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NPF Microfinance Bank loses N230 million to rogue staff

NPF Microfinance Bank in its 2018 financial statements disclosed a staff defrauded the bank of N230 million.

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NPF Microfinance Bank recently released its audited results for the 2018 financial year and first quarter ended March 2019.  

2018 results showed a sharp decline in the bank’s bottom-line. While gross earnings increased from N3.6 billion in 2017 to N3.9 billion in 2018, profit before tax fell sharply from N819 million in 2017 to N287 million in 2018. Profit after tax also dropped from N631 million in 2017 to N195 million in 2018.  

The causes  

The poor performance may have been due to provisions following the fraud committed by one of the bank’s staff, and the adoption of IFRS 9. 

  • Total operating expenses jumped from N2.5 billion in 2017 to N3.2 billion in 2018 
  • Net impairments and administrative expenses had the sharpest increases.  
  • Net Impairments also jumped sharply from N184 million in 2017 to N446 million in 2018.  
  • Administrative and general expenses increased from N901 million in 2017 to N1.2 billion in 2018. 

Why net impairments rose 

  • Net impairments may have risen due to the adoption of IFRS 9. 
  • The key change arising from the adoption of IFRS 9 was that the bank’s impairment losses on financial assets are now based on an Expected Credit Loss (ECL) mode. 
  • This means  that impairments are made on expected future losses due to macroeconomic variables. 
  • Prior rules were based on an incurred loss model where only past and present loss events were considered. 

  The fraud incident 

The sharp rise in administrative and general expense was due to a fraud case involving one of the bank’s staff. 

  • There was a case of fraud involving a middle management employee at the Sokoto branch of the bank. 
  •  The bank lost the sum of N266,480,000 from the fraud.  
  • A sum of N35,500,000 has been recovered to date, while the remaining balance has been fully written off during the year.  
  • Appropriate action has been taken against the complicit employee for further recovery.  

  Going Forward 

In a bid to prevent a reoccurrence, the bank has taken several corrective measures: 

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  • Strengthened the key controls and procedures surrounding its operations.  
  • Appointed Assistant Regional Heads and redeployed staff.  

The consequences 

Shareholders of the bank, bear the brunt of the bank’s poor risk management, as it has had to cut down its dividend per share sharply. Dividend per share fell by 70.5% from 17 kobo in 2017 to 5 kobo in 2018.  

About NPF Microfinance bank 

NPF Microfinance Bank was incorporated in Nigeria as a Private Limited Liability Company on 19 May, 1993. It obtained a provisional license as a Community Bank from the Central Bank of Nigeria on 12 July 1993 with License No. FC 00200 and commenced operations on 20 August, 1993.  

The bank obtained a final license from the Central Bank of Nigeria on 24 January2002. It was registered as a Public Limited Company on 13 July2006. The bank was given an approval-in-principle to operate as a Microfinance Bank on IMay, 2007 and obtained the final license on 4 December, 2007. The shares of the bank were listed on the Nigerian Stock Exchange on 1 December, 2010. 

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Onome Ohwovoriole has a degree in Economics and Statistics from the University of Benin and prior to joining Nairametrics in December 2016 as Lead Analyst had stints in Publishing, Automobile Services, Entertainment and Leadership Training. He covers companies in the Nigerian corporate space, especially those listed on the Nigerian Stock Exchange (NSE). He also has a keen interest in new frontiers like Cryptocurrencies and Fintech. In his spare time, he loves to read books on finance, fiction as well as keep up with happenings in the world of international diplomacy. You can contact him via [email protected]

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Coronavirus

COVID-19 Update in Nigeria

On the 22nd of October 2020, 138 new confirmed cases and 2 deaths were recorded in Nigeria

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The spread of novel Corona Virus Disease (COVID-19) in Nigeria continues to record significant increases as the latest statistics provided by the Nigeria Centre for Disease Control reveal Nigeria now has 61,805 confirmed cases.

On the 22nd of October 2020, 138 new confirmed cases and 2 deaths were recorded in Nigeria, having carried out a total daily test of 4,648 samples across the country.

To date, 61,805 cases have been confirmed, 56,985 cases have been discharged and 1,127 deaths have been recorded in 36 states and the Federal Capital Territory. A total of 595,283 tests have been carried out as of October 22nd, 2020 compared to 590,635 tests a day earlier.

COVID-19 Case Updates- 22nd October 2020,

  • Total Number of Cases – 61,805
  • Total Number Discharged – 56,985
  • Total Deaths – 1,1127
  • Total Tests Carried out – 595,283

According to the NCDC, the 138 new cases were reported from 13 states – Katsina (44), Lagos (35), Kwara (15), Kaduna (13), Plateau (7), Imo (6), Adamawa (5) Rivers (4), Yobe (3), Ogun (2), Oyo (2), Osun (1), FCT (1).

Meanwhile, the latest numbers bring Lagos state total confirmed cases to 20,768, followed by Abuja (5,944), Plateau (3,594), Oyo (3,423), Rivers (2,746), Edo (2,648), Kaduna (2,585), Ogun (1,989), Delta (1,812), Kano (1,741), Ondo (1,659), Enugu (1,314),  Kwara (1,065), Ebonyi (1,049), Katsina (948), Osun (919), Abia (898), Gombe (883).  Borno (745), and Bauchi (710).

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Imo State has recorded 613 cases, Benue (484), Nasarawa (478), Bayelsa (403),  Ekiti (329), Jigawa (325), Akwa Ibom (295), Anambra (277), Niger (274), Adamawa (257), Sokoto (162), Taraba (122), Kebbi (93), Cross River (87), Yobe (82), Zamfara (79), while Kogi state has recorded 5 cases only.

READ ALSO: COVID-19: Western diplomats warn of disease explosion, poor handling by government

Lock Down and Curfew

In a move to combat the spread of the pandemic disease, President Muhammadu Buhari directed the cessation of all movements in Lagos and the FCT for an initial period of 14 days, which took effect from 11 pm on Monday, 30th March 2020.

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The movement restriction, which was extended by another two-weeks period, has been partially put on hold with some businesses commencing operations from May 4. On April 27th, 2020, Nigeria’s President, Muhammadu Buhari declared an overnight curfew from 8 pm to 6 am across the country, as part of new measures to contain the spread of the COVID-19. This comes along with the phased and gradual easing of lockdown measures in FCT, Lagos, and Ogun States, which took effect from Saturday, 2nd May 2020, at 9 am.

On Monday, 29th June 2020 the federal government extended the second phase of the eased lockdown by 4 weeks and approved interstate movement outside curfew hours with effect from July 1, 2020. Also, on Monday 27th July 2020, the federal government extended the second phase of eased lockdown by an additional one week.

On Thursday, 6th August 2020 the federal government through the secretary to the Government of the Federation (SGF) and Chairman of the Presidential Task Force (PTF) on COVID-19 announced the extension of the second phase of eased lockdown by another four (4) weeks.

READ ALSO: Bill Gates says Trump’s WHO funding suspension is dangerous

 

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Economy & Politics

Breaking: Some Nigerians mistook promptness of FG response as sign of weakness – Buhari

President Buhari has said that FG’s promptness to consent to the demands of the protesters was taken as a sign of weakness.

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Buhari says large proportions of new COVID-19 infections now occur in communities

President Muhammadu Buhari has pointed out that the promptness with which the Federal Government acted in meeting the demands of the #EndSARS protesters seemed to have been misconstrued as a sign of weakness and twisted by some for their selfish unpatriotic interests.

This was disclosed by the president in his national broadcast on Thursday, October 22, 2020, on the current widespread violence which has engulfed the country following the protest against police brutality and extrajudicial killings.

The president said that the government listened to the protesters and after evaluating their five-point demands, they were accepted and some of them implemented, which includes the disbandment of SARS.

In his address to Nigerians, President Buhari said, “As a democratic government, we listened to, and carefully evaluated the five-point demands of the protesters. And, having accepted them, we immediately scrapped SARS and put measures in place to address the other demands of our youth.

“On approving the termination of SARS, I already made it clear that it was in line with our commitment to the implementation of extensive Police reforms.

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“Sadly, the promptness with which we have acted seemed to have been misconstrued as a sign of weakness and twisted by some for their selfish unpatriotic interests.

The president said the actions of these elements has caused serious violence which has led to the loss of human lives, attack on correctional facilities, destruction and vandalization of public and private properties, attack on the palace of Oba of Lagos, invasion of International Airport and so on.

While acknowledging that the choice to demonstrate peacefully is a fundamental right of every citizen as enshrined in the constitution, the president pointed out that this right to protest also imposes on the demonstrators the responsibility to respect the rights of other citizens and the necessity to operate within the law.

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Details later…

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ENDSARS

#EndSARS: Full text of President Muhammadu Buhari’s National address

The promptness with which we have acted seemed to have been misconstrued as a sign of weakness and twisted by some for their selfish unpatriotic interests.

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Fellow Nigerians,

It has become necessary for me to address you having heard from many concerned Nigerians and having concluded a meeting with all the Security Chiefs.

I must warn those who have hijacked and misdirected the initial, genuine and well-intended protest of some of our youths in parts of the country, against the excesses of some members of the now-disbanded Special Anti-Robbery Squad (SARS).

On Monday 12th October, I acknowledged the genuine concerns and agitations of members of the public regarding the excessive use of force by some members of SARS.

The choice to demonstrate peacefully is a fundamental right of citizens as enshrined in Section 40 of our Constitution and other enactments; but this right to protest also imposes on the demonstrators the responsibility to respect the rights of other citizens, and the necessity to operate within the law.

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As a democratic government, we listened to, and carefully evaluated the five-point demands of the protesters. And having accepted them, we immediately scrapped SARS, and put measures in place to address the other demands of our youth.

On approving the termination of SARS, I already made it clear that it was in line with our commitment to the implementation of extensive Police reforms.

Sadly, the promptness with which we have acted seemed to have been misconstrued as a sign of weakness and twisted by some for their selfish unpatriotic interests.

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The result of this is clear to all observers: human lives have been lost; acts of sexual violence have been reported; two major correctional facilities were attacked and convicts freed; public and private properties completely destroyed or vandalised; the sanctity of the Palace of a peace-maker, the Oba of Lagos has been violated. So-called protesters have invaded an International Airport and in the process disrupted the travel plans of fellow Nigerians and our visitors.

All these executed in the name of the ENDSARS protests. I am indeed deeply pained that innocent lives have been lost. These tragedies are uncalled for and unnecessary.

Certainly, there is no way whatsoever to connect these bad acts to legitimate expressions of grievances of the youths of our country.

The spreading of deliberate falsehood and misinformation through the social media in particular, that this government is oblivious of the pains and plights of its citizens, is a ploy to mislead the unwary within and outside Nigeria into unfair judgement and disruptive behaviour.

On the contrary, both our deeds and words have shown how committed this administration has been to the well being and welfare of citizens, even with the steadily dwindling revenues, and the added responsibilities and restrictions due to the Coronavirus pandemic.

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Government has put in place measures and initiatives principally targeted at youths, women and the most vulnerable groups in our society.  These included our broad plan to lift 100 million Nigerians out of poverty in the next 10 years; the creation of N75 billion National Youth Investment Fund to provide opportunities for the youths, and the Micro, Small and Medium Enterprises (MSME) Survival Fund, through which government is:

a. paying 3-months salaries of the staff of 100,000 micro, small- and medium- enterprises
b. paying for the registration of 250,000 businesses at the Corporate Affairs Commission
c. giving a grant of N30,000 to 100,000 artisans
d. guaranteeing market for the products of traders

These are in addition to many other initiatives such as:

a. Farmermoni,
b. Tradermoni,
c. Marketmoni,
d. N-Power,
e. N-Tech and
f. N-Agro.

No Nigerian Government in the past has methodically and seriously approached poverty-alleviation like we have done.

With regard to the welfare of police personnel, the National Salaries, Income and Wages Commission has been directed to expedite action on the finalization of the new salary structure of members of the Nigeria Police Force.

The emoluments of other paramilitary services are also being reviewed upwards.

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In order to underscore the importance of education in preparing youths for the future, this administration has come up with a new salary structure and other incentives for our teachers.

Let me at this point re-affirm the Federal Government’s commitment to preserving the unity of this country.

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We will continue to improve good governance and our democratic process, including through sustained engagement.

We shall continue to ensure that liberty and freedom, as well as the fundamental rights of all citizens, are protected.

But remember that government also has the obligation to protect lives and properties, as well as the right of citizens to go about their daily businesses freely and protected from acts of violence.

To our neighbours in particular, and members of the international community, many of whom have expressed concern about the ongoing development in Nigeria, we thank you and urge you all to seek to know all the facts available before taking a position or rushing to judgement and making hasty pronouncements.

In the circumstances, I would like to appeal to protesters to note and take advantage of the various well-thought-out initiatives of this administration designed to make their lives better and more meaningful, and resist the temptation of being used by some subversive elements to cause chaos with the aim of truncating our nascent democracy.

For you to do otherwise will amount to undermining national security and the law and order situation. Under no circumstances will this be tolerated.

I therefore call on our youths to discontinue the street protests and constructively engage government in finding solutions.

Your voice has been heard loud and clear and we are responding.

And I call on all Nigerians to go about their normal businesses, and enjoin security agencies to protect lives and properties of all law-abiding citizens without doing harm to those they are meant to protect.

Let me pay tribute to officers of the Nigeria Police Force who have tragically lost their lives in the line of duty.

I would like to thank those State Governors, traditional and religious leaders who have appealed for calm and restraint.

I also thank youth leaders who have restrained their followers from taking the law into their own hands.

This government respects and will continue to respect all the democratic rights and civil liberties of the people, but it will not allow anybody or groups to disrupt the peace of our nation.

Thank you all.

God bless the Federal Republic of Nigeria.

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