TAJBank Nigeria has forged a strategic partnership with Astana International Financial Centre (AIFC) Kazakhstan, aimed at promoting non-interest banking, boosting Nigeria’s merchandize trade with Asian countries, and improving the country’s foreign exchange (FX) earnings.

The Memorandum of Understanding (MoU) between the two institutions was formalized in Abuja, with the Ooni of Ife, Oba Enitan Ogunwusi, and other prominent dignitaries in attendance.

The MoU specifically focuses on promoting and developing non-interest banking products and services in Nigeria, in line with Islamic financial principles.

It also aims to streamline and secure the management of export proceeds, particularly for agricultural commodities like cocoa. Additionally, the agreement seeks to explore innovative financial instruments and mechanisms to enhance trade finance and provide comprehensive support to Nigerian exporters.

At the event, the Ooni of Ife commended TAJBank’s management for formalizing a strategic framework with Astana International Financial Centre, leveraging non-interest banking opportunities to benefit Nigerians, Asians, and their businesses.

He also recalled TAJBank’s remarkable efforts and achievements to deepen financial inclusion through non-interest banking model in the country over the past few years.

“I believe this MoU between TAJBank and AIFC is another initiative that I strongly feel will foster export ties between Nigeria and Kazakhstan.

“We look forward to better international trade involving cocoa and other commodities as I hear that you have the best chocolates in Kazakhstan”, Oba Ogunwusi added.

The deal further seeks to strengthen trade ties between Nigeria and Kazakhstan, as well as other Central Asian countries, by identifying opportunities for joint ventures, strategic investments, and improved trade financing. This will help drive economic cooperation and deepen regional partnerships.

Hamid Joda, Founder and Managing Director of TAJBank, emphasized that this partnership represents another significant milestone in the bank’s ongoing commitment to support Nigerian businesses across the country, as well as dedication to fostering growth and prosperity nationwide.

“We are excited to have our Royal Father, the Ooni of Ife here at this event, which is a clear demonstration of his endorsement of our partnership with the AIFC.

“I assure all our customers and potential ones that TAJbank will continue to do its best to support them with world-class non-interest banking products and services”, Joda added.

In his brief remarks on the pact, Yernar Zhanadil, AIFC’s Director noted that the Islamic market, with over eight million users in Kazakhstan was still untapped.

“We can issue Ijara or Sukuk using Nigeria’s model. It has so much potential. With the Ooni’s involvement and TAJBank, I am even surer of the immense benefits of the MoU for bank customers and the economies of the two countries,” Zhanadil stated.

The Central Bank of Nigeria (CBN) has reaffirmed its commitment to maintaining a transparent and resilient financial system by reinforcing regulatory compliance and risk management across the country’s financial institutions.

Speaking at a high-level Mandatory Compliance and Anti-Money Laundering (AML) Training Workshop held in collaboration with Citi, on Friday, in Lagos, Special Adviser to the CBN Governor on Compliance, Shola Phillips, emphasised the need for strict adherence to global banking standards to sustain confidence in the nation’s financial sector.

“Regulators expect financial institutions to maintain dynamic, risk-based AML/Combating the Financing of Terrorism (CFT) programmes that are responsive to the evolving financial environment.

“Proactive engagement with regulatory developments and the integration of innovative compliance solutions are essential for institutions to meet these expectations effectively,” Phillips stated.

The training, attended by compliance officers, trade operations specialists, and correspondent banking teams from various financial institutions, provided critical insights into global regulatory trends, emerging financial risks, and strategies for sustaining correspondent banking relationships.

In her remarks, Siobhan Ni Ealaithe, Managing Director of Citi’s Correspondent Banking Group, highlighted the critical role of robust governance frameworks in mitigating risks.

She underscored the necessity of Know Your Customer (KYC), Know Your Business (KYB), and Know Your Transaction (KYT) protocols in preventing illicit financial activities.

Stephanie Bailey, Head of EMEA AML Risk Management for Foreign Correspondent Banking, provided a blunt assessment of financial crime risks, noting that over $3 trillion in illicit funds flow through the global financial system annually.

She urged financial institutions to strengthen due diligence measures, leverage technology-driven risk assessments, and uphold transparency in all transactions.

According to a statement issued by the apex bank, the workshop aligns with CBN Governor Olayemi Cardoso’s vision to uphold regulatory excellence and strengthen Nigeria’s financial system.

The statement said: “As Governor Cardoso has consistently emphasised, ‘A strong financial system is built on trust, and trust is earned through integrity and compliance.

“The CBN will continue to set high regulatory standards to protect Nigeria’s financial ecosystem and ensure its alignment with global best practices.’

“By fostering a strong culture of compliance and strengthening risk management frameworks, the CBN aims to safeguard Nigeria’s financial sector while ensuring its resilience and credibility locally and globally.”

Foreign investors withdrew N45.85bn from the Nigerian stock market in January 2025, an outflow that significantly overshadowed the N25.66bn recorded as foreign inflows within the same period.

The latest Nigerian Exchange Domestic and Foreign Portfolio Investment Report revealed that foreign outflows accounted for 64.12 per cent of total foreign transactions on the exchange, reinforcing concerns over declining foreign participation in the market despite the relative stability of the naira.

It showed that total foreign transactions increased by 7.13 per cent, rising from N66.75bn in December 2024 to N71.51bn in January 2025.

However, this increase was largely driven by investors liquidating their holdings, as evidenced by the much larger outflow compared to inflows.

This trend indicates that while some foreign investors may still engage with the Nigerian market, a greater proportion opt to exit, contributing to capital flight.

The withdrawal of foreign funds from the market came amid a 9.89 per cent decline in total equity transactions on the NGX, which fell from N673.66bn in December 2024 to N607.05bn in January 2025.

On a year-on-year basis, total transactions dropped by 6.83 per cent from N651.52bn recorded in January 2024.

This suggests that investor sentiment remained subdued as both foreign and domestic players exercised caution in response to prevailing economic conditions.

The report read, “On a monthly basis, Nigerian Exchange Limited polls trading figures from market operators on their Domestic and Foreign Portfolio Investment flows.

“As at 31 January 2025, total transactions at the nation’s bourse decreased by 9.89 per cent from N673.66bn (about $438.64m) in December3 2024 to N607.05bn (about $410.84m) in January 2025.

“The performance of the current month when compared to the performance in January 2024 (N651.52bn) revealed that total transactions decreased by 6.83 per cent. In January 2025, the total value of transactions executed by Domestic Investors outperformed transactions executed by Foreign Investors by circa 76 per cent.”

The report further disclosed that foreign investors’ share of total market transactions stood at 11.78 per cent, with domestic investors dominating with 88.22 per cent.

This represents a slight increase from 9.91 per cent foreign participation in December 2024 but remains far below historical averages when foreign investors played a more substantial role in market liquidity and depth.

The disparity between inflows and outflows further highlights the persistent reluctance of foreign investors to commit fresh funds to Nigerian equities.

A closer look at domestic transactions revealed a notable shift in investor behaviour. Institutional investors, who traditionally drive market stability, significantly reduced their participation, with transactions falling by 33.95 per cent from N406.04bn in December 2024 to N268.19bn in January 2025.

This decline contrasts sharply with the retail segment, which saw a 33.10 per cent increase, as retail transactions rose from N200.87bn to N267.35bn within the same period.

This shift suggests that while institutional investors remain cautious, retail investors are showing increased enthusiasm, possibly seeking bargain opportunities in a market where valuations may appear attractive.

Despite concerns over foreign outflows, the exchange rate showed signs of stability, with the naira appreciating from N1,535.81/$ in December 2024 to N1,478.22/$ in January 2025.

This stability, however, was not sufficient to reverse foreign investor sentiment, as broader macroeconomic challenges persist.

The NGX report also provided a broader historical context, showing that over an 18-year period, domestic transactions increased by 33.15 per cent from N3.556tn in 2007 to N4.735tn in 2024, while foreign transactions grew by 38.31 per cent, from N616bn to N852bn over the same period.

However, foreign participation has steadily declined in recent years, with foreign investors accounting for only 15 per cent of total transactions in 2024, while domestic investors controlled 85 per cent of the market.

There is a need for foreign investors to increase their stake in Nigerian equities and for more stable macroeconomic policies, improved market transparency, and strengthened investor confidence.

However, the Central Bank of Nigeria’s monetary tightening policies, designed to curb inflation and stabilise the naira, are gradually boosting renewed foreign interest in the equity market.