Connect with us

Business

Banking System Credits Up By 4.6%

Published

on

The 5.5 per cent increase in claims on the private sector drove the aggregate banking system’s credit (net) to the domestic economy by 4.6 per cent in July 2009, the Central Bank of Nigeria (CBN) has disclosed.

Claims on the private sector include gross credit from the financial system to individuals, enterprises and non-financial public entities not included under net domestic credit, as well as  financial institutions not  included elsewhere.

Before the recent CBN cleansing exercise in the banking sector, banks credit to the economy has been the major driver of recorded growth in other sectors of the economy. This is an indication that other sectors’ activities may have been boosted in relative terms by 4.6 per cent increase in banks’ credit to the economy.

This recorded credit level is compared to the increase of 3.6 per cent in the preceding month.

At N3.088 billion, the banking system’s credit (net) to the Federal Government declined by 7.2 per cent, compared to the fall of 4.9 per cent in June, 2009. The fall was attributed wholly to the 11.1 per cent decline in deposit money banks’ (DMBs) holdings of government securities during the month.

The banking system’s credit to the private sector rose by 5.5 per cent to 9.026 billion, compared to the increase of 0.6 per cent in June 2009. This reflected largely the 4.6 per cent increase in DMBs claim on other private sectors. At N7.554 billion, foreign assets (net) of the banking systems declined by 1.2 per cent, as against the increase of 0.1 per cent in the preceding month. The development was attributed to the fall in both CBN and DMBs’ holding.

Meanwhile, the recorded contraction in broad money (M2) is a reflection of the respective decline of 1.2 and 8.5 per cent in net foreign assets and other assets (net) of the banking system. Barely a month to the end of year 2009, the apex bank noted in its July report that over the level at end – December 2008, M2 decline by 3 per cent.

With the expectation  of more developments on the sector by the CBN as the year draws to a close, monetary and credit developments in the economy have been trailed with mixed developments in July.

For instance, provisional data by the CBN indicated a decline in monetary aggregates  at the end July 2009, while broad money (M2) fell by 2.1 per cent to N8.889 billion, compared to the 4.1 per cent decline in June 2009. Similarly, narrow money (M1) declined by 4 per cent to N4.303 billion, as against the incase of 3.8 per cent in the preceding month.

The CBN revealed that quashi money fell by 0.2 per cent to N4.585 billion, in contrast to the increase of 4.4 per cent in June 2009. The development reflected the decline in all the components, namely:   time, savings and foreign currency deposits of the DMBs.

Other assets (net) of the banking system also fell by 8.5 per cent to N4.602 billion, compared to the decline of 3.4 per cent in the preceding month. The fall was attributed to the decline in unclassified assets of both the CBN and the DMBs.

At N1,008 billion, currency in circulation increased by 0.2 per cent in July 2009, over the level in the  preceding month. The rise was due to the 2.7 per cent increase in currency outside the banks. Monetary aggregates contracted further in July 2009, while banks’ deposit and lending rates indicates a general increase. The value of money market assets increased, largely on account of the rise in commercial papers (cps).

Print Friendly, PDF & Email
Continue Reading

Business

CBN Retains Lending Rate At 11.5%

Published

on

Central Bank of Nigeria (CBN) says it has retained the Monetary Policy Rate at 11.5 per cent.
Disclosing this during a briefing after the first Monetary Policy Committee meeting for the year held in Abuja yesterday, the CBN Governor, Godwin Emefiele, also stated parameters left unchanged.
According to the apex bank boss, other parameters left unchanged are the Cash Reserve Ratio and Liquidity Ratio at 27.5 per cent and 30 per cent respectively.
While announcing the committee’s decision, Emefiele said, “after a careful balancing of the benefits and the downside risks of the policy options, the MPC decided to hold all parameters constant”.
He said this is “believing that a whole stance will enable the continuous permeation of current policy measures in supporting the recorded growth recovery and further boost production and productivity, which will ultimately rein in inflation in the short to medium term”.
“The MPC”, he continued, “thus decided by a unanimous vote, the MPC voted as follows, one, retain MPR at 11.5 per cent; retain the asymmetric corridor of +100/-700 basis points around the MPR; retain the CRR at 27.5 per cent; and retain the Liquidity Ratio at 30 per cent.”

Print Friendly, PDF & Email
Continue Reading

Business

NARTO Urges FG To Complete Mile 2 Port Access Rd

Published

on

A chieftain of the National Association of Road Transport Owners (NARTO), Alhaji Abdullahi Inuwa Mohammed, has called on the Federal Government to expedite action on the reconstruction of the Mile 2 – Tincan Island Port Road to ease the hardship encountered on the road by commuters and truckers.
Mohammed, who made the call recently, noted that the completion of the reconstruction work on the road was one of the major expectations of the entire maritime stakeholders which was never met in 2021.
“They have to pay attention to the completion of the reconstruction work and make sure that they create enabling environment for the exporters, and also to make sure that the shipping lines do the needful by providing holding bays where trucks can freely go and discharge their empty containers.
“We urge the government to create an enabling environment. If those things are there and the enforcement team is doing what they should do with the Eto, things will get better.
“But we know now that we are having global challenge because about 65% of import has dropped but we know it’s a global challenge. There’s scarcity of containers globally”, he said.
While emphasizing that the Federal Government did a lot last year to encourage export trade, he, however, expressed regret that the system put in place by the Nigerian Ports Authority (NPA), which they thought could have been improved for the exporters, the farmers as well as miners to enjoy was lagging behind.
“If you recall, last year, so many exporters lost their investment because of poor handling and poor facility which resulted to the rejection of some of the items exported by the receiving countries, which is not good for the country.
“So, we do expect that government should pay more attention to see that anything that will disturb the movement of export goods is being taken care of to create an enabling environment for exporters to export their goods”, he stated.
Mohammed, however, called on the Federal Government to de-emphasize tariff increments, adding that it’s not by increasing tariffs, irresponsible revenue drive and creating hardship for the citizens that it would improve the state of the economy, but by fixing charges that would be pocket friendly both to the importers and exporters so as to cushion the hardship on the citizens.

By: Nkpemenyie Mcdominic, Lagos

Print Friendly, PDF & Email
Continue Reading

Business

FG To Convert 200,000 Vehicles To Autogas … Plans 580 Refuelling Centres

Published

on

The Federal Government (FG) says it has perfected plans for the full deployment of autogas in filling stations and the conversion of 200,000 commercial vehicles to run on gas this year.
This was disclosed in a meeting with oil marketers in the downstream sector convened by the Minister of State for Petroleum Resources, Chief Timipre Sylva, in Abuja.
The meeting in which government unveiled the 2022 Framework for the deployment of CNG (Compressed Natural Gas, popularly called autogas) in Nigeria, had in attendance Senior officials of the Major Oil Marketers Association of Nigeria, Depot and Petroleum Products Marketers Association of Nigeria, as well as other key players in the downstream sector.
At the meeting, Sylva told his guests that the government was out to ensure that it made available the alternatives required before the removal of subsidy on Premium Motor Spirit (petrol), stressing that the deployment of autogas was one of such key alternatives.
He also stated that the government would be supporting them with 50 per cent of the conversion kits to fast-track the process, adding that additional support as required would be given, going forward.
“We said we must provide alternative fuel and the alternative that we concluded on was the autogas alternative. To provide it for our people,” the Minister said.
He continued that “Since this agreement between us (government and marketers), a lot of work has been going on and we have come to a certain point where we need to take it further. But we cannot move further without ensuring that you as our partners are fully on board.”
In the framework, the government explained that with abundant gas reserves of about 206.53 trillion cubic feet, a population of about 200 million people, and the enactment of the Petroleum Industry Act, which eliminated the continuous absorption of petrol subsidy, it was now vital to deploy autogas.
The goverent stated that its priority now was the rapid and strategic introduction of Natural Gas Vehicles as an alternative fuel for transportation in Nigeria in line with the approved National Gas Policy.
“This will pave the pathway to full deregulation of the downstream petroleum sector in Nigeria, while reducing the effect of deregulation on transportation costs,” the document read in part.
It added that  “The Ministry of Petroleum Resources was charged with the responsibility to provide autogas (LPG, CNG, LNG) as an alternative and competitive fuel for mass transportation
“CNG was selected as the fuel of choice because it holds a comparative advantage due to its ease of deployment, its comparatively lower capital requirements, commodity’s supply stability, existing in-country volumes, and local market commercial structure which relies predominantly on the naira.
“Hence a single track CNG deployment is proposed in the initial phase and other alternatives can be considered as the market attains maturity.”
Three implementation options were highlighted in the document, as the government stated that in the first option, its target was to convert one million public transport vehicles and install 1,000 refueling centres within 36 months.
For the first 18 months it targets to achieve 500,000 conversions and 580 refueling centres supplied by five Original Equipment Manufacturers, among other targets.
In the plan, the government targets to convert 200,000 commercial vehicles this year, including tricycles, cars, mini-buses and large buses.
The cities captured in Phase 1 of the project include Abuja, Kaduna, Kano, Kogi, Kwara, Lagos, Ondo, Oyo, Edo, Delta, Bayelsa, Niger, and Rivers.
Cities under Phase 2 were listed as Sokoto, Katsina, Jigawa, Borno, Bauchi, Gombe, Yobe, Osun, Ekiti, Enugu, Anambra, Imo, Cross River, Abia, Akwa Ibom and Plateau. For Phase 3 cities, they were listed as Kebbi, Zamfara, Yobe, Gombe, Taraba, Adamawa, Benue and Ebonyi.

Print Friendly, PDF & Email
Continue Reading

Trending