Shareholders of five banks are up in arms over N83.58 billion contribution into the sinking fund of the Asset Management Corporation of Nigeria (AMCON) in 2018.
The banks are Sterling Bank, United Bank for Africa (UBA), Guaranty Trust Bank, Zenith International Bank and FBN Holdings.
Data obtained from the banks’ annual reports indicated that Sterling Bank paid the sum of N6.0 billion for the financial year ended Dec. 31, 2018.
UBA during the period paid N16.63 billion, GT Bank N16.31 billion, Zenith Bank contributed N9.54 billion and FBN Holdings paid N35.10 billion.
The Central Bank of Nigeria (CBN), on Jan. 1, 2011, had signed an agreement with banks operating in the country to establish the AMCON sinking fund.
The agreement required the CBN to contribute N50 billion and the banks an equivalent of 0.3 per cent of their total assets as at the date of their audited financial statements, annually for ten years.
However, the contribution, a non-refundable levy on all banks in Nigeria, was increased to 0.5 per cent in 2013.
Shareholders have kicked against the sinking fund saying that they were shortchanged and urged the Federal Government to wind down the corporation.
Commenting on the issue, Mr Moses Igbrude, Publicity Secretary, Independent Shareholders Association of Nigeria, described AMCON as a fraud designed to surpress investment in Nigeria.
Igbrude said banks and their shareholders had paid over N1trillion to AMCON within eight years of its existence in spite of nationalising some banks without giving their shareholders anything.
He said AMCON was an emergency toxic vehicle established by the government through the CBN and stakeholders then to save the situation at hand then, and noted that “it has over stayed its welcome.
“The only way forward is for AMCON to start winding up their operations because it has spent eight years, the remaining two years should be used for rounding off.
“The lawmakers should not extend the years. Shareholders will protest and even go to court to challenge AMCON’s extension,” Igbrude said.
According to him, the government needs to evaluate the performance of AMCON since inception, noting that, the impact of the corporation is not felt.
Malam Shehu Mikail, National President, Constance Shareholders’ Association of Nigeria, decried the huge contributions being made by banks into the sinking fund to the detriment of their shareholders.
Mikail said the act that established AMCON needed to be reviewed. “The body should give details of its services to the nation.
“We do believe that all other regulatory agencies are up to the task of enforcing the necessary rules to sustain the financial sector,” he said.
Mikail noted that AMCON must be disengaged because, “it is causing more injury to shareholders in terms of dividend payment.”
Mr Ambrose Omordion, the Chief Operating Officer, InvestData Ltd. , believes that the establishment of AMCON saved many listed and unlisted companies by not allowing debts to swallow them.
However, he said the 0.5 per cent contribution by the banks to AMCON’S sinking fund meant a reduction in the funds available to banks to lend to the private sector.
“This is because such contributions can be channelled to support one sector of the economy, or enhance banks’ rewards to their shareholders,” Omordion said.
He noted that AMCON’s mandate was to recover and manage debt but nobody knew had the corporation deployed the contribution.
He explained that shareholders were against the contribution because they were not seeing the impact of the contribution to the capital market or the economy.
‘No plans to relocate NGC headquarters from Niger Delta’
The Nigeria National Petroleum Corporation (NNPC) has assured stakeholders that it has no plans to relocate headquarters of its subsidiary, Nigerian Gas Company (NGC) from Delta State.
A statement by the Group General Manager, Group Public Affairs Division, Ndu Ughamadu, described as unfortunate, statement credited to Deputy President of the Senate, Ovie Omo-Agege, where he reportedly condemned alleged moves by the corporation to relocate the NGC headquarters from the Niger Delta.
Ughamadu called on the NGC host communities and other stakeholders to disregard the relocation tale, which he described as “totally false”. He maintained that Omo-Agege may have been misinformed or was quoted out of context as the subject of relocation of NGC was never on the table for deliberation.
NNPC promised to ensure harmonious relationship with stakeholders and host communities to entrench a win-win scenario for all.
Buhari signs AfCFTA agreement at AU Summit
President Muhammadu Buhari in Niamey, Niger Republic, signed the African Continental Free Trade Area (AfCFTA) agreement, making Nigeria the 53rd state on the continent to append its signature to the document.
Reports reaching Area News, indicated that the president signed the agreement at exactly 10.47 am local time
Buhari had delayed in signing the agreement, which entered into force May 30, 2019.
The delay was to give room for extensive consultations with stakeholders, culminating in the submission of the report by the Presidential Committee to Assess Impact and Readiness of Nigeria to join the free trade area.
The committee had recommended that Nigeria should sign the agreement which aims to boost intra-African trade.
In accepting the report as submitted, the President made it clear that Nigerian government would be seeking to include terms that engender the development of policies that promote African production, among other benefits.
President Buhari said: “Africa, therefore, needs not only a trade policy but also a continental manufacturing agenda.
“Our vision for intra-African trade is for the free movement of `made in Africa goods’. That is, goods and services made locally with dominant African content in terms of raw materials and value addition.
“If we allow unbridled imports to continue, it will dominate our trade. The implication of this is that coastal importing nations will prosper while landlocked nations will continue to suffer and depend on aid.’’
The AfCFTA is expected to be the world’s largest free trade area since the formation of the World Trade Organization, with a potential market of 1.2 billion people.
CIFI N20bn loans: Access Bank begins disbursement to creative sector
Access Bank has commenced disbursement of loans to beneficiaries in the entertainment industry, under the Creative Industry Financing Initiative of the Central Bank of Nigeria.
The bank disclosed this during a forum with some stakeholders in the entertainment industry in Lagos on Tuesday.
It said the first tranche of the CIFI loans worth N20bn, would be made easily accessible to the borrowers in the sector.
Bidemi Adeboye of Access Bank said stakeholders in the creative industries such as fashion, Information Technology, movie production, movie distribution, music and software engineering student could access the loans.
When all documentations were completed and the loans approved, the bank would ensure the beneficiaries got the funds within two weeks, he said.
He added, “The CBN wants to create jobs, develop local capacity, preserve foreign exchange and ensure empowerment in the entertainment industry.
“It is more interested in providing infrastructure funding such as film house, equipment, studio, auditorium, which will make it easier for the entertainers to operate at lower cost and be able to make profit.”
He explained that the loan had maximum interest rate of nine per cent per annum and a repayment period of up to 10 years.
According to him, those who would access the loans should come up with business plan or statement; they must be registered and should be doing what had economic benefits.
Chizoma Okoli of Access Bank said that the CIFI loan was introduced by the CBN to support the creative sector.
She said the bank decided to organise the forum with the stakeholders in the entertainment industry, to get more ideas from them on how best they could disburse the funds to them, and the documents they would need.
Music star, Oladapo Oyebanjo, popular known as D’banj, urged the bank to make the loans easily accessible as promised.
He said, “Most times when we apply for loans, it usually takes up to six months for us to get such. This will be a good development if we can access the loans within two weeks.”