GTBank Set to Divest from GT Assurance

 Managing Director/Chief Executive of GTBank, Mr. Segun Agbaje

Guaranty Trust Bank Plc (GTBank) has said it had concluded arrangements to divest from GT Assurance Plc (GTAssur), its insurance subsidiary.

The bank had agreed to  sell its 67.68 per cent equity stake in the insurance firm, valued at N11.910 billion to Assur Africa Holding (AAH).

The move was in line with the new Central Bank of Nigeria (CBN) banking model.

A statement  filed by the bank to both the management of the London Stock Exchange (LSE) and the Nigerian Stock Exchange (NSE), a copy of which was made available to THISDAY Thursday, however explained that completion of the deal was subject to regulatory approvals.

It said the transaction was expected to be concluded at the end of the third quarter of 2011.

GTAssurance was listed on the NSE on Friday, November 21, 2009. The management of the company had listed a total of 10 billion shares of the company at 50 kobo each at N3 per share.

The insurance firm is reputed as one of the most profitable companies in the Nigerian insurance industry. Its share price which stood at N1.43 per share as at close of trading at the stock exchange Thursday , however remained one of the most attractive in the
sub-sector, considering the downturn and the unimpressive performance of the sub-sector.

AAH is a special purpose vehicle incorporated in Mauritius for the purpose of GTAssur acquisition. The shareholding structure of AAH is made up of six members, comprising three private equity funds with substantial investments across Africa.

They include - African Development Partners I, advised by Development Partners International (DPI) based in the United Kingdom, AfricInvest II LLC and AfricInvest Financial Sector Limited, both advised by AfricInvest Capital Partners (ACP) based in Tunisia and three international developmental finance institutions which includes DEG (Germany), Proparco (France) and FMO (Netherlands).

The acquisition is also being made in conjunction with a number of Nigerian investors.

Commenting on the deal, Managing Director/Chief Executive of GTBank, Mr. Segun Agbaje, said: "This is a critical milestone in the
implementation of our compliance plan with the new licensing regime of the CBN, on the back of shareholders' approval obtained at the Bank's Extra-ordinary General Meeting (EGM) held in October 2010."

On the selection of AAH as GTBank's preferred bidder, Agbaje affirmed that with the pedigree of the new buyer, the Bank was confident that AAH would continue to promote a culture of corporate governance in GTAssur that is consistent and compatible with best practice.

In addition, he stressed that AAH's robust post-acquisition plan for GTAssur as well as its support of the GTAssur management team and its strategy to profitably grow the business beyond the Bank's divestment contributed to its selection as the preferred bidder for GTBank's 67.68 per cent shareholding interest.

Agbaje said: "Over the last 7 years, GTBank has imparted on GTAssur our unique and enduring culture based on ethical and professional conduct as well as a high level of corporate governance, a legacy which has helped project the company from a marginal position (97th in market share) as at 2003 to a leadership position (fifth) by 2010.

In this regard, we are proud of our contribution to the development and deepening of the Nigerian insurance industry."

"This sale realises significant value for our shareholders. Together with the ongoing disposals of our other non-banking subsidiaries, it demonstrates clear delivery of our strategic focus of concentrating the Group's financial and management resources on our core business of commercial banking, with a view to enhancing our market positioning in the segments where we have strength and scale."

House Endorses Islamic Banking, Withdrawal Limit

Aminu Tambuwal house Speaker

The House of Representatives has accepted the arguments advanced by the Governor of Central Bank of Nigeria (CBN), Mallam Sanusi Lamido Sanusi, in favour of the apex bank’s policies on Islamic component of non-interest banking and the limitation of daily cash withdrawals.

The lower chamber of the National Assembly gave its nod to the controversial policies after it received a comprehensive briefing on them at Thursday’s plenary. 

But, significantly, members were not allowed to ask any questions after his presentation.

There has been a lot of public outcry over the policies and the House had invited Sanusi to clarify the basis for introducing the non-interest banking and limiting the amount of cash a customer could withdraw from his bank account in a day.

Deputy Speaker of the House, Hon Emeka Ihedioha, who presided over the session, ruled that the clarifications offered by the apex bank were satisfactory and members had become more enlightened on the policies.

Ihedioha said that in view of the volume of explanations already made and the fact that the House would not have sat yesterday because of the death of the Chairman, National Assembly Service Commission, Alhaji Ahmed Aliyu Dogondaji, the interaction should not be reduced to a question and answer session. 

The House had earlier observed a minute silence in honour of Dogondaji who died in the early hours of Thursday.

However, a cross section of lawmakers, who spoke to newsmen outside the chambers, disagreed with this position, arguing that the presentation made by Sanusi still left many questions unanswered and they were not given the opportunity to seek further clarifications.

Sanusi, who briefed the House for about one hour, said the introduction of the non-interest banking was to provide bank customers, particularly small scale businessmen, with an alternative banking platform that would allow them to borrow money to finance their enterprises without running into the  huge debt burden usually associated with the conventional banking system. 

The cash withdrawal limit policy, Sanusi said, was intended to reduce cost of service, increase access and convenience as well as advance Nigeria into the club of countries that run cashless economies. Both policies, he said, were in the overall interest of the Nigerian economy.

Apart from these policies being in line with global trends, Sanusi explained, they were in the interest of the poor masses in the country that had been bearing the huge cost of banking services even though their share of the cash flow in the economy had remained very low.  

He said under the policy on cash transaction, there is actually no embargo on the amount of money a bank customer could withdraw except that withdrawal beyond the stipulated limit would attract a cost to the customer.

“For the avoidance of doubt, no limit exists on cash transaction, but the very few high volume cash users should bear commensurate service cost while most of Nigerians are exempted from subsidising them. The 90 per cent of Nigerians who are poor people are subsidising 10 per cent who impose the huge cost of cash on the system.

“The industry proposal is not to place limit on cash transactions, but to provide that the 10 per cent of customers who make high volume cash transactions will bear the associated cost and eliminate the subsidy by the mass public (90 per cent) of banking customers. 

This will have direct impact on banking industry efficiency and cost structure – reducing the cost of cash to the financial system will result in significant savings that can be passed on to customers in form of reduced cost of banking services and lower lending rates to borrowers,” he said.

On Islamic banking, Sanusi lamented that he had been grossly misunderstood on the policy by persons who launched a media war against him without taking the pains to read the details of the policy. 

He said that contrary to the perception in some quarters, Islamic banking is simply a non-interest bank which transacts banking business, trading, investments and commercial activities without charging interest on loans. 

The bank, he also said, does not support alcohol, pornography, gambling, speculations and other ventures that are not in accordance with Islamic commercial jurisprudence.

According to him, the idea of non-interest banking was conceived long before he was appointed governor of CBN. The policy, he said, had been embraced by many countries in Africa, Europe, Asia and America and does not discriminate against any religion.

“The greatest danger to any government policy in this country is the tendency for people to view it from some primordial angles. This tendency to view every single national matter as either ethnic or religious will not get us anywhere. We had an election in which the issue of concern was not education, health or electricity but whether the president comes from the North or South and whether he is a Muslim or Christian.

“Let us remove the product (non-interest banking) from religion because it is already a universal banking product, even though it might have had religious roots. The CBN is not setting up or promoting Islamic banking, non-interest banking is already operational in more than 70 countries of the world and it is not discriminatory,” Sanusi said.

Meanwhile, the Minority Leader of the House, Hon. Femi Gbajabiamila (ACN/Lagos), has expressed reservations about the manner in which the explanations were taken without questions. 

Gbajabiamila said it was an error of judgement to allow the CBN governor to appear before the House in plenary without the members having the opportunity to interact with him and seek further clarifications. 

He said the encounter was more or less a monologue and not even a lecture because in a typical classroom situation lecturers are obliged to take questions from students.  

The session, Gbajabiamila said, would have been more enriching if the lawmakers had been allowed to seek more explanations on some of the grey areas of the two policies under review.

Another lawmaker, Hon. Daramola (ACN/Ekiti), faulted the decision by the leadership of the House not to allow members ask questions after the briefing.

However, Hon. Umar Adam Katsayal (CPC, Katsina State) said members of the parliament needed to engage their constituents in some enlightenment programmes to facilitate the acceptability of the policies.

Former Deputy Chairman, House Committee on Public Accounts, Hon. Uche Ekwunife (APGA/Anambra), said that since many Nigerians were ignorant of the rudiments of the policies, there was an urgent need for the CBN to educate the populace on the dynamics of contemporary banking especially as it affects the non-interest banking.

Also reacting to the briefing, Hon. Robinson Uwak (PDP, Akwa Ibom) explained that a lot of Nigerians were yet to understand the policies. 

He urged the apex bank to take measures to help win the confidence of the generality of Nigerians towards the reforms in the banking sector. 

Uwak, however, berated the CBN governor, whom he said attempted to ridicule critics of his policies, especially some of the clerics who picked holes in the new policies, rather than addressing the core issues.

JTF Patrol Team Escapes Explosion in Maiduguri

Haliru Mohammed, Defence Minister

Some men of the Joint Task Force (JTF) deployed in Maiduguri, Borno State, Thursday narrowly escaped being wounded or killed by a bomb targeted at them by suspected members of Boko Haram.

Though the bomb exploded at the London Chiki area of Maiduguri metropolis, no casualty was recorded.

Residents of the area told THISDAY that they heard a loud bang which was followed by thick smoke around 9am.

Confirming the incident, the newly appointed spokesman of JTF, Lt. Col. Hassan Mohammed, said an improvised explosive device (IED) targeted at a team of JTF exploded in the area but no casualty was recorded.   

He also said they were yet to make any arrest in connection with the incident.

Meanwhile, more business centres and markets have been opening their doors to customers. Also some banks have resumed operations, although limited to between three and four hours.

In some of the banks visited, it was gathered that they only operate between 9am and 12 noon, while some operate from 9am to 1pm.

House Summons Sanusi on Bank Transaction Policy

Sanusi Lamido, CBN Governor

By Onwuka Nzeshi       

The House of Representatives Tuesday summoned the Governor of the Central Bank of Nigeria (CBN), Mallam Sanusi Lamido Sanusi, over the controversy surrounding the proposed policy of the apex bank to limit daily cash withdrawals by bank customers to N150,000 for individuals and N1 million for corporate organisations.

A resolution passed by the lower chamber of the parliament directed Sanusi to appear before the lawmakers tomorrow to offer explanations on the new proposal and other sundry policies of the apex bank which, in the perception of the public, might have some negative impacts on the populace. 

The House will also Thursday at plenary deliberate on the alarming rate of road accidents being recorded on the Nyanya/ Mararaba expressway in the Federal Capital Territory (FCT), Abuja.  

Hon Zephaniah Jisalo, member representing AMAC/Bwari Federal Constituency, Abuja had drawn the attention of the House to the multiple ghastly road accidents which claimed over 20 lives on the road on Monday and demanded an end to such incidents.   

The House observed a minute silence in honour of those who lost their lives in the latest fatal road accident. 

The cash withdrawal limitation policy which is billed to take effect from June next year, has been roundly condemned by a cross section of Nigerians particularly politicians who claimed that the country was not ready for the envisaged switch to a cashless economy.  

Sanusi will also be expected to answer questions on the equally controversial policy of Islamic banking, an issue that has pitted him against the Christian Association of Nigeria (CAN) and raised more questions than answers on the constitutional status of Nigeria as a secular state.  

The summon followed a motion sponsored by Hon. Aliyu Yakubu (PDP Yobe) in which the lawmaker alerted the chamber on the implications of the policy. 

Yakubu argued that the daily cash withdrawal limitation would cause undue hardship to citizens of the country as hundreds of communities in Nigeria have no commercial banks, microfinance banks and have no access to the Automated Teller Machines (ATM) through which they could make multiple withdrawals to meet their daily cash needs. 

He expressed concern that the policy would affect local farmers and traders who have no banks in their localities, adding that while the move to make Nigeria a cashless society was commendable, there were a lot of logistic challenges that could make the policy impracticable in the country.

Yakubu also argued that the policy might be an effort in futility considering the current scenario where inter-banks transactions carried out even in major cities and urban centres take at least 48 hours to be completed.  

In the substantive motion, the lawmaker urged the CBN to extend the deadline to enable commercial banks to expand their branch networks to the rural communities which were not currently enjoying banking services. 

He tasked the CBN to enunciate a new policy that would encourage banks to establish outlets in the rural areas just as he tasked Sanusi to prevail on commercial banks to improve their information technology facilities to enhance speedy transactions wherever they operate.  

In a contribution to the debate, a former Chairman, House Committee on Banking and Currency, Hon. Ogbuefi Ozomgbachi, urged the House to intervene in the controversy and ensure that the CBN introduced measures that would not only advance the banking sector but impact positively on Nigerians. 

Ozomgbachi said that while reforms were needed in the banking sector, any new policy must be designed and promoted in such a way that Nigerians were not made to suffer unnecessarily.

Ruling in favour of the summon, Speaker of the House, Hon. Aminu Tambuwal, said the House needed to be properly informed on the proposal as well as other sundry policies including the vexed non-interest banking policy recently introduced by the CBN. 

He said the explanations expected from Sanusi would enable the House to make informed decisions and take appropriate action in the interest of the public.  

“We need more information to take proper action on these proposals. To this end, the governor of the Central Bank should appear before the House on Thursday at 10am,” Tambuwal said.

Senate to Probe BPE over Failed Privatisation

Senate President, David Mark

Against the backdrop of a recent revelation by Vice-President Namadi Sambo that 80 per cent of government companies that had been privatised had failed to operate properly due to lapses in the privatisation process, the Senate Tuesday set up a seven-man ad hoc committee to investigate the privatisation and commercialisation activities of the Bureau of Public Enterprises (BPE) from 1999 to date.

The setting up of the committee followed the adoption of a motion by Senator Ahmad Lawan (ANPP, Yobe North) who incidentally is to chair the panel. The motion was co-sponsored by 25 other senators.

Other members of the committee, which has four weeks to submit its report, are Senators Babafemi Ojudu (ACN, Ekiti), Alli Ndume (PDP, Borno), Philip Aduda (PDP, FCT), Ifeanyi Okowa (PDP, Delta), Hope Nzodima (PDP, Imo) and Mohammed Magoro (PDP, Kebbi).

Although it is not expressly stated in the committee’s terms of reference, it was gathered that the audience with all the directors-general (DGs) of the BPE since its inception, including its pioneer DG, Mallam Nasir el-Rufai, Dr Julius Bala, Mrs. Irene Chigbue and the incumbent DG, Ms. Bola Onagoruwa, is to enable the committee to investigate the process through which the BPE privatised the companies and establish the agreements and conditions upon which the privatisation was consummated.

It will also determine how much was realised from the sale of the companies and where the proceeds were paid into while also determining how many jobs were lost and gained after the privatisation of companies.

Other terms of reference of the probe panel are to identify the factors militating against the expected improved and good performance of the privatised companies as well as determining the best way forward for the privatisation exercise and the desirable development and growth of the sold companies.

In his remark after announcing the committee’s composition, Senate President David Mark charged the panel to approach its assignment with an open mind, saying: “There should not be any witch-hunting.”

He told the committee members that the Senate had no predetermined position on the investigation because, according to him, “the bureau would have done a few good things and a few bad things”.

Mark said: “To the best of our ability, we should approach it with an open mind; no playing to the gallery in this exercise. Let us do a thorough work so that when the findings are brought here, people will appreciate the fact that those who have been put in the committee have done a thorough work; a work that can stand the test of time.”

He charged further: “The public should be involved and those who are stakeholders should be involved. Definitely, the searchlight will be on the members of the committee and you must be above board, absolutely above board in what you are going to come up with.

“I believe that there could have been problems with the implementations and those problems must be brought out not just to apportion blames, but you must also make recommendations so that as we continue the privatisation exercise, those mistakes that were made in the past will not be repeated in the future.”

He therefore charged the committee to make recommendations that would be beneficial to the nation in the future.

Presenting the motion earlier, Lawan noted that the Federal Government embarked on the privatisation and commercialisation of federal public enterprises through the enactment of the Privatisation and Commercialisation Act No 25 of 1988, Bureau of Public Enterprises Act No 78 of 1993 and Public Enterprises Act of 1999.

He said the primary and fundamental purpose of privatisation by the Federal Government was to divest and free the subsidies that were paid into the operations of the enterprises, so as to fund better the provision of critical and crucial infrastructure.

The senator however expressed concern that the Chairman of the National Council on Privatisation (NCP), Sambo, told the nation that 80 per cent of government companies that had been privatised had failed to operate properly due to lapses in the privatisation process.                      

He lamented that due to the collapse of the privatised companies, there were massive loss of jobs and colossal loss of economic returns to the Nigerian economy, citing the steel sector that used to employ up to 20,000 workers but now has less than 4,000 after the exercise.

Seconding the motion, Senator Enyinnaya Abaribe (PDP, Abia) said there was no aspect of the privatisation exercise that had succeeded.

He said: “Our problem in Nigeria is that we start with good intention and at the end of the day what we see is not what the original intention is.”

Lamenting that corruption is the bane of privatisation, whereby those who buy the companies strip them of machineries and send the tools abroad, Abaribe said: “Someone must be called to account if we are to stop this ugly trend.”

Also supporting the motion, Senator Smart Adeyemi (PDP, Kogi) said: “Privatisation is the worst major government policy since our independence,” adding that, “it is a policy that has handed over our collective wealth to some privileged Nigerians. Privatisation has further enslaved us as a people”.

Describing privatisation as “a policy without human face”, Adeyemi said: “At the time it was conceived, we were told that it is a policy that will enhance efficiency of the privatised public companies.”

In his contribution, Senate Leader Victor Ndoma-Egba said privatisation would have ordinarily been a good policy but for the selfishness of those charged with implementing it in Nigeria.

He said: “The reason why privatisation is a desirable policy is the realisation all over the world that government has no business in business.”

On his part, Senator Ganiyu Solomon (ACN, Lagos) lamented that it would appear that the privatisation exercise was not designed to succeed by those in charge of its implementation.

The Deputy Senate President Ike Ekweremadu however said the main essence of the motion was to ensure that privatisation would be made to serve our people and not to jettison the policy.

He also lamented that the policy was programmed as a huge fraud, adding that “at the time it was done, some people took advantage of the weakness in our monitoring policy”.

Others who spoke in support of the motion included Senators Abdu Ningi (PDP, Bauchi), Nurudeen Abatemi (PDP, Kogi), Kabiru Garba Marafa (ANPP, Zamfara), Gbenga Kaka (ACN, Ogun) and George Akume (ACN, Benue).

Banks Increase Appetite for Bankers’ Acceptance

CBN   Headquarters

Investment in Bankers’ Acceptance (BAs) increased by 5.3 per cent to N63.4 billion in the month of April, as banks continue to search for alternative investment window.

The figure represented a growth by N3.4 billion, compared with the N60.04 billion recorded in the month of March.

BAs are short-term credit investment created by a non-financial firm and guaranteed by a bank. They are often traded at a discount from face value on the secondary market. Banker's acceptances are very similar to T-bills and are often used in money market funds

According to the Central Bank of Nigeria (CBN) monthly economic report made available to THISDAY yesterday, the value of investment in Bas had declined by 10.7 percent in the preceding month.

The report stated that the increase recorded, reflected the increase in investments by deposit money banks and discount houses.

It showed that the value of money market assets outstanding as at the end of April 2011 was N4.861 trillion, representing an increase of 5.6 per cent, compared with an increase of 2.5 per cent at end- March 2011.

“The development was attributed to the 6.8, 5.3 and 4.2 per cent rise in the value of FGN Bonds, Bankers Acceptances and Nigerian Treasury Bills, respectively. Activities on the Nigerian Stock Exchange (NSE) in April 2011 were bullish, as all the major indicators trended upward.

Gross federally-collected revenue in April 2011 was estimated at N781.84 billion, representing an increase of 30.6 and 37.5 per cent over the proportionate monthly budget estimate and the receipts in the corresponding period of 2010, respectively. At N621.53 billion, gross oil receipts, which constituted 79.5 per cent of the total revenue, exceeded the proportionate monthly budget revenue estimate and the receipts in the corresponding period of 2010 by 49.7 and 56.6 per cent, respectively,” it added.

According to the report, banking system’s credit to the private sector fell by 0.5 per cent to N9.376 trillion in the month under review, from the preceding month’s level, in contrast to a rise of 2.7 per cent at end-March 2011. Similarly banking system’s claims on the core private sector declined by 0.4 per cent to N9.012 trillion, in contrast to the increase of 2.6 per cent in the preceding month.

It said: “The development reflected wholly the fall in the deposit money banks’ claims on the sector. Relative to the level at end-December 2010, banking system’s credit to the private sector fell by 4.6 per cent.”

Labour Suspends Strike

Abdul Waheed Omar, NLC President

It was close, very close but organised labour finally decided early Wednesday morning to call off its three-day warning strike which was planned to commence Wednesday.

The impasse over the implementation of the new minimum national wage of N18,000 was finally resolved after a series of meetings between the labour unions and governors as well as Federal Government officials.

A communique released early Wednesday morning said the strike had been called off with immediate effect.

THISDAY however learnt that because of the lateness of the truce, the labour officials would find it difficult to pass the message across to members, meaning the strike may be observed Wednesday, at least partially.  

The communique also said payment of the new minimum wage would start from August 1, 2011, declaring that all negotiations should end by July 31.

All arrears since the law was signed last March are also expected to be paid.

The communique concluded that "no worker shall be victimised" as a result of this industrial action.

The communique was signed on behalf of the Federal Government by Secretary to the Government of the Federation, Senator Anyim Pius Anyim; Minister of Labour, Chief Emeka Wogu; and Head of Service of the Federation, Professor Afolabi.

President of Nigeria Labour Congress (NLC), Comrade Omar Abdulwahid and President of Trade Union Congress (TUC) Comrade Peter Esele signed on behalf of labour.

It was read by Abdulwahid.

Before the strike was called off, it had been announced that employees of the Lagos State civil service had opted out. 

The state government said its workforce was not participating in the action because none receives below the N18,000 in question as monthly wage. 

The state Head of Service, Prince Adesegun Ogunlewe, who said this at the presentation of retirement bond certificates worth N2.198 billion to 322 retirees, added that the government had already complied with the Minimum Wage Act. 

A circular with Ref No CIR/HOS/11/VOL.I/068 was issued to ministries, departments and agencies (MDAs) including the office of the deputy governor, speaker of the House of Assembly, 

commissioners, permanent secretaries, local government chairmen and hospital administrators, among others. 

The circular read: “As a proactive government, it is heartening that the new salary structure being operated since January 2011 in the Lagos State Public Service has adequately accommodated the provisions of the Act since the least paid employee now earns N18,780.48k (GP) per month as already reflected in circular Ref No. EST/S.190/S.6/VOL.III/192 of 21st February, 2011. In the same vein, parastatal organisations in the State Public Service are being assisted to comply with the Minimum Wage Act. 

“The action of government is driven at ensuring stability in the socio-economic activities of the state which any industrial action might severely hamper.  Furthermore, the state is seriously concerned about the negative impact of strike to the dispensation of essential safety and security services such as healthcare, water supply, fire services and emergency management, etc, to her citizenry.” 

The meeting between the Nigerian Governors’ Forum (NGF), NLC and TUC had ended in a more confusing state. 

The NLC and TUC officials refused to speak to newsmen at the Rivers State Governor’s Lodge, saying they were heading to another meeting with Anyim. 

Chairman of the NGF, Mr. Rotimi Chibuike Amaechi, had told newsmen that they had concluded their aspect of the meeting with the NLC and TUC. 

He said: “We have finished with the NLC and TUC. We are ready to make sacrifice where necessary because of the overbearing interest of the country, which is bigger than any individual. We have reached an agreement not to talk to anybody on this again.” 

Also, the President of TUC, Esele, simply said: “We are going to the SGF’s office for the concluding part of the meeting.” 

The NGF consequently raised a five-man committee to accompany the NLC and TUC to the meeting with the SGF on an observer status. 

The members of the committee include Edo State Governor Adams Oshiomhole, his Enugu State counterpart, Sullivan Chime, and three others, whose names THISDAY could not ascertain at press time. 

It was gathered that at the meeting, the governors convinced the labour leaders that they were willing to pay the minimum wage but insisted that it would be based on availability of funds. 

According to one of the governors, who explained the terms of the meeting to THISDAY, “we are willing to pay, but we are also pushing that there be an amendment to the Federal Revenue Allocation formula to reflect the reality on ground". 

He said: “This is what we meant by the relativity to pay.” 

He said the chairman of the NGF signed an agreement with the labour leaders that the states would pay the minimum wage once there was the “relativity agreement” and the Federal Government kept to its agreement that the revenue sharing formula would be reviewed. 

The governors of Rivers, Bauchi, Enugu, Edo, Kwara, Akwa Ibom, Plateau, Zamfara, Nasarawa and deputy governors of Katsina, Jigawa, and Ondo, among others, were present at the meeting. 

Abdulwahid; the two Deputy Presidents of NLC, Isa Aremu; and Promise Adewusi, were at the meeting. The TUC President, Esele, and TUC’s General Secretary, John Kolawole, were also at the meeting. They arrived the venue at exactly 12.56 pm. The meeting came to an end at about 6.50 pm.

NNPC, Capital Oil Project to Create 3,000 Jobs

Minister of Petroleum, Mrs Diezani Allison-Madueke

The Kero-Direct Scheme (KDS), a project put together by the Nigerian National Petroleum Corporation (NNPC) in partnership with Capital Oil and Gas will generate about 3,000 direct employments for Nigerians.

Managing Director of Capital Oil and Gas Industries, Mr. Ifeanyi Ubah, who disclosed this at the weekend said in the last one week, the company had employed about 250 youths, while additional 2,750 would be employed in the next six months.

The Kero-Direct Schme (KDS) was put together by the NNPC in partnership with Capital Oil and Gas Industries to supply kerosene directly to households in the country.

The project, which kicked-off in Lagos last Saturday with Amuwo -Odofin and Apapa Local Government Areas as starting points, will be extended to all the 57 LGAs in Lagos and subsequently to other parts of the country.

Under the arrangement, the Pipelines and Products Marketing Company (PPMC), a subsidiary of the NNPC will provide the product that will be sold to end users at the official rate of N50 per litre. The product will be dispensed through the use of Capital Oil dispensing trucks.

Ubah said to ensure that middlemen do not hijack the scheme, the sale would be restricted to 25 litres to each household, adding that about 880 households from each of the 57 local councils in Lagoswill benefit on weekly basis.

He said his company had acquired seven large barges and five tug boats, to ensure that the exercise was conducted without hitches, adding that the scheme was a bold effort by NNPC in partnership with Capital Oil to kerosene directly to the people.

“Capital Oil has been very concerned about the difficulty in getting kerosene for domestic use. It is in response to this that the company came up with this innovation of deploying mobile filling stations with standard dispensing pumps to deliver kerosene at official price of N50 per litre to Nigerians. The scheme will afford our people greater access to the product with a view to reducing the use of charcoal and fire woods, which are hazardous to health.

“With a storage capacity of 196 million litres and dispensing capacity of 56 million litres per day, our knack for efficiency and excellence is demonstrated in our innovative robustness as we operate a system that transfers product from our jetty to other nearby depots through integral underground pipe network. In addition to our depot, we can supply up to four other depots simultaneously. With our newly acquired seven large barges and five tug boats, we are more than poised to deliver quality service to the good people of Nigeria”, he said.

According to him, the choice of Amuwo-Odofin and Apapa as selling points for the commencement of the project was deliberate as those areas are among places with higher concentration of people.

Capital Oil and Gas has world class depot with the capacity to store about 196 million litres of products. The company also has dispensing capability of 56 million litres per day, 30 arms loading gantry, deepwater jetty that is capable of docking four large vessels simultaneously, 700 road tanker fleet, integrated products pipelines, regional strategic oil depots in Suleja, Funtua, Kano and Emene as well as 1,100 capacity-ultra modern truck park.

N18,000 minimum wage: Yuguda lists conditions for payment

Bauchi State governor Malam Isa Yuguda has said that the proposed 18 000 naira minimum wage is even too small for the Nigerian worker but in view of the present financial status of most states, the sum will only be paid as the states can afford to do so.

Speaking to a group of journalists on Sunday in Abuja, Governor Yuguda said for now each state government will look into its various revenue sources and sit down with the Labour unions to appraise the do-ability of the proposal and arrive at a position where the trio of the civil service, government and the public will be happy at the end.

“We have deliberated and agreed that it is something that is doable when able. As far as I am concerned 1800 is even too small for the average Nigerian worker. So if we can even afford more, we should do it. We will look at the various avenues of generating revenue, after all, the Labour themselves know those sources; they know how much we get and how much we pay out for services. We pay for security; we run schools, hospitals; we create jobs and so on. So there are so many competing needs for this small resource,” he said.

The governor, however, observed that for now, there are states whose financial capacity can enable the payment of more than 18,000 and urged them to do so. He stressed that if Bauchi State has such status he will approve a sum above 18,000.

According to him, “Every state should sit down with Labour and bring out its balance sheet, your income, your expenditure. These are mandatory expenditures: salaries, wages, hospitals, schools and provision of water. These are all necessities and we have to pay them just like we are paying salaries. If we don’t buy alum and provide fuel for generators to pump water into Bauchi, there won’t be water supply in Bauchi. So do you want us to give you the money and stop pumping water?”

He therefore challenged Labour unions to support the programme of deregulation which will translate into more funds for state governments to pay increased salaries and fund development projects to the satisfaction of the public.

He said rather than help the ordinary Nigerians, the subsidy on petroleum products have only continued to line the pockets of few Nigerians.

“Deregulation is a necessity, a sine qua non for development of this country. People are taking funds from petroleum products that are pumped through non existing pipes. 6000 to 7000 billion is going into a few hands and they are buying Yachts and sky skyscrapers in renowned cities of the world, building financial empires at the expense of the poor man working on the street.”

Governor Yuguda noted that the country needs to build a middle class which will have the purchasing power to consume products to be produced by small and medium scale industries which various governments are working on. He said one way is by increasing workers’ pay but that is only possible with increased revenue for the various tiers of government.

After the Storm, Maiduguri Gradually Bounces Back to Life

 You can walk into a shop and buy mobile phone recharge cards, pick up a few groceries and even share a joke with the shop keeper. That is what two days without the sound of a bomb can do in Maiduguri.

Life has started picking up gradually in the troubled capital city of Borno State as some business centres and markets which were closed at the peak of the Boko Haram crisis were opened yesterday.

But the roads are still deserted as motorists shy away, perhaps wondering where the next bomb would go off.

Also, no bank has opened to customers yet but some shops were opened on the popular Post Office area and Ahmadu Bello Way with the popular Monday and Baga markets having an influx of both sellers and buyers.

The roads that were deserted for major parts of last week also witnessed improved traffic as commuters started coming out from their homes.

Some who fled in the heat of the crisis have started coming back to the town as the bombing has stopped for about two days now.

 One of the returnees who spoke with NIGERIA FACTORS, Uche Ebelechukwu, said he decided to return to Maiduguri believing that the worst was over because of the assurances by Governor Kashim Shettima. Shettima also compensated some victims of the mayhem Monday.

The governor gave out 11 vehicles to those whose vehicles were burnt at the London Chinki area when the Joint Task Force (JTF) engaged the sect in a shoot-out.

The governor equally gave N1.6 million to the two widows of late Mohammed Bahaushe, Sande and Habiba Mohammed who alleged that they lost the amount during the clash that claimed the life of their husband.

The governor, while addressing the victims at the Multi- Purpose Hall, Government House Maiduguri, sympathised with them and disclosed that the government had already set up a committee for the distribution of thousands of tri-cycles recently purchased by the government.

He said they would be given on loan basis, payable at N200,000 only, instead of the company price of N300,000.

Shettima also promised to re-build the houses that were razed, and called on those who had fled the area to come back and settle down, as the government was doing everything possible to restore peace and normalcy in the state.

The University of Maiduguri Teaching Hospital (UMTH) said yesterday that the institution was at no time closed to the public.

The Head of Information and Public Relations, Hajia Mabruka Babagaji, said as a well-known hospital that is alive to its responsibilities, there was no way the hospital could have closed especially in a period where casualties were on the rise.

She said the management was disturbed by the advert in some of the national dailies which claimed that the hospital was closed.

She added that it was only the University of Maiduguri (UNIMAID) that was closed last week but not the hospital, stressing that “the entire departments in the hospital are fully functional and there was never a break in service delivery since the outbreak of this crisis”.

The hospital was functioning as doctors, nurses and clinical staff were seen attending to patients when correspondents visited yesterday.

The National Emergency Management Authority (NEMA) has commenced distribution of relief materials to over 140 Internally Displaced Persons (IDPs) in the state.

According to a press release by the agency in the North-east signed by Mr. Ibrahim Farinloye, the relief materials were given to the IDPs at camps in Gidan Lawane Maya Kyariri community in Mafa Local Government Area of the state and some 245 families stationed at the Central Mosque in Jimtilo, an outskirt of Maiduguri.

Farinloye disclosed that relief materials which included blankets, mosquito nets, rice, beans, detergents, bathing soaps and clothes were also distributed to IDPs now in Damaturu, Potis-kum, Bama, Auno and Konduga.

The NEMA spokesman said the agency was considering applying psycho-social and trauma treatment in collaboration with the Federal Neuro-Psychiatric Hospital, Maiduguri on some of the displaced persons.

However, the state Chairman of Christian Association of Nigeria (CAN), Rev. Yuguda Ndurvwa, has condemned the compensation to the victims, insisting that it was based on religious consideration.

Ndurvwa alleged that the compensations were to 33 Muslim victims.

He said that the Christian community in the state was not happy with this, adding that many pastors and Christians were killed in the two-year sectarian crises.

Speaking in a telephone interview with journalists, he said: “I am hearing it now from you for the first time; and this is very privileged information with which we are not happy. We are sad that the governor could segregate or exclude Christians killed and injured in the Boko Haram attacks, killings and bombings of our members and their churches and houses.”

He said he was summoning a meeting of the Executive Council of CAN today to fully deliberate on the actions of the governor in excluding Christians for the distribution and disbursement of vehicles and funds to the Boko Haram victims of Zannari and Kaleri wards.

CBN Extends Interbank Guarantee for Three Rescued Banks

Sanusi Lamido, CBN Governor

The Central Bank of Nigeria (CBN) Monday extended its interbank guarantee for three rescued banks that have reached advanced stages in their recapitalisation process from September 30 to December 31, 2011.

The rescued banks, which it said would benefit from the guarantee extension because they had advanced about 50 per cent into resolving their capital deficiency, are FinBank Plc, Intercontinental Bank Plc and Union Bank Plc.

In fact, the apex regulatory authority officially announced that the three banks had moved beyond the Memorandum of Understanding (MoU) stages, with the signing of their Transaction Implementation Agreements (TIAs) with strategic partners.

TIA is an agreement which defines the relationship between the rescued bank and its potential investors.

It also explains how the financial terms are spelt out. The TIA document, which is usually bulky, officially announces the engagements by the parties and will be followed afterwards with the “marriage”.

The CBN however insisted that there was no going back on the September 30 deadline fixed for the recapitalisation of the affected banks.

The apex bank had in a circular on July 13, 2009, initiated a policy that guaranteed all inter-bank placements and placements with banks by Pension Fund Administrators (PFAs).

The liquidity management office had in the policy, directed that overnight placements shall not be priced higher than MPR + two per cent, while a maximum spread of 300, 400 and 500 basis points above the MPR shall be maintained for tenors up to 30, 60 and 90 days respectively.

The CBN had warned that any placements priced outside these bands would not be

eligible under this programme.

The apex bank had also threatened to nationalise any of the affected banks that failed to conclude its recapitalisation process by the end of September.

CBN’s Deputy Governor, Financial System Stability (FSS), Dr. Chiedu K. Moghalu, who had an interaction with journalists on the recapitalisation process in Lagos Monday, expressed “unreserved optimism” that the remaining five rescued banks that were yet to sign their TIA’s would achieve similar feat before the deadline.

He assured the banks that the CBN would also extend their interbank guarantee once they were able to scale through the MoU stage.

While Intercontinental Bank last week signed a TIA with Access Bank Plc, FinBank Bank also took a major step in signing similar document with First City Monument Bank Plc (FCMB). In the same vein, Union Bank also signed same agreement with its core investor- African Capital Alliance Consortium (ACA Consortium).

Moghalu stated: “The signing of the three legally binding TIAs represents a significant step towards resolving close to 50 per cent of the capital deficiency of the affected banks. The reason why we extended the interbank guarantee is in recognition of the substantial achievement for the banks. It is to enable them tidy up their affairs so that everyone can still have confidence in the banks as there will be transition to new management and new structure.

“From all the information available to us, the remaining five banks are making progress towards recapitalisation; therefore we do not see any danger. But if for any reason, they do not meet the deadline, the CBN will carefully find the appropriate action to take. We continued to say that the deadline is firm and we expect that all the banks will meet it. We have always said that the CBN is a systemic regulator and it is our responsibility to ensure stability.

“The CBN had made it clear that we have a responsibility to ensure that there is a deadline. Without deadlines, you cannot achieve anything. If you continue to allow the negotiations to continue endlessly, people will begin to ask questions.”

Moghalu, who spoke in company with some other senior CBN officials, also expressed strong belief that shareholders of the affected banks would support the process when called upon for their approval.

“Shareholders’ approvals are another imminent major step. We believe these approvals which are being fast-tracked, will be obtained within the next few weeks. The role of the shareholders is to vote on the decision that has been taken by the board of directors on their behalf. The negotiations are not done by shareholders and so we should not be creating the perception by some shareholders that the negotiation process is their role,” he noted.