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2021 budget: Senate approves President Buhari’s N2.343trn external borrowing request



Chamber Senate
Senate chamber

The Senate has approved President Muhammadu Buhari’s request for the authourisation of N2.343 trillion ($6.183 billion USD) as External Borrowing in the 2021 Appropriation Act.

This was just as it directed the Minister of Finance, Budget and National Planning, Zainab Ahmed, the Director General of the Debt Management Office, Patience Oniha, and the Governor of the Central Bank of Nigeria, Godwin Emefiele, to submit to the National Assembly within ten working days (excluding the day of close of trading), a letter containing the United States Dollars amount so raised and received as a result of the approval together with the applicable exchange rate.

The sum is expected to be sourced through the Issuance of Eurobond in the International Capital Market.

The approval by the upper chamber followed the consideration of a report by the Committee on Local and Foreign Debts.

Chairman of the Committee, Senator Clifford Ordia (PDP, Edo Central),  said that in considering the President’s request, the Committee noted the serious concerns of Nigerians about the level of sustainability and servicing of Nigeria’s External Borrowing.

According to him, “due to the short fall in our annual revenues in relation to our need for rapid infrastructural and human capital development, we had to pass deficit budget every year requiring us to borrow to finance the deficit in our budget.”

Ordia explained that the new borrowing was calculated at Exchange rate of USD1/N379, and raised from multiple sources – multilateral and bilateral lenders through the issuance of Eurobonds in the International Capital Market.

He emphasized that the proceeds of the USD$6.183 would be used to fund various specific capital projects specifically from priority sectors of the economy namely; Power, Transportation, Agriculture, and Rural Development, Education, Health, Provision of counterpart funding for Multilateral and Bilateral Projects, Defense and Water Resources.

The lawmaker disclosed that the final terms and conditions – the interest rate and tenors in the case of Eurobonds – can only be determined at the point of issuance of the Bonds in the International Capital Market and would be subject to market conditions prevailing at the time of issuance.

He added that the Primary listing of the Bond will be on the London Stock Exchange while the Secondary Listing will be on the Nigerians Stock Exchange and Financial Markets Dealers Quotations (FMDQ) Securities Exchange.

Ordia observed that, “multilateral and bilateral institutions operate on standard terms and conditions and Nigeria secures the best terms and conditions within the context of the market.”

Accordingly, the Senate while adopting the resolutions of the Committee on Local and Foreign Debt approved the issuance of $3 billion USD but not more than $6,183,081,643.40 Eurobond in the International Capital Market for the implementation of the new External Borrowing of N2,343,387,942,848, for the financing of part of the deficit authorized in the 2021 Appropriation Act.

It also approved that the amount authorized may be raised from multiple sources such as the International Capital Market and any other Multilateral or Bilateral sources as may be available.

In addition, the upper chamber directed the Minister of Finance, Budget and National Planning, the Director General of the Debt Management Office and the Governor of the Central Bank of Nigeria to submit to the National Assembly within ten working days (excluding the day of close of trading) a letter containing the United States Dollars amount so raised and received as a result of the approval together with the applicable exchange rate.

In his remarks, the Senate President, Ahmad Lawan, stressed that the approved external borrowing is not a fresh loan by the President Buhari administration but a request captured in the 2021 Appropriation Act passed by the National Assembly last year.

He, however, tasked Committees of the National Assembly to carry out strict oversight on how the loans are applied to the implementation of the 2021 budget.

Lawan urged Ministries, Departments and Agencies of Government entrusted with the management of the funds to ensure prudent application to projects across the country.

“Our committees should be alert on how the funds that will be borrowed will be used.

“No frivolous expenditures should be entertained. I imagine that everybody in the trust of public funds, especially this laws will be as prudent and economical as possible”, he said.

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Business & Economy

NDIC commences payment of N16.18bn to liquidated banks’ depositors




Following impressive recoveries from debtors and realisation of assets of banks in liquidation, the Nigeria Deposit Insurance Corporation (NDIC) has declared N16.18 billion liquidation dividends to depositors, creditors and shareholders of 20 banks in-liquidation.

A statement by the Director, Communication & Public Affairs, NDIC, Bashir Nuhu, disclosed that the Corporation has commenced verification and payment of stakeholders covered by the declarations within 30 days, starting from 28th September 2023.

The ongoing payment is sequel to an earlier payment of various sums which cumulatively amounted to N45.45bn as liquidation dividends in respect of the 20 banks by July 2023, Nuhu said.

Relevant stakeholders have been requested to visit any of the NDIC offices closer to them or go to the claims page on the corporation’s website, to download, complete and submit the verification form with prescribed supporting documents to a dedicated email.

The closed banks covered by the exercise are Liberty Bank, City Express Bank, Assurance Bank, Century Bank, Allied Bank, Financial Merchant Bank, Icon Merchant Bank, Progress Bank, Merchant Bank of Africa (MBA), Premier Commercial Bank, North South Bank and Prime Merchant Bank.

Others are Commercial Trust Bank, Cooperative and Commerce Bank, Rims Merchant Bank, Pan African Bank, Fortune Bank, All States Trust Bank, Nigeria Merchant Bank and Amicable Bank in-liquidation.

Liquidation dividends represent amounts in excess of the insured sums paid by the NDIC to depositors of a closed bank from recoveries made from realisation of assets of failed financial institutions. They also cover the amount paid to creditors and shareholders of closed banks after full payment to depositors of such defunct banks.

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Business & Economy

Senate Confirms Appointment Of Cardoso, Others As CBN Governor And Deputies 



Yemi Cardoso


The Nigerian Senate has confirmed the appointment of Yemi Cardoso as the Central Bank of Nigeria (CBN) Governor and four others as Deputy Governors of the apex bank.

They were confirmed on Tuesday following a screening by the upper legislative body.

The deputy governors who were confirmed are Emem Nnana Usoro, Muhammad Sani Abdullahi Dattijo, Philip Ikeazor, and Bala Bello.

“The nomination of Olayemi Cardoso is hereby confirmed as governor of the Central Bank of Nigeria (CBN),” Senate President Godswill Akpabio said.

Before their confirmation, the nominees had answered questions on matters related to economic and other policies.

During the screening, Cardoso promised to embrace compliance, assuring that under his leadership, the apex bank would remain apolitical.

“I believe that the Central Bank under our watch will have no choice but to embrace a culture of compliance,” he said.

“We will not wait for oversight to come and tell us what to do. We will ensure that by the time the system is passing through us, we catch it and we deal with it,” said Cardoso who promised zero tolerance for abuse of compliance.

“That is a cultural shift, a change in mindset, but we will make sure it happens,” the former Citibank Nigeria chairman assured.

Cardoso’s confirmation comes weeks after President Bola Tinubu nominated him as the acting CBN governor and four others as deputies.

He assumed office last week, replacing the then-acting governor of the CBN Folashodun Shonubi.

The recent appointments followed the suspension and resignation of Godwin Emefiele as the apex bank boss. The Delta-born began his reign in 2014 but got backlash owing to the naira redesign policy.

Emefiele, who was later arrested by the Department of State Services (DSS) but released on bail,  is being tried on an alleged N6.9b fraud.

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Business & Economy

Senate Screens CBN Governor, Deputies Today – Bamidele 



Yemi Cardoso


The Senate will on Tuesday screen former Chairman of the Board of Citi Bank Nigeria, Dr. Olayemi Michael Cardoso for the position of the Governor of the Central Bank of Nigeria (CBN).

The senate will also screen four nominees for the positions of CBN Deputy Governors, who will join forces with Cardoso to steer affairs of the apex bank in the next five years.

In a statement by the Media Office of the Senate Leader, Senator Michael Opeyemi Bamidele, the senate will screen all the nominees following its resumption from its annual recess.

The statement said: “The Senate of the Federal Republic of Nigeria will resume plenary on Tuesday, September 26. We will consider the screening of Dr. Cardoso at the Committee of the whole.

“Dr. Cardoso will be screened alongside four deputy governors namely Mrs. Emem Nnana Usoro, Mr. Muhammad Sani Abdullahi Dattijo, Mr. Philip Ikeazor, and Dr. Bala M. Bello.

“Besides, the Senate has scheduled to screen the ministerial nominees – Dr. Jamila Bio Ibrahim and Mr. Ayodele Olawande, respectively designated as Minister of Youth and Minister of State for Youth on October 3.”

On September 15, President Tinubu approved the nomination of Cardoso to serve as the new Governor of the Central Bank of Nigeria (CBN).

He also approved the nomination of four deputy governors for a term of five years each at the first instance, pending their confirmation by the Senate of the Federal Republic of Nigeria.

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