12 Dec

Daily Watch – Lagos unveils trillion naira budget, APC in frenzy over possible cabinet reshuffle

  • CBN Governor Godwin Emefiele says the cash reserve ratio of banks who lend a certain portion of funds to SMEs may be reduced. Speaking at the ninth Banker’s Committee retreat in Lagos on Sunday, Emefiele said the interest rate will not be more than five percent and the fund’s tenor should be at a minimum of seven years so that those who access the fund would have ample time to repay. The CRR is used to determine the minimum deposit commercial banks must hold in reserves with the CBN rather than lend out. It influences funds available at bank’s disposal to create loans. At its last meeting in November, the monetary policy committee of the CBN agreed to hold CRR at 22.5 percent. The regulator also announced the resuscitation of a proposed ₦500 billion export stimulation loan for non-oil producers and exporters in the country.
  • Nigeria’s states have submitted 108 names to President Muhammadu Buhari for appointment as ministers and board members, the Daily Trust newspaper reports, citing unnamed sources. The paper said each state has submitted the names of three APC members to be appointed as ministers or heads of federal agencies. Buhari said during a 31 October APC NEC meeting that he planned to expand the ministerial appointments from 36 to an undisclosed number. The president has reportedly allocated one more ministerial slot to Kano and Lagos states; as well as one to each of the six geopolitical zones.
  • Lagos Governor Akinwumi Ambode has presented the 2018 budget before the state house of assembly. The ₦1.046 trillion budget is ₦254 billion less than Cross River’s 2018 proposed spending plan – which at ₦1.3 trillion – is the highest by any Nigerian state. Officially titled, the budget of “progress and development” and a 28.67 percent increase over Y2017 budget, the spending plan calls for N699.082 billion in capital expenditure spending and N347.039 billion for recurrent expenditure, representing a capital/recurrent ratio of 67 to 33 percent.
  • The SEC said that the total value of issuances included equities, bonds and unlisted securities in the Nigerian capital market amounted to ₦1.55 trillion in September. SEC Acting Director-General Abdul Zubair made the disclosure at the 2017 annual conference of Capital Market Correspondents Association of Nigeria, CAMCAN, in Lagos. He said the equities accounted for 12 percent of the total value of issuances in the market during the period and added that secondary market total equities transactions appreciated by 78.6 percent to ₦1.66 trillion between 2016 and September 2017. Foreign transactions also increased by 47.31 percent during the period and the NSE ASI had posted a remarkable recovery, returning 47.11 percent as at 7 December.
  • The Nigeria Inter-Bank Settlement System and Precise Financial Systems have collaborated to unveil a new National Automated Clearing System which allows all the DMBs in the country to clear cheques within hours. The banks have been test-running the infrastructure for 11 weeks and a total of ₦5 trillion worth of cheques from 10 million transactions has been processed through the new platform. At the post go-live session in Lagos at the weekend, the NIBSS Managing Director, Ade Shonubi explained that the institution had been on the project for over 18 months. The software firm behind NACS, PFS Managing Director, Yele Okeremi said the process of clearing cheques in all Nigerian banks has been simplified with the launch of NACS and that the successful completion of the project will open the door for Nigerian firms to take on more national challenges.