E-Financial
Nigerian Banks Face Cash Crisis-CBN
A Capital Adequacy Ratio (CAR) audit of the 23 banks in the country by Central Bank of Nigeria (CBN) showed that some have “high level of liquidity crisis”, meaning that some have cash crisis.
The report showed that only 16 banks have CAR above 15 per cent; five have CAR above 10 per cent, but less than 15 per cent.
The Nation Newspaper said that an analysis of the report showed that a bank’s CAR is below 10 per cent but greater than five per cent. Another one’s CAR was below five per cent.
The report said the minimum ratio of capital to total risk-weighted assets shall remain 10 per cent for Regional and National Banks and International Banks, 15 per cent.
According to the CBN Monetary, Credit, Foreign Trade and Exchange Policy Guidelines for 2012 -2013, the banks’ lenders should maintain a higher level of capital commensurate with their risk profile.
The Financial Stability report showed that after a careful study of the liquidity stress test conducted on the banks at the end of June, last year, the CBN mandated them to carry out internal CAR audit at least once yearly to ascertain their liquidity positions.
According to The Nation, the results showed that the industry liquidity ratio fell to 16.7 and 13.3 per cent after the respective five-day and cumulative 30-day shocks were applied, from the pre-shock position of 67.8 per cent.
“The banking industry solvency stress test assessed the resilience of the industry based on historical worst case and hypothetical strained macroeconomic situations. The overall banking industry was resilient to liquidity shocks, though a few banks were found to be vulnerable.
“The diagnostic study earlier commissioned by the CBN to examine the Nigerian financial system, taking into account specific tools required in the light of international developments since the 2007 crisis, was completed in the period under review,” it said.
The report suggested the enhancement of existing supervisory tools and institutional arrangements based on three major components, namely: macro-prudential policy; micro-prudential policy, and crisis management, necessary for the achievement of financial stability in the country.
“Henceforth, banks are required to carry out their Internal Capital Adequacy Assessment Process (ICAAP) on an annual basis, as at December 31, and forward copies of the report to the CBN for review,” Mrs. Tokunbo Martins, CBN Director Banking Supervision, said.
According to her, the full adoption of Basel Accords will be executed by June but preliminary works would start this month. The Basel Accord is a financial analysis principle expected to give banks’ financials better credibility.
She said the policies specified approaches for quantifying the risk weighted assets for credit risk, market risk and operational risk for the purpose of determining regulatory capital.
According to her, the computations are meant to ensure that banks have sufficient high quality capital to support their risk taking activities.
The lenders, she said, are also expected to establish effective risk management systems commensurate with their level of operations.
She said all banks and banking institutions are expected to adopt the basic approaches for the computation of capital requirements for credit risk, market risk and operational risk, adding that the adoption of the Standardised Approach for Operational Risk and other sophisticated approaches will however be subject to the approval of the apex bank.
“The guidance notes are applicable to all banks and banking groups licensed to operate in Nigeria and should be applied on a solo as well as a consolidated basis. The minimum capital requirement is retained at 10 per cent and 15 per cent for local and internationally active banks,” she said.
World Bank has said that it has given approval of $300 million to fund a new project aimed at bolstering access to services and economic opportunities for internally displaced persons (IDPs) and their host communities in northern Nigeria.
In a release, the World Bank said the Solutions for the Internally Displaced and Host Communities Project (SOLID) was approved on August 7.
It stated that the project will adopt an integrated development strategy to help displaced persons and host communities transition from humanitarian aid to self-reliance and resilience.
It also said the ongoing conflict and insecurity in the region have displaced more than 3.5 million people, straining infrastructure and deepening competition for scarce resources in affected communities.
The bank said SOLID will build on previous government and partner interventions, including the multi-sectoral crisis recovery project (MCRP), which focused on emergency recovery.
“Key areas of focus include building climate-resilient infrastructure, promoting social cohesion, supporting livelihoods, and strengthening institutions to better respond to the pressures of forced displacement.
“We are glad to support this initiative which has a tremendous potential to help Nigeria in addressing development challenges associated with protracted displacement in a sustainable way,” Mathew Verghis, World Bank country director for Nigeria, said.
“The Project’s integrated approach which is aligned with the National IDP Policy and the FGN’s long-term development vision will ensure that IDPs and host communities can transition from dependency on humanitarian assistance to self-reliance and resilience which will open up better economic opportunities,” it added.
The World Bank, which noted that the cproject is expected to benefit up to 7.4 million people, of whom up to 1.3 million individuals are identified as IDPs, added that the project will be implemented through a coordinated, community-driven approach involving all tiers of government, with strong partnerships from international stakeholders.
United Bank for Africa (UBA), Plc, Africa’s Global Bank, has launched its revamped Group website to enhance users’ digital experience.
The newly revamped website boasts of a faster, smarter, and more dynamic digital platform, designed to deliver live news updates, real-time Nigerian stock prices, and a world-class user experience among other world-class features.
The upgrade marks a significant leap in the bank’s digital transformation journey, setting new standards for speed, accessibility, and innovation in the African banking industry.
Alero Ladipo, group head, Marketing and Corporate Communication, UBA, who spoke excitedly about the revamped website, explained that the redesign focuses on simplifying user-journey, improving responsiveness across all devices, and incorporating a language-agnostic interface that caters to the bank’s diverse global audience.
She explained that with its sleek, intuitive layout and enhanced navigation, the site empowers customers, investors, and stakeholders to access critical information instantly – whether it is the latest market movements, breaking financial news, or UBA’s wide range of products and services.
Ms Ladipo said, “We are thrilled to unveil our new website, which represents a significant milestone in our digital transformation journey. Our goal is to provide a world-class digital experience that meets the evolving needs of our customers and stakeholders.”
Continuing, she added, “A major highlight of the upgrade is its speed, powered by an upgraded server infrastructure with enhanced load balancing to ensure minimal downtime and lightning-fast performance. By combining speed, accessibility, and live market intelligence, our new platform strengthens our position as an industry leader.”
She pointed out that the site also integrates automated news updates powered by International agency, Bloomberg and real-time stock prices tracking, ensuring visitors remain informed at all times.
Throwing more light on the new features, Amanda Oguamanam, head, Digital and Online Marketing, UBA, said; “We have transformed our website to be faster, cleaner, and more engaging, removing clutter by over 60%, upgrading servers for speed and reliability, streamlining navigation, and tailoring content to inspire global partners while making it easier for customers to find what they need.”
Other standout features, she added, include improved accessibility for users with disabilities, dark/light mode toggle, advanced search functions, and a simplified content structure, which are all designed to deliver an inclusive, modern experience for a global audience.
The revamped website is live and accessible at www.ubagroup.com.
United Bank for Africa is one of the largest employers in the financial sector on the African continent, with 25,000 employees group wide and serving over 45 million customers globally.
Operating in twenty African countries and the United Kingdom, the United States of America, France and the United Arab Emirates, UBA provides retail, commercial and institutional banking services, leading financial inclusion and implementing cutting-edge technology.
Nigeria’s Value Added Tax (VAT) revenue surged to ₦6.72 trillion in 2024, marking an 84.6% increase from ₦3.64 trillion in 2023, according to the National Bureau of Statistics (NBS). This sharp rise reflects stronger economic activity and improved tax collection efforts across key sectors.
VAT revenue showed consistent growth throughout the year. In Q1 2024, collections stood at ₦1.43 trillion. This rose to ₦1.56 trillion in Q2, representing a 9.09% increase. Q3 recorded ₦1.78 trillion, up 14% from the previous quarter, while Q4 peaked at ₦1.95 trillion, a 9.5% rise from Q3.
In Q4 alone, VAT collections totaled ₦1.95 trillion, with domestic VAT payments contributing ₦917.40 billion, non-import foreign VAT at ₦554.68 billion, and import VAT at ₦474.75 billion. Domestic VAT remained the largest source, indicating strong local business activity and consumer spending.
Several sectors posted significant quarter-on-quarter growth in Q4. Extraterritorial organisations and bodies saw a dramatic rise of 180.05%, followed by agriculture, forestry and fishing at 70.83%, and human health and social work at 46.13%. These gains suggest increased operational scope, improved compliance, and possibly targeted government incentives.
However, not all sectors fared well. Households as employers and self-use production contracted by 28.97%, while the information and communication sector declined by 23%. The drop in ICT may reflect shifting market dynamics or regulatory headwinds affecting digital services.
Overall, the surge in VAT revenue signals a positive fiscal outlook for Nigeria, with implications for budgetary planning, infrastructure investment, and social services funding. It also highlights the importance of sector-specific monitoring to sustain momentum and address emerging challenges.
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