Connect with us

Business

$7bn FX: OPS threatens to sue banks over rejected applications

Published

on

Central Bank of Nigeria

Some businesses under the aegis of the Organised Private Sector of Nigeria are considering taking legal action against some commercial banks for not honouring forex requests which have lingered over an extended period.

The OPSN also called for a comprehensive audit of the Central Bank of Nigeria’s forex backlog payments. This follows a recent claim by the apex bank that all valid forex backlogs have been cleared.

Members of the OPS insisted that the claim by the apex bank that it had settled all forex backlogs was not entirely true.

Some of the member associations, speaking in separate interviews, faulted the process through which the CBN conducted the settlement of the backlogs. They argued that the process was not transparent, neither was it carried out in the interest of full disclosure.

The threat of litigation comes despite a recent stakeholder meeting comprising NACCIMA, MAN, the affected banks and customers which was convened by the Minister of Industry Trade and Investment at the Bank of Industry in Lagos on March 21, 2024.

The CBN, had on Wednesday announced that it has successfully cleared all valid foreign exchange backlogs, effectively eliminating a legacy burden.

The announcement was made by the bank’s Acting Director of Corporate Communications, Mrs Sidi Ali, in a statement made available to journalists on Wednesday.

The CBN followed this month by reporting a significant increase in external reserves, rising by $993m to $34.11bn as of March 7, 2024, the highest level in eight months.

Notably, the CBN recently completed the payment of $1.5bn, resolving obligations to bank customers and thereby clearing the residual balance of the FX backlog.

The statement partly read, “The Central Bank of Nigeria has announced that all valid foreign exchange backlogs have now been settled, fulfilling a key pledge of the CBN Governor, Mr Olayemi Cardoso, to process an inherited backlog of $7bn in claims.

“Clearance of the foreign exchange transactions backlog is part of the overall strategy detailed in last month’s Monetary Policy Committee meeting to stabilise the exchange rate and thereby curb imported inflation, spurring confidence in the banking system and the economy.

“Cardoso used the MPC meeting and a subsequent conference call with foreign portfolio investors to set expectations for sustained increases in Nigeria’s foreign currency reserves and improved liquidity in the foreign exchange market.”

Cardoso, speaking at a recent meeting, had underscored the importance of clearing the FX backlog to restore credibility and confidence in the Nigerian economy.

The clearance of the foreign exchange transactions backlog aligns with the strategy outlined during last month’s Monetary Policy Committee meeting.

In January, the Central Bank of Nigeria said it released $500m to various sectors in its determination to address the backlog of verified foreign exchange transactions.

This came barely a week after the apex bank paid approximately $2bn to settle outstanding commitments across various sectors.

Reacting to the apex bank’s claim, the National Vice President of the Nigerian Association of Small Scale Industrialists, Segun Kuti-George said the claim by the CBN on clearing all valid forex backlog was not entirely correct.

According to him, many businesses still have funds trapped at the banks without any communication from the CBN regarding what constitutes a valid forex request and those deemed invalid.

Kuti-George further argued that the claim by the CBN that some of the forex requests were invalid was ‘propaganda’ and that some of the affected businesses are contemplating taking legal action against the banks in order to force the CBN’s intervention in the matter.

Kuti-George said, “Some of the requests have been cleared, but there are others that they are saying were illegal and did not meet their criteria, but the importers are not aware of the reason why the requests have been rejected. Their monies are still with the bank, and they are groaning.

“The ones that they did not approve. Let us know why it was not approved. We don’t know, and our monies are still hanging. The deposits are still hanging. So, they are crying. In fact, some of them are saying that they are thinking of taking the banks to court, and the bank in return, will pull the CBN in.

“What makes the requests invalid? Have they told the banks? So that they can get back to the owners? No. the banks themselves are unaware of what makes them invalid and the owners still have the funds with the banks, expecting them to pay foreign exchange. One of them told me he has over a N100m hanging.”

In the same vein, the National President of the National Association of Chambers of Commerce, Industry, Mines, and Agriculture, Dele Oye called on the CBN and the Ministry of Trade and Industry to craft an urgent solution to the unmet forex requests by some members of the OPSN to avert what appears to be a looming legal action on the part of the affected businesses.

Oye stated that several NACCIMA member companies and other private sector operators have challenged the completeness of the forex clearance.

He also noted that many of NACCIMA’s members have reported that despite the CBN’s commitment to provide foreign exchange, their funds in Naira have been retained for extended periods, some for over a year.

He expressed regret that this had occurred without adequate communication from their respective banks or the CBN, leaving their business operations in a state of uncertainty.

Oye also recalled that in February, NACCIMA as part of the Organised Private Sector of Nigeria, sought the intervention of the Minister of Finance to address these issues, emphasising the need for transparency and expedited resolution.

He added that NACCIMA, alongside NASSI, NASME and other associations, raised these concerns with the Minister of Industry, Trade, and Investment during a courtesy visit that same month.

Oye said, “As part of the Minister of Industry Trade and Investment’s preparation for the National Assembly Summons, a stakeholder meeting Comprising of NACCIMA, MAN, affected banks and customers was convened by the Minister of Industry Trade and Investment at the Bank of Industry in Lagos on March 21, 2024.

“At the meeting, it was gathered that there has been a lack of formal communication from the CBN regarding the rejection of foreign exchange bids. Furthermore, it was revealed that Deloitte, the consulting firm engaged by the CBN for verification purposes, had not directly engaged with the affected banks or their customers for clarification on any contentious transactions.”

According to Oye, the consensus from the meeting was that direct engagement with the CBN is essential. He recalled that the “Minister urged all parties to pursue dialogue and cautioned against actions like litigation that could hinder such discussions.”

Speaking further, Oye urged for a more comprehensive and transparent approach to resolving the remaining foreign exchange allocations.

This, he said, will not only support the integrity of banking processes but also bolster the confidence of the private sector in Nigeria’s financial institutions and the broader economic policies of the government.

He added, “NACCIMA appeals to the CBN to collaborate closely with the Honourable Minister of Industry, Trade, and Investment, as well as the banking sector and their clientele, to resolve all outstanding issues pertaining to legitimate letters of credit for which Naira has already been collected (for a considerable time) with a promise of fulfilment.

“It is important to underscore that the continuity of government obligations transcends the tenure of individual officeholders; hence, legitimate transactions initiated under previous administrations must be honoured with the same level of commitment.

On his part, the president of the Manufacturers Association of Nigeria, Francis Meshioye said the forex requests by its members are yet to be cleared.

According to Meshioye, the lingering status of the forex requests by manufacturers, which remains unmet, had taken a negative toll on many businesses.

Meshioye said, “Surely not. They have not cleared it. We know there are a lot of issues surrounding forward contracts, especially forex that is due to be paid. The agreement is that the money (forex) should be paid at a future date, and the future date has passed.

“They are in arrears. This is a concern to the manufacturers because it has a lot of effects, not only on the manufacturers but the country as a whole. In the first instance, you will lose your credibility.

“Forget about the woes it is causing the economy, you will lose your credibility in the international trade arena. It affects Nigeria as a brand. It is not good to the economy. Based on the obligation the CBN has entered in the past, there is a lot of money (forex) that is hanging, and we expect them to honour it.”

 

Continue Reading
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Business

 ‘We can’t pay’ – Nigerians react to Multichoice new prices for DStv, GOtv subscription

Published

on

There has been growing concerns among Nigerians over the recent increase in subscription fees for Multichoice products, specifically

There has been growing concerns among Nigerians over the recent increase in subscription fees for Multichoice products, specifically Gotv and Dstv. Many Nigerians have expressed their dissatisfaction with the company’s decision to raise prices annually, claiming that it is becoming excessive and burdensome for consumers.

Multichoice on Wednesday jacked up the prices of its offerings in Nigeria four months after its last increment. The company reviewed prices in its packages across the board. The new prices will take effect from May 1, 2024.

With the latest price hike, the DStv Premium package increased from N29,500 to N37,000. Similarly, the DStv Compact+ went up from N19,800 to N25,000 while the Compact package increased from N12,500 to N15,700.

The Comfam package moved from N7,400 to N9,300. Yanga package moved up from 4,200 to N5,100 while Padi package increased from N2,950 to N3,600. HDPVR was increased from N4,000 to N5,000, the Access Fees package from N4,000 to N5,000, and XtraView moved from N4,000 to N5,000.

Meanwhile, the Gotv Supa+ package moved from N12,500 to N15,700, Supa package from N7,600 to N9,600, and Max package from N5,700 to N7,200.

While the Jolli package was jacked up from N3,950 to N4,850, the Jinja package moved from N2,700 to N3,300, and Smallie package from N1,300 to N1,575.

The company implemented an upward review of prices in December 2023, days after announcing a $72m loss in its financial statement for the third quarter of the year.

Checks on the company’s reviewed price list then showed a 20 per cent per cent hike in the company’s packages across the board.

In April 2023, the broadcasting company also announced an upward review of prices on its DStv and GOtv packages by 17 per cent.

This was confirmed in a text message sent to customers that the new rates will take effect on May 1, 2023.

The pay-tv firm said the price adjustment was due to the rising costs of business operations.

“Please note that from May 1, your monthly subscription (premium) will be N24,500. To retain your old price of N21,000 for up to 12 months ensure you are active by April 30,” the text message reads.

Also, in March 22, MultiChoice increased the prices of its DStv and GOtv packages.

Announcing the increase in a statement, the company said the rising costs of inflation and business operations led to the increment in the prices of the packages.

As a result, there have been calls for the government, represented by the National Assembly leaders, to intervene and possibly even ban the usage of Multichoice products in the country.

The rationale behind this move is to safeguard the interests of Nigerian consumers who are grappling with the escalating cost of living in the country. The situation has led to heightened tensions between the company and its customers, with many calling for a more equitable and transparent pricing model.

Businesses need to respond to the concerns of their customers, particularly in a highly competitive market such as the media and entertainment industry. Multichoice’s current pricing policy has been met with significant resistance from Nigerian consumers, and the company must take proactive steps to address these concerns. Failure to do so may result in a loss of customer loyalty, decreased revenue, and reputational damage.

The PAPERS speaks with some consumers about the latest Multichoice products prices.

A civil engineer, Mr. Albert Ihedioha said: “It is not their fault; our government gave them the audacity to be scamming us deliberately. The government is not doing enough to protect the citizen of this country from scamming company like Multichoice. What stops this company from operating pay-as-you-go?  As for me, I have stopped using my DStv, I will look into anther cable for cheaper rate, enough is enough for DStv.

Another consumer, Mr. Kazzem Olaonipekun who operates lounge business also speaks against the hike and called it ‘scam’.

“This is not acceptable, I want call on the government to checkmate this South African company, we can’t accept this. This is like a daylight robbery and scam, imagine the inflation, look at the price and how they have been consistently doing it for three years. These are the people running down our economy, president Tinubu must intervene to this act with urgency.”

Speaking in the same vein, Mrs. Nkechi Sinat, a bar owner in Owerri said it is over to the Nigeria government to call Multichoice to order.

She said: “The truth of the matter is that those who are supposed to checkmate them have taken bribes, and that is why they feel they can do anyhow in our own country. Can we go to South Africa to do such? The kind of leverages they have here, can we have it there? As for me and my family, no more GOtv or DStv, and I want to confirm to you that I am selling off my dish once the current subscription expires next week.”

Mr. Michael Ighodalo from Belgium questions the manner at which some companies operate in Nigeria which is different from the way they operate in their own countries.

Hear him: “In a democratic country like Nigeria, such nonsense should stop. I think the Senate needs to look into this, especially this time when people are facing hardship, Multichoice is not reasonable at all. Is that the way they behave in their own country? I am calling on every Nigerian to stand up and say NO to MULTICHOICE and its products. They should stop the extortion. We have other products in the country why can’t we patronize them and dump these Multichoice products?”

Continue Reading

Business

NGX: Investors lose N673bn in five hours

Published

on

Investors in the Nigerian equities market endured another bearish session on Wednesday as they lost N673 billion at the end of trading.

Investors in the Nigerian equities market endured another bearish session on Wednesday as they lost N673 billion at the end of trading.

This followed the dip in the share value of MTNN, Transcorp Hotel, Oando and FBNH on the trading floor today.

After five hours of trading at the capital market, the equity capitalization decreased to N55.4 trillion from N56.1 trillion posted by the bourse on Tuesday.

Similarly, the All-Share Index (ASI) decreased to 98,121.30 from 99,311.54 achieved by the bourse the previous day.

The market breadth was positive as 20 stocks advanced, 19 declined, while 78 others remained unchanged in 7,907 deals.

Sunu Assurances Nigeria, Neimeth International Pharmaceutical, and The Initiate led other gainers with 10% growth each in share price to close at N1.21, N1.98, and N1.98 from their previous price of N1.10, N1.80, and N1.80 per share.

UPDC, CAP, and McNichol also increased their share prices by 9.90%, 9.90%, and 9.57% respectively.

On the flip side, MTN Nigeria Communications and Transcorp Hotels led other price decliners as they shed 10% each off their share prices to close at N201.60 and N87.93 from their previous N224.00 and N97.70 per share.

Oando, First Bank of Nigeria Holdings (FBNH), and Fidson Healthcare equally shed their share prices by 9.90%, 9.82%, and 9.75% respectively.

On the volume index, Guaranty Trust Holding Company traded 81.407 million shares valued at N2.9 billion in 444 deals followed by Zenith Bank which traded 46.156 million shares worth N1.69 billion in 650 deals.

United Bank for Africa (UBA) traded 41.600 million shares valued at N953.5 million in 717 deals.

On the value index, GTCO recorded the highest value for the day trading stocks worth N2.93 billion in 444 deals followed by Zenith Bank which traded equities worth N1.69 billion in 650 deals.

UBA traded stocks worth N953 million in 717 deals.

Source: RipplesNigeria

 

Continue Reading

Business

FULL LIST: Multichoice hikes DStv, GOtv prices

Published

on

Broadcasting company Multichoice has jacked up the prices of its offerings in Nigeria four months after its last increment.

Broadcasting company Multichoice has jacked up the prices of its offerings in Nigeria four months after its last increment.

The company reviewed prices in its packages across the board. The new prices will take effect from May 1, 2024.

With the latest price hike, the DStv Premium package increased from N29,500 to N37,000. Similarly, the DStv Compact+ went up from N19,800 to N25,000 while the Compact package increased from N12,500 to N15,700.

The Comfam package moved from N7,400 to N9,300. Yanga package moved up from 4,200 to N5,100 while Padi package increased from N2,950 to N3,600. HDPVR was increased from N4,000 to N5,000, the Access Fees package from N4,000 to N5,000, and XtraView moved from N4,000 to N5,000.

Meanwhile, the Gotv Supa+ package moved from N12,500 to N15,700, Supa package from N7,600 to N9,600, and Max package from N5,700 to N7,200.

While the Jolli package was jacked up from N3,950 to N4,850, the Jinja package moved from N2,700 to N3,300, and Smallie package from N1,300 to N1,575.

The PAPERS reports that the company implemented an upward review of prices in December 2023, days after announcing a $72m loss in its financial statement for the third quarter of the year.

Checks on the company’s reviewed price list then showed a 20 per cent per cent hike in the company’s packages across the board.

 

Continue Reading

Business

UBA branches sealed over alleged N14.3 million unpaid tax

Published

on

The Kaduna Internal Revenue Service, KADIRS, on Wednesday sealed the United Bank for Africa branches in the state metropolis over

The Kaduna Internal Revenue Service, KADIRS, on Wednesday sealed the United Bank for Africa branches in the state metropolis over alleged N14.3million unpaid tax.

Speaking to newsmen after the excercise, Aysha Ahmad, the KADIRS Board Secretary/Legal Adviser, said the enforcement was to ensure tax compliance in the whole state in respect of withholding taxes and money agents.

“We sent so many demand notices to them. We have asked them to pay the money but they refused, we are left with no other option but to enforce,” she said.

Mrs Ahmad added that the service wants voluntary compliance of tax payment, while lamenting that the defaulter had been recalcitrant.

She, however, said when the defaulters pay, the service would unseal the premises.

Speaking further, the board secretary said the the enforcement was part of a rocess to achieve the N120billion revenue target set by the Kaduna state government.

“To achieve a target, there is always a starting point. Sealing UBA branches in the state for tax default is our start. We are also going after all other defaulters to get what is due for the state government.

“We served them with demand notices . We have been communicating with their consultant and Headquarters. Infact, they even took us to court and the outcome was like a win-win situation at the tax appeal tribunal.

“The court gave us directives to review our assessment which we did and they did not still comply. It is on the reviewed assessment we are enforcing this morning,” she said.

Mrs Ahmad called on the people of the state to ensure voluntary tax compliance, describing it as a civic responsibility.

NAN

 

Continue Reading

Business

MTN records highest number of subscribers porting to other networks

Published

on

Telecommunications giant, MTN, has recorded the highest number of subscribers porting out of its network since inception to December 2022.

Telecommunications giant, MTN, has recorded the highest number of subscribers porting out of its network since inception to December 2022.

This is according to the Nigerian Communications Commission in its newly published 2022 Subscriber/Network Data Annual Report.

The report represents the analysis of the Subscriber and Service Data – Porting Trend in Nigeria, from May 2013 to December 2022.

The analysis revealed that of the four major GSM operators in the country, 444,226 subscribers ported out of MTN to other network providers, as against Airtel, Glo and EMTS that respectively recorded 351,422; 277,527; and 190,724 customers porting out.

The analysis also revealed that EMTS recorded 676,944 port-ins, representing the highest number of subscribers porting into its network, followed by AIRTEL with 331,837; MTN with 181,301; and Glo with 105,746 port-ins.

A segment of the report titled, ‘C. subscriber & service data – porting trend in Nigeria as at December 2022’, highlighted the number of GSM porting activities across the four major network providers in the country.

It read, “Table 14 below shows the trend of Nigeria’s porting activities from inception (May, 2013 to December, 2022) for the four (4) major GSM Operators. The analysis illustrates that EMTS had the highest count of Port-in subscribers [676,944] while Airtel, MTN and Glo respectively recorded the following counts of port-in as follows [331,837]; [181,301] & [105,746].”

“Similarly, our analysis from May, 2013 to December, 2022, reveals that MTN had the highest number of subscribers that ported-out [444,226] to other networks while Airtel, Glo & EMTS are as follows [351,422]; [277,527] & [190,742] respectively.”

 

Continue Reading

Business

Heineken sells more beer in first quarter, sticks to outlook

Published

on

Heineken sold more beer than expected in the first quarter, reporting its first quarterly year-on-year growth in volumes in a year as it

Heineken sold more beer than expected in the first quarter, reporting its first quarterly year-on-year growth in volumes in a year as it stuck to its forecast for profit growth in 2024.

The world’s second-largest brewer said on Wednesday that beer volumes rose 4.7 per cent organically in the January-March period, beating the 2.5 per cent growth expected by analysts in a company-provided poll.

Heineken is focused on restoring volume growth this year, which was hurt in 2023 as it hiked its prices to offset the rising costs of everything from energy to barley.

CEO Dolf van den Brink said in a statement that all regions posted higher volume and net revenue.

He added the quarter was helped by an earlier Easter and one-off effects.

Still, the brewer said it continued to see the economic environment as “challenging and uncertain”.

“Despite the solid start to the year, we cannot extrapolate the reported top-line growth to the rest of the year,” it said.

Heineken disappointed investors in February with its wide range for forecast operating profit growth, which it said could be anywhere between a low and high single-digit percentage this year.

Its cautious view early in the year had been in part caused by the uncertainty in two of its important markets, Vietnam and Nigeria, where economic conditions dragged on its performance last year.

Heineken said total volume in Nigeria grew close to 20 per cent. In Vietnam, where it had to destock last year, volume rose in the low-teens.

Barclays analyst Laurence Whyatt pointed out a recovery in high-margin market Vietnam, as well as promising performance in Mexico and Brazil.

“There is no denying that the underlying business appears to have turned the corner and we continue to expect improvements during the year,” he said in a note.

In Brazil, Heineken said its namesake brand became the No.1 brand by value in the quarter, while beer volume grew by a high-single-digit.

Net revenue before one-offs rose 9.4 per cent organically to €6.85 billion, above the 7.2 per cent growth expected by analysts. Currency translation reduced the figure by 4.6 per cent, Heineken added.

Source: www.irishtimes.com

 

Continue Reading

Top Stories