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DMO harps on increased revenue drive to reduce borrowings




The Debt Management Office (DMO) has stressed the need for the Federal Government to increase revenue drive to reduce the country’s debt profile and reduce fresh borrowing.

The Director General, DMO, Ms Patience Oniha, said this during a virtual interactive session tagged: “Nigeria moving beyond COVID-19; Opportunities for investors” organised by Coronation Merchant Bank (MB) on Tuesday in Lagos.

Oniha said that government needs to prioritise and invest heavily on sectors capable of generating increased revenue such as agriculture, mining and ICT to grow the economy.

According to her, sectors with robust revenue drivers are better positioned to respond to the risks associated with any transformation and to the urgency created by disruptive events.

Oniha said that the country’s debt profile had been on the increase because of the impact of revenue crash and the crises trailing the coronavirus pandemic on the economy.

She argued that the rate of borrowing had started declining until COVID-19 crisis forced Nigeria, like many other nations, to increase its borrowing in order to stimulate the economy and create more jobs for the people.

“To increase the level of revenue, and the DMO is very much in support of that;  if we grow revenues, then debt service will be lower and debt will be sustainable, but it also means that we may not need to borrow that much.

“The second point which we have put forward to the government is that it cannot finance the projects like it used to.

“Our position for debt sustainability is to grow revenues and begin to work with the private sector to finance capital projects, and that way, the only thing that might increase is the off balance sheet liabilities in terms of guarantees and not on balance sheet borrowing,” Oniha said.

On whether the country will return to the Eurobond market after successful issuances, Oniha said, “We do have 6.18 billion dollars to raise for the 2021 budget but our transaction advisers told us to do 4 billion dollars.

“We were looking to go back at

some point but within one week of pricing, the market headed south and is still in that situation right now.

“Omicron came, Evergrand had some challenges in the market and so it is not exactly good for us to go back, and I can say for this year, we are not approaching the market, but if we do not get the money from the ICM, we can get it from another source.”

“We borrowed more because of the COVID-19 pandemic to provide palliatives, build a vibrant health sector and embark on activities that can create jobs because a lot of people lost their jobs due to the pandemic,” she said.

Oniha admitted that the nation’s growing insecurity poses a threat to investment inflow.

Also speaking, the Managing Director and Chief Executive of FMDQ, Mr Bola Onadele, said government needs to deploy large proportion of its borrowing into the productive sector to stimulate growth.

Onadele said: “Debt is sustainable when a country has the ability and size to meet current and future payment obligation without external assistance and default.

“Debt that is not sustainable has a negative consequence on investment.

“It is important that any country trying to borrow should have a pay back structure because investors in the global market look at capabilities to pay back to see if the country is within the purview of debt to service ratio,” he said.

The Managing Director, Commercio partners Ltd., Mr Steve Osho, said investors consider macro economics and ratings of countries and subnational in determining whether to invest into the country.

Osho said: “In Nigeria, Debt Service to GDP is 90 per cent. What it means is that as you generate N100, N90 is used to service debt and this will definitely affect credit rating. This is a source of concern.”

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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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