CAC Exceeds 2020 Revenue Target by 4.4%
By Adedapo Adesanya
The Corporate Affairs Commission (CAC) has disclosed that it exceeded its revenue target for 2020 by 4.4 per cent as it raked in N19 billion as Internally Generated Revenue (IGR) in the period under review.
This was disclosed by the CAC Registrar-General, Mr Garba Abubakar, on Wednesday.
According to him, in spite of the COVID-19 pandemic that affected economic activities, the commission recorded an increase in the registration of businesses and other corporate entities during the year.
“The year 2020 was one of our best years in terms of revenue generation as we recorded a surge in registration above the previous year.
“We had a revenue target of N18.2 billion, but we closed here with over N19 billion.
“For the first time in the last 10 years, we are able to give more money to the federal government in terms of operating surplus.
“We are hoping that we will meet our target for 2021 because where there is increased compliance by customers, there will be an increase in the revenue for the government.
“Transactions are now easily carried out with the electronic system, as you pay through the remittal on our portal, without paper works,” he said.
He expressed hopes that the agency would surpass the N20 billion revenue target this year by leveraging on electronic systems transactions for most of its operations.
Mr Abubakar, who was appointed to head CAC on January 7, 2020, by President Muhammadu Buhari, said the commission has undergone some reforms in the past year.
According to him, the organisation has successfully embedded the Federal Inland Revenue Service (FIRS) Tax Identification Number (TIN) on the certificate of registration for companies through the existing FIRS stamp duty portal.
He said that the agency has commenced the implementation of the Companies and Allied Matters Act, 2020 (CAMA 2020) with the introduction of a new self-service portal that allowed for end-to-end electronic submission by customers.
He said that the new CAMA provided a robust framework towards reforming identified legal, regulatory and administrative bottlenecks, which had hitherto slowed down the wheel of doing business for over three decades.
The Registrar-General, however, noted that inherited financial liabilities and the COVID-19 pandemic were some of the challenges he faced in steering the affairs of the organization in the past year.
“The challenges we had last year was the inherited liabilities, as I took over with over N6 billion liabilities, and also had challenges of service delivery because of the COVID-19 restrictions.
“Before the COVID-19 pandemic, we were registering company and business names within 24 hours, but the pandemic and the various restrictions to curb the spread of the disease affected our service delivery,” he said.
Mr Abubakar said that part of the commission’s agenda for 2021 was to build stronger collaborations with relevant agencies and intensify the enforcement of the provisions of the new CAMA.
He tasked all registered entities on compliance with the new law in terms of filing their annual returns and other statutory duties to the commission.
According to him, with the new law, it is now easier for companies to file their returns without going through any lawyer, accountant or chartered secretary.
“With the new portal, a company can decide to have its own electronic account that will allow it to make all its fillings directly.
“The new portal also shows at a glance the status of a company, whether it is active, dormant, receivership or liquidation.
“We have given access to most government agencies and foreign missions in Nigeria to confirm the status of companies and we will continue to do that.
“Before they deal with any registered company, they will verify if such company is actually an active company and whether the information provided by such company is consistent with the CAC records,” he said.
Mr Abubakar further said the commission was working out modalities for granting amnesty on annual returns to companies and other registered entities and it would be announced before the end of the first quarter of this year.
Nigeria Records 36.3% Rise in Insurance Premium in Q4 2022
By Adedapo Adesanya
The National Insurance Commission (NAICOM) has said that Nigeria’s insurance industry recorded a 36.3 per cent quarter-on-quarter growth and 17.8 per cent year-on-year improvement in gross premium income at N726.2 billion in the fourth quarter 2022.
According to a bulletin release by the country’s insurance sector regulator, this was remarkable situation compared to the real growth (3.5 per cent) of Gross Domestic Product (GDP) over the same period.
This development was attributed to the consistent regulatory measures being carried out by the commission.
It also said the non-life business, as in the prior periods, continued its dominance, contributing about 57.4 per cent relative to the share of the life business at 42.6 per cent, keeping about same position in prior period.
“The proportional significance of life in the industry was sustained a positive course in recent times reflective of the consumer’s confidence and awareness,” it said.
In-depth analysis of the non-life segment of market shows oil & gas business sustaining its market share dominance at 30.25 per cent, increasing by two point (2.4 per cent) compared to the previous quarter.
The figure posted by fire insurance came a distant second at 22.2 per cent, maintaining same pattern of contribution to the gross premium pool of the market, while motor insurance at 14.9 per cent, marine & aviation at 12.2 per cent, general accident at 11.1 per cent, and miscellaneous at 9.5 per cent followed in that order.
On the other hand, life business was driven by individual life portfolio (38.6 per cent) even as its relative contribution fell by about (2.6 per cent) compared to third quarter (41.6 per cent).
The bulletin added, “In a contrasting path to the previous quarter, group life followed by about 34.5 per cent while annuity business contributed gross premium income of about 26.9 per cent during the period.
“In the phase of operational challenges posed in domestic and global economies, the industry continues to post inspiring numbers in business retention, reflective of the market resilience and increasing capacity. In the period under review, industry wide average retention ratio stood at about 71.3 per cent, although, slightly a point lower than it held in the previous quarter and four points lower in comparison to same period (YoY).
“Persistently, the life business retained about the same point of 93.3 per cen from its prior position of 93.8 per cent in quarter three.
“In the non-life segment which also took a similar pattern, motor insurance continued its lead as the highest retaining portfolio with a retention ratio of about 93.5 per cent also a point higher than its standing in the prior quarter.
Oil & Gas recorded the least at about 35.9 per cent. The oil and gas portfolio remained a challenging angle in the market owing to its nature of enormous capital and professional requirements.
“Consequently, the retention performance in the current period sustained its prior position when compared to the third quarter as evidenced by the overall non-life business ratio of 55.0 per cent, slipping from about 56.6 per cent held in the prior period.”
“Claims reported during the fourth quarter stood at N318.2 billion representing a 31.2 per cent QoQ growth. Possible attainment as a result of growing awareness and Market expansion as well as consumer’s confidence. In a similar pattern, the net claims paid were reported at N244.3billion, growing at about 17.9 per cent QoQ during the same period.
“Insights into the non-life segment shows that motor insurance led with regards to claims settlement vis a vis gross claims reported at about 92.3 per cent signifying a nine points improvement as against its prior position.
“Fire insurance was the least at about 46.3 per cent, the only class below average proportion. All other portfolios of general accident insurance (80.7 per cent), oil & gas (51.6 per cent), marine & aviation (74.4 per cent), miscellaneous insurances (86.1 per cent) recorded a proportion above the average, of paid claims against gross claims reported.
“Life insurance business on the other hand reported two points less in comparison to the position held in the prior period of 94.6 per cent of net claims paid compared to total claims reported during the same period of 2021,” the bulletin added.
Moghalu Explains Why CBN Naira Redesign Policy Woefully Failed
By Aduragbemi Omiyale
A former deputy Governor of the Central Bank of Nigeria (CBN), Mr Kingsley Moghalu, has attributed the failure of the Naira redesign policy of the apex bank to the lack of effective risk management, its use as a political tool and others.
Last October, the central bank Governor, Mr Godwin Emefiele, announced that the designs of the N200, N500, and N1,000 denominations would be changed.
In a special press briefing, he disclosed that the new notes would be introduced into the banking system by December 15, while the old currency notes would cease to be legal tender from January 31, 2023.
However, the deadline was moved forward to February 10, and on March 3, the supreme court extended the deadline to December 31, 2023, meaning the old notes will remain valid by the end of the year.
From February 10 till now, Nigerians have been unable to have access to cash as commercial banks limit what customers can withdraw via their channels. In some cases, customers are limited to N1,000, N2,000, and N5,000 cash withdrawals, forcing them through an untold hardship and making a mess of the Naira redesign and cashless policies of the CBN.
While speaking on the issue, Mr Moghalu blamed his former employers for the failure of the policy, noting that they did not put the system under thorough scrutiny.
“The terrible suffering and economic loss Nigerians have experienced as a result of the faulty IMPLEMENTATION of the Central Bank of Nigeria’s Naira redesign policy, the entry of the judiciary into central banking functions, all show clearly how our institutions— and Nigeria — fail when institutions that are meant to be operationally independent become politicized.
“Currency functions are a core part of any central bank’s mandate. To that extent, I had no problem with the policy, except for two vital issues. First, the 90-deadline, which I warned, was too short to be effectively executed. Second, the timing is so close to the elections.
“But, as later became clear, there was a haphazard and incoherent communication of the PURPOSES of the policy. In one breath, it was said to be to reduce the money supply and help tame inflation (after the bank had created and lent N23 trillion to the federal government illegally because that was way beyond approved limits under the CBN Act of 2007). Next, it was promoted as a national security measure to halt kidnapping, Naira hoarding and sundry crimes. Then, next, it became about free and fair elections to stop vote-buying.
“This last reason became the most important — and controversial — reason as the tempo of the 2023 presidential contest rose to boil point. Expectedly, politicians who felt the policy targeted them complained loudly and wanted the deadline extended, while those who believed it helped their own political agendas hailed the tight and impractical deadline and did not want it moved.
“Nigerians were trapped between the devil and the deep blue sea of a desire to curb the menace of vote-buying and the effective confiscation of their own money by the implementation failure of the policy.
“While increasing digital payments, another purported goal of the policy, was a good one, that thinking failed to consider the reality that the payment infrastructure was still not robust in many rural areas of our country, that cash remains king, and, as I said on an interview with @LadiAAle of @channelstv, we were carrying on as if it has now become a crime to use cash in Nigeria. Most important, as I raised the question in that same interview, what exactly is the mandate of the CBN? Had it now become to end vote buying in elections? Surely, we have anti-corruption institutions vested with such mandates, and to use the CBN for that primary purpose was to politicize the institution.
“But many Nigerians, as usual, did not think deeply about the implications of this line of thinking and action because of their political passions against presumably corrupt politicians.
“Today, whatever may have been the benefits of the Naira redesign policy have been cancelled out by the economic and social gridlock it has created. We are still suffering from it after the almighty presidential election has come and gone.
“There are several lessons here. One such lesson is the importance of effective risk management, which was evidently absent in the conception and execution of the policy.
“I had highlighted this in a previous intervention. But there is the fundamental lesson of whether our institutions in Nigeria have been hijacked and subverted from serving the Nigerian people and our economy to serving personal and political agendas, including a dishonest use of a war against corruption as an attractive shiny object.
“One day, we will count the losses to the Nigerian economy, the legitimacy and effectiveness of a once-prestigious institution, and to the legitimacy of the Nigerian state itself, of the partisan politicization and de-professionalization of the leadership of the CBN.
“Our apex bank, along with the judiciary, is one of the key institutional prisms through which foreign countries and investors abroad and at home assess the functioning or otherwise of the Nigerian state. Turning it into a political football was and is a big mistake, and a strong indicator of state failure,” he wrote via his verified Twitter page.
OTC Stock Market Drops 0.22% as 11, CSCS Record Losses
By Adedapo Adesanya
Central Securities Clearing System (CSCS) Plc and 11 Plc suffered losses on Thursday, causing the NASD Over-the-Counter (OTC) Securities Exchange to deflate by 0.22 per cent.
The duo overturned the gains recorded by FrieslandCampina WAMCO Nigeria Plc and Geo-Fluids Plc.
Data obtained by Business Post showed that CSCS Plc lost 5 Kobo to quote at N14.00 per unit versus the previous day’s N14.05 per unit, while 11 Plc lost N10 to close at N140.00 per unit compared with Wednesday’s value of N150.00 per unit.
On the flip side, FrieslandCampina appreciated by 59 Kobo to finish at N76.00 per share versus the previous closing price of N75.41 per share, as Geo-Fluids Plc gained 14 Kobo to close at N1.64 per share as against the previous day’s N1.50 per share.
At the close of transactions, investors lost N2.11 billion as the value of the OTC stock market closed at N959.06 billion, in contrast to the midweek’s N961.17 billion.
Following the same trend, the NASD Unlisted Securities Index (NSI) decreased at the close of trades by 1.61 points to 729.87 points from 731.48 points.
It was observed that the volume of securities traded in the session went down by 77.2 per cent to 5.2 million from 23.1 million units, the value of stocks expanded by 139.5 per cent to N24.3 million from N10.1 million, while the number of deals increased by 7.7 per cent to 14 deals from 13 deals.
Geo-Fluids Plc remained the most traded stock by volume on a year-to-date basis with 460.3 million units valued at N501.9 million, UBN Property Plc transacted 365.8 units worth N309.5 million, while IGI Plc was in third place with 71.1 million units valued at N5.1 million.
Conversely, VFD Group Plc was the most traded stock by value on a year-to-date basis with 7.3 million units worth N1.7 billion, Geo-Fluids Plc has transacted 460.3 million units valued at N501.9 million to retained second place, while UBN Property Plc was in third place with 365.8 million units worth N309.5 million.
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