Banking
Banks to Recover Loans from Defaulters’ Deposit Accounts
By Adedapo Adesanya
The Central Bank of Nigeria (CBN) in conjunction with Nigeria Inter-Bank Settlement System (NIBSS) and the Bankers’ Committee have agreed to launch an initiative that will allow lenders to recover loans from deposit accounts of loan defaulters from any bank or financial institution in the country.
This was disclosed by Ms Aishah Ahmad, the Deputy Governor of the Central Bank of Nigeria at the end of the meeting of the Bankers’ Committee held in Abuja on Monday, August 26, 2019.
According to Ms Ahmad, the directive was to encourage banks to increase lending in the country with more comfort.
“We are not unaware of the challenges/reasons why credit has not been growing. Part of that was the appetite of banks to lend especially when you have customers that willingly refuse to pay their loans.
“In this respect, we have come up with a new clause that will be included in the offer letters that will be granted going forward,” the banker formerly with the defunct Diamond Bank said.
Ms Ahmad also said, “This is going to be a credit risk protection clause. Basically, it will contain the BVN details and TIN of the customers and more or less it will be a commitment on the part of the customers that you agree that should you default on the loan, the total amount of deposits you have across the banking industry would be applied towards repaying the loan.
“This is not uncommon because banks already have rights of set-off within a bank. Which means you take money from a bank; the bank usually has a clause in the letter that allows your bank to repay your loan from the assets you have with the bank.”
“This is just extending it across the industry,” she added.
The CBN deputy governor further noted that the directive will enable banks to lend with more confidence especially to those within the SME sector confident that moves like this will help reduce default rates among banks.
Speaking further, Ms Ahmad said the apex bank is also guarding against increasing the rate of non-performing loans in the system despite the recent directive that banks should increase the loan to deposit ratio (LDR) to 60 percent.
Non-Performing Loans (NPL) was 9.36 percent as of June 2019, the lowest in about 40 months. Initiatives like these as well as the collateral registry is expected to help reduce credit risk.
Banking
CBN Clears Otedola’s Nominee to Join FBN Holdings Board
By Dipo Olowookere
After acquiring a significant stake in FBN Holdings Plc, oil mogul, Mr Femi Otedola, now has someone to protect his interest in the financial institution.
A few months ago, FBN Holdings was embroiled in a leadership tussle between Mr Otedola and the current chairman of the company, Mr Tunde Hassan-Odukale.
The Nigerian Exchange (NGX) Limited and other stakeholders had to intervene in the matter and it was clearly made known that Mr Otedola is the largest single shareholder of FBN Holdings, which is sometimes fondly called First Bank.
It was feared that Mr Otedola may topple his rival from the position when shareholders of the company meet at the Annual General Meeting (AGM) later this year.
On Tuesday, Business Post gathered that Mr Otedola’s nominee to the board has been cleared by the Central Bank of Nigeria (CBN) as a non-executive director.
The new member of the FBN Holdings board of directors is Mr Julius B. Omodayo-Owotuga, the deputy chief executive of Geregu Power Plc.
In 2018, Mr Otedola sold his 75 per cent stake in Forte Oil Plc, which later became Ardova Plc, to acquire Geregu Power Plc.
His confidence and trust in Mr Omodayo-Owotuga may have influenced his decision to send him to FBN Holdings to protect his interest in the financial institution.
Mr Omodayo-Owotuga was formerly with Mr Otedola at the defunct Forte Oil as the Group Executive Director in charge of Finance and Risk Management.
He is a finance expert with huge experience in Finance, Risk Management, Treasury, Internal Controls, General Administration, Procurement, and Information Technology.
While at Forte Oil, he was a member of the Executive Management Team that restructured a then moribund company into a vibrant industry player.
He equally led the capital restructuring, acquisitions, debt capital raise, maiden credit rating and divestment initiatives.
Prior to joining Forte Oil Plc, he had responsibility for the Asset and Liabilities Management function at the Africa Finance Corporation.
He is a KPMG trained finance professional who possesses extensive investment experience spanning Financial Services, Power and Oil & Gas sectors with a proven track record of significant achievements.
His two decades of work experience spans blue-chip companies such as KPMG; Standard Chartered Bank; Africa Finance Corporation (AFC); Forte Oil Plc, MBC International Bank (Now First Bank of Nigeria Limited) and Geregu Power Plc.
Mr Omodayo-Owotuga is an alumnus of Oxford University’s Said Business School, United Kingdom, IE Business School, Madrid, Spain and the University of Lagos, Lagos, Nigeria.
He has a B.Sc. in Accounting and a Masters in Business Administration (with distinction). He is a CFA Charter Holder; a Fellow of The Institute of Chartered Accountants of Nigeria (ICAN), The Chartered Institute of Taxation of Nigeria (CITN) and The Institute of Credit Administration.
Banking
Fidelity Bank Customers Win Millions of Naira in GAIM 5 Promo
By Modupe Gbadeyanka
On Thursday, January 27, 2022, some Fidelity Bank customers had the opportunity to win millions of Naira in the month’s draw of the lender’s Get Alert in Millions savings promo, season 5 (GAIM 5).
It was gathered that no fewer than 10 customers of the financial institution became N1 million richer. They were from several branches across the six geo-political zones of Nigeria and presented with their prizes at an event held at Fidelity Bank, Awolowo Road, Ikoyi, Lagos.
One of the winners, Stanley Okpoto, who could not hide his joy, said, “I am more than happy to receive this cash prize from Fidelity Bank.
“Being a long-time customer and follower of the bank, I feel special and grateful that as little as 2K earned me so much money. I am looking forward to how this money will further transform my business. I encourage my friends and family to take advantage of this life-changing opportunity.”
Also speaking at the well-attended event, the promo Chairman and Executive Director in charge of the bank’s Lagos and South-West Directorate, Dr Ken Opara, said the ceremony marked a special celebration for the bank being the first prize presentation for the year and therefore sets the tone for the remaining prize presentations to be held in the year.
“It gives me great pleasure to announce the presentation of the sum of N1 million to Ajoma Rachael Iyowo and Stanley Sunday Okpoto who emerged winners in the second GAIM 5 monthly draw which held last week.
“Asides Stanley and Ajoma, eight other customers of Fidelity Bank will receive cash prizes at similar events holding simultaneously at some of our branches across Nigeria. These customers only had to maintain a minimum of N2,000 in their Fidelity Bank accounts to emerge winners. That is the beauty of the GAIM 5 savings promo.
“As a bank, we remain committed to empowering our customers with the resources, expertise and solutions they need to meet their strategic business goals. Whether it is the right loan product, appropriate payment channel or in this case, the benefits for saving their money with us, we are all about providing platforms and solutions to help our customers grow,” explained Dr Opara, who was represented by the bank’s Chief Digital Officer, Lanre Showunmi, stated.
The GAIM campaign is an 8-month long scheme that was launched in November 2021. So far, Fidelity Bank has enriched the lives of over 520 customers with cash prizes ranging from N10,000 to N1 million in weekly consolation draws and monthly draws respectively.
Qualifying requirements for the scheme are maintaining an account balance of at least N2,000 in a Fidelity Bank savings account and activating a debit card. According to the bank, the promo employs a ticketing approach whereby each N2,000 in customers’ accounts represents a ticket in the draws.
In operation since 1988, Fidelity Bank is a full-fledged commercial bank with a growing customer base of over 6 million customers across Nigeria. The bank is known for exceptional customer service and digital innovation.
Banking
Subscription for N20bn FSDH Merchant Bank Series 6, 7 CP Ongoing
By Dipo Olowookere
FSDH Merchant Bank Limited is currently selling the series 6 and 7 of its commercial paper and it plans to raise about N20 billion from the exercise.
Business Post gathered that subscription for the corporate debt instrument commenced on Wednesday, January 26, 2022, and will end on Monday, January 31, 2022.
The exercise is under the financial institution’s N40 billion commercial paper programme issuance, which would be used to finance the company’s short-term working capital requirements and general corporate purposes.
According to details of the sales, the series 6 is with 181-day maturity with a discount rate of 9.00 per cent and an implied yield of 9.42 per cent, while the series 7 is a 268-day tenor with a discount rate of 9.75 per cent and an implied yield of 10.50 per cent.
FSDH Merchant Bank is the subsidiary of FSDH Holding Company Limited. It operates as a private limited liability company duly licenced by the Central Bank of Nigeria (CBN) to carry on merchant banking activities in the country.
The firm said investors can subscribe to the papers as they are free and clear of withholding taxes, though the minimum subscription is N5 million, with multiples of N1,000 thereafter.
A look into the books of the lender indicated that its liquidity profile is above-average as its liquid assets accounted for about 60 per cent of its total assets in the 2021 financial year.
However, in the accounting year, the gross earnings fell year-on-year by 15.48 per cent to N13.79 billion, with interest income contributing about 80 per cent to the revenue.
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