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Naira Is Now At An All Time Low of N410/$1 And This Is Who Is To Blame

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The unofficial exchange rate between the Naira and the Dollar hit an all time low of N409/$1 as scarcity swept through the retail end of the black market.

The exchange rate sold for as high as N410/$1 in some markets outside Lagos according to an independent survey by our research team. Sellers quoted for higher prices, with the knowledge that the scarcity was rife and unlikely to end soon. Meanwhile the official inter-bank rate closed at N316/$1.

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Traders confirmed Nairametrics fears that the recent suspension of 9 banks by the CBN is the major reason for the depreciation of the Naira.

“The suspension of some banks from transaction in the forex market has really increased pressure on the market,” said Aminu Gwadabe, President of the Bureaux de Change Association.

As explained in earlier articles, the pattern we have noticed since January is that the rate at the parallel market began its unabated rise when the CBN came up with brash policies. From banning BDC operators from the interbank market to limiting the amount of dollars that can be withdrawn and more recently banning 9 banks…these decisions, more than anything else, jolted the forex market.

Ironically, the fall in oil prices, which has remained stable lately and even the increase in pipeline bombings has not impacted on the value of the Naira as much as the actions of the CBN.

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A rash of policy directives, rhetorics and inactions have caused more harm to the country’s exchange rate, making it nearly impossible for it to recover to pre-January 2016 levels. The Naira is now officially the world worst currency and the Apex bank has a lot to do with that.

As ordinary Nigerians wallow in financial distress, actions and inactions of those saddled with the responsibility of managing our currency are gradually chipping off the value of the naira making it nearly impossible to recover without a re-donomination.

 

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Patricia

Nairametrics is Nigeria's top business news and financial analysis website. We focus on providing resources that help small businesses and retail investors make better investing decisions. Nairametrics is updated daily by a team of professionals. Post updated as "Nairametrics" are published by our Editorial Board.

1 Comment

1 Comment

  1. Anodebenze

    August 26, 2016 at 3:17 pm

    To be or not in Nigeria,tentative,unsure,does not know their job,uneasy.i means the cbn lies the crown,i do not envy any Nigerian president or head of state,and heaven forbid he will make me one.st Augustine2 God make holy but not now* I want to indulge myself.i want to be happy.i want to be in the companion of the most beautiful woman in our planet.
    Nigerians in London are most located in Brixton,hackney,abbey wood,totenham,peckham,and they built business,they establishes African restaurant, and sells African food,inthose shop,they do remmitance to Nigeria through their shops,some of them are independent,also other immigrant do their remmitance some vietamese,chinese,philiphines,thailand,Ghanaian,there are Nigerian banks with branches in the city of London.
    Why are the cbn is denoting foreigners as the only official company allowed to remit fund to Nigeria.can the cbn tell us Nigerians why ?Those Nigerian banks can be use to remit fund to Nigeria through those Nigerian owned shops.some Nigerians could get rich through this process.
    Before 2000 Ad,some americans were edging that American will loses in this coming century,this happen in history,some proposes some srategic aim that America will not loses and be relevant in the coming century,but they are losing power and they do not knows it come ,2001 9/11 happened ,instead of looking for bin laden,they decided to invade Iraq,with it’s result,if president trump win the American presidential,as an an African man I want mr trump to winnow they got bogged down with it,to withdraw or stay,they cannot decide,according to the Chinese Military strategic Sun Tzu.war can drain a country,and any war can destroy a nation
    Me I want understand why president Buhari grant audience to Mr John Kerry,they have not solved their problems they created in agfanistan and Iraq.we have nothing to talk about,there about 1 billion moslems in our planet,will president trump make an exception with president Buhari,who is of moslem faith

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Companies

NSITF board to investigate suspended MD and others over financial misconduct

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FG moves to scrap hazard allowances earned by State Governors

The board of directors of the Nigerian Social Insurance Trust Fund (NSITF) has revealed that it will investigate the activities of the suspended Managing Director, 3 Executive Directors, and 8 other senior management staff over financial breaches and gross misconduct.

This was disclosed by the Chairman of the board of NSITF, Mr. Austin Enajemo-Isire, in a statement in Enugu on Sunday July 5, 2020.

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Enajemo-Isire said that the Managing Director and other top management staff of the organization would have the opportunity to clear themselves of any wrongdoing with the probe panel which was being set up.

While reacting to claims that the suspension did not follow due process as President Muhammadu Buhari did not approve it, Enajemo-Isire said that the approval for the suspension of the affected staff had been conveyed to the Labour Minister in a correspondence referenced SGF. 47/511/T/99 of June 30, 2020.

According to the Chairman, “The minister has conveyed this approval and directives to me for necessary action in terms of setting up a board-driven investigative panel.

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“This is to give the affected officers the opportunity to clear themselves of the financial and procurement breaches and acts of gross misconduct and other infractions that gave rise to their prima facie indictment.

“It is in this light that I have decided to call a virtual meeting of the management board on Tuesday, July 7, 2020, to consider the modalities for our action.”

He, therefore, appealed to staffers of NSITF and their social partners to keep calm and exercise restraint.

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A few days ago, Nairametrics reported the suspension of the Managing Director and some senior management staff over corruption allegations. However, the management in its reaction debunked that claim and said that the President did not approve their suspension but that rather, it was the sole decision of the Labour Minister, Chris Ngige, who they said was overreaching himself.

Patricia
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Appointments

Fidelity Bank appoints Chike-Obi as Board Chairman

This announcement was contained in a notice signed by the Company Secretary.

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Fidelity Bank has announced the appointment of Mustafa Chike-Obi as Chairman of the Board of Directors. The appointment has been approved by the Central Bank of Nigeria, and will take effect on August 14, 2020, after the expiration of the tenure of the current Chairman, Mr Ernest Ebi.

This announcement was contained in a notice signed by the Company Secretary, Ezinwa Unuigboje, and sent to the Nigerian Stock Exchange.

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Also in the notice, the bank announced the retirement of Mr Seni Adetu, who served as Independent Non-Executive Director on the board. He stepped down from the board after completing his tenure on June 30, 2020.

The board of directors and the management of the bank appreciated Ernest Ebi and Seni Adetu for their contributions to the progress of the bank during their tenures.

“Under the chairmanship of Mr Ernest Ebi, the bank recorded significant growth across key financial metrics, with both Messers Ebi and Adetu playing significant roles, complementing management efforts in the delivery of these milestones; in service of the long-term vision of the bank. The banks market share position has also been materially strengthened over the period,” the notice read.

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The appointment is in line with the bank’s high governance standards and best practices, and in compliance with internal succession policies; Mr Ebi will, over the next six weeks, ensure a successful transition and smooth handover to Chike-Obi.

Mustafa Chike-Obi has over 40 years’ experience in investment banking and the financial services sector, working with reputable global investment banking and asset Management firms. He is currently with the Alpha African Advisory, where he provides leadership and oversees the capital-raising division.

He was the inaugural CEO of the Asset Management Corporation of Nigeria (AMCON), from where he joined Alpha African Advisory.

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He was also founding president at Madison Advisors, a financial services advisory and consulting firm in New Jersey, where he specialised in hedge funds and private equity investment advice.

He holds a bachelor’s degree in Mathematics from the University of Lagos, and an MBA from Stanford University Graduate School of Business.

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Patricia
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Companies

Nigerian Content Intervention Fund increased to US$350 million

The fund expansion was one of the decisions taken at the board’s recent meeting.

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NCDMB, output cut, Petroleum Industry Bill to be passed by mid-2020, says Sylva, FG discovers crude oil in north, says there’s more , OPEC, non-OPEC countries to meet as Saudi, Russia price war affects Nigeria’s budget, FG considers fuel price reduction, OPEC deal: Nigeria to generate additional $2.8 billion revenue as FG reacts

The governing council of the Nigerian Content Development and Monitoring Board (NCMB) announced on Sunday that it has approved a $150 million expansion of the Nigerian Content Intervention Fund, raising it from $200 million to $350 million.

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The fund expansion was one of the decisions taken at the board’s recent meeting on June 16, 2020, chaired by Minister of State for Petroleum Resources, H.E. Chief Timipre Sylva, who is also the Chairman of the Council.

The board said that $100 million from the additional fund would be used to boost five existing loan products, which include manufacturing in the oil and gas industry, asset acquisition of rigs, marine vessels, contract financing for Nigerian oil service providers, contract financing for oil and gas community contractors, and loan refinancing with Nigerian banks.

The council also announced that $20 million and $30 million would be used for 2 newly developed loan product types (the Intervention Fund for Women in Oil & Gas and PETAN Products) which include Working Capital loans and Capacity Building loans for PETAN member companies.

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Started in 2017, the Nigerian content Intervention fund was developed as a $200 Million fund managed by the Bank of Industry, to facilitate on-lending to qualified stakeholders in the Nigerian oil and gas industry on five loan product types.

The NCI Fund is a portion of the Nigerian Content Development Fund (NCDF), aggregated from the one percent deduction from the value of contracts executed in the upstream sector of the oil and gas industry.

According to the NCMB, “About 94 percent of the NCI Funds has been disbursed to 27 beneficiaries as at May 2020.”

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Patricia
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