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Union Bank To Reduce Operating Cost By N1bn

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The management of Union Bank Plc is planning to reduce operating costs by N1 billion over to next one year, Mrs Funke Osibodu, the managing director of the bank said.

Osibodu noted that  the cost management strategy embarked upon by the new management of the bank recently is expected to culminate in the saving of N300 million on purchase of diesel for the head office of the bank over the next one year. Already, about N30 million has been saved on diesel for the head office alone in two months and by the time the cost management strategy is extended to other branches of the bank, over N300 million would be saved over the next one year, Mrs Osibodu and two of her executive directors made these known during an interactive session with the media.

Mr Adebisi Shonubi, executive director operations, technology and services, said rather than toe the line of the old order by buying diesel from distributors, Union Bank has since the new management came on board, been purchasing diesel directly from the importers, thereby reducing costs.

Besides, he noted that about N145 million was also saved by the bank for purchase of new computers. Instead of buying new ones as had always been the case, Shonubi, said the bank had to approach the manufacturers and asked them to refurbish existing ones at N5 million and still achieve same results.     “On the average, we use about two tankers of diesel in this building in a week. We were buying diesel from distributors. Meanwhile, all the people who import diesel into this country have account with us. It meant we were paying more for the diesel than we could have gotten taking to our existing customers who are directly importers.

“We would have turned the business over in our customer’s account to make them happier with us but we were not doing that. Immediately we started doing that since August, we have saved over N20 million just on item and that is on this building.

We expect that by the time we roll it out to other branches, and the other cost cutting things that we want to do on the energy alone, we should be looking at about N200 million,” he said. Shonubi said the institution had a mandate by its Group Managing Director to cut operating expenses by about 30 per cent. Executive Director, commercial and Retail Banking/Consumer Banking, Mr Adekunle Adeosun, said a e-mial culture has been instituted to improve on turn around time.   

Previously, a customer’s request could take two to three weeks to complete, he said.  With the e-mail system however, he said that could be achieved within 24 hours. “What we have done is improve turn around time. Our system is very old-fashioned. A request for customer stakes two to three weeks to complete the process. We are instituting an e-mail culture. Every staff has an e-mail address, so why we couldn’t use it is just an attitude and leadership thing. We have reinstituted it and the staff are embracing and using it. We are not only cutting costs in terms of cartridge, we are also helping the environment by cutting the use of paper, he said.

He, however, admitted the fact that only 45 to 50 per cent of its Automated Teller Machines (ATMs) were working properly. He said there is an ongoing process to revamp the machines and enhance their uptime, in view of their relevance in modern banking business. He said there are plans to outsource the distribution of its cheque books, stressing that the online order system has now been put in place.

Giving an update on the loan recovery efforts of the bank, Mrs Osibodu said the bank has recovered N31 billion and that the bank came from Transcorp, she explained, N600 million was in cash from government, while the remaining was in promissory notes, earning interest of 8.6 per cent per annum for the bank.

The GMD also revealed that the bank’s liquidity ratio had at different intervals reached a peak of 42 per cent. The stipulated liquidity ratio for all banks in the country is 25 per cent.   On the alleged face-off  between the bank and some labour unions over issues bothering on retirement and retrenchment benefits, the President, Union Bank Association of Senior Staff (UBASS), Mr Fred Ojeh, who was also in attendance, said the relationship between the union and new management has been cordial.

“The relationship here has been so cordial, I must confess, and if there are grey areas we sit down and talk it over. We support in totality all the actions of the new management to bring the bank back to Eldorado and we hope more will be done?”

“Nobody will picket Union Bank without our consent. The other faction of Association of Senior Staff of Bank, Insurance and Finance Institution (ASSBIFI) are not representing our interest,” he said. Head, Human Resources, Union Bank, Mr Mike Iyella, pointed out that the bank is committed to engage the union in positive dialogue over any issue that may arise.

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Crude Hits Seven-Year High On Recovery Hope … Equity Rally Runs Out

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Crude oil hit a more than seven-year high yesterday on optimism that the global recovery will ramp up demand.
However, concerns about the end of long-running central bank support and rising Treasury yields saw most equity markets reverse early gains.
After an almost uninterrupted rally from the early days of the COVID-19 pandemic, world markets are showing signs of levelling out as global finance chiefs shift from economy-boosting largesse to measures aimed at reining in inflation.
Still, there is an expectation that equities will enjoy further gains this year as countries reopen and people grow more confident about travel, especially as studies suggest the more prevalent Omicron coronavirus variant appears to be milder and as vaccines are rolled out.
Analysts are also watching the corporate earnings season that is underway, with hopes that firms can match their stellar performances last year.
But while Asian markets started the day brightly after Monday’s travails, traders returned to selling, with US Treasury yields surging on expectations the Federal Reserve will have to unveil several interest rate hikes to tackle a worrying spike in inflation. Wall Street was closed Monday.
Tokyo, Hong Kong, Sydney, Seoul, Singapore, Taipei, Mumbai, Bangkok and Jakarta all fell.
There were gains in Shanghai in hopes of fresh economy-boosting measures, while Wellington and Manila also edged up.
London, Paris and Frankfurt all fell at the open.
But oil built on its early promise, with Brent climbing to $88.13 a barrel and WTI hitting $85.74, both levels not seen since October 2014.
The gains came thanks to demand optimism as the world reopens and concerns about Omicron ease. The loosening of travel restrictions in several countries has seen jet fuel costs soar.
Hopes for more monetary easing by major consumer, China, to reinforce its stuttering economy were also seen as key support for the oil market.

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NPA, MWUN, Others Synergise On Labour

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President General of Maritime Workers Union of Nigeria (MWUN), Comrade Adewale Adeyanju, has reaffirmed commitment to ensuring smooth working relationship with  management, Tin Can Island Port Complex (TCIPC) of the Nigerian Ports Authority (NPA) on labour related issues.
Adeyanju, who made the commitment during a working visit to the Port Manager, TCIPC, Mr. Buba Jubril, in Lagos, noted that the union will continue to promote industrial peace and harmony in the  operational activities at seaports.
Noting that synergy among all the maritime stakeholders was key for port efficiency, he hinted that the union has changed the narrative from being tagged as hooligans to a more responsible and civil Institution in the maritime industry.
Earlier, the Port Manager, TCIPC, Buba Jubril, thanked the  PG of MWUN for the systematic approach on labour related issues at the port level
Disclosing that the PG has been instrumental to the existing peace in port operations, Jubril assured on the existing synergy the port authority and all the unions.
Jubril further said that “ Myself and the President General MWUN has come a long in the industry.
“I have known him (PG) for over 33years and that will tell you that he is my friend and friend to management of the Nigeria port authority”, he said.

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Osinbajo Wants More Stakeholders’ Involvement In Blue Economy … Inaugurates Committee

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Vice President Yemi Osinbajo has sought for wider participation of relevant stakeholders in the blue economy project to deepen participation and benefits of Nigerians from the country’s marine resources.
Making the call at the  inaugural meeting of an Expanded Committee on Sustainable Blue Economy in Nigeria at the Presidential Villa yesterday, the Vice President said “a viable blue economy project will offer vista of opportunities not only for littoral states where there are bodies of waters, but for the entire country”.
He identified areas to be exploited to include ports, terminals, fishing, training, environment, tourism, power,oil and gas.
While identifying possible challenges of sustainability, the VP urged all the ministries, departments and agencies to strengthen their collaborations in an atmosphere of inter ministerial working groups and advised all members to attend the meetings faithfully for maximum results.
Osinbajo , who formally inaugurated the expanded committee, identified the need for a legal framework that will be more robust than other international maritime conventions on blue economy, which Nigeria has been signatory to.
He said the scope and participation of the committee will be further improved upon to accommodate more members from government agencies and relevant private sector stakeholders
“There is no doubt that the blue economy is a new frontier for economic development and a means of diversifying the economy through the use of resources from oceans, seas, rivers and lakes for the well being of the people.
“It also provides positive contribution to the achievement of the Sustainable Development Goals(SDGs) 2052 Africa Integrated Maritime Strategy (2052AIM) and the UN 2030 agenda
“This concept for economic diversification is promoted by the international community and provides friendly means of livelihood in line with this administration’s agenda on job creation’, he said.
He continued that “the ocean economy as an emerging economic frontier applies to ocean-based industry activities and the assets, goods and services of marine ecosystems.
“Countries have to define the scope of their blue economy based on their priorities. For example, in Bangladesh, the ocean economy consists of the following broad and growing economic sectors; living resources, minerals, energy, transport, trade, tourism and recreation, carbon sequestration and coastal protection.
“These industries and ecosystem services do not develop in isolation, but rather interact as an economic ecosystem”, the VP said.
Earlier in his remark,Transportation Minister, Rotimi Amaechi said the blue economy is capable of improving government revenue, create employments and grow the gross domestic product of Nigeria.
Amaechi, who was represented by the Permanent Secretary of the ministry, Dr Magdalene Ajani, also expressed optimism in the benefits derivable from a well exploited marine environment
Speaking at the event,  Dr. Paul Adalikwu, Secretary General of Maritime Organisation of West and Central Africa (MOWCA) lauded the initiative of the expansion while recommending inclusion of financial institutions such as the Central Bank of Nigeria (CBN) and African Development Bank (AfDB), as well as key financial institutions that will contribute meaningfully to realizing Nigeria’s Blue Economy objective.
In addition to  maritime agencies such as the Nigeria Ports Authority, Nigerian Maritime Administration and Safety Agency, and Maritime Academy of Nigeria, the expanded committee also include ten state governors.
They the Governors of Rivers, Lagos, Delta, Akwa Ibom, Borno, Ogun, Ondo, Cross River, Bayelsa and Edo States.
Other members are Ministers of Foreign Affairs, Power, Finance, Environment, Trade and Investment, Agriculture and Water Resources , Chief of Naval Staff, Comptroller General of Customs, Lake Chad Basin Commission, Nigeria Economic Summit Group, etc.

By: Nkpemenyie Mcdominic, Lagos

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