Business
Stanbic IBTC non-performing loans rise to N25bn
Non-Performing Loans of Stanbic IBTC Holding Plc have risen by N5bn in the first six months of this year to N25.27bn.
The loans rose from N20.338bn in December 2021 to N25.27bn in June 2022. This indicates a rise from 1.87 per cent in December to 2.32 per cent in June this year, latest data from the bank have shown.
Non-Performing Loans refer to the amount of borrowed funds whose scheduled payments have not been met by the debtors for a period of time usually 90 or 180 days, depending on terms.
Data from the bank’s half year financial statement for 2022 revealed that the bank had a total performing loans of N1.06tn and an NPL of N20.34bn by the end of last year.
Although the figures of the performing loans remained at N1.06tn in June 2022, the NPLs grew to N25.27bn.
The Central Bank of Nigeria exposure drafts on prudential guidelines for financial institutions said, “The NPL limit banks are required to manage their credit risk effectively. To this end, all banks are to ensure that the level of NPLs in relation to gross loans does not exceed five per cent.”
Stanbic IBTC’s NPL is within regulatory limits, but experts believe that there could be a surge in loan defaults in coming months after the CBN increased Nigeria’s benchmark interest rates.
The Governor of the Central Bank of Nigeria, Godwin Emefiele, had revealed a “reduction in the NPL ratio to 4.95 per cent in June 2022, compared with 5.7 per cent in June 2021.”
The apex bank’s MPC wants the bank to sustain its tight prudential regime to ensure that the NPL ratio is brought well below its prudential benchmark.
A 2018 CBN report had revealed that the “drivers of NPLs vary across the two categories of banks, but, weighted average lending rate is a vital macroeconomic driver of NPLs.”
The CBN recently hiked the Monetary Policy Rate to 14 per cent, a move aimed at reducing inflationary pressure, but experts believe it could worsen the NPLs among banks.
This implies that banks will restructure their loans and review upward to reflect the new rate.
Nigeria’s prime lending rate is 12.29 per cent, while maximum lending rate is currently 27.61 per cent, but it is expected to move upwards.
Business
FG begins crude sales in naira to Dangote Refinery
FG begins crude sales in naira to Dangote Refinery
The Federal Government has officially begun the sale of crude oil in naira, in line with a directive from President Bola Tinubu.
This update was shared by Wale Edun, the Minister of Finance and Coordinating Minister of the Economy, through a statement on the ministry’s official X account.
The shift to naira transactions aligns with a directive from the Federal Executive Council (FEC).
According to the statement, “The sale of crude oil and refined petroleum products in Naira has officially commenced as of October 1st, 2024.”
It continued, “Following a meeting of the Implementation Committee, chaired by the Hon. Minister of Finance and Coordinating Minister of the Economy on October 3rd, 2024, to conduct a post-commencement review of the Crude Oil and Refined Products Sales in Naira initiative, the commencement of this strategic initiative was affirmed by key stakeholders.”
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The review meeting involved significant stakeholders, including the Minister of State for Petroleum (Oil), the Special Advisers to the President on Revenue and Energy, top executives from the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), representatives from the Dangote Group, and leadership from the Nigerian National Petroleum Company (NNPC), including its Group Chief Executive Officer (GCEO), Chief Financial Officer (CFO), and Executive Vice President (Downstream).
Recall that back in July, President Tinubu approved the sale of crude oil in naira, with the Dangote refinery chosen as the pilot for the initiative.
The long-term impact of this move on petroleum prices remains to be seen.
FG begins crude sales in naira to Dangote Refinery
Business
90 million litres stuck as NNPCL shuts petrol purchasing portal – Marketers
90 million litres stuck as NNPCL shuts petrol purchasing portal – Marketers
Oil marketers have raised concerns about a potential fuel scarcity following the shutdown of the Nigerian National Petroleum Company Limited (NNPCL) petrol purchasing portal.
The shutdown has prevented dealers from placing new orders for fuel, leading to supply disruptions.
According to marketers, over 90 million litres of petrol, worth approximately N79 billion, are pending delivery from NNPCL.
The National Publicity Secretary of the Independent Petroleum Marketers Association of Nigeria (IPMAN), Chinedu Ukadike, confirmed that while marketers can still load fuel, they cannot access the portal to check prices or make new purchases.
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Ukadike stated that there are currently over 2,000 pending tickets for 45,000-litre petrol trucks, which amounts to a significant volume of fuel awaiting supply. He warned that the continued closure of the portal could result in another wave of fuel shortages across the country.
Other marketers, speaking anonymously, echoed concerns that the portal’s shutdown is already causing fuel shortages.
One marketer mentioned, “Everyone is affected because we all go to the NNPC portal to place our orders, and when the portal is inaccessible, supply is disrupted.”
As of now, there has been no official response from NNPCL spokesperson Olufemi Soneye regarding the situation. However, some marketers believe the portal was shut down temporarily to resolve backlogs of pending orders.
90 million litres stuck as NNPCL shuts petrol purchasing portal – Marketers
Business
Naira appreciates to N1,685 in parallel market
Naira appreciates to N1,685 in parallel market
The Naira yesterday appreciated to N1,685 per dollar in the parallel market from N1,700 per dollar on Monday.
Similarly, the Naira appreciated to N1,659.26 per dollar in the Nigerian Autonomous Foreign Exchange Market, NAFEM.
Data from FMDQ showed that the indicative exchange rate for NAFEM fell to N1,659.26 per dollar from N1,669.15 per dollar on Wednesday, indicating N9.89 appreciation for the naira.
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The volume of dollars traded (turnover) in the official market increased sharply by 155.2 percent to $450.39 million from $176.45 million traded on Wednesday.
Consequently, the margin between the parallel market and NAFEM rate narrowed to N25.74 per dollar from N30.85 per dollar on Wednesday.
Naira appreciates to N1,685 in parallel market
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