South-East Senators, IYC, CACOL Reject Budget Cuts

The South-East Caucus in the Senate, the Ijaw Youth Congress, the Centre Anti-Corruption and Open Leaders and an Afenifere chiefrain, Femi Okurounmu, have opposed the alterations made by the National Assembly to the 2018 budget.

While the South-East caucus faulted the reduction in the funds allocated for the Second Niger Bridge and the Enugu Airport projects, CACOL said the National Assembly did not follow due process.

The IYC, on its part, berated the lawmakers for cutting budgetary allocations for  the Nigerian Maritime University, Okerenkoko, and the East -West Road projects.

Enugu airport, 2nd Niger Bridge votes manipulated – S’East senators

The Senate South-East Caucus expressed surprise over the slashing of the N2bn allocated to the Enugu Airport Terminal to N500m.

The Chairman, Senator Enyinnaya Abaribe, told journalists in Abuja on Thursday that members of the caucus were shocked to hear that the initial amount, which was jointly adopted by the Committees on Aviation at the Senate and House of Representatives, had been reduced.

Abaribe, who is representing Abia South Senatorial District, said an emergency meeting by senators from the South-East had been called to unravel who made the cut and at what point was it made.

The lawmaker, who is the Chairman of the Senate Committee on Power, Steel Development and Metallurgy, said the caucus was set to meet to find out what went wrong especially at what point the cut in the allocation was made.

He pointed out that budget documents were verifiable and “we are committed and determined to find out who made the cut.”

The senator recalled that the South-East lawmakers lobbied for the allocation to the airport to be increased to N3.5bn but were told by the Ministry of Aviation that it had an envelope budgetary plan, which would not allow an increment beyond the N2bn.

Abaribe alleged that N30bn was smuggled into the power budget without his committee’s knowledge.

According to him, the money was listed for expansion and re-enforcement of infrastructure in the distribution companies to reduce stranded firms.

The allocation, he said, “never passed through the Senate Power committee.” He asked, “Where did such huge sum of N30bn come from?”

“Let the Budget Office and other relevant bodies conduct a self-examination. Such self-examination will go a long way to clear certain grey areas,” Abaribe stated.

He added, “In the case of the Enugu Airport Terminal and the Second Niger Bridge, we want to find out at what point the cut was made.”

Abaribe said members of the caucus were collectively agitated. According to him, the geopolitical zone, which hardly receives a fair share of the national projects, had the little that came its way reduced.

He stated that no right thinking Igbo man would support slashing of allocation to projects in the South-East.

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N’Assembly’s action, condemnable, says IYC

The IYC  said the National Assembly showed that it was  selfish by reducing the budget allocations to  developmental projects including the Nigerian Maritime University, Okerenkoko and the East-West Road,  and increasing its allocation.

IYC noted that a similar reduction in allocations to developmental projects  was done under the administration of former President Goodluck Jonathan. This,  it  stated,  led to the non-completion of the East-West Road.

The IYC, in a statement on Thursday by its President,  Mr.  Eric Omare, described the reduction in allocations to major projects as retrogressive.

Omare, “We consider the action of the National Assembly as insensitive and retrogressive to the development of the country. It is utter selfishness for the National Assembly to reduce funds allocated to key developmental initiatives and increase its budget.”

He recalled  the establishment of the Nigerian Maritime University, Delta State was one of the agreements reached between the leaders of the Niger Delta  and the Federal Government to ensure peace in the region.

Omare stated that it was in furtherance of the agreement that N5bn was budgeted for the establishment of the university.

The youth leader called on President Muhammadu Buhari to immediately send a supplementary budget to the National Assembly to enable it to  correct the anomaly  in the interest of  the Niger Delta.

He said, “The IYC is compelled to ask if the members of the National Assembly were elected to serve the interest of the generality of Nigerians or their personal interest.  There is no single reason why members of the National Assembly would reduce funds allocated for key projects such as the Maritime University, East- West Road, Mambilla Power Project and the completion of Enugu International Airport  and increase their own budget. This is to say the least condemnable.”

N’Assembly’s action fraudulent, says Okurounmu

Also, an Afenifere chieftain, Senator Femi  Okurounmu has described the action of the National Assembly   as fraudulent.

He said this in Abeokuta  on Thursday  while fielding questions  from journalists on the sidelines of an event organised by a Yoruba socio-cultural group, Omoluabi.

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Okurounmu  noted that the lawmakers usually hide their allowances and other expenses.

Okurounmu, a former senator, said, “They are fraudulent; not only do they do a lot of budget padding, they introduce a lot of extra-legal amount just to meet all those illegal allowances that they are getting.

“To now accommodate their own demands, they inflate the budget. The President doesn’t know how to deal with the National Assembly; so there is always a stalemate between the National Assembly and the Presidency and the President is always going along with them because every budget the National Assembly inflates must accommodate their own demands or needs.

“These are the things that people cry about; about the horrible, extraneous allowances of legislators – senators and members of the House of Representatives. This is where it comes from.”

He noted that there was a lot of corruption to be fought in the National Assembly, arguing that it was immoral for those who were corrupt to be making laws for the nation.

He, however,  said the President  had no choice but to sign the budget because there was a stalemate.

He said, “The National Assembly blackmailed him; he cannot dismiss all of them and he doesn’t have the courage to fight them. If he has the courage to fight them he can fight them but he doesn’t have the courage because he’s surrounded by corrupt people himself.

“So, just as the National Assembly can blackmail him, he too can blackmail the National Assembly. So, it’s a game of mutual blackmail.”

N’Assembly didn’t follow due process – CACOL

Also a civil society organisation, the Centre for Anti-Corruption and Open Leadership, blamed the National Assembly for not following due process.

It said the padding of the 2018 budget was due to the power tussle between the legislative and executive arms of the government.

The CACOL Director, Debo Adeniran,  in an interview with The PUNCH, said, “The legislature has not followed the right procedures. The executive is supposed to put the budget estimates together. What one expected was that during the budget preparation, there should have been room for the legislature to send their projects to the appropriate ministries, departments and agencies, but there has been power tussle between the executive and the legislature.

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“This tussle has left Nigerians in limbo, because the interests of the people are not the reason why the two arms are quarrelling. This is a kind of power show which should not be accommodated. What ought to have been done was for the legislature to go back to their constituencies to carry out a needs assessment. The legislature is also to blame for delaying the budget.”

Senators, Reps clash over inserted 6. 403 projects

Meanwhile, some  senators and members of the House of Representatives  have expressed different views on the issues raised by the President.

The lawmaker representing Yobe East Senatorial District, Senator Bukar Abba Ibrahim, pointed out that Buhari should not be condemned if the 2018 budget was not fully implemented as it had always been impossible for successive administrations to do so.

Ibrahim stated this while addressing journalists in Abuja on Thursday.

Ibrahim asked, “When in Nigeria have we implemented a budget 100 per cent.” It will take us another 100 years, maybe, to do that. So, irrespective of whatever we put in there, he doesn’t necessarily have to implement all of them. Every year we talk about 50, 60, 70 per cent budget implementation; we have ever had 80 per cent. So, does it really matter if certain things were inserted?”

But Senator Dino Melaye said Buhari only tried to whip up sentiments against the National Assembly with his criticisms.

He pointed out that the legislature was not expected to be a rubber stamp to the executive proposals.

Melaye said, “I notice that PMB is trying to whip up sentiments against the National Assembly again by alleging that the 2018 budget was padded.

“What the President is authorised to do constitutionally is to present a bill to the National Assembly.  A bill is a work in progress and not a finished work. The reason the constitution directs the bill to be submitted to the National Assembly is that it expects the National Assembly to vet it and make inputs into such a bill before passing it as the Appropriation Bill.

“The National Assembly is not just expected to rubberstamp whatever bill the President presents. If this was the norm, then there would have been no need for the constitution to direct that the bill be submitted to the National Assembly in the first place.”

The lawmaker stated, “Mr. President should therefore refrain from playing to the gallery and milking the naivety of the masses on the issue.

“In any event, he reserves the prerogative of refusing to append his signature to the bill passed if it meets with his displeasure. He is also free to return the bill to the National Assembly unsigned, with a note indicating his areas of disaffection.

“Therefore, Mr. President should halt his chicanery and smear campaign against the National Assembly.”

On Wednesday night, Senator Shehu Sani said the National Assembly made adjustments to the 2018 Appropriation Bill to ‘slim fit’ the budget with his administration.

He said, “Baba took his cloth to the tailors and asked them to make agbada for him. They measured his frame and after six months, they made a kaftan for him. He angrily complained that they short changed his fabric (sic), made a wrong design and wasted his time. The tailors replied that the delay was because ‘you have been travelling a lot all this while’ and the size was because ‘you lost so much weight and now you have a slim fit.’

In the House of Representatives, some members, who spoke with The PUNCH also expressed different views.

The Majority Leader of the House, Mr. Femi Gbajabiamila, told The PUNCH that the matter was not for the two arms of government to take extreme positions, but to resolve it through a middle course.

He argued that the proper thing to do was to first examine the President’s observations.

Gbajabiamila stated,  “The President has made some observations.  The two arms of government will work it out in a way that is most beneficial to the Nigerian people for whom the budget is for.

“That is what democracy is all about.”

But, the Deputy Minority Whip, Mrs. Binta Bello, disagreed with Gbajabiamila’s “diplomatic approach”, saying that the budget had become a law which Buhari was bound to implement.

She asked why in every budget year, the Executive would raise questions over the power of appropriation “vested in the National Assembly by the 1999 Constitution.”

Bello noted that the executive rarely admitted blame or accepted failure for non-implementation of budget.

She added, “I think what the President is doing is to pit the National Assembly against Nigerians. He knows that elections are coming in 2019.

“When people ask him why there is non-implementation of budget by his administration, he will blame it on the National Assembly or use insertions as the excuse.

“My advice to him is that he should implement the budget.”

The Chairman, House Committee on Financial Crimes, Mr. Kayode Oladele, said under section 14 of the constitution, government’s primary responsibility remained the security and welfare of the citizenry.

He explained, “Government here means both the Legislature and the Executive, both contributing to the budget to address the security and welfare of the citizenry.

“The power of appropriation belongs to the legislature. In the US, it is called the power of the purse, where there is also frequent debates over insertions.

“However, at the end of the day, what becomes the budget is the law that should be implemented, else there will be government shut-down

We’ll speak on inserted projects worth N578bn today – N’Assembly

Meanwhile, the National Assembly will on Friday explain the 6,403 projects worth N578bn allegedly inserted by the lawmakers into the 2018 budget.

This was made known in a statement by Chairman of the Senate Committee on Media and Public Affairs, Senator Aliyu Sabi-Abdullahi, in Abuja on Wednesday night.

“It should also be noted that the leadership of both chambers have directed the chairmen of our Committees on Appropriations to provide item by item, detailed explanations on all points raised by the President for the benefit of members of the public. They will therefore address a press conference on Friday, June 22nd, 2018,” the statement read in part.

Journalists at the National Assembly were on Thursday informed that there would be a joint press conference by the Chairmen of the Senate and House of Representatives’ Committees on Appropriations, Senator Danjuma Goje and Mr. Mustapha Dawaki.


How FG’ll Raise N9.1tn To Fund 2018 Budget – Udoma

The Minister of Budget and National Planning, Udo Udoma, has explained how the N9.1tn revenue to finance the 2018 budget will be raised by the Federal Government.

Speaking during the public presentation of the 2018 budget on Thursday in Abuja, Udoma expressed optimism that the government would be able to generate enough revenue to finance its programmes as contained in the fiscal document.

The event was attended by the Minister of Finance, Mrs Kemi Adeosun; Minister of State for Budget and National Planning, Hajiya Zainab Ahmed; the Director-General, Budget Office of the Federation, Mr Ben Akabueze, and other top government officials.

The 2018 budget, which was designed to consolidate on the Economic Recovery and Growth Plan, was presented to the National Assembly on November 7, 2017.

It was passed by the lawmakers on May 16, 2018, transmitted to President Muhammadu Buhari on May 25 and assented by him on June 20.

The fiscal document signed by Buhari had a total proposed spending of N9.1tn, made up of N2.87tn for capital expenditure, N3.51tn for recurrent (non-debt) expenditure and N2.01tn projected to be spent on debt servicing.

Giving a breakdown of how the N9.1tn budget would be financed, Udoma said the sum of N2.99tn would be generated from  oil revenue, N31.25bn would come from dividend to be received from the Nigerian LNG Limited, while N1.17bn was expected to be realised from minerals and mining revenue.

The minister stated that the Federal Government was targeting to generate N658.55bn from Companies Income Tax, N207.51bn from Value Added Tax, N324.86bn from Customs duties, while N57.87bn was expected to come from Federation Account levies.

In the same vein, he said the government was expecting N847.95bn as independent revenue from its agencies, while tax amnesty income, signature bonus and unspent balance from previous years would provide N87.84bn, N114.3bn and N250bn, respectively.

He also said the sum of N374bn was expected to be realised from domestic recoveries and fines, while N138.44bn would come from other Federal Government recoveries.

The minister added that the sum of N710bn would be realised from the sale of oil assets, while grants and donor funding would contribute N199.92bn.

He stated that N146.64bn would be realised from other unnamed revenue sources, while the budget deficit of N1.95tn would be financed through borrowing of N1.64tn.

The N1.64trn borrowing is made up of domestic borrowing of N793bn and foreign debt of N849bn.

In addition, the minister said about N306bn was expected from privatisation proceeds, while N5bn was projected to be realised from the sale of other government property to partly finance the deficit.

He noted that the government would be implementing some key reform initiatives contained in the ERGP in order to boost its revenue.

Some of them are deployment of new technology to improve revenue collection, upward review of tariffs and tax rates where appropriate, and stronger enforcement action against tax defaulters.

The government, according to Udoma, will improve the revenue performance of government-owned enterprises by reviewing their operational efficiency and cost-to-income ratios.

He said, “The 2018 revenue projections reflect new funding mechanism for Joint Venture operations, allowing for cost recovery in lieu of the previous cash call arrangement; and additional oil-related revenue, including royalty recovery, new/marginal field licences and early licensing renewals.

“Our journey out of the recent economic recession has helped us reset our priorities and to focus more on reforms and activities that have both short and long-term bearings on sustainable economic growth.

“In line with the ERGP, we are seeking to optimise derivable benefits from oil by restructuring our equity in JV oil assets while we intensify our efforts at accelerating economic diversification and non-oil revenue generation.”

The minister added, “Already, diversification efforts are yielding positive results with significant growth in the non-oil sector.

“Government will continue to create the enabling environment for the private sector to increase its investment and contribute significantly to job creation and economic growth.”

With the slashing of funds meant for the completion of key projects between this year and the next by the lawmakers, the implication, according to him, is that there may be a shift in their completion dates.

This, he noted, was because the available funds were insufficient to cater for the costs of the projects.

While calling for the cooperation of the legislature, Udoma noted that the Executive would soon approach them with a request for a readjustment of the already signed budget.

“We are determined to ensure that the budget is effectively implemented. We will work closely with the National Assembly where we need adjustment or a supplementary budget.  We hope that they will cooperate with us,” he added.

Akabueze, on his part, promised that the 2018 budget would be the last time that the government would present the annual budget estimates to the National Assembly late.

He said the country would never experience any delay in the commencement of the budget under his watch as the DG of the Budget Office, adding that the development was slowing down the expected growth of the economy.

He noted that the understanding between the executive and legislature would be strengthened to accelerate a cordial working relationship.

Akabueze stated, “This event is holding just a day after the budget was signed, which underscores the seriousness we attach to what we are doing and also a sense of decency to which we must approach the vision of this project.

“This will be the last time, hopefully, that the Federal Government’s budget for any fiscal year will be delayed.”

In her presentation at the event, Ahmed debunked claims that the money meant for the Special Intervention Programme, including the home-grown school feeding programme, was mismanaged.

She explained that those who tried to sabotage the programme were caught and punished accordingly.

She said, “We run the programme in such a way that there are checks and balances. And there has been an attempt from different levels to short-change the programme, but because of the things we have put in place, we have easily found out and taken it up with security agencies, and we are trying to curb the challenges.”

“We have had some people that have been apprehended for short-changing the system.”


N1.6 Trillion Released For Capital Projects In 2017 Budget – Adeosun

THE Federal Government has announced that a total of N1.6 trillion (N1,580,270,755,084.44) capital cost was released to Ministries, Departments and Agencies for the 2017 federal budget. Minister of Finance, Kemi Adeosun, made this known in Abuja, yesterday.

The N1.6 trillion total capital releases for 2017 is higher than the N1.2 trillion (N1,219,471,747,443.00) total capital releases for 2016. In the 2017 capital releases, Power, Works and Housing received the highest allocation of N523,011,701,723.25 which was 33.10 per cent of the total capital releases. The sector also received the highest releases in the 2016 capital budget, which was a total of N307,411,749, 682.00 (25.21 percent) of the 2016 capital budget.

Defence and Security received the second highest capital releases of N197,596,016,072.02 (12.50 per cent) in 2017, as against N77,532,885,729.00 (6.36 per cent) total releases the sector received in 2016. Agriculture and Water Resources received a total of N149,485,276,897.37 (9.46 per cent) in 2017. The sector had received N143,121,925,241.00 (11.74 per cent) of the capital releases in 2016. Transportation received a total of N126,253,042,607.50 (7.99 per cent) of the 2017 capital releases as against the N171,900,597,013.00 (14.10 per cent) in 2016. Health and Education together received a total of N98,190,277,285.69 (6.21 per cent) for 2017 as against N56,270,030,992.00 (4.61 per cent) the sectors received in 2016. Other sectors combined received a total of N485,734,440,498.61, which was 30.74 per cent of the 2017 capital releases. In 2016, a total of N463,234,558,786.00 (37.99 per cent) was disbursed to these sectors. The Minister of Finance noted that despite the economic challenges in 2017, the Federal Government was able to fully cash-back the capital releases. She added that the sustained high allocations to key sectors were a reflection of the Federal Government’s commitment to infrastructure development in the country. The minister said that the Federal Government was working assiduously to attract private capital to complement government spending in these key areas.


Auditors To Get N8.7bn For Recovering N58bn Into Federation Account

Auditors who helped to recover N58bn into the Federation Account are to receive N8.7bn for their efforts, investigation has revealed.

The amount represents 15 per cent of the recovery, which the auditors helped the government to make from banks that failed to remit the money into the Federation Account.

The Revenue Mobilisation, Allocation and Fiscal Commission recently announced that the auditors helped it to recover N58bn, which the banks collecting revenues on behalf of the government failed to remit into the Federation Account.

Investigation by our correspondent showed that the RMAFC signed an agreement that allowed the auditors to receive 15 per cent of any amount they helped the government to recover from the defaulting banks.

The commission also announced that it had issued a demand notice to the banks for another N16.4bn that had yet to be recovered from those of them appointed to collect revenues on behalf of government revenue collecting agencies.

The banks were appointed to collect revenues on behalf of the Federal Inland Revenue Service, Nigeria Customs Service and the Department of Petroleum Resources.

The Acting Chairman, RMAFC, Umar Gana, had said that N48.7bn of the recovered money had been paid into the Federation Account, while N9.07bn relating to withholding tax on dividend only had been released to the benefitting states’ boards of internal revenue.

The PUNCH had exclusively reported that the RMAFC had in 2016 selected 111 auditors and auditing firms out of more than 150 that applied to probe the banks operating for non-remittance of taxes and duties collected on behalf of the government.

The probe of the banks covered the period July 2012 to December 2015.

The audit exercise covered taxes, levies and duties collected by the banks for the FIRS, NCS and the Department of Petroleum Resources.

The probe was sequel to a similar exercise in which the banks were investigated for revenues collected between January 2008 and June 2012. The exercise had revealed that the banks failed to remit N12bn that they collected in taxes and duties on behalf of the revenue collecting agencies.

Following the success of the first exercise, the National Economic Council at its meeting on April 21, 2016 approved that the RMAFC should appoint a good number of consultants to ensure wider coverage of the verification of the activities of the banks regarding revenue collection.


NNPC Repairs Pipeline, Power Generation Increases By 1,304MW

Power generation has risen to 3,876.9 megawatts after the Nigerian National Petroleum Corporation fixed the gas pipeline that was ruptured on Friday, which supplies gas to most thermal electricity generating plants in the country.

Data obtained from the Transmission Company of Nigeria in Abuja on Tuesday showed that the country’s power generation increased by 1,304.3MW, as it moved up from the 2,572.6MW recorded on Sunday to 3,876.9MW on Monday, which was the latest generation figure as of when this report was filed in.

The TCN also stated that that there was significant improvement in gas supply to the power generating plants following the restoration of the ruptured pipeline, adding that gas was gradually building up in most generating stations.

The firm noted that in a day or two, it was expected that gas and power supply would be back to normal and explained that the increase in power generation to the national grid was an indication that gas supply had improved.

The electricity grid witnessed a sharp drop in power generation on Friday and Saturday, losing 1,087.6 megawatts as about eight power stations were forced to shut down operations due to the rupturing of the gas pipeline.

Power generation had plunged to about 2,905MW on Friday from 3,992.6MW the preceding day, following the rupturing of the gas pipeline belonging to the Nigeria Gas Company as well as technical issues at the gas wells of an international oil company, Shell, on June 16.

The TCN commended the NNPC and the NGC for the quick intervention, and also appreciated the Federal Ministry of Power, Works and Housing, the power generation and distribution companies and electricity customers for their cooperation during the crisis period.

The General Manager, Public Affairs, TCN, Mrs Ndidi Mbah, stated that as soon as the gas build up was completed, the affected generating stations would resume normal power generation to the grid.

She noted that through the implementation of the Transmission Rehabilitation and Expansion Programme, the TCN had commenced the construction of new substations as well as upgrading of existing ones and transmission lines across the country.

“This is expected to further stabilise the grid and also put necessary flexibility and redundancy in line with N-1 capacity,” Mbah added.

<< PUNCH.>>

Improved Forex supply deflates banks’ e-payment income

BANKS’ income from electronic payment (e-payment) businesses fell by 11.6 percent in 2017, prompted by the improved foreign exchange supply for invisibles by the Central Bank of Nigeria (CBN) in 2017.

Newsmen investigations of the electronic banking income of 12 banks in 2017 showed a significant decline to N131.26 billion in 2017 from  N148.49 billion in 2016.

The banks, however, attributed the decline to improved foreign exchange supply for invisibles from the CBN, suspension of cross border transactions on Naira debit cards and new electronic banking tariff introduced by the apex bank in 2017. They were, however, upbeat that this trend will be reversed in the 2018 financial year.
In the height of the foreign exchange scarcity in 2016, banks suspended cross border transactions on Naira debit cards. Prior to this, bank customers used their Naira debit cards for dollar transactions abroad including ATM withdrawals.

The banks sourced for the dollar to settle the transactions and hence earn commission of 0.25 percent per transaction value. The suspension of cross border transactions on Naira debit cards, however, wiped out this income in 2017.

Furthermore, as part of its efforts to boost dollar supply and appreciation of the naira,  the CBN from March last year begin to supply dollars to meet demand for invisibles such as Business Travel Allowance (BTA), Personal Travel Allowance (PTA), medical and school fees.

As a result forex end users did not have to rely on the Naira debit cards for dollar transactions when travelling out of the country. This development severely affected the electronic payment income of six of the 12 banks while the other six were able to overcome the challenge and grew their income.

The six  banks that were able to survive the challenge and grew their e-payment income in 2017 are: FBN Holdings (First Bank), GTBank, Zenith Bank, FCMB, Ecobank Transinternational (ETI) and Wema Bank. The e-payment income of the six banks rose by 19 percent to N87.26 billion in 2017 from N72.79 billion in  2016.  Wema Bank recorded the highest growth of 26 percent, with e-payment income rising to N2.26 billion in 2017 from N1.79 billion in 2016.

ETI came second with 25 percent growth to N24.2 billion in 2017 from N18.1 billion in 2016. FCMB came third with growth of 17 percent to N16 billion in 2017 from N13.7 billion in 2016. First Bank and Zenith Bank both recorded 15 percent growth in their e-payment income, which rose to N25 billion and N12.3 billion respectively in 2017 from N21.8 billion and N10.7 billion respectively in 2016. GTBank recorded the lowest growth of 12 percent to N7.5 billion in 2017 from N6.7 billion in 2016.

On the other hand, six banks suffered 42 percent decline in e-payment income as a result of the improved dollar supply environment. The six banks, namely Access Bank, UBA, Diamond Bank, Fidelity Bank, Union Bank and Stanbic IBTC, recorded N44 billion as e-payment income in 2017, down from N75.7 billion recorded in 2016.

Access Bank suffered the largest decline of 73 percent as e-payment income fell to N5.8 billion in 2017 from N21.3 billion in 2016. Union Bank recorded the second highest decline in e-payment income of 52 percent to N1.1 billion from N2.3 billion in 2016. Fidelity Bank came third as e-payment income fell by 36.7 percent to N6.8 billion in 2017 from N10.7 billion in 2016.

UBA recorded 32 percent decline in e-payment income which dropped to N20.9 billion in 2017 from N30.5 billion in 2016. Diamond Bank and Stanbic IBTC recorded 14 percent decline in e-payment income during the year. From N5.7 billion recorded in 2016, Diamond Bank’s epayment income dropped to N4.9 billion in 2017, while Stanbic IBTC epayment income fell to N4.5 billion in 2017 from N5.2 billion in 2016.


Equities Market Sustains Bullish Trading on Positive Sentiments

The stock market sustained its positive performance last week as the Nigerian Stock Exchange (NSE) All-Share Index appreciated by 0.76 per cent, to close higher at 38,928.02, while market capitalisation chalked up N150.9 billion to end the week at N14.102 trillion.

The market had recovered from a bearish trading the preceding week, by gaining N700 billion in terms of market capitalisation.

Although trading was for only four days last week due to public holiday last Friday and today, declared by the federal government to mark the end of Ramadan and commemorate the Eid-al-Fitr celebrations, the bulls were able to repel advances by the bears twice.

Consequently, the market closed higher, for the second week running. While  the NSE ASI and other indicators appreciated the NSE Corporate Governance, NSE Consumer Goods and NSE Industrial Goods Indices depreciated by 0.08 per cent, 0.85 per cent and 0.12 per cent respectively.


Daily Performance

Trading   resumed on  Monday on a positive note  with  the  index rising by 0.45 per cent, to close at 38,844.32.  A total of 30 stocks appreciated  while   20 others depreciated.  Consequently, the month-to-date and year-to-date growth improved to 1.94 per cent and 1.57 per cent in that order.

According analysts at Meristem Securities Limited, trading recovered from the losses recorded on the final trading session the preceding week.

“The gains on counters in the banking and consumer goods sectors drove the performance of the market. We expect this to continue for the remainder of the week, even with bouts of profit taking on some of the counters,” they had said.

Bellwethers such as Nigerian Breweries Plc, FBN Holdings Plc, Guaranty Trust Bank Plc and Zenith Bank Plc were among the advancers. But NASCON Allied Industries Plc led the overall gainers’ table with 7.1 per cent on that day.

Diamond Bank Plc trailed with 6.5 per cent, while Japaul Oil & Maritime Services Plc gained 6.4 per cent. NAHCO Plc and Equity Assurance Plc chalked up 5.0 per cent each. AIICO Insurance Plc and Presco Plc gained 4.8 per cent and 4.7 per cent respectively last Monday.

Conversely, Berger Paints Nigeria Plc led the price losers with 5.0 per cent, followed by BOC Gases Plc with 4.9 per cent. Eterna Plc shed 4.7 per cent just as Prestige Assurance Plc and Wema Bank Plc went down by 4.4 per cent and 3.9 per cent respectively.

Meanwhile, activity level was mixed on the first trading day last week, as volume traded improved by 187.2 per cent to 603.2 million shares while value traded remained flat at N3.9 billion. The most traded stocks by volume were Ikeja Hotel Plc (279.6 million shares), United Capital Plc (79.1 million shares) and African Prudential Plc (56.8 million shares) while Ikeja Hotel Plc (N705.0 million shares), Dangote Sugar Refinery Plc (N641.9 million) and GTBank (N437.7 million) were the top traded stocks by value.

Nevertheless, the bullish trend was sustained on Tuesday as the index rose further by 0.84 per cent to close at 39,167.39.

Similarly, the market capitalisation added N117 billion to close last Tuesday at N14.2 trillion.

As a result, the year-to-date (YTD) growth improved to 2.4 per cent.

The performance was influenced by gains in Dangote Cement Plc, Nestle Nigeria Plc and Seplat Petroleum Company Development Plc. In all, 27 stocks appreciated while 21 depreciated.

Seplat led the price gainers with 8.1 per cent on as investors increased their stake ahead of improved returns. The company had last year returned to profitability last year and consolidated on the performance in the first quarter ended March 31, 2018.

The Managing Director of Seplat, Mr. Austin Avuru last week told investors at the company’s annual general meeting that the company was well equipped to deliver long-term value for shareholders.

“I am pleased to report that Seplat made a return to full-year profitability in 2017, registered strong cash flow performance and significantly strengthened the balance sheet.

“In a year of contrast, we were plagued throughout most of the first half by force majeure at the Forcados terminal. Our proactive and decisive management coupled with the strong underlying fundamentals of the business have seen us emerge from an exceptionally challenging period a much fitter and stronger business that is well equipped to deliver long-term value for our shareholders,” he had said.

Double 11 Plc closed as the second highest price gainer with 4.9 per cent, NEM Insurance Plc and Equity Assurance Plc garnered 4.8 per cent and 4.7 per cent in that order.

Conversely, last Tuesday, Prestige Assurance Plc led the price losers with 4.6 per cent, followed by Eterna Plc with 4.4 per cent. FCMB Group Plc shed 4.1 per cent, just as Niger Insurance Plc and A.G Leventis Plc went down 3.7 per cent.

In terms of sectors, four of them appreciated while only one declined.  The loser was the NSE Banking Index that shed 0.04 per cent.  The NSE Oil & Gas Index led with 4.9 per cent on the back of gains by Seplat and Double 11.

The NSE Insurance Index rose 0.9 per cent, while the NSE Industrial Goods Index and NSE Consumer Goods Index depreciated by 0.5 per cent and 0.4 per cent.

However, on Wednesday the positive trend was halted as some investors moved in to take profit.  This led to the index declining by 0.35 per cent to close at 39,031.72.

Similarly, on that day, the market capitalisation shed  0.35 per cent  to close at N14.14 trillion. The depreciation recorded in the share prices of FBN Holdings, Dangote Sugar, Nigerian Breweries, Zenith Bank, and UBA were mainly responsible for the negative close.

The three most actively traded stocks on that day, were UBA (90.61 million shares), United Capital (78.68 million shares), and African Prudential (72.10 million shares).

But the stock market closed lower on Thursday, which was the last trading day of the week. While the index fell from 39,031.72 to close at 38,928.02,  market capitalisation declined from N14.139 trillion to N14.102 trillion.

Although 28 stocks appreciated as against 17 that depreciated, heavy weight such as  Zenith Bank Plc, FBN Holdings Plc and Nigerian Breweries Plc that were among the losers led to the bearish close.


Market Turnover

In  the   four trading sessions last week , a total turnover of 1.738 billion shares worth N18.462 billion in 14,790 deals was recorded compared with  1.749 billion shares valued at N31.183 billion that exchanged hands in 24,604 deals the previous week.

However, the   Financial Services Industry was the most active with  1.170 billion shares valued at N9.695 billion exchanged in  7,809 deals, thus contributing 67.3 per cent and 52.5 per cent  to the total equity turnover volume and value respectively. The Services Industry followed with 293.492 million shares worth N733.407 million in 531 deals. The third place was occupied by Consumer Goods with a turnover of 154.093 million shares worth N4.997 billion in 3,002 deals.

Trading in the top three equities namely – United Capital Plc, Ikeja Hotel Plc and United Bank For Africa Plc accounted for 811.747 million shares worth N3.887 billion in 986 deals.


Price Gainers and Losers

Meanwhile, 40 equities appreciated in price during the review week, lower than 49) in the previous week, while 28 equities depreciated in price, lower than 29 equities of the previous week.

Japaul Oil & Maritime Services Plc led the price gainers with 22.5 per cent, trailed by Equity Assurance Plc with 20 per cent. Union Bank of Nigeria Plc appreciated by 10.7 per cent just as Okomu Oil Palm Plc and Learn Africa Plc chalked up 10.2 per cent and 9.7 per cent in that order.

Other top gainers were: LASACO Assurance Plc (8.5 per cent); NPF Microfinance Bank Plc (8.5 per cent); Ikeja Hotel Plc (8.3 per cent); Honeywell Flour Mills Plc (8.2 per cent) and C & I Leasing Plc (7.4 per cent).

Conversely,  Mutual Benefits Assurance Plc led the price losers, shedding 13.8 per cent, followed by A.G Leventis Nigeria Plc (7.5 per cent). Nigerian Breweries Plc went down by 5.9 per cent, just as  Berger Paints Nigeria Plc declined 5.0 per cent.

Other top losers included: B.O.C Gases Plc (4.9 per cent); Union Diagnostic & Clinical Services Plc ; Neimeth International Pharmaceuticals Plc(4.7 per cent apiece); Law Union & Rock Insurance Plc (4.6 per cent); Prestige Assurance Plc (4.4 per cent) and Newrest ASL Nigeria Plc (4.2 per cent).


ABCON Backs CBN Currency Swap Deal

The Association of Bureaux De Change Operators of Nigeria (ABCON) has once more applauded the $2.5 billion currency swap agreement between the Central Bank of Nigeria (CBN) and the People’s Bank of China (PBoC), saying the deal will promote naira’s sovereignty in Africa.

ABCON President, Alhaji Aminu Gwadabe, was quoted in a statement at the weekend, to have said the naira would benefit hugely from the deal given the rising influence of the Chinese Yuan in the international market.

He argued that the admittance of Yuan into the basket of International Monetary Fund (IMF) currencies and the naira/yuan swap deal would actualise the dream of naira sovereignty in Africa.

The naira has remained stable at both the official and parallel markets, as the CBN continues its weekly dollar interventions.

The naira which in February 2017 was exchanging at N520/$ in the parallel market now trades at N361/$, while rate at the official market remains N305.9/$.

The Yuan has equally made significant progress this year, appreciating 1.8 per cent against the dollar to become the world’s second-strongest Asian currency.

The ABCON boss also urged the CBN to consider diversifying dollar disbursement to BDCs with percentage amount of Yuan to meet the critical needs of their numerous clients travelling to China for personal and business purposes.

Gwadabe disclosed that the currency swap deal was part of the CBN’s plan to keep the naira stable and protect the foreign reserves domiciled in dollars.

He said the deal would provide adequate local currency liquidity for Nigerian and Chinese industrialists and reduce difficulties they face in searching for the greenback.

The ABCON said his members would equally benefit from the bilateral currency deal, given that a stable and strong naira was good for the economy and operators.

He added that increased use of Yuan in trade deals would also open a new business opportunity for BDC operators.

According to Gwadabe, ABCON will continually support CBN in achieving its exchange rate stability mandate and promoting economic growth through increased global partnerships and collaborations.

Gwadabe reiterated that the said swap deal would smoothen bilateral trade,  boost  investment,  and  protect the financial market in both countries as well as cut dollar demand by Nigerians entrepreneurs importing from China. All these, he said, would firm the value  of  the  local currency.

He therefore advised that to achieve the full gains of the deal, Nigeria has to take steps that boost its trade balance with China by raising the quality of its local products to make them more attractive and acceptable to the Chinese people.

“The deal will expand the BDCs capacity to handle new business transactions in Yuan. Besides, BDCs in both countries will have their transaction base expanded, including new opportunity to transact higher volume of Naira/Yuan in the export/import of equipment, raw materials and finished goods,” he said.

Gwadabe praised the CBN-led Bankers’ Committee for promising incentives to Nigerian businesses that import their machinery and goods with Yuan instead of dollar, adding that such act would deepen entrepreneurs’ interest in the swap deal.


NNPC raises kerosene price thrice in two months

The Nigerian National Petroleum Corporation has increased the price of kerosene three times between May and so far this month, raising the cost of the commodity by about N40 per litre, an investigation by our correspondent has revealed.

It was found out that despite the price hike, the corporation through its subsidiary, the Pipelines and Product Marketing Company, had not been supplying the commodity to marketers.

Many marketers of the product, popularly known as Dual Purpose Kerosene, said they had not received what they paid for since November 2017, despite making additional payments to the PPMC following the price increases.

Findings by our correspondent in Abuja on Tuesday showed that some independent oil marketers paid N4.785m each for 33,000 litres of DPK in November 2017, which translates to N145 per litre, but had not been supplied the commodity till date.

Some of them paid an additional sum of N165,000 each in March 2018 in order to pick up the product, bringing the cost of the commodity to N150 per litre. But they still could not get the product.

On May 3 this year, the PPMC issued a circular with reference number, PPMC/CSD/UPM/0034, announcing a further increase in the DPK price and raised the cost to N179.83 per litre for ex-depot Lagos/Oghara, while coastal price ex-refinery was put at N168.94 per litre.

Additional payments of N984,390 and N335,610 were made on May 9 and June 6 this year by some of the affected marketers for the same product that was initially paid for in November 2017. This brought the cost of kerosene to about N190 per litre and made it the third time the cost of the product was increased within two months.

It was learnt on Tuesday in Abuja that the concerned independent marketers had yet to take delivery of their products from the PPMC despite the increases in price and the payments they had made so far.

They stated that at the point of picking up the product, they often got new information from the PPMC announcing another price hike and mandating them to make additional payments before taking delivery.

One of the affected marketers, who pleaded not to be named for fear of being victimised, said, “In the last two months, the NNPC has increased the cost of DPK three times. The cumulative increase on about four occasions is close to N1.5m. The price of 33,000 litres of DPK, as of last year November, was N4.785m, which was about N145 per litre. When you add the additional N1.5m, this raises the price per litre to about N190.

“The annoying part is that they have refused to make the product available for the past seven months. Anytime you’re to receive what you’ve already paid for as agreed, they will tell you that you can’t because the price has increased again.

“So, in the past two months, the NNPC, through its subsidiary, the PPMC, has increased the DPK price three or four times. We see this as a fraud and it is alarming!”

Another independent marketer argued that the increase in crude oil price should not be used as a reason to prevent dealers from accessing their products.

He stressed that the products that were paid for should be supplied first, adding that the corporation was free to inform marketers of a price increase in the subsequent round of purchase if need be.

He added, “We know the price of crude has been appreciating but that does not mean you should hold on to the products we’ve paid for. Release the ones we’ve paid for and inform dealers that there will be a price hike in the next round of purchase.

“Stop using the crude price instability as a yardstick to defraud independent marketers partly because of the dysfunctional nature of the Independent Petroleum Marketers Association of Nigeria. This is not fair and should not be happening under a government that is perceived to be fighting corruption.”

When contacted, the Group General Manager, Group Public Affairs Division, NNPC, Ndu Ughamadu, told our correspondent that kerosene supply was now coming from the country’s refineries on first pay, first load basis, because imported DPK was expensive and that the corporation’s representatives had been directed to stop collecting money from marketers.

He said, “We are supplying the market with DPK mainly from the refineries as imported volume is expensive. We have maintained a regime of first pay, first load from such refineries and have directed our sales reps not to take further payment for such product until old tickets are supplied.

“As you know, the marketers like to pay in advance for DPK and AGO (diesel), being their preferred products, and when the refineries are down, they start complaining.”


NERC issues power generation, distribution licences for Ariaria

The Nigerian Electricity Regulatory Commission has issued power generation and distribution licences to two firms to independently generate and distribute 9.5 megawatts of electricity in the popular Ariaria Market in Aba, Abia State.

The regulator issued the power generation licence to Ariaria Market Independent Power Plant Limited, while Ariaria Independent Energy Distribution Network Limited got the right to distribute the embedded electricity in the market.

In a statement issued in Abuja on Tuesday, the commission said, “NERC, in pursuit of overriding public interest, has granted a 9.5MW embedded electricity generation licence to Ariaria Market Independent Power Plant Limited and an Independent Electricity Distribution Licence to distribute same within the Ariaria Market to Ariaria Independent Energy Distribution Network Limited.”

It explained that the licences were in accordance with the laws guiding the power sector, adding that the move would promote access to electricity and impact positively on the outputs of industries in the area.

NERC said, “The licences, issued in line with Section 71(6) of the Electric Power Sector Reform Act, 2005, were granted after careful consideration of the applications in the public interest to promote access to common good and to promote commercialisation and industrialisation for which Ariaria, a leading commercial hub in the country, is reputed.

“Both licences granted to Araiaria were affirmation of the commission’s commitment and response to the long-time yearnings of the market for a stable, reliable and sustainable electricity supply to improve the quality of goods and services by Nigerian enterprises and entrepreneurs.”