock Exchange and the Federal High Court, which will approve a court ordered meeting of shareholders.

A joint release by both institutions recently stated that the combined bank will be a unique financial institution, with proven corporate banking capabilities, strengthened commercial banking business and a robust platform for retail growth. "The merged entity will also benefit from complementary transactional banking platforms and offerings. Furthermore, the combined entity will better leverage capital, optimise synergies and drive shareholder value."

FCMB chief executive officer, Ladi Balogun told Reuters that he expects the SEC and shareholders' approval to be obtained within the next 40 days and that the bank would not need to raise fresh funds to finance the deal. "This will enable FCMB to grow its strategy," he was quoted as saying.

Finbank is one of the eight banks rescued by the Central Bank in 2009 and got an injection of about N50 billion to stay afloat after replacing the sacked management. Since then, the CBN has encouraged the entrance of new core investors in the intervened banks. Under this scenario, FCMB would emerge as the dominant partner.

The CBN last month gave the rescued banks until September to recapitalise or face nationalisation or liquidation. As an incentive, it extended the interbank guarantee to intervened banks that had signed the TIA to December 31.

CBN deputy governor, financial systems stability, Kingsley Moghalu has said that the recapitalisation of the intervened banks is completed in as timely a manner as possible since the institutions still remain in a fragile condition. "It is not in the interest of the nation's financial system for the recapitalisation process to be open ended, without a deadline, or timeline to work with," he said.

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CBN disburses N185bn intervention fund to banks

The Central Bank of Nigeria, CBN, has disbursed N185.172 billion intervention fund for the manufacturing sector to the Bank of Industry, BOI, for onward payment to participating banks.

The disbursement is from the N200 billion intervention funds approved for the manufacturing sector by the Federal Government.

According to the CBN, a total of 30 applications valued at over N222.50 billion were received.

Speaking at at roundtable on 2011 Nigerian Economic Road map, organised by the Lagos Chamber of Commerce and Industry, LCCI, CBN governor, Lamido Sanusi, said 516 projects, valued at N199.67billion or 98 per cent had been utilised by banks through the BOI to finance and restructure their outstanding manufacturing exposures.

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