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Economy

Guaranty Trust Bank profit before tax hits N215.6bn in 2018

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Bank

Guaranty Trust Bank Plc on Wednesday announced its audited results for the financial year ended Dec. 31, 2018 on the Nigerian and London Stock Exchanges.

The company in the result released by the Nigerian Stock Exchange (NSE) posted profit before tax of N215.6 billion against N197.7 billion recorded in the corresponding period of 2017, an increase of 9.1 per cent.

Gross earnings for the period under grew by 3.7 per cent to ₦434.7 billion from ₦419.2 billion reported increase 2017.

Its customers’ deposits increased by 10.3 per cent to ₦2.27 trillion from ₦2.06 trillion in the comparative period of 2017.

Also, loan book dipped by 12.9 per cent from ₦1.45 trillion recorded as at December 2017 to ₦1.26 trillion in December 2018.

The result showed that the bank closed the 2018 financial year with total assets of ₦3.29 trillion and shareholders’ funds of ₦575.6 billion.

An analysis of the bank’s asset quality showed that non-performing loans and cost of risk improved to 7.3 per cent and 0.3 per cent during the review period from 7.7 per cent and 0.8 per cent in December 2017, respectively.

The bank is proposing final dividend of ₦2.45 per share in addition to interim dividend of 30k per share, bringing the total dividend for 2018 financial year to ₦2.75k per share.

Commenting on the result, Mr Segun Agbaje, the bank’s Managing Director, said that the result represented the fundamental strength of its brand.

“In 2018, our focus on staying nimble, strengthening customers’ relationships and driving our digital-first strategy paid off.

“We successfully navigated the pressures of our challenging and radically changing business environment, recorded growth across key financial indices and reaffirmed our position as one of the best performing and well managed financial institutions in Africa.

“This result reflects, not just the fundamental strength of our brand, but also commitment to our values of excellence, creating value for all stakeholders and putting our customers first in everything that we do.

“Driven by these values, we are building the bank of the future by pairing the best of our business with the massive potential of digital technologies to create Africa’s first integrated and trusted platform,” Agbaje said.

Economy

Lagos govt. reiterates plans to fast-track industrialisation, development

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Gov. Babajide Sanwo-Olu of Lagos State says his administration remains committed to the holistic implementation of policies that would fast-track development of the state, making it desirable for investment.

Mr Babajide Sanwo-Olu, represented by the Secretary to the State Government, Mrs Folasade Jaji, emphasised the commitment at the 2019 Africa Industrialisation Day/ Young African Industrialists Week, with the theme: Positioning African Industry to Supply Africa Continental Free Trade Area (AfCFTA).

The governor lauded key stakeholders for their contributions to the development of the industrial sector, particularly the Small and Medium Enterprises (SMEs), in spite of the harsh business environment.

“Considering the erratic and turbulent macro economic environment under which our industrialists operate, kudos should be given to stakeholders that have continued to remain in operation and contribute to the socio-economic development of the state.

“In the light of this, the provision of promotional tools that encourage the establishment and growth of businesses remains one of the major priorities of this administration.

“I assure you that we shall continue to formulate and implement policies and programmes that would consolidate the position of the State as the industrial and commercial hub of Nigeria,” he said.

The governor urged each state of the federation to initiate policies and programmes that would engender the development of the non-oil sectors as a panacea to the present economic downturn.

Also at the event, Commissioner for Commerce, Industry and Cooperatives of the state, Dr Lola Akande, called for the evolution of internal policies to act as catalysts for local industries to benefit from the opportunities available in the AfCFTA.

Akande revealed that the event included the exhibition of locally fabricated machines, equipment and innovative projects from schools in Lagos to create the desired linkages between machine producers,  manufacturers of goods and end users.

She enjoined stakeholders to take advantage of the opportunity and make efforts to create the necessary synergy that would lead to value addition on the path to industrialisation, economic recovery and growth.

“The state government is aware of the challenges of industrialisation and for this reason has continuously keyed into programmes that are capable of boosting the potential of the private sector and creating a conducive business environment.

“The state has consistently supported the Micro, Small and Medium Enterprises (MSMEs) by devoting trade fairs to them.

“We have taken a step forward to at this forum include the exhibition of locally fabricated machine and innovative projects from schools in Lagos,” she said.

Mr Ibukunoluwa Akinrinde, Technical Anchor, Trade, Industry and Investment Policy Commission of the Nigerian Economic Summit Group (NESG) urged Lagos to champion more public – private infrastructural partnerships.

This, he said, was necessary to address the various challenges affecting the manufacturing sector and properly position the country for the benefits of the Africa Continental Free Trade Agreement.

Akinrinde also called for an export review within the context of a trade policy framework to help keep up with the dynamism of world trade activities.

Mr John Aluya, Vice President, Manufacturers Association of Nigeria (MAN), said the manufacturing sector would be faced with very stiff competition, should the AfCFTA be implemented at the moment due to the challenges facing the sector.

He called for trade facilitation infrastructure, trade research programmes, reviewed and harmonised trade policies and a strengthened business environment to unleash manufacturing sector potentials.

“Cost of production must be reduced and an increased capacity building exercise must be in place to understand trade origin mechanisms to enjoy this AfCFTA,” he said.

Edited by Jane (NAN)-Frances Oraka/Oluwole Sogunle

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Economy

Unity Bank deepens advocacy initiatives for stronger climate action

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Unity Bank says it is in partnership with Avant-Garde Innovation and Technology Services (AGITS) to deepen advocacy initiatives for stronger climate action that will entrench values and ethos for achieving Sustainable Development Goals in the country.

A statement by the bank on Wednesday quoted Mrs Tomi Somefun, Managing Director, Unity Bank Plc, as stating this in Lagos at a roundtable discourse with the theme: “The Future of Sustainable Development in Nigeria: Achieving Economic Growth with Low Carbon Trajectory in a Circular Economy.”

Somefun said that the discourse provided the platform for stakeholders to evaluate developmental activities impacting on climate change and opportunities in a green economy as a means of improving environmental sustainability.

She said that a green economy would address global warming, rising sea levels, pollution, desertification and deforestation, and determine effective response to promote community action, protect the environment and advance sustainable development.

Somefun, represented by Usman Abdulqadir, Executive Director, Risk Management and Compliance, stressed the need for increased stakeholder engagement on sustainable development to deepen commitments towards promoting climate change initiatives.

“It is the hope that while sharing experiences on actions to protect the earth for future generations, the platform is capable of harnessing ideas to forge common action points and convergence for policy makers, entrepreneurs, sustainable development experts and other organisations playing pivotal roles to solve problems threatening the sustainability of the planet earth.

“Having promoted sustainable practices in agriculture over the years, and its commitment to sustainability, Unity Bank appreciates the need to create more awareness, engagement and collaboration in the execution of sustainability initiatives, thus the roundtable is not only relevant but timely,” she said.

Somefun recalled that in 2018, Unity Bank won the Central Bank of Nigeria (CBN) award on ‘Sustainable Transaction of the Year in Agriculture’ in recognition of the bank’s initiatives to promote sustainability initiatives and impact in the agricultural space.

Edited by Oluwole Sogunle (NAN)

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Economy

Nigerian selected among 10 startsup by Dubai Chamber of Commerce

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A Nigerian, Mr Kenneth Obiajulu-Okonkwo, and five other Africans have been selected among 10 startups by the Dubai Chamber of Commerce and Industry.

The Nigeria News Agency reports that the other five are from the UAE.

Obiajulu-Okonkwo, who is the co-Founder and Managing Director of FarmCrowdy Nigeria, prior to their selection, participated in the first-ever Chamberthon, which took place in Kigali, Rwanda earlier this year.

NAN also learnt that during the Chamberthon, 20 UAE and African startups worked together to develop the structure and criteria of the Global Business Forum (GBF) Mentorship Programme.

FarmCrowdy is focussed on providing major processors and international buyers the opportunity to buy commodities directly from farm clusters through technology.

Obiajulu-Okonkwo told NAN at the forum on Wednesday in Dubai that his company had optimised the market access to African farmers and also improve their income by at least 40 per cent.

“FarmCrowdy Africa brings the farmers closer to the processors and off-takers by eliminating the layers of intermediaries in the value chain.

“Our business model focus on identifying major processors and international buyers for certain commodities through their platform and identifying the production clusters and building relationships with local farmers in those areas.

“It also involves getting major processors to place orders via the platform and aggregating the commodities from smallholder farmers.

“The forum pays attention to the unique specifications of the buyers and delivery of the commodities to the major processors or the international buyer’s agent,’’ he said.

Obiajulu-Okonkwo said that he was excited with the opportunity given to him by the Dubai Chamber of Commerce and Industry, Vice President and Prime Minister of the UAE and Ruler of Dubai, Sheikh Mohammed Bin Rashid Al-Maktoum to speak at his stand.

“It also afforded me the opportunity to showcase my business concepts and solutions at the forum,’’ Obiajulu-Okonkwo told NAN.

The President of Dubai Chamber of Commerce and Industry, Mr Hamad Buamim, said the selection of startups was an important step forward in establishing bridges of communication and cross-border cooperation between UAE and African startups.

Buamim pointed out that many of the selected startups specialised in advanced technologies, smart solutions, artificial intelligence and fintech.

He added that collaboration in these key areas would pave the way for mutual benefits and growth for both business communities.

“Startups are playing an active role in fostering innovation as they leverage and test out cutting-edge technologies that improve the way we live and work.

“The GBF Mentorship Programme provides an ideal platform for high-potential startups to develop their business concepts, benefit from collaboration, access new growth opportunities through the Global Business Forum on Africa platform and build valuable partnerships.

“Such efforts complement Dubai Chamber’s programmes and initiatives offered to entrepreneurs through Dubai Startup Hub,’’ Buamim said.

Edited by Abdulfatah Babatunde (NAN)

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Economy

SEC Chairman seeks exploration of non-oil sector

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The Chairman of the board of the Securities and Exchange Commission (SEC), Mr Olufemi Lijadu, has stressed the need for exploration of the country’s non-oil sector for economic growth and development.

Lijadu said that exploration of the non-oil sector, especially the capital market, would enable Nigeria attain its full growth potential.

He spoke at a breakfast meeting between the board and stakeholders in the capital market in Lagos on Wednesday.

“We all love our country and we need to develop our country. We have potential and it’s time we start taking steps to realise the potential.

“We need money to develop our economy, and to get the money, we need to attract investors — both local and foreign.

“To be able to attract them, our markets need to have the basic rules that are obtainable anywhere else in the world by aligning ourselves with best practices internationally,” he said.

The chairman said that the apex capital market regulator and market operators had the same interest of enhancing the growth of the market.

He expressed the need for all to work together in the overall interest of the market and the economy.

“We are ready to listen to you, to be accessible to you and to work with you.

“This meeting is the beginning of a partnership that we hope will continue.

“You are there in the market and can give us that sensitivity of what the market is feeling and can give us that direction to frame our policies in the interest of the market,’’ Lijadu said.

The board chairman commended the market operators for the degree of interaction with SEC,  and said that the cooperation would get better.

He expressed confidence on the level of knowledge and professionalism of stakeholders in the market.

Lijadu said by the time views and suggestions from the interaction are put together, the market would arrive at some solutions.

“We are key pillars in the ability of our country to find solutions to its developmental needs by attracting relevant funding, together we can make our country great,’’he said.

Earlier in her welcome address, Ms. Mary Uduk, SEC Acting Director-General, lauded the stakeholders for the support they had extended to the commission during the four years it operated without a board.

Uduk enjoined them to continue to support the SEC in its effort to regulate and develop the market.

“You are the ones that provide us with guidance as to the direction the market should go because you are the ones at the forefront and know it firsthand.

“We are happy that you have agreed to be with us here today.

“We are here today to rub minds with you and further solicit your cooperation in all that we intend to do to deepen the market,’’ Uduk said.

She said that the commission’s board was made up of formidable people that would lead the market to the next level.

Mr Haruna Jalo-Waziri, The Central Securities Clearing System (CSCS) Plc, Managing Director, commended the board for the great initiative to meet with the capital market operators.

Jalo-Waziri described the development as a good start aimed at deepening the nation’s capital market.

He said that the market needs to form a formidable force to achieve the desired growth and development.

Edited by Emmanuel Okara/Oluwole Sogunle (NAN)

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Economy

South Africa’s Eskom needs $12bn to comply with new emissions laws

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South Africa’s power utility Eskom needs around 187 billion rand (12.60 billion dollars) to comply fully with existing legislation curbing harmful emissions, a government presentation to parliament showed on Wednesday.

Eskom, which uses mainly coal-fired power plants to generate electricity, was one of 37 top domestic polluters, including Sasol, granted a five-year reprieve by government until 2020 to meet air emission standards.

The new minimum emissions standards for air quality laws in South Africa, which cover particulate, sulfur dioxide and nitrogen oxide emissions, came into effect on April 1, 2015.

“Complete compliance with the 2010 Minimum Emission Standard would require an estimated 187 billion rand,” the presentation by the Department of Public Enterprises said.

Africa’s biggest public utility supplies over 90 per cent of South Africa’s electricity, relying largely on ageing, heavily polluting coal-fired power stations, but does not generate enough cash to meet its debt servicing costs.

Project delays and cost overruns at Medupi and Kusile, two mega-coal plants currently being built by Eskom, largely contributed to Eskom’s debt ballooning to 440 billion rand.

“Given the current financial constraints, at this stage Medupi will be prioritised to be retrofitted with Flue-Gas Desulfurisation (FGD technology),” the department said.

South Africa has said any new coal plants would need to have emission-reducing technology such as FGD.

In September, Eskom said it might have to shut some plants if it fails to reduce emissions, raising the prospect of further power cuts in the county and also putting more pressure on the government which has had to bail out the debt-ridden company to keep it afloat.

Eskom has applied to the Department of Environmental Affairs for rolling postponements of its obligations under the legislation to meet the emissions and air standards.

Ageing plants and poor maintenance have triggered several power cuts throughout the year, putting pressure on key economic industries such as mining as the country skirts a recession.

The latest bout of nationwide blackouts come after repeated power cuts in February and March, which hit the economy and pushed the government to grant Eskom a four billion-dollar bailout on top of a 16 billion dollars bailout spread over the next 10 years.

Edited by Abdullahi Mohammed/Tajudeen Atitebi

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Economy

Economists list expectations ahead MPC meeting

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As the Central Bank of Nigeria (CBN) prepares to hold its last Monetary Policy Committee (MPC) meeting in 2019, experts have urged the apex bank to maintain the current Monetary Policy Rate (MPR) and other parameters.

The experts told the Nigeria News Agency on Wednesday in Lagos that maintaining the MPR alongside other policy parameters would help to tame inflationary pressures.

The next MPC meeting — the last for the year — is scheduled for Nov. 25 and Nov. 26.

Recall that the CBN had, since March 2019, held the MPR at 13.5 per cent alongside other monetary policy parameters.

The Director, Centre for Economic Policy Analysis and Research (CEPAR), University of Lagos, Prof. Ndubisi Nwokoma, urged the committee to use the MPR to stop the increasing direction of inflation occasioned by border closure.

“The Central Bank should do what it can to arrest the rising case of inflation that is occasioned by border closure.

“I will advise that the committee maintains the Monetary Policy Rate which is at 13.5 percent, or even go to 14 per cent if possible,’’ he said.

According to him, the inflation is trending upward and it can get worse because of the minimum wage that is about to be implemented.

He urged the apex bank to arrest and maintain price stability.

Nwokoma said: “The primary function of the Central Bank is price stability; Monetary Policy Committee specifically, is to maintain price stability and they have been arresting that for some time now and it’s been coming down; now its trending up.

“I don’t think they will want to lower rate; they will rather maintain it, if not even increase it, because they cannot see inflation trending upward and you are now loosening interest rate.

“That may not be what anybody will expect. So, I think they will seek redress to find stability,’’ he said.

In the same vein, the Chief Operating Officer of CitiServe Limited, Mr Jubril Salaudeen, believes that the monetary policy rate would be maintained.

“I strongly believe that CBN Monetary Policy Rate will be maintained at 13.5 per cent.

“Maintaining the monetary policy rate at its present level is essential for better understanding of the momentum of growth before determining any possible modifications.

“ The border closure and associated changes to deposit and withdrawal of cash across the country have upset the system a bit.

“Also, this will help the country to tame inflationary pressures as headline inflation rose to 11.37 per cent,’’ he said.

NAN reports that the MPC, at its last meeting in September 2019, left the MPR at 13.5 per cent and kept all other variables unchanged.

Liquidity ratio was left at 30.00%, Cash Reserve Ratio (CRR) at 22.5%, and the asymmetric corridor unchanged at +200/-500 basis points around the MPR.

MPR is the interest rate at which CBN lends to the commercial banks.

The MPR is the benchmark against which other lending rates in the economy are pegged and is usually used as an instrument to moderate inflation in the economy.

CRR refers to the ratio of customer deposits banks are expected to hold as cash or keep with the CBN.

Edited by Oluwole Sogunle

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