Nigeria mortgage agency seeks approval to raise capital

 Nigeria Mortgage Refinance Company (NMRC) will seek approval from members by month-end to raise additional equity capital of 28.5 billion naira ($143 million) through a shelf registration programme, the state-backed mortgage agency said on Monday.

NMRC set a price range of 4.50 to 7 naira per share for the first tranche of equity to be raised under the programme worth 6 billion naira.

Nigeria put $300 million of World Bank aid money into a mortgage-backed guarantee last year in a bid to boost lending through the creation of a secondary housing market, which is virtually non-existent in Africa's biggest economy.

Africa's most populous nation suffers a housing shortage, with somewhere between 16 million and 20 million new homes needed just to keep up with current demand, according to official figures.

The NMRC was set up with the aim of lowering mortgage lending rates -- currently around 20 percent for a 10-year loan or up to 30 percent for households with lower credit ratings.

The debut general meeting will be held on Aug. 31, the NMRC said in a notice to approve the capital plans. It added that further equity tranches will be approved by members.

Mortgage lending is a small portion of the overall property market. There are about 20,000 mortgages open in Nigeria, the finance ministry has said, none of which are tradable because of a lack of liquidity. None extend beyond 10 years.

Skye Bank to raise equity, restructure loans

 

Nigeria's Skye Bank is in talks to raise 30 billion naira ($151 million) from existing and new investors before the end of the year to bolster its capital base, its chief executive said on Monday.
 
Timothy Oguntayo told an investors' call the bank had identified some shareholders who were willing to support the cash call, part of which is meant to help the lender prepare as the country adopts stricter international requirements.

"With or without changes in the macro (economic) environment, our existing shareholders have shown some interest in the offering," he said, referring to a weaker currency and lower oil price that have hampered Nigeria's outlook as an investment destination.

The bank had said in April it planned to raise 50 billion naira.

Shares in Skye Bank, down 21 percent so far this year, ended flat at 2.10 naira.

Last week the bank, which acquired nationalized lender Mainstreet Bank in 2014, reported a 47.4 percent rise in first-half pretax profit to 10.71 billion naira.

It said it had so far this year restructured 65 billion naira in loans, about 30 percent of which were to clients in the oil and gas sector.

Loans grew by 14 percent in the half year to 657 billion naira and it set loan growth guidance of 5 percent this year.

CBN mandates banks, others to prioritise attention to legitimate FX demand

The Central Bank of Nigeria, has directed all authorised dealers in foreign exchange (FX) to henceforth treat as top priority all legitimate demand for FX for eligible transactions.

The CBN also reassured that all legitimate requests for FX for eligible transactions, normally referred to as “invisibles,” such as remittances for school fees, student maintenance allowances, BTA, PTA, medical and other eligible transactions, would be fully met at the official/interbank exchange rate.

Already, all the legitimate demand for such transactions through recognised channels has so far been fully met by CBN.

The latest directive, which is another measure to check huge FX arbitrage in the system, had become necessary following observations that most banks were in the habit of denying or frustrating customers who want to genuinely source FX for remittances for school fees, student maintenance allowances, BTA, PTA, medical and other eligible transactions with excuses that they were working inline with CBN directives.

In a statement signed by Ibrahim Mu’azu, CBN director of corporate communications, the apex bank once again advise individuals that wish to source foreign currency for such eligible transactions to approach their banks with their legitimate demand as the CBN has made adequate provisions of foreign currency for all such legitimate and eligible purposes.

“The CBN hereby directs all authorized dealers in foreign exchange in Nigeria to henceforth treat as top priority all legitimate demand for foreign exchange for eligible transactions,” the CBN noted.

It further assured that holders of naira denominated debit and credit cards would continue to have access to the use of their cards at ATM machines in any part of the world, but subject to the annual limit of $50,000.

ATM withdraws is still restricted to a maximum of $300 per day.

Economy takes bashing as best non-oil export constitutes 4% of total

A five-year analysis of the International Trade Centre data pinpoints the source of Nigeria’s current economic trauma as a blatant failure to diversify away from oil,  with the country’s best performing non-oil export within the period constituting only 3.8 percent of total non oil exports.

The data show that rubber is Nigeria’s most performing export product, while cocoa is next in value in the non-oil segment, with only 1.7 percent share.

Of the $539.34 billion worth of exports between 2010 and 2014, crude oil and distillation products recorded 89 percent share, reflecting the country’s penchant for oil and neglect of the non-oil sector over the years.  

The ITC data collated by BusinessDay, further show that while rubber occupies 3.82 percent, cocoa shared 1.7 percent  within the period. Similarly, raw hides, leather and skins (other than furskins) contributed only 1.15 percent.

Finished manufactured products made insignificant contributions to the export trade, with aluminium occupying 0.20 percent, plastics 0.17 percent and machinery/nuclear reactors& boilers 0.16 percent.

Other products exported within the period included fertilizers, cotton, lead, tobacco, coffee, tea, fish and crustaceans, among others.

“Nigeria has spent so much time supplying primary products such as cocoa and rubber to the world,” said Imo Itsueli, former chairman of the Nigerian National Petroleum Corporation (NNPC), at a foreign policy dialogue organised by the Lagos Chamber of Commerce and Industry (LCCI).

Port Harcourt Refinery begins full production of petrol, to reduce import by 40%

The New Port Harcourt Refining Company, PHRC 2, will this week begin full production of Premium Motor Spirit, PMS, popularly called petrol, after the completion of the rehabilitation of Area 3, where petrol, Liquefied Petroleum Gas, LPG, and other lighter products are produced. This will reduce the importation of fuel by 40 per cent when fully operational.

The 210,000 barrels per day capacity refinery had last month commenced preliminary production with Unit 1 producing largely Dual Purpose Kerosene (DPK) and Automotive Gas (AGO), otherwise known as diesel.

Disclosing this to newsmen over the weekend, Chairman of the Chrome Group, Sir Emeka Offor, revealed that since 2000 when Chrome Consortium successfully completed the Turn Around Maintenance (TAM) of Port Harcourt Refinery, his company had remained in the refinery to provide massive maintenance services because of the satisfactory completion of the TAM.

The multi-billionaire business mogul stated that his company was the lead partner in the consortium that carried out the TAM, which was certified by Shell Manufacturing Services, an international company that supervises TAM in refineries.

He stated that as a life-running plant, the refinery is supposed to have TAM every two years but noted that no TAM has been carried out since 2000.

Noting that since 2000, all the major activities, interventions and critical jobs in Port Harcourt Refinery have been done by Chrome, Offor pointed out that the fact that the refinery is still running today is partly because of the jobs being done by Chrome.

He stressed that his company had also done some intervention jobs in Kaduna Refinery, adding that the major Fluid Catalytic Cracking Unit (FCCU) heater in Kaduna refinery was rehabilitated by Chrome Oil on time and on schedule.

FG directs NPA to pay workers salaries to avert shutting down of nation’s ports

The Federal Government has directed the Nigerian Ports Authority (NPA) to pay salaries and allowances of dockworkers.

The president of the Maritime Workers Union of Nigeria (MWUN), Mr. Emmanuel Nted, made the disclosure at a briefing in Lagos on Friday.

He said the Federal Ministry of Transport in a letter on August 4 to NPA’s managing director, signed by the Director of Maritime Services in the ministry, S. U. Galadanchi, directed the management of the NPA to settle the salaries of the workers.

Maritime workers had threatened to shutdown ports in the country from August 6 over unpaid salaries to dock workers.

Also, the President of Dockworkers’ Branch of MWUN, Mr Adewale Adeyanju, said although efforts are being made to solve the issue, workers will shutdown the ports if they fail to receive concrete assurance on the payment of the salaries by close of work today.
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Nigeria to introduce new rules to stop tax evasion

Nigeria's Federal Inland Revenue Service (FIRS) says it would crack down on tax evaders by denying access to banking facilities for individuals and companies that failed to join its register.

FIRS chairman Sunday Ogungbesan told a news briefing in Lagos there were more more than 440,000 companies in the country, which has Africa's biggest economy, but only about 120,000 paid taxes.

Ogungbesan said it was difficult to track the financial activities of those who did not pay taxes, most of whom said their firms were not active.

Tax identification numbers were introduced for corporate bank accounts in 2012 but some firms whose accounts pre-date the the system are currently not obliged to have one.

President Muhammadu Buhari, who took office two months ago, was elected in March after vowing to crack down on corruption.