FG revokes N32bn metering contract, vows to sell five DisCos

President Bola Tinubu has ordered the revocation of a N32 billion ($200m) metering contract awarded by the Federal Government since 2021 for non-performance.

Minister of Power Adebayo Adelabu disclosed this and hinted of plans to sell off five electricity Distribution Companies (DisCos) over persistent blackout.

Adelabu spoke on Monday while hosting members of the Senate Committee on Power in his Abuja office.

The minister said the Federal Government had mobilised a company named Messr Zigglass with $200 million (N32 billion) to supply three million meters, but that the firm had failed to deliver.

“If you held N32 billion for these years, where is the interest?” he asked.

According to him, President Tinubu has directed that the contract be revoked.

The government, he said, would bridge the current eight million metering gap in the next four to five years.

The minister also said the funding would be coming from a seed capital of N100 billion and N75 billion.

He added that the Nigerian Sovereign Investment Authority (NSIA) would come to the aid of the ministry with the funds.

The sale of the five DisCos to reputable technical power operators, he said, would be completed within three months.

He told the committee that tough decisions on the DisCos had become necessary because the entire Nigerian Electricity Supply Industry (NESI) failed due to the poor performance of the distribution companies.

The minister said the ministry would prevail on the Nigerian Electricity Regulatory Commission (NERC) to revoke underperforming licences and change the management boards of the DisCos if necessary.

Adelabu said, “On distribution, very soon you will see that tough decisions will be taken on the DisCos. They are the last lap of the sector. If they don’t perform, the entire sector is not performing.

“The entire ministry is not performing. We have put pressure on NERC, which is their regulator to make sure they raise the bar on regulation activities.

“If they have to withdraw licences for non-performance, why not? If they have to change the board of management, why not?

“And all the DisCos that are still under AMCON and banks; within the next three months, they must be sold to technical power operators with good reputations in utility management.

“We can no longer afford AMCON to run our DisCos. We can no longer afford the banks to run our DisCos. This is a technical industry and it must be run by technical experts.”

He listed those affected as Abuja Electricity Distribution Company (AEDC) under the management of the United Bank of Africa (UBA), Benin Electricity Distribution Company (BEDC), Kaduna Electricity Distribution Company and Kano Electricity Distribution Company managed by Fidelity Bank; Ibadan Electricity Distribution Company (IEDC) is under the AMCON management.

Investors hold 60 per cent of shares in the DisCos. The Federal Government holds the remaining 40 per cent.

Blackout has persisted in most states with DisCos blaming low allocation from the national grid as well as gas shortage to generating companies (GenCos) as the causes.

The minister said that the energy distribution assets are technical and should be managed by experts.

According to him, the Ibadan DisCo is too large for one company to manage.

Responding to the decision to resell the DisCos, a member of the committee, Senator Isah Jibrin, alleged that some of the operators have stripped the assets of the DisCos they took over in 2013.

He insisted that the operators of any revoked DisCo must be compelled to fix the assets as they were prior to handover.

Adelabu blamed issues in the industry on uncompleted projects and appealed to the committee to approve funds for the completion of over 120 projects across the country.

Naira depreciates against dollar as speculators reportedly hoard

The naira fell in value against the US dollar to N1,234 in the official foreign exchange market on Monday, according to statistics from the FMDQ securities exchange.

The currency rate indicates that the naira decreased by N65, or 5.26 percent, from N1,169.99/$1 recorded on Friday.

The local currency had strengthened to about N1,072.74 on Wednesday, as traders expected the naira will trade below N1,000/$1 for the first time.

However, the latest drop appears to coincide with the remarks of the apex bank Governor, Yemi Cardoso, who stated that the intent of the bank was not to defend the Naira, when asked about the sudden drop in external reserves.

Nigeria’s foreign exchange reserves have maintained a one-month dip streak. The latest figures from the Central Bank of Nigeria show the external reserves reached a new low of $32.1bn on April 18, 2024. The reserves dropped by $2.35bn in 31 days, from $34.45bn on March 18, 2024.

But the CBN governor at the International Monetary Fund/World Bank Spring Meetings stated that the bank would refrain from intervening in the exchange unless unusual circumstances arose, stressing that the recent slight shift in reserves was unrelated to defending the naira.

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He said, “I want to make this as clear as possible, it is not in our intention to defend the naira. and as much I have read in the recent few days, some opinions with respect to what is happening with our reserves and if the central bank is defending the naira.”

The national currency had slumped badly in the forex market in the weeks preceding the clampdown on Binance, exchanging for as much as N1,950 in mid-February.

Observers blamed its earlier misfortune on alleged manipulation of the market by Binance. However, some stakeholders have accused the new crypto exchange platforms BYBIT and BITGET for the latest slip.

Analysts suggested that the naira experienced a depreciation over the span of six months from July 2023 to January 2024, particularly evident in the black market following the disbursement of funds by the FAAC to federal, state, and local government authorities.

The summary of the forex transaction showed that the intra-day high depreciated, closing at N1,295 per dollar. The intra-day low also reduced to N1,051/$. While the total daily turnover dropped slightly to $110.17m on Monday.

At the parallel market, currency traders sold the dollar between the rate of N1,250 and N1,270 from N1,154 recorded last Friday.

Bureau de Change operators who spoke to our correspondent said the reason for the new increase in dollar rate was due to market forces, adding they were unsure if there would be more increase or reduction before the end of the week.

The naira’s surge since late March, which had made it the best-performing currency in the world, came to a stop on Sunday when it had its first weekly decline in several weeks on the parallel market.

A BDC operator, Abubakar Taura said, “We sold the dollar today between the rate of N1,50 and N1,270 and it is a bit surprising because we don’t even know the real reason but that is the market, one day there will be profit and another day we make losses.”

Naira depreciates against dollar as speculators reportedly hoard

Olusegun Alebiosu named acting Chief Executive of FBN

FBN Holdings Plc has named Mr Olusegun Alebiosu as acting Chief Executive of the First Bank of Nigeria Limited (FirstBank), its flagship subsidiary.

This is coming after the recent resignation of the bank’s Managing Director/Chief Executive, Dr Adesola Adeduntan.

This is contained in a statement to the Nigerian Stock Exchange, signed by the holdings’ acting Company Secretary, Adewale Arogundade.

It said the appointment taking immediate effect would be subject to the approval of the Central Bank of Nigeria (CBN).

The statement added that the announcement was in accordance with the Rulebook of The Exchange (Issuers’ Rules), which required that the Nigerian Exchange Limited and the investing public be duly notified of such development.

Alebiosu was an Executive Director/Chief Risk Officer who jointly led the transformation of FirstBank over the past eight years, and was an integral member of the team under the previous CEO’s leadership.

He joined FirstBank in 2016 and has over three decades of banking experience.

“The Board of Directors expressed gratitude to Adeduntan for his exemplary leadership in the last nine years during which he superintended the transformation and growth of the bank and wish him well in his future endeavours,” the statement added.

The new acting First Bank CEO commenced his professional career in 1991 with Oceanic Bank Plc (now EcoBank Plc).

Prior to joining FirstBank in 2016, he had served as Chief Risk Officer at Coronation Merchant Bank Limited, Chief Credit Risk Officer at African Development Bank Group, and Group Head, Credit Policy and Deputy Chief Credit Risk Officer at United Bank for Africa Plc.

He is an alumnus of Harvard School of Government and holds a bachelor’s degree in Industrial Relations and Personnel Management.

Alebiosu also obtained a master’s degree in International Law and Diplomacy from the University of Lagos and holds a master’s degree in Development Studies from the London School of Economics and Political Science.