financial Vanguard

Page 1

MAY 21, 2012

Pix from left Mr. Phillips Oduoza, Group MD/CEO, United Bank for Africa PLC; Chief Israel Ogbue, Chairman and Mr. Bili Odum, Company Secretary at the 50th Annual General Meeting of UBA PLC held in Lagos on Friday. Photo by Lamidi Bamidele

NATIONAL HOUSING FUND:

Banks, insurers owe N8.6trn in 5 years *Operators claim ignorance of provisions in NHF Act *FMBN reports to National Assembly *Developers may take CBN, banks to court By YINKA KOLAWOLE Deposit money banks and insurance companies operating in the country have failed to invest in the National Housing Fund (NHF) as statutorily required under the NHF Act No. 3 of 1992, thus owing the Fund trillions of

Naira in un-remitted monies. Central Bank of Nigeria (CBN) which is supposed to deduct at source from the banks and remit to Federal Mortgage Bank of Nigeria (FMBN), the managers of the Fund, has failed in its responsibility in this regard. Vanguard investigations showed, for instance, that between 2006 and 2010,

banks and insurance firms in the country ought to have invested about N8.58 trillion in the Fund in line with the provisions of the Act. Banks should have invested N8.49 trillion, being 10 percent of their loans and advances for the five year period; while insurance companies should have invested nothing less than

N89.49 billion as part of their NonLife and Life premiums for the period, into the housing fund. The NHF scheme was established to facilitate the continuous flow of lowcost funds for long-term investment in housing for the benefit of contributors to the fund. The NHF Act states that resources of the fund shall consist of contributions by Nigerians both in the public and private sectors; investment in the fund by commercial and merchant banks; investment in the fund by insurance companies registered under the insurance act and; financial contributions by the Federal Government for long-term loans. Investigations by Vanguard revealed that neither deposit money banks nor insurance companies have invested a kobo into the housing fund since inception. But most of the banks are rather offering mortgage products of their own with rates clearly outside the 6 per cent stipulated by the NHF Act. When confronted with the provisions of the Act as regards their expected contributions, officials of these financial institutions claimed ignorance of the existence of such a law. Section 5 of the NHF Act stipulates: “Every commercial or merchant bank shall invest in the fund 10 per cent of Continues on page 18

178.85

-1.25

2,260.00

+36.00

20.49

-0.37

107.36 -0.13 92.15

-0.41

CURRENCY BUYING CENTRAL SELLING CFA 0.2801 KRONER 26.4408 EURO 196.6237 POUNDS 244.6426 RIYAL 41.2489 SDR 235.8402 FRANC 163.5825 DOLLAR 154.7 WAUA 234.9579 YEN 1.9496 RENMINBI 24.4441

0.2901 26.5263 197.2592 245.4333 41.3823 236.6025 164.1112 155.2 235.7173 1.9559 24.5236

0.3001 26.6117 197.8947 246.224 41.5156 237.3647 164.6399 155.7 236.4767 1.9622 24.603

CBN Exchange rate as at 18/05/2012 C M Y K


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