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First Bank too big for one person to own, says Emefiele

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No one person can lay claim to ownership of a big bank such as the First Bank, the Governor of the Central Bank of Nigeria, Godwin Emefiele, has clarified.

He also said the Securities and Exchange Commission would provide the final decision on the ownership structure of FBN Holdings Plc, the parent company of First Bank Plc.

The company’s majority stake recently became a subject of controversy among investors, following the announcement of a significant share acquisition by billionaire business mogul, Femi Otedola.

Emefiele, commenting for the first time on the controversy at the end of the Monetary Policy Committee (MPC) meeting in Abuja, said that SEC as the capital market regulator would have the final decision on the ownership structure.

He said, “We have cleaned up the balance sheet of the bank. The NPL has dropped. People are now competing for the shares of First Bank.

“Should I quarrel that people are now competing for the shares of First Bank which six years ago was N2.00 and they were running away from it. The last time I looked at it, last weekend, it was N11. 55.

“I am happy that they are competing for the shares. But of course, we should all know that First bank is so big that no one person can say he owns First Bank.

“I have read the SEC clarifying the shareholding percentages and differences and indeed they are the people that are supposed to look at it.

“Our examiners were also opportune to look at it. I think we should take the SEC’s position because the SEC is the regulator of the capital market. We will take their position and they will give guidance on this subject.

“And of course as it affects the operation and the running of the bank we will ensure that the right things are done.”

On developments in the domestic economy, Emefiele said that the MPC noted the continued improvement in the Manufacturing Managers Index.

“This improvement indicated the gradual recovery of output growth   driven largely by increase in new   orders associated with   rising aggregate demands   and off-swing in business activities,” he said.

Emefiele noted that there were no major challenges of flooding this year and that as such he was optimistic of a bumper harvest.

A good harvest, he said, would further drive down the rate of inflation, given that the food basket has been a major driver of inflationary trends.

On forbearance, the CBN boss said that the institution expected all those who took bank loans should be able to start repayment next year, when the forbearance earlier announced would end.

He said, “At this time, we believe that global economy has opened up, lockdown have been lifted and of course, we know the casualties, the economic damages and the fatalities that were caused as a result of the lockdown, and I am so sure that not too many countries, if at all, will embark on a wholesome lockdown any longer, particularly because most countries are all administering vaccination that they think should assist in reducing the impact of the spreading   of the virus.

“So, we believe in Nigeria, businesses are back or companies are back to business, revenue has been improved and if revenue improves then, then you expect naturally that companies that took loans should be able to pay back their loans.

“So as a result, we do not see a likelihood of increase in NPL. Indeed, we have worked so hard to bring the NPL down from as high as about 9% to 10% about two years ago to the level it is today, which is about 5.3%.

“And we are gratified that we are aggressively working NPL down to the maximum threshold that has been set by the CBN.”

The CBN had, at the outbreak of the COVID-19 pandemic, last year, announced a one-year moratorium for loans that people, companies and businesses had taken from banks. It was later extended by another one year, early this year.

Emefiele announced the decision of the MPC to retain the Monetary Policy Rate (MPR) at 11. 5 per cent and the asymmetric corridor of +100/-700 basis points around the MPR.

He added that the Cash Reserve Ratio, CRR, at 27.5 per cent and the 30 per cent Liquidity Ratio were equally maintained.

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Despite FG’s Plea, Electricity Workers Cripple Power Supply in Abuja, Environs

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Despite a federal government statement pleading with the National Union of Electricity Employees (NUEE) not to embark on an industrial action, the workers yesterday made good their threat, crippling power supply in parts of Abuja and environs.

The affected areas under the Abuja Electricity Distribution Company (AEDC) franchise included Abuja, Nasarawa, Kogi, parts of Edo, Niger and Kaduna states.

Specifically, the protesters attached to the AEDC said they were embarked on the industrial action over the non-payment of their entitlements for over 20 months.

The federal government at the weekend through the ministry of power had cautioned workers against the action, as a consequence of the impact of the ownership tussle in the Distribution Company (Disco).

Minister of State, Power, Mr Goddy Jedy-Agba, had urged members of the labour union to follow due process in airing their grievances, stressing that going contrary to established rules will run against extant laws which may have unintended consequences.

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The minister had advised the union members to be, “cautious and responsible to avoid endangering the fragile state of our electricity infrastructure which the present government is working hard to strengthen.”

But in defiance, members of staff of the company who are demanding the payment of their 2020 bonus and other entitlements and remittance of pensions allegedly deducted by the company to their pension fund administrators, shut down some the of facilities belonging to the AEDC.

“Enough is Enough! Pay us our outstanding pension remittances, thrift/corporative deductions, 2020 productivity bonus, bulk rent and union check off bonus,” some of the banners in a number of the AEDC’s offices in Abuja read.

In its reaction, management of the Transmission Company of Nigeria (TCN) informed that though it had available bulk power for delivery to the distribution load centres of the AEDC to offtake for its customers, power evacuation from injection substations across the franchise area had been disrupted.

“TCN regrets this disruption and assures Nigerians that normal bulk power delivery to AEDC will be restored as soon as the injection substations are opened for onward electricity supply to consumers,” a statement by TCN’s General Manager, Public Affairs, Ndidi Mbah, stated.

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Also, a statement from the AEDC signed by its Public Affairs Manager, Oyebode Fadipe urged the distribution company’s customers to be calm as all the pending issues were being resolved.

“Following the industrial action embarked upon by the National Union of Electricity Employees, power supply to some of our areas of operation, especially those on the 11kV network, may be affected.

“We would like to assure all our customers that all hands are on deck to resolve the issues that prompted this action. We would also like to apologise to our customers for the inconvenience and disruption,” the Disco stated.

Thisday

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How to halt N1t electricity subsidy, CBN’s N1.5t interventions

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Electricity stakeholders in the country, yesterday, insisted that removal of subsidy in the power sector was feasible if the Federal Government and the Central Bank of Nigeria (CBN) could streamline interventions in the sector to mitigate the negative impact on the masses.

Last week, the Federal Government alerted that the gap between the Cost Reflective Tariff (CRT), and Allowable Tariff (AT) peaking at N28 per unit of electricity supplied to consumers, this year stands at about N1t.

Coming at a time that it is also considering subsidy removal on Premium Motor Spirit (PMS), the Special Adviser to President Muhammadu Buhari on Infrastructure, Ahmad Zakari, had disclosed at the 12th edition of PwC Nigeria’s Annual Power and Utilities Roundtable, that the nation needs to optimise the potential in the power sector through a cost-reflective tariff regime.

Since the sector was privatised in 2013, perpetual interventions through the CBN have served as lifelines to the sector. They include Power and Aviation Intervention Fund (PAIF), hovering at about N300b, Nigerian Electricity Market Stabilisation Facility (NEMSF), which is about N213b, an N140b Solar Connection Intervention Facility, an over N600b tariff shortfall intervention, as well as a recent N120b intervention designed for mass metering among others.

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In March 2017, the Federal Executive Council (FEC) approved an N701b CBN facility as Power Assurance Guarantee, just as the Federal Government, in 2019, also signed the release of another N600b to bridge the shortfall in the payment of monthly invoices by key stakeholders in the sector.

Fueled by tariff shortfall, receivable collection, technical, commercial and collection losses, financial liquidity in the power sector hovers around N4t as the apex bank, alongside the Federal Government has continued to initiate a series of interventions to douse tension and avert a collapse of the 2013 electricity privatisation exercise.

In about eight years, the CBN would have spent over N1.5t to keep the nation’s power sector afloat although the sector was privatised to survive by itself.

Although most stakeholders insisted that the interventions remained critical, especially in easing the liquidity crisis and attracting further interventions, they maintained that tweaking the interventions in manners that would ease further the masses’ burden and halt arbitrary billing of consumers was very important.

Renowned energy expert, Prof. Wunmi Iledare, noted that interventions by the CBN as a payable loan was understandable, even if it is a forgivable loan.

He insisted that the current structure of the electricity market in the country could mar the interventions, stressing that there must be a decentralised energy planning system.

According to him, while it is good that banks are targeting spending, subsidy may be a political expediency instrument, not economic efficiency hence “it should be disavowed. By the way, estimated billing now termed electronic billing is fraudulent! A quick way to bring subsidy to an end is metering and decentralisation of power management and services. Nearly everything centralised in the fashion of militarism has failed woefully, education, health, energy services road infrastructure, name it,” Iledare said.

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An energy expert, Eseosa Lloyd Onaghinon, stated that the energy sector must be rid of inefficiencies, which is usually passed on to consumers, adding that there are about 40 per cent inefficient losses between transmission and distribution.

“If we do not address such losses that occur, we might as well get into a trap where it’s an unending discussion of ‘subsidy’ even though it is continuous inefficiencies covered up as subsidies,” Onaghinon stated.

For energy lawyer, Osagie Agbonlahor, most of the woes experienced in the sector were responsible for the poor electricity situation in the country, adding that the development should be blamed on electricity operators, revenue collectors and the powers that be.

“How many army, police, air force, navy barracks in the country that their residents pay electricity bills at all? How many government ministries, army, air force, navy offices pay for the electricity that they consume? Who has ever dared to drive to the barracks and disconnect their source of public power supply the way they do to ordinary Nigerians? For how long has this been going on in this country? If you take away these huge leakages, you will see that the ordinary Nigerians have been sustaining and subsidising the electricity consumption of these people.

Agbonlahor said that the government broached the idea of deducting the huge outstanding electricity bill consumed in barracks and government offices under President Olusegun Obasanjo.

He noted that “until we start to do the right things, we are just going to be beating about the bush.”

He asked the government to do a forensic audit of the N1t subsidy to check where the so-called subsidy is coming from.

The Guardian had earlier reported that the failure of federal and state governments, as well as their ministries and agencies to pay over N100b outstanding electricity bills is currently worsening the liquidity crisis in the sector.

The situation has also reportedly led to distribution companies hounding private electricity consumers who pay more through estimated bills and higher tariffs, rather than recover outstanding debts from government agencies.

Guardian

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Range Rover shines as Velar wins 2021 Nigeria luxury SUV

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The 2021 will go down as a year of glory for Range Rover brand as its new model, the Velar, has won multiple awards. The latest is the Luxury SUV of the Year 2021 at the annual Nigeria Auto Journalists Association (NAJA) Awards just in Lagos.

The Velar, which is currently on sale in Nigeria via Coscharis Motors, had earlier won the 2021 Business Motoring Award for the Best Large SUV.

A statement by Coscharis Motors said the awards were a follow up to the 2018 World Car Awards for the design of the year.

The auto firm noted that the new Range Rover Velar fought off stiff competition from other brands nominated for the same category.

The editorial team considered the entrants based on a combination of factors such as technology, design and style, adding that the Velar excelled on all fronts.

The Range Rover Velar was said to have been chosen as the outright winner in the luxury car of the year category due to its class-leading technology, exhibiting novel features such as Pivi and Pivi Pro, providing the latest in-car artificial intelligence such as self-learning navigation system for a fully connected journey; the deployable door handles which could retract when not in use, the split armrest and crafted materials throughout.

The organisers praised Land Rover’s cutting-edge lineage, said to be instantly recognisable in the Velar, given its beautifully balanced stance with optimised proportions from the formal, powerful front end, through a flowing, continuous waistline, culminating in a taut and elegantly tapered rear.

The Velar was also commended for its Meridian’s Trifield 3D technology, found to create a truly unique ‘live’ sound experience.

Group General Manager, Marketing and Communications, Abiona Babarinde, who received the award on behalf of the auto firm, said, “For combining the off-road capabilities of a Range Rover and leading technology with the desirability of an electric vehicle, the Range Rover Velar just had to win it for us.”

He also said the NAJA award meant a lot to Coscharis Motors and “it is fantastic for the Velar to win the Luxury SUV of the Year as that is what the vehicle truly represents.

“I am really happy to pick it up on behalf of Coscharis Motors and most especially the Land Rover team who put so much hard work into the design and engineering – it is great to be recognised for leading edge and innovative technology wrapped in such a fantastic design.”

According to the statement, every Land Rover vehicle sold by Coscharis Motors comes with a complementary five-year/100,000km service plan and five-year/150,000km warranty.

 

 

L-R: Dr Boboye Oyeyemi, Corps Marshal, Federal Road Safety Corps, giving award of Luxury SUV of the year to Mr Abiona Babarinde, GM, Marketing Corporate Communications, Coscharis Group; Mr Felix Mahan, Brand Manager, Coscharis Motors; and Mr Mike Ochonma, Chairman, Nigeria Auto Journalists Association, during the 2021 edition of the association’s award night held in Eko Hotel, Victoria Island, Lagos.

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