05 Apr

Daily Watch – Public anger rises over petrol scarcity, Fidelity exposed to ‘partially bad’ Oando loan

  • Bello Rabiu-Babura, Upstream Co of the NNPC, says the Kaduna Refining and Petrochemical Company will resume production in two weeks. Rabiu-Babura said that all the three Refineries, Warri, Port Harcourt and Kaduna would resume refining crude oil for local consumption by the end of April to address the current scarcity. “The Kaduna Refinery will resume in two weeks’ time as part of efforts to end the lingering fuel scarcity being experienced in the country,” he said. According to him, local crude refining at the KRPC would address the scarcity being experienced, especially in the Northern region. Meanwhile, an NNPC sales representative, Wale Olayinka, became the first recorded victim of rising public anger over the petrol scarcity as he was beaten to a near coma at the NNPC Mega Station in Osogbo, Osun  State.
  • From July 1, Nigeria’s export products may be rejected if they or the containers in which they are loaded, are not weighed before being loaded onto ships. The rule, which is a convention of the International Maritime Organisation, is expected to become effective for all member nations on July 1. It is estimated that new rule will cost shippers $5 billion in additional costs as a huge investment will be required to install the weighing mechanisms at seaports worldwide. Containers leaving the country and their contents are not being weighed at the moment as shippers are only required to estimate the weight of the contents of the containers.
  • Bank customers lost the sum of N2.25 billion to fraudsters in 2015 despite a significant fall in the value of financial fraud recorded last year, data from the CBN and the Nigeria Inter-Bank Settlement System Plc showed. In 2014, fraudsters made 1,461 attempts to steal N7.8 billion, but succeeded in stealing N6.2 billion. The Head, Industry and Security Service, NIBSS, Femi Fadairo, said, “Though there were 10,743 attempts to steal N4.3 billion, only about N2.25 billion was eventually stolen from Nigerians by fraudsters last year (2015). Fadairo said that the ATMs were more vulnerable to fraud in 2015 and would even be the most targeted platform in 2016. The fraud volume through ATMs in 2015 was 5,133 and valued at N355,892,201.30.
  • Fidelity Bank has confirmed that its $113 million (N22.4 billion) loan to Oando Plc is “partially bad”, and has now taken a 5% special provision on the loan. According to Nnamdi Okonkwo, the bank’s MD, Fidelity has placed Oando on its watch list following indicating that parts or all of the loans might go bad. The CBN it was learnt, had asked commercial banks who lent money to Oando to take adequate provisioning on the loan in anticipation that it might go bad even though banks like Fidelity reported the loans as performing. Banks take provisions on loans if there are indications that it might go bad. A consortium of banks, including FBN Capital and FCMB lent over $350 million to Oando Plc in 2013 when it wanted to acquire Conoco Phillips’s assets in Nigeria.