E-Financial
CBN Barks, to Publish Names of Chronic Bank Debtors
Central Bank of Nigeria (CBN) said it would publish the names of chronic bank debtors and waxed worriedly about the growing amount of non-performing loans in the books of banks in the country.
The apex bank and banks, under the aegis of the Bankers Committee, have also decided to bar bad debtors from purchasing foreign exchange in the interbank foreign exchange market.
These were the major fallouts of the 321st meeting of the Bankers’ Committee in Lagos.
Mrs. Tokunbo Martins, director, Banking Supervision, CBN, at a press briefing after the said the central bank, in collaboration with the committee, had also decided to stop the serial debtors from buying foreign currencies at the official interbank foreign exchange market.
Also to be stopped from buying foreign currencies, according to her, are members of the board of directors of debtor companies as well as their subsidiary firms.
She recalled that the Asset Management Corporation of Nigeria had spent a fortune to buy toxic assets from the banks’ books in the past and that it was important to stage timely interventions to forestall a repeat of past mistakes.
Martins said, “So, it was decided that going forward, one thing that we will do is to stop them (chronic debtors) from getting access to foreign exchange. Another thing that we also considered doing is to publish the names of the borrowers that refuse to pay up. This is to ensure the continuous safety and soundness of the banking industry.
“It is not all debtors, it is the bad and chronic debtors; those ones that have deliberately refused to pay; those are the ones we are talking about. Now, in the industry we have a standard, we don’t want the NPLs to be more than five per cent of the total loan in the industry.
“The total loan in the industry is in the region of N13tn to N15tn. Right now, we have not reached the upper limit of five per cent, but we don’t want to get there. That is why we decided that we need to come out with this measure. Currently, the industry average of non-performing loans is at 3.3 per cent and we don’t want to get to five per cent; that is why we came up with this measure.”
She said the CBN, in collaboration with the Bankers’ Committee, had laboured to keep the banking industry safe and sound, and that there was a need to ensure the continued safety of the banks.
Emeka Emuwa, managing director and CEO Union Bank Plc, said the amount spent by naira debit cardholders overseas was rising fast and the banks were beginning to notice some arbitrate in the segment.
Consequently, the CBN and the Bankers’ Committee will slash the annual allowable drawdown for each bank customer, according to him.
The current annual allowable drawdown is $150,000 per customer but Emuwa did not specify the amount it would be slashed to.
He said, “We did find that in a number of cases, people were using the cards in manners that were not expected of them and there have been some arbitraging going on. So, in order to sustain stability, what was agreed by the committee was that the limits for the use of the naira debit cards would be reduced.
“As a customer, if you have a dollar account, you will still have unfettered access to it; but for naira debit accounts, the limits will be reduced to more judicious levels. This specifically refers to the use of these banks’ products abroad, because when they are used abroad, the merchants have to be settled.
“Even if it is the Automated Teller Machines, the service provider, Visa or MasterCard has to be settled in foreign currencies and we find that it is a drain on the foreign resources available to finance our industries. So, there is going to be a reduction in the annual allowable drawdown using naira debit cards abroad.”
Also speaking Mrs. Bola Adesola, managing director, Standard Chartered Bank Nigeria, said the foreign exchange market was safe and sound, and was already moving towards a near convergence of rates in the various segments.
This, she said, was as a result of the positive actions taken in the past by the central bank and the committee.
“As you are all aware, in the last couple of months, several methods have been taken by the CBN and the banks to try and attain some stability in the foreign exchange market. This has been achieved because the demand for foreign currencies by businesses has been continually met. All genuine demands for foreign currencies have been met by the CBN,” Adesola said.
Also at the press conference were Mr. Omar Hafeez, Chief Executive of Citibank Nigeria; and Alhaji Ibrahim Muazu, CBN Director of Corporate Communications.
Jaiz Bank has successfully listed the N10.04 billion proceeds from its private placement on the Nigerian Exchange Group (NGX), following regulatory approvals by the Central Bank of Nigeria (CBN), Securities and Exchange Commission (SEC).
This places the bank among the few banks that have already met the new capital requirements of the CBN, ahead of the June 2026 deadline.
The bank in a statement yesterday indicated that its financial position remained robust, with a well-structured, diversified, and resilient balance sheet.
“Total assets currently stand at ¦ 1.06 trillion, while shareholders’ funds have reached ¦ 47.9 billion,” it said.
Speaking on the successful capital-raising exercise, the Chief Executive Officer of the bank, Dr. Haruna Musa, “This achievement underscores the commitment of the board and management to adding value to our customers by providing bespoke ethical finance solutions.
“Jaiz Bank is well-positioned to compete effectively on all fronts, fulfilling customer needs through ethical and innovative financing. Despite a challenging operating environment, we have demonstrated resilience and achieved remarkable growth across financial and non-financial metrics. This positions us firmly on track to becoming the leading ethical bank in Africa.”
He emphasized the bank’s strategic focus, saying: “Looking ahead, we will continue strengthening relationships with our loyal customers while attracting new ones.
“Through our digital platforms, innovative products, and services, we aim to support individuals, businesses, and communities alike. Our journey to lead the future of ethical finance in Africa remains unwavering, as we stay committed to excellence and delivering long-term value to all stakeholders.”
Jaiz Bank’s performance metrics highlight its exceptional growth and operational efficiency. Key financial ratios include a Return on Equity (ROE) of 60.74% and a Return on Assets (ROA) of 2.18%.
The achievement reinforces Jaiz Bank’s position as a leader in ethical banking, further solidifying its commitment to providing innovative financial solutions to its customers.
The World Bank is set to decide on three major loan projects for Nigeria in 2025, totalling $1.65bn, as part of efforts to address critical developmental challenges in the country.
The loans, currently in the pipeline, will focus on internally displaced persons, education, and nutrition enhancement.
According to information obtained from the World Bank’s website, the loans are designed to support Nigeria’s social and economic recovery, particularly in vulnerable sectors requiring urgent intervention.
The first project, titled Solutions for the Internally Displaced and Host Communities Project, has a commitment amount of $300m and is scheduled for approval on April 8, 2025.
The project, which remains at the concept review stage, seeks to provide sustainable solutions for internally displaced persons and their host communities, addressing their social and economic challenges.
The second project, HOPE for Quality Basic Education for All, is expected to receive $553.8m in financing.
Its approval is slated for March 20, 2025, and it also remains in the concept review phase.
The third project, Accelerating Nutrition Results in Nigeria 2.0, involves the largest share of the proposed loans, with a commitment of $800m.
The World Bank is expected to hold a decision meeting on the project by February 20, 2025.
The $1.65bn financing package reflects the World Bank’s continued commitment to supporting Nigeria’s ongoing reforms.
The World Bank’s schedule indicates that decisions on these loans will be made in early 2025, with Nigeria’s ability to meet project prerequisites and demonstrate accountability in implementation likely to play a key role in getting the funds.
The Central Bank of Nigeria (CBN) has restricted Point of Sales (PoS) agents to a daily transaction limit of N1.2 million. The apex bank revealed this in its ‘Circular on Cash-Out Limits for Agent Banking Transactions,’ released on Tuesday.
It noted that this is in line with its ongoing efforts to advance a cashless economy. “The Bank hereby releases the following policy interventions, which have become necessary to enhance the use of electronic payment channels for agency banking operations,” the circular signed by Oladimeji Yisa Taiwo for the Director, Payments System Management Department, read.
According to the Nigerian Financial Services Report, agency banking (Point of Sale [PoS] and mobile money) is one of the major ways people without bank accounts get money from people outside their community and is a key enabler of financial inclusion. As of July 2024, Nigeria had 3.05 million deployed PoS and 4.06 million registered PoS terminals, according to the Nigeria Interbank Settlement System Plc.
Part of this policy intervention also set a cash withdrawal limit per customer (regardless of channel) at N500,000 per week.
All agent banking terminals are now set to a daily maximum transaction cash-out limit of N100,000 per customer, and an agent’s daily cumulative cash-out limit is now pegged at N1.2 million.
Also, agent terminals must be connected to a Payment Terminal Service Aggregator (PTSA). “Ensure that all daily transactions per agent, including withdrawals, limits of transactions, and balances in the float accounts of each agent, are sent electronically to NIBSS as a report to the CBN. The template of this report will be sent to principals,” the apex bank noted.
According to the CBN, agent banking services are now to be demarcated from merchant activities, and agents must apply the approved Agent Code 6010 for agent banking activities.
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