Financial Vanguard

JULY 22, 2013

ISPS: US Coast Guard indicts FG over confusion at ports

By GODWIN ORITSE

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HE United States of America Coast Guard has indicted the Nigerian government over the confusion at the nation's ports, as to who has the authority to implement the

International Ship and Port Facility Security (ISPS) Code in the country among the various government agencies.

This is coming as the 90 days ultimatum on port security issued by the United States government to Nigeria expires in about two weeks. The United

States Coast Guard is again set for another visit with a view to auditing the level of Nigeria’s compliance with the ISPS Code. The US Coast Guard team is expected in Nigeria on the 26th of August just as plans to receive them have been concluded. Since the threat to withdraw shipping services from

Nigeria was issued by the American government, both the Nigerian Maritime Administration and Safety Agency, NIMASA, and the Nigerian Ports Authority, NPA, have been making frantic efforts to ensure that all is set for the US Coast Guard inspection.

Should Nigeria fail to pass the audit exercise, it will spell doom for the nation’s economy as the American government and its allies will stop their vessels from sailing to Nigeria.

Already, the United States Coast Guard in its report after last year’s visit to Nigeria thumbed down Nigeria’s preparedness as to the implementation of the ISPS Code and noted that there is considerable confusion as to who has the authority to implement the ISPS Code in the country among the various government agencies with overlapping functions at the ports.

It was after the absence of a Designated Authority at the nation’s maritime service was brought to the notice of the Nigerian government that NIMASA was asked to take up the Continues on page 18

131.75

+4.20

2,353.00

+6.00

16.28

+0.10

109.45

+0.36

108.25

+0.21

CURRENCY BUYING CENTRAL DOLLAR POUNDS EURO FRANC YEN

CFA

NEC MEETING - From left: Governor Babangida Aliyu of Niger State; Governor Emmanuel Uduaghan of Delta State; Governor Murtala Nyako of Adamawa State; Finance Minister, Mrs. Ngozi Okonjo-Iweala and Governor Gabriel Suswam of Benue State discussing during the National Economic Council Meting at the Aso Chambers, State House, Abuja. Photo by Abayomi Adeshida C M Y K

WAUA RENMINBI RIYA KRONA SDR

SELLING

154.76

155.2

236.1792

236.9423

237.7053

203.0915 164.2713

203.7477

204.4038

164.802

1.542

1.547

165.3328 1.552

0.3005 232.777 25.294 41.3971 27.2611 233.4955

0.3105 233.5266 25.3759 41.5305 27.3489 234.2475

0.2905 232.0273 25.2121 41.2638 27.1733 232.7436

155.76

CBN Exchange rate as at 19/07/2013

18 — Vanguard, MONDAY, JULY 22, 2013

Cover Story

The Basic Guide to Starting your Business Part 2

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VISIT - From left: President, Experiential Marketers Association of Nigeria (EXMAN), Kayode Olagesin; Managing Director, Lagos State Signage and Advertisements Agency (LASAA), George Kayode Noah; Chief Executive Officer, Ideas House, Kehinde Salami and Head Business Development and Support, LASAA, Siraj Bello, duing EXMAN visit to LASAA Corporate Head Office in Alausa Ikeja Lagos on Wednesday.

ISPS: US Coast Guard indicts FG over confusion at ports responsibility of Designated Authority, D\A. In the report, the American government through its Coast Guard expressed concern over the fact that even NIMASA as presently constituted has not developed any form of expertise to tackle the issue of terrorism in the maritime industry.

The US government also expressed concern that there is no anti-terrorism measures in place in Nigerian ports and threatened to impose sanctions on Nigeria if measures are not put in place within 90 days.

The report read in part: “The embassy of the United States of America presents its compliment to the Ministry of Foreign Affairs of the Federal Republic of Nigeria and the honour to request that the Ministry forward this message to and the attached Aide Memoire to the Honourable Minister of Foreign Affairs, Olugbenga Ashiru, Honourable Minister of Transport, Idris .A. Umar, Senior Special Adviser to the President on Maritime Affairs, Mr. Leke Oyewole, DirectorGeneral, Nigerian Maritime Administration and Safety Agency, NIMASA, Mr. Patrick Akpobolokemi, Managing Director, Nigerian Ports Authority, NPA, Mallam Habib Abdullahi.

“The embassy has the honour to note that the government of the United States of America appreciates the willingness of the government of the Federal Republic of Nigeria to host the visit by the United States Coast Guard (USCG) team to Nigeria C M Y K

to assess the effectiveness of anti-terrorism measures at ports and continued efforts to comply with the International Ship and Ports Facility Security (ISPS) Code.

“Overall, with some noteworthy exceptions noted in the attached Aide Memoir, the United States Coast Guard team determined that Nigerian

,

Continued from page 17

The Embassy has the further honour to note that the United States Coast Guard must provide public notice of such changes in condition of entry

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Ports did not have in place effective anti-terrorism measures. Based on such observations during these visits to the Federal Republic of Nigeria, the government of the United States of America would like to communicate several areas of concern.

“The visiting team noted the lack of clarity regarding which agency in the Federal Republic of Nigeria has the overall responsibility for overseeing anti-terrorism measures at these ports, as well as the uneven quality and consistency of oversight. As a result, the United States Coast Guard

identified areas for improvement regarding antiterrorism measures in Nigerian ports.

“The government of the United States of America respectfully request corrections of issues identified in the attached Aide Memoir within 90 days of receipt of this notification. Correction of such issues would allow the United Sates Coast Guard to refrain from implementing additional conditions of entry on all vessels sailing to United States ports that have called at nonexempted ports in the Federal Republic of Nigeria within five port calls of arrival in the United States of America.

“The Embassy has the further honour to note that the United States Coast Guard must provide public notice of such changes in condition of entry.

The Embassy adds that vessels arriving from Nigerian port facilities assessed as having effective anti-terrorism measures, as listed in the attached Aide Memoir, will remain exempt. The Embassy respectfully notes that these additional conditions of entry, when implemented, would slow down maritime trade between our two countries and increase costs for Nigerian and other regional exporters using Nigerian ports.

‘The government of the United States of America, therefore, requests that the government of the Federal Republic of Nigeria implement necessary actions as soon as possible to remedy specific port deficiencies noted in the attached Aide Memoir.

‘The Embassy recognises that

Continues on page 19

steps have worked for me and I dare say are still working for me, and I am confident they will work for you and everyone that reads this book.

WHAT IS BUSINESS? Before you start a business, it is very important to understand what a business is in order to avoid making mistakes that can be very detrimental. The term business is very broad and can be vague; for some it is any activity or trade with the sole aim of making profits.

On the one hand, it can be said to be the occupation, work or trade in which a person is engaged in. On the other hand, a business can be defined as “an organization that provides goods and services to people who want or need them”.

When many people think of business careers, they often

,

What is not business? ne might wonder the importance of knowing what is not business, but this is necessary because you need to know the kind of business you should not go into, and businesses that are prohibited by law. Not every business is a genuine one and I will be taking you through a list of businesses you must not be found doing.

The mentality of a business man: There’s a saying in the good book which reads thus “by their fruits you shall know them”.

The same applies to business men; they possess certain qualities and mind sets that make them stand out.

Consequently, before you start a business you need to be adequately sure that you possess the die-hard mentality of an entrepreneur to withstand the challenges that will arise.

Who is an entrepreneur?

Over time various definitions have been given to the term, but I will be teaching you the difference between an entrepreneur and a businessman, the boundless and countless opportunities open to an entrepreneur, the traits and characteristics of a successful entrepreneur. In short, everything you need to know if you want to be not just a business man but also an entrepreneur.

Your readiness to be your own boss: A lot of people embark on a journey without fully preparing for it, and as such they are knocked off balance by the slightest wind that blows.

No warrior goes to war without his arms and it’s only a stupid farmer that goes to farm without his hoe. At the end of this topic, you would know if you are ready to start a business and peradventure you are not, you would be taught steps that will help you to be both mentally and financially ready.

The basic steps: In this chapter I will be taking you through the steps that you cannot overlook, if you want to have a successful business. These include: conceiving an idea, planning, funding, structuring, location, training and so much more.

I am of the sincere opinion that this would be more than just a book for you and your loved ones; it will be a compass that will guide you on your journey into the world of entrepreneurs. There is no better time to start your own business than now. These same

Before you start a business you need to be adequately sure that you possess the diehard mentality of an entrepreneur to withstand the challenges that will arise

,

think of jobs in large wealthy corporations, but for the entrepreneur, a business is any activity aimed at creating and keeping customers. There are basically two ways to carry out a business: Sell goods (physical things like books, toys, cars, houses, etc).

Sell services (intangible things like nursery education, legal services, health care, insurance, etc).

Many business-related careers though, exist in small businesses, non-profit organizations, government agencies, and educational settings. Conversely, your business may consist of selling both goods and services; for example if you are a computer dealer, you may sell goods (hardware and software) and services ( m a i n t e n a n c e , troubleshooting, or consulting).

Vanguard, MONDAY, JULY 22, 2013 — 19

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orking in Nigeria is quite interesting and as well, very challenging.

Public sector workers have to use their meager salaries to fend for themselves, their immediate family and extended family. In a country where the minimum wage is 18, 000 naira and the rate of inflation runs sky high, the average public sector worker finds it challenging and begins to cut corners to meet up with his daily expenses. There is no efficient transport system, no housing scheme to guarantee the workers’ welfare. So, naturally, in a bid to meet up with their counterparts in the private sector, they cut corners, compromise their offices and take bribes to bend the rules.

It is only in Nigeria that you have to save about N5million to buy a car and pay cash. It is only in Nigeria also that you have to save and build your Worse still, government demand for goods and house, paying cash to the appointees are given free cars, services and encourages contractors. In other places, housing and feeding and manufacturers to produce consumer credit and mortgage almost every other thing is more and thus ensure job financing are developed to free. Such individuals having creation. assist the individuals to own attained a certain level of Nigeria is a nation with properties and pay over a long standard of living do massive unemployment; a period of time. In many of the everything in their power to developed consumer credit countries we borrowed ensure they secure their scheme can trigger massive democracy from, their citizens future. Hence, corruption is at hardly build houses by its highest level in the civil themselves. There are service. mortgage institutions and housing companies that build lso, consumer credit in houses and give them out to developed society has workers on mortgage helped workers to be focused financing basis. and own whatever they want Workers who own such without stealing from the houses are conscious of the treasury. In those societies, fact that they have to pay their you only need to show proof mortgage on monthly basis or that you are gainfully be thrown out. Such workers employed. The banks will are committed to their jobs finance needed household because losing such jobs equipment, car and any other means they cannot afford a thing that will make life home. So, they become comfortable for the worker. But demand for goods and dedicated. But what do you the reverse is the case here. services that will encourage have here? Millions of You have to save to buy a car, production and job creation.

Nigerians are without homes build a house, and do The mortgage system is yet and no hope of ever owning everything for yourself. This another channel through one. When such individuals has become part of the which Nigeria can stimulate come in contact with avenues Nigerian culture such that the economy and create jobs. to make money, they go all Nigerians are naturally The demand for housing and out. That is why some adverse to loans and mortgage in Nigeria is vast. members of the National advances. Nigerians have Nigeria at the moment has a Assembly are all out to make developed an attitude towards housing deficit of 17 million money in whatever way, credit as if it is a taboo. Credit units and it is adding to that without considering the plight helps society and economy to at the rate of two million of the ordinary man on the grow. It puts money in the houses per year. That is on the street who they claim to hands of individuals who demand side. The housing represent. ordinarily will not have had supply side in any economy This is why some civil the means of making certain is a very strong driver of servants steal the nation blind. purchases. It stimulates economic growth, if properly

Consumer credit and mortgage financing can help fight corruption

,

A

handled. There are so many linkages within the economy as regards housing employment. Once an economy starts driving the housing and construction sector, it will employ carpenters, welders, masons, interior decorators, etc. It is a

Once an economy starts driving the housing and construction sector, it will employ carpenters, welders, masons, interior decorators, etc. It is a whole lot of linkages

,

whole lot of linkages. In any economy, this is a perfect instrument for job creation.

This is exactly why the USA monitors housing gaps every month. One of the key indicators is how many houses have been built, how many old houses have been purchased.

An index measures the movement of housing crisis within the economy.

H

as Nigeria’s policy makers realised that this is an instrument of job creation and economic growth.

Last April, in Washington, the

Minister of Finance and Coordinator of the Economy, Dr. Mrs Okonjo-Iweala, told reporters that Nigeria has decided to add more access and liquidity on mortgagee financing through the creation of a mortgage refinancing institution that will be mainly private sector held. She said that government will only be a motivator and will have a small share in it.

The partners, she disclosed, are the banks, which is why the CBN has a key role in it. The CBN is a partner. Nigeria, she said, will be looking for other investors. The document has been prepared to attract domestic and foreign investors into the housing sector. The World Bank is a strong partner as it is providing $300 million of liquidity facility at concessional rate of zero per cent, commitment charge of 0.7 per cent, 10 years of grace and 40 years repayment period to help us do this. Six states Lagos, FCT, Bauchi, Niger, and Anambra - were said to have volunteered to pioneer the mortgage project. So far, nothing else has been heard about this. How soon will Nigerians be able to have access to mortgage finance and consumer credit? Will this work without a credible national identity card? This is one question begging for an answer from the federal government.

Cover Story ISPS: US Coast Guard indicts FG over confusion at ports Continued from page 18 authorities may face significant difficulties in instituting the needed measures and would welcome follow-on discussions.

The US Coast Guard report further said “The Embassy has the honour to note that International Port Security Liaison Officer Commander, David Gates, remains prepared to assist the government of the Federal Republic of Nigeria in addressing these issues so that the United States Coast Guard can change this determination as soon as possible.

“The Embassy respectfully requests that the government of the Federal Republic of Nigeria identify a point of contact for

future dialogue on this issue.

The United States government, however, noted and commended some individual terminals and port facilities who are currently maintaining effective anti-terrorism measures.”

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eanwhile, the management of the Nigerian Ports Authority has prepared both Port Facility Security Plans (PFSP) and Port Facility Security Assessment (PFSA) on every terminal and facilities across the country. In the report, the American government also expressed concern over the ability of NIMASA to midwife and implement the Code. Some of

the deficiencies noted by the U S Coast Guard team in some of the terminals visited include inadequate training programmes, inadequate access control measures, and the failure to ensure that effective drills and exercises are carried out at several terminals.

“The Nigerian Maritime Administration and Safety Agency claims some legal authority for ISPS Code matters, but has not been exercising the duties of a Designated Authority for port facilities and has not developed security expertise.

“The future of the current Designated Authority remains in doubt and intense friction remains between the various

government ministries and agencies vying for authority over port security.

Reacting to the report, NIMASA’s spokesman, Mr. Isichei Osamgbi, said that the agency is working hard to ensure that Nigeria as a country is compliant to the ISPS Code.

Recall that the Presidential Implementation Committee on Maritime Security and Safety (PICOMSS) was responsible for the ISPS Code until NIMASA became uncomfortable with its presence and moved against it to be scrapped.

Even after PICOMSS was scrapped, NIMASA was still at a loss as to what to do until the government directed it to oversee the implementation of

the Code in Nigeria.

As at the time of filling this report, the management of the Nigerian Ports Authority was making arrangement to acquire trained dogs that will be distributed to every port across the country.

In his reaction to the development, the Executive Secretary of the Nigerian Shippers Council, Mr. Hassan Bello, explained that Nigeria has obligation to the International Ship and Port Facility Security (ISPS) Code and all its attachments.

He, however, opined that Nigeria is currently complying with some aspect of the Code, adding that with time, it will be fully implemented in Nigeria.

C M Y K

20 — Vanguard, MONDAY, JULY 22, 2013

Business & Economy BRIEFS CBN, SEC urged to compensate shareholders of nationalised banks

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hief Executive Officer, Standard Union Securities Ltd., Mr Sehinde Adenagbe, has called on capital market regulators to compensate shareholders of the three banks nationalised in 2011.

Adenagbe said in Lagos that the compensation would enhance the participation of local investors in the capital market. The stockbroker said that such a monumental loss without compensation could discourage local investments.

He urged the Securities and Exchange Commission (SEC), the Nigerian Stock Exchange (NSE) and the Central Bank of Nigeria (CBN), to revisit the issue.

The shareholders should not be allowed to suffer for the offence of others.

“The capital market regulators should provide succour and not allow the investors to suffer a total loss,” he said. According to Adenagbe, the development may be the reason for poor participation of local investors in the nation’s bourse.

Mortgage finance company takes off in October — MBAN

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he Mortgage Banking Association of Nigeria (MBAN) has said it would formally incorporate the Nigeria Mortgage Finance Company (NMFC) during the last quarter of 2013. Mr Kayode Omotosho, the MBAN Executive Secretary, disclosed this in Lagos.

According to him, the company, which has been on the drawing board, will get a financial boost to take-off from the World Bank. Kayode said that the company would help mortgage banks in terms of cash availability and make funds readily available for further mortgage lending to customers. “So far, NMFC has received $300 million (N45 billion) loan from the World Bank.

The shareholders have contributed about N6 billion and this will be more than enough for it to open to the public for business,” he said.

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Oil workers tackle presidency over crude oil theft

…insist politicians, highly placed individuals are responsible

BY VICTOR AHIUMA-YOUNG

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ORKERS in the nation’s petroleum industry have accused the Presidency of being economical with words over the alarming rate of crude oil theft in the country, insisting that politicians and highly placed individuals are responsible for the increasing crude theft.

Under the umbrella of the Nigeria Union of Petroleum and Natural Gas Workers, NUPENG, and Petroleum and Natural Gas Senior Staff Association of Nigeria, PENGASSAN, the workers dismissed accusation by the Special Adviser to the President Goodluck Jonathan on Niger Delta Affairs, Mr. Kingsley Kuku, that the oil workers were the brains behind crude oil theft in the country.

Reacting to a statement credited to Mr. Kuku in a national paper of July 17, 2013 titled: “Oil Workers are the Ones Stealing Crude Oil,” NUPENG and PENGASSAN, described the allegation as unimaginable, unguided, mischievous and condemnable.

They said they took serious exception to such perturbing, mischievous, d i a b o l i c a l unsubstantiated and alarming allegation clownishly and flippantly discharged without mindful of its implications and ramifications.

The workers alleged that the criminal activities of crude oil thefts were perpetrated by highly placed and influential individuals and politicians, adding that Kuku “is only being economical with the truth and trying to cover up with his allegation against the workers.”

The unions asked the federal government to call to order the special adviser to the president against unguided and unsubstantiated provocative utterances in

Managing Director, A2W Estates Ltd, Mr. Busayo Akanro (left), members- Mr. Mathew Abolurin, Mrs. Nkiru Akwarandu, Mr. Emeka Nwankwo, Group Managing Director, A2W Nigeria Ltd, Mr. Adeolu Akinyemi, his wife, Mrs. Tope Akinyemi and a member, Mrs Ijeoma Chukwu, at the commissioning of A2W Estate Phase 1, in Iju Ishaga, Lagos State...on Thursday. the interest of industrial peace and the respect for “Our nation that seriously yearn for peace at this relatively volatile moment of our national life.”

Speaking on behalf of the NUPENG and PENGASSAN,

President of PENGASSAN, Babatude Ogun, expressed the oil workers preparedness to take up the issue with the special adviser to the president unless he substantiated his allegation,

saying that the Joint Tax Force (JTF) should also help in unmasking those behind criminal act of crude oil theft and other national sabotage activities.

FG gives NPA 2 weeks ultimatum on workers’ arrears

BY VICTOR AHIUMAYOUNG & KELECHI AZUBUIKE THE Federal Government has given the Nigerian Ports Authority, NPA, two weeks to determine the cost implications of the arrears and modalities for payment of the 12 months salary arrears to Tally Clerks and on-Board securities men members of Maritime Workers Union of Nigeria, MWUN. President-General of MWUN, Emmanuel Anthony Nted, told Vanguard that this was part of the agreement reached at stakeholders meeting called by government to address the looming industrial unrest in the Maritime industry, over 12 months unpaid salaries to Tally Clerks and on-board security men members of the union among other grievances.

He said the stakeholders

would reconvene Tuesday, July 23, to agree on when the payment would commence.

Through the Ministry of Labour and Productivity, the government had last Monday summoned the management of NPA, MWUN and Safety Agency, NIMASA, and other stakeholders to a meeting to find solution to a planned strike by workers over 12 months unpaid salaries of Tally Clerks, on-board security men among other grievances.

But for the meeting, the union had planned to shut down the nation’s ports last Wednesday (July 17) two weeks after the Minister of Labour intervened and pleaded with the union to give the NPA time to sort things out.

However, Nted said at the Monday stakeholders’ meeting presided over by the Permanent Secretary, Federal Ministry of Labour and Productivity, Dr .Clement

IIIoh, that the union has agreed to suspend the planned strike.

According to him, “At the end of the meeting, it was resolved that the NPA would need two weeks to receive inputs from the parts, determine the cost implications of the payment of arrears, interface with the Managing Director of NPA, and work out the modalities for payments accordingly.

The meeting also noted the issues of the non-payment of salaries to Tally Clerks and on-board security men in different parts of the country and the statement by the Executive Director, NPA, on the insufficiency of the national budget for NPA for that purpose currently.

Federal Ministry of Labour and Productivity stressed the need to redress all issues pertaining to the payments of salaries where relevant, and arrears of the agreed increment.”

Vanguard, MONDAY, JULY 22, 2013 — 21

Business & Economy

BY GABRIEL EWEPU

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HE Minister of Agriculture and Rural Development, Dr. Akinwumi Adesina, has said the Federal Government will soon release N10 billion for cassava bread development fund and to further boost the cassava production. Adesina who was represented by the Senior Technical Assistant to the Minister of Agriculture, Dr. Adetunji Oredipe, disclosed this in Kogi State at the Cassava GES Roll Out at Agbadu Staple Crop Processing Zone, SCPZ, in Kabba Bunu Local Government

FG to release N10bn cassava bread development fund Area of the state.

He explained that Government established the Cassava Bread Development Fund, which would be funded through the tariff on wheat flour. He further said that the Cassava Bread Development Fund would also be used to support research and development efforts on cassava bread, training of master bakers, and support for master bakers for the acquisition of

new equipment for production.

Speaking on the Growth Enhancement Scheme (GES), the minister said that the GES will allow the farmers to produce additional food because the farmers will receive their improved cuttings and fertilisers.

“This year, we are taking cassava GES programme to scale, we have designed different levels of support to different categories of farmers

and we are committed to making this work. This marks another major milestone in our drive to ensure that the modern cassava farmers adopt the best available agricultural practices starting with the use of improved inputs; cuttings and fertilisers. In doing this, we will ensure that our farmers, the real cassava farmers who should be the real beneficiaries of government policy are well targeted by government

programme”, he said.

According to Adesina, to assure sustainable supply of high quality cassava flour, a secure low interest and long term financing from the China Exim Bank for the importation of 18 large scale high quality cassava flour processing plant was made to be owned and operated by the private sector.

In his address, Commissioner for Agriculture, Kogi Sate, Dr. Olufemi Bolarin, noted that the Governor of Kogi State, Idris Wada, has keyed into the ATA in Agriculture by encouraging and assisting Kogi State peasant farmers in all facets of agricultural production.

22 — Vanguard, MONDAY, JULY 22, 2013

Banking & Finance BRIEFS Detroit files biggest ever US municipal bankruptcy

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he city of Detroit filed for bankruptcy last week, making it the largest ever municipal bankruptcy in U.S. history and marking a new low for a city that was the cradle of the U.S. automotive industry.

In a letter accompanying the filing, Michigan’s Governor Rick Snyder said he had approved a request from Detroit Emergency Manager Kevyn Orr to file for Chapter 9 bankruptcy protection saying “it is clear that the financial emergency in Detroit cannot be successfully addressed outside of such a filing, and it is the only reasonable alternative that is available.”

Snyder, a Republican, appointed Orr in March to tackle the city ’s spiraling long-term debt, which is estimated at $18.5 billion.

The former manufacturing powerhouse has seen its population fall to 700,000 from a peak of 1.8 million people in 1950.

The city ’s government has been beset by corruption cases over the years. Waning investment in street lights and emergency services has left the city struggling to police the streets.

Microsoft profit below estimates after tablet charge

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icrosoft Corp on Thursday reported lower-than-expected quarterly earnings as slow personal computer sales ate into its Windows business and it took an unexpected $900 million charge for its inventory of unsold Surface tablets.

The world’s largest software company reported fiscal fourth-quarter profit of 59 cents per share, compared with a 6 cents per share loss in the year-ago quarter when it wrote off the cost of a failed acquisition.

Revenue rose 10 percent to $19.9 billion, helped by sales of Microsoft’s Office suite of applications, but fell short of analysts’ average estimate of $20.7 billion.

Microsoft said the $900 million charge related to its Surface RT tablet, which was launched alongside Windows 8 in October but has not sold well.

Earlier last week, Microsoft said it was drastically cutting prices and expanding distribution of the model to entice buyers.

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Strategy, leadership needed for development — ISMN

By PROVIDENCE OBUH

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he Institute of S t r a t e g i c Management, Nigeria (ISMN), has said that strategy and leadership should be given priority to help solve national problem and create development.

In his keynote address, at the institute’s annual conference/ 10th anniversary, with the theme: “Strategy and Leadership: Panacea to our National Malaise,” Ekiti State Governor Kayode Fayemi, said that a developmental state is anchored on strategic thinking.

Fayemi said, “Creating a strategic mindset in governance is the key to constructing a sustainable future. Strategic leadership therefore is not just designed to answer questions in the present but to anticipate and answer the developmental questions posed by the future.

“A developmental state is anchored on strategic thinking. In this sense, the pursuit of development in a world in which nations are competing for

advantage calls for the adoption of strategic intelligence.

He noted that development planning is a long term endeavour, saying, “Embracing strategic thinking also means jettisoning our institutional and cultural predilection for short-termism.

Development planning is a long term endeavour.

“The economic miracle of

Southeast-Asian nations was built on the back of long term planning. China’s emergence which is perhaps the most talked about and analyzed development story in recent times was nurtured over the course of thirty years. These are the countries we want to emulate.”

Earlier in his welcome address, ISMN President, Mr. Otive Igbuzor said that the

development of any nation requires a comprehensive development strategy.

Igbuzor noted that the development strategy of a nation is a comprehensive policy document that identifies the priority areas of the country, the resources available in the country and how to harness the resources to bring about improvement in the lives of the citizens.

FORUM: From left: Deputy Controller, Nigerian Custom Service, Mr. Abber Benjamin; Assistant Superintendent, Nigerian Custom Service, Egwunyenga Isioma; Managing Director GTBank, Mr. Segun Agbaje and Assistant Superintendent, Nigerian Custom Service, Abba Suleiman, during the 2013 GTBank Settlement Forum, held in Lagos.

‘Cash flow forecast key to MSMEs success’

By NKIRUKA NNOROM

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ASH flow forecast has been identified as a critical tool for the planning, monitoring and evaluation of activities of Micro, Small and Medium Enterprises, MSMEs. A financial management consultant, Mr. John Ekpikhe, Senior Consultant, Mark-George Consultants, made the call recently while addressing owners of MSMEs at the 34th Diamond Bank’s Business Xpress Enterprise Seminar.

Speaking on a paper titled ‘SME Cash Flow’ Ekpikhe explained that the objective of the module is to expose entrepreneurs on how to manage and determine cash flow in a business, saying that cash is to a business what blood is the body.

Ekpikhe who advised participants to ensure they

separate business from personal interest, noted that cash sufficiency is vital for the success of every business, even if a business is fundamentally profitable.

“Cash flow forecast assists in planning, monitoring and evaluation.

For many businesses, cash flow is a big problem and obstacle to success. You must learn to plan your expenses in advance in anticipation of certain changes in income and expenditure,” Ekpikhe advised.

He also cautioned that before an entrepreneur starts a business, there is need for him to do research on the business and set his goals.

The consultant said a business plan was imperative because it is the document that banks and other investors would look at to determine whether to invest in such business or not.

Ekpikhe commended Diamond Bank for setting the pace by heavily supporting the growth of MSME acknowledged to be engines of

economic growth and major contributors to employment generation, wealth creation, poverty alleviation and food security.

“With the seminar, Diamond Bank is positioning itself as number one caretaker of the small business industry and I believe they are not just controlling the market, they are the leaders. They are setting the pace and as we go round the country, we are unearthing more and more of the small business people, we are giving them capacity, we are training them,” he said.

Also, Mr. Collins Adeyemi, Chief Executive Officer, CA Diversified, in a presentation titled ‘Succeeding as an Entrepreneur: The Empire Builder’ noted that to be an entrepreneur, one must have vision, guts, foresight, direction, passion, heart and integrity among other attributes.

According to him, every great product started as an idea, but not every great idea

became a great product, adding that the best product is that which is developed by research.

He listed some of the qualities of an entrepreneur to include initiative, ability to see and seize the opportunity, persistence, risk taker, goal setter and goal getter, dedication, networking, driven by excellence, ability to research, planning and selfconfidence.

Alhaji Abduraman Mohamed, Managing Director, Daily Need Distributors Limited, in a lecture titled, ‘Starting Small, Ending Big’ admonished participants to ensure continuous investment of the profit into their businesses.

Earlier in his address, Mr. Chima Nnadozie, Head, MSME Propositions of Diamond Bank, noted that the purpose of the seminar, which is being hosted across the country, was to support owners of MSME to grow their businesses through capacity building.

Vanguard, MONDAY, JULY 22, 2013 — 23

Banking & Finance

By YINKA KOLAWOLE

T

HE Financial Reporting Council (FRC) has emphasized the need for Notfor-profit organisations to comply with the new financial reporting regime, given them till the end of the year to comply to register with the Council.

Chief Executive Officer/ Executive Secretary, FRC, Mr. Jim Obazee, at an interactive session with journalists, last week, in Lagos, said at the end of the deadline, the Council will begin commence the enforcement of the law against them. He said the Council is currently registering Not-for Profit organisations via its website, adding that a number of them have already registered.

“Currently, financial

FRC harps on registration of Not-for-profit organisations *Not responsible for approving financial reports statements presented by Not for Profit organisations in Nigeria are not uniform and comparable. They differ from one type of institution to another and sometimes among institutions of a particular type, thus, making comparison and accountability difficult. SAS 32, that became effective July 1, 2011 establishes uniform basis of accounting and reporting of activities of Not for Profit organisations. Section 11(d) of the Financial Reporting Council of Nigeria Act No. 6, 2011 provides that the Council is to ensure accuracy and reliability

of financial reports and corporate disclosures, pursuant to the various laws and regulations currently in existence. This includes the financial reports of Not-forProfit Organisations.

“It has also been noticed that a number of entities operating on commercial lines, within charity, are claiming exemption on their income on the ground that the totality of the outfits are charitable institutions. This is based on the argument that they are engaged in the “advancement of an object of general public utility” and

From left:Country Manager, South African Airways, Ms. Thobi Duma; Chairman, NigeriaSouth Africa Chamber of Commerce, Mr Folusho Phillips; Deputy High Commissioner, South Africa High Commission in Nigeria, Mogkethi Monaisa; and Head, Africa, South Africa Airways, Mr Aaron Munetsi, during a breakfast meeting of NSACC organized by South Africa Tourism and South African Airways, in Lagos.

classified as “company limited by guarantee” as provided for by Section 26 of the Companies and Allied Matters Act LFN 2004. Such a claim, when made in respect of an activity carried out on commercial lines, is contrary to the intention of the provision and put the assets of the charitable purpose at significant risk,” he stated.

Meanwhile, Obazee said FRC is not responsible for approving financial reports of organisations, but rather reviews them to ensure compliance with International Financial Reporting Standard (IFRS). He was reacting to a newspaper report (not Vanguard) that the Council refused to approve the 2012 annual report of the Central Bank of Nigeria, CBN. “The financial report of entities including that of the CBN is approved by the Governing Board of the organisations. The FRC does not approve accounts. Section 8 (d) of the FRC Act requires preparers of financial statement to send their financial statements to the FRC within 60 days after approval by their own board.

The FRC looks at the financial statements sent to us and review it. And remember, they first have to submit the statement to their primary regulators before the approval of the board, and it is only after these have been done that they end a copy of the approved statement to the FRC,” he remarked.

Sterling Bank grows half-year profit by 97%

By PETER EGWUATU

S

terling Bank Plc has recorded a growth in its profit after tax of 97 percent for the 2013 first half result released last week, just as it expressed confidence in its ongoing rights issue.

The first-half report came on the heels of initial filings showing extensive shareholders’ interests in the bank’s ongoing N12.5 billion rights issue. Sterling Bank is raising N12.5 billion through a rights issue of about 5.889 billion ordinary shares of 50 kobo each at N2.12 per share.

Sterling Bank had traded at a high of N3.05 at the stock market. The shares have been pre-allotted on the basis of three new ordinary shares of 50 kobo

each for every eight ordinary shares of 50 kobo each held as at May 20, 2013. Application list, which opened on June 24, 2013, will run till July 31, 2013.

A breakdown of the bank’s nterim report and accounts for the six-month period ended June 30, 2013 showed that earnings per share doubled to 38 kobo in 2013 as against 19 kobo in comparable period of 2012, underlining the increasing attraction of the bank as a high-yield stock. Investors responded positively to the earnings report as the bank’s share price rose by 0.38 per cent yesterday to N2.67. This implies double-digit six-month earnings yield of 14.2 per cent.

The report showed that profit before tax rose by 93.5 per cent to N6.27 billion as against

N3.24 billion recorded in corresponding period of 2012.

Profit after tax nearly doubled from N3.01 billion to N5.92 billion, representing an increase of 96.7 per cent.

The bottom-line performance was driven by the bank’s growing brand acceptability and customers’ deposit as well as efficient cost and risks management. Gross earnings rose by 28 per cent from N32.68 billion to N41.86 billion.

While interest income grew by 18 per cent from N26.34 billion to N31.08 billion, net interest income grew faster by 27 per cent to N15.17 billion in 2013 as against N11.96 billion in comparable period of 2012.

Key balance sheet items also underscored the continuing

fundamental strength of the bank. Total deposits rose by 21 per cent from N466.85 billion recorded as at December 31, 2012, which was the opening figure for this year, to N564.93 billion by June 2013. Within the same period, total assets grew by 19 per cent to N690.84 billion compared with N580.23 billion while shareholders’ funds increased from N46.64 billion to N49 billion. While loans and advances increased by 19 per cent from N229.42 billion to N272.75 billion, the proportion of non-performing loans to gross loans and advances remained checkmated at 2.7 per cent during the period, far better than industry’s benchmark of 5.0 per cent.

BRIEF Accion increases savings volume with “Brighta Save”

BY PROVIDENCE OBUH

T

o grow its savings volume, Accion Microfinance Bank (AMfB) has said that it is using “Brighta Save” promotion as key.

Meanwhile, a truck driver, Mr. Nofiu Eniola emerged star prize winner of a new Kia Picanto in the promo.

Speaking at the grand finale draw of the promo, Managing Director of the bank, Mrs. Bumi Lawson said, “with over 90,000 clients, AMfB aims to grow its savings volume from N450 million to N884 million. This savings mobilisation is targeted at the target market of the bank which is the micro and small entrepreneurs as the bank keep striving to empower them through its various products and offerings such as health insurance, life insurance, fire and robbery insurance.”

Bumi noted that the promo is premised on the belief that building savings culture for micro entrepreneurs and low income earners is important, as it provides security in time of emergencies and safety nets for the future.

“Through savings, they are able to accumulate capital and invest in capital asset as opposed to consumption and depletion of wealth,” he said.

Contesting the general believe that poor people don’t save, she said that research and studies have continued to show that the poor have their way of saving and there are enormous potentials to be tapped in this market segment.

She said, “It is our strong hope that the witnesses of the program and the mobile Grand Prize Winners will add a boost to the deposit mobilisation drive of the Bank.”

Eniola, who expressed satisfaction over the prize, is a savings customer with the IdiOro branch and earns his living as a truck driver. He started his banking relationship with the bank in March 2013, saving consistently since then.

He said, “This can only be God, AMfB is reliable and secured,” even as he urged micro entrepreneurs’ to inculcate the habit of saving.

The second prize winner got a tricycle while the third prize winner went home with a Refrigerator. Three customers of Idi Oro, Idumagbo and Ikeja were winners of the Grand Draw as 1st, 2nd and 3rd winners respectively.

24 — Vanguard, MONDAY, JULY 22, 2013

Corporate Finance BRIEF "Nigeria ready for property investment"

BY PROVIDENCE OBUH

N

igeria is fast becoming an attractive investment destination for real estate, according to Mr. Steve Ike, Head of Organising Team, Luxury Living Africa Property Exhibition.

Ike said this at the 9 th Property Exhibition organised by Campaign Hype Limited in Lagos.

According to him, "If you look back to six years ago, you will find out that there has been a lot of improvement in real estate in the country, apart from the fact that it is the place to invest now, Nigeria is competing well. Investors are coming to invest in the real estate sector. Even if we have shortfalls in housing, there are still improvements. We aim to bring what has been done so far in the sector to the public. Basically, Nigeria is becoming an attractive area of investment for real estate, we put up this exhibition for us to be able to showcase new development in real estate". He said developers should begin to consider investing in mass housing as a panacea for Nigeria's housing shortage. "I think what has to be done is for developers to provide low cost mass housing schemes.

You can have luxury living in a one-bedroom apartment, it is about comfort. So developers should provide low cost buildings that will still be attractive to live in," he said.

Lagos State Commissioner for Housing, Mr. Bosun Jeje, said at the event that the state has step up efforts to ensure investment in real estate is safe. Represented

by Director of Estate, Lagos State Ministry of Housing, Mr. Kehinde Abayomi, the commissioner said state government decided to sanitise real estate practice by putting in place regulations, to regulate their activities.

"If you are going to practice real estate in Lagos State, you are required to register with our Department in the Ministry of Housing where we give regular training. The intention is to make real estate investment safe for the citizens and investors as well," he said.

C M Y K

NSE woos utilities sector, pledges support

By NKIRUKA NNOROM

T

he Nigerian S t o c k Exchange, NSE, has assured that it has the capacity to accommodate listing from the utilities sector, calling on the companies involved to take advantage of cheap pool of fund offered by the NSE for their expansion projects.

Speaking on ‘Financing the Utilities Sector through the Nigerian Capital Market’ at the third quarter of CEOs’ utilities sector dinner, the NSE’s Chief Executive Officer, Mr. Oscar Onyema, argued that utilities companies have huge capacity to raise capital, saying that the quality of a company depicted by its financial performance would attract funds from all financial markets both local and international.

The utilities sector comprises of water, power and waste sectors of the economy.

Citing reasons why utilities’ companies should embrace listing, Onyema said that such move would offer them potential for more growth, recognition and strong boost to set standards for other companies.

He emphasised that

(L-R): Edem Vindah, Corporate Media and Brand Public Relations Manager, Nigerian Breweries Plc; Kunle Jaiyesimi, Deputy Managing Director, CFAO Motors Nigeria Limited; Walter Drenth, Marketing Director and Kuffre Ekanem, Corporate Affairs Adviser; all of Nigerian Breweries Plc., at a press conference on Gulder Ultimate Search 10, held at Nigerian Breweries Bar, Iganmu, Lagos.. Photo by Lamidi Bamidele

while key listings on the NSE is from industrial goods, financial services and consumer goods sectors, listing in the Jourhannesburg Stock Exchange include companies in the telecommunications, resources and energy sectors.

Ghana Stock Exchange have most of its listing from companies in the mining, Oil & Gas, telecommunications, and utilities sectors; Egyptian Stock Exchange’ key listings are in telecommunication, utilities and refineries, while

those of Nairobi Stock Exchange include companies in the telecommunication, utilities and refineries.

While saying that the market potentials of utilities sector are enormous, he lamented that they are weighed down by varying problems.

Making comparison with 21 other African countries, Onyema said that only 46 percent of the over 170 million Nigerians have access to power supply, adding that

Nigerians depend on self power generation to run their businesses.

Saying that power sector remained an important infrastructure pillar, the NSE boss lamented that the sector is characterised by unutilised generation capacity, inefficient supply/plant maintenance, poor gas supply, poorly motivated workforce and captive power supply and lack of investment among others menace.

Heritage Bank commits to taking SMEs to stock market

By PETER EGWUATU

H

eritage Bank has i n d i c a t e d commitment to take the Small and Medium Scale Enterprises (SMEs) to the Nigerian stock market.

The Bank also said that after four months of its operation as a regional bank it can transcend to a national bank as it has grown its capital base to N25 billion.

The Managing Director/CEO, Heritage Bank, Mr. Ifie Sekibo, who disclosed this on Wednesday in Lagos

during a parley with the SMEs to intimate them about the vision and mission of the bank, said “ We choose to start small and grow. Today, within four months of our operations as a regional bank, we have grown our capital to N25 billion that can fetch us a national license.

Continuing, he said, “We want the SMEs that we are going to work with to nurture them so that within the next three years they should be able to list on the Nigerian Stock Exchange (NSE). We want to create wealth, preserve and transfer wealth.

Our vision is generation banking and our mission is to ensure we nurture the SMEs to a level that generation will inherit and

benefit.

Explaining further, Sekibo said, “ As an institution , we told ourselves that we want to go for the SMEs. We saw there is vacuum in that sector and electronic banking. So, we are going to use technology to drive our business. You will not see us establishing branches here and there but with electronic banking, we will get everywhere we want. We are going to work together with Enterprise Development Centre (EDC) to nurture the SMEs that are serious to stay with us. SME is untapped and unstructured and that is why they cannot get needed fund from any bank. So, we are ready to restructure them to a level that we can lend

money to them to boost their businesses.

In her remark at the parley, Executive Director of the bank, Mary Akpobome, said, “ Heritage Bank has a unique dream to take the SMEs to the capital market.

According to her, “Most of the SMEs don’t have structure and financial records. Many entrepreneurs want to assume every position in the firm. No one person knows very thing. It is the not good to have everything of nothing. Rather it is better to have small thing of something. Therefore, it is better for a promoter of SME to have 10 percent of something than to have 100 percent of nothing. There is no bank that would be ready

Vanguard, MONDAY, JULY 22, 2013 — 25

C M Y K

Company Oil and Gas and Products Petroleum Prod ucts Capital Oil Plc 1st fTier Securities AGRICULTURE Crop Production FTN Cocoa Processors Plc Okomu Oil Palm Plc Presco Plc

Opening Price (N) 0.50

Daily Stock Market Report Closing Price (N) 0.50

Quantity Traded 26,250

Year High 0.50

Year Low 0.50

E.P.S.

P.E. Ratio

Sim Capital Alliance Plc Stanbic IBTC Bank Plc UBA Capital Plc HEALTHCARE Medical Supplies Morison Industries Plc Healthcare Providers Union Diagnostics & Clinicals Services

0.09

Pharmaceuticals Ekocorp Plc Evans Medical Plc Fidson Healthcare Plc Glaxo Smithkline Consumer Nig May & Baker Nigeria Plc Neimeth International Pharm Nigeria-German Chemicals Plc Pharma-Deko Plc

0.50 47.00 40.00

0.50 47.00 40.00

1,552,000 441,825 131,574

0.50 24.58 8.30

0.50 14.53 6.40

0.10 7.33 2.75

50.00 2.77 4.37

4.97

4.92

1,115,210

0.66

0.48

0.11

15.00

1.45 4.41 1.40 5.32 1.51 63.00

1.45 5.43 1.42 5.42 1.43 63.00

11,216 1,000 83,677 100 25,796,045 292,949

2.54 7.60 8.82 8.28 1.82 42.50

1.45 6.43 5.89 5.52 0.50 28.70

0.16 0.31 0.00 0.35 0.24 6.89

5.18 20.74 0.00 15.77 3.64 4.14

CONSTRUCTION/REAL ESTATE Building Construction/Structure ARBICO Plc Constain (WA) Plc

5.60 1.45

5.60 1.45

4 535,100

4 2,720,390.38

20

CONSTRUCTION/REAL ESTATE Non-Building/Heavy Construction Julius Berger Nig Plc Roads Nigeria Plc

83.75 9.06

83.75 10.07

447,525 1,000

62.26 8.28

32.96 3.01

15.99

15.99

219,367

20.15

11.59

1.69

7.33

100.00 50.00

100.00 50.00

13,400 -

100.00 -

97.00 -

11.75 -

8.51 -

0.50

0.50

145,506

0.50

0.50

0.00

0.00

7.07 260.00 24.94 179.40 0.68

6.43 260.00 24.69 176.00 0.75

40,000 58,994 38,035 1,692,577 20,000

4.63 255.00 7.10 100.00 1.01

2.23 186.00 5.23 72.50 0.93

0.00 9.95 0.41 5.08 0.00

0.00 19.98 16.29 22.22 0.00

Beverages-Non-Alcoholic 7-UP Bottling Company Plc

65.00

65.00

333,869

51.49

,39.00

2.69

13.92

Food Products Dangote Flour Mills Plc Dangote Sugar Refinery Plc Flour Mills Nigeria Plc Honeywell Flour Mill Plc National Salt Co. Nig Plc UTC Nigeria Plc

Tools and Machinery Nigerian Ropes Plc

9.50 12.45 90.00 3.31 12.92 0.78

9.50 12.22 90.00 3.36 12.99 0.79

325,333 384,311 121,528 1,865,031 394,229 534,500

19.90 16.20 95.00 6.60 6.70 0.88

4.31 4.02 57.00 2.31 3.80 0.50

0.00 0.91 4.09 0.39 1.01 1.13

16.91 14.38 16.89 16.92 5.75 8.83

NATURAL RESOURCES Chemicals BOC Gases Plc

Food Products-- Diversified Cadbury Nigeria Plc Nestle Nigeria Plc

52.05 1,000.00

53.05 1,000.00

326,347 35,107

37.27 840.10

8.33 400.00

Livestock/Animal Specialities Livestock Feeds Plc CONGLOMERATES Diversified Industries A.G. Levents Nigeria Plc Chellarams Plc John Holt Plc SCOA Nigeria Plc Transnational Corporation UACN Plc

Real Estate Development UACN Property Development Real Estate Investment Trusts Skye Shelter Funds Union Homes Real Estate Investment CONSUMER GOODS Automobile/Auto Parts DN Tyres & Rubber Plc Beverages-Brewers/Distillers Champion Breweries Plc Guinness Nigeria Plc International Breweries Plc Nigerian Brew Plc Premier Breweries Plc

1.35 25.43

10.11 2.26

27.61 32.84

Household Durables Nigerian Enamelware Plc Vitafoam Nig. Plc Vono Products Plc

32.27 4.45 1.71

32.27 4.70 1.71

60 1,441,174 13,000

36.19 5.54 2.88

33.96 2.91 2.88

13.89 0.61 0.00

2.44 7.07 0.00

Personal/Household Products PZ Cussons Nigeria Plc Unilever Nigeria Plc

44.30 62.00

48.50 62.00

984,949 145,991

41.02 47.39

21.02 27.60

0.82 1.44

4.39 32.91

FINANCIAL SERVICES Banking Access Bank Plc Diamond Bank Nigeria Plc Ecobank Transnational Incorporated Fidelity Bank Plc First City Monument Bank Plc Guaranty Trust Bank Plc Skye Bank Plc Sterling Bank Plc UBA Plc Union Bank Nig. Plc Unity Bank Plc Wema Bank Plc Zenith Bank Plc Insurance Carriers, Brokers and Sector African Alliance Insurance AIICO Insurance Plc Continental Reinsurance Plc Cornerstone Insurance Company Consolidated Hallmark Insurance Custodian and Allied Insurance Plc Equity Assurance Plc Goldlink Insurance Plc Great (Nig) Insurance Plc Guinea Insurance Plc International Energy Insurance Plc Investment and Allied Assurance LASACO Assurance Plc Law Union & Rock Insurance Plc Linkage Assurance Plc Mansard Insurance Plc Mutual Benefits Assurance Plc NEM Insurance Co. (Nig) Ltd Niger Insurance Co. Plc OASIS Insurance Plc. Prestige Assurance Co. Plc Regency Alliance Insurance Sovereign Trust Insurance Staco Insurance Plc Standard Alliance Insurance UNIC Insurance Plc Unity Kapital Plc Universal Insurance Plc Wapic Insurance Plc Microfinance Banks Fortis Micro-Finance Bank Plc NPF Micro-Finance Bank Plc Mortgage Carrier, Broker and Sector Abbey Building SOC Aso Savings and Loans Plc Resort Savings & Loans Plc Union Homes Savings Plc Other Financial Institutions Africa Prudential Plc Crusader (Nigeria) Plc Deap Capital Management & Trust Plc FBN Holdings Plc Nigeria Energy Sector Fund Royal Exchange Assurance

11.30 6.85 15.00 3.09 4.75 26.40 4.80 2.67 8.30 12.40 0.60 1.16 21.50

11.19 6.90 14.75 3.10 4.75 26.42 4.81 2.73 8.34 12.35 0.60 1.16 21.60

11,766,712 912,006 3,019,292 4,028,167 865,336 15,621,259 4,585,813 5,204,081 14,049,547 1,317,738 18,653,691 1,265,765 20,831,585

12.39 7.51 14.04 3.47 5.70 26.09 6.50 3.05 7.69 10.60 1.22 1.75 21.49

4.70 1.92 9.90 1.13 2.90 13.02 2.65 0.80 1.64 2.34 0.50 0.52 11.96

0.50 0.94 1.16 0.60 0.50 1.57 0.50 0.50 0.50 0.50 2.50 0.50 0.50 0.50 0.50 2.10 0.50 0.73 0.50 0.50 0.53 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.91

0.50 0.90 1.22 0.50 0.50 1.58 0.50 0.54 0.50 0.50 2.50 0.50 0.50 0.50 0.50 2.14 0.50 0.72 0.50 0.50 0.53 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.90

400,000 10,802,701 118,500 301,000 2,570,580 1,518,985 1,765 62,500 200,000 50,000 41,900 1,670,890 33,800 48,727 37,000 443,000 20,000 7,325,497 726,380 3,410 1,103,367 3,500 49,550 2,000 2,000 2,000 100 20,000 1,704,536

0.50 1.11 1.03 0.54 0.50 2.44 0.50 0.68 0.50 0.50 0.50 0.50 0.50 0.60 0.50 2.59 0.54 0.81 0.61 0.50 1.01 0.50 0.56 0.50 0.50 0.50 0.50 0.50 1.08

0.50 0.50 0.58 0.50 0.50 1.08 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 1.06 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50

6.60 0.96

6.00 0.96

3,000 16,000

6.00 1.18

0.00 0.92

0.04 0.92

150.00 10.56

1.50 0.50 0.50 0.50

1.53 0.50 0.50 0.50

1,000,000 100 10,000,000

1.57 0.50 0.50 0.50

1.37 0.50 0.50 0.50

0.19 0.02 0.00 0.00

47.6 7 25.00 0.00 0.00

1.71 0.50 2.02 18.69 552.20 0.60

1.85 0.50 1.34 18.65 552.20 0.62

2,206,710 22,000 70,000 11,911,385

0.75 0.50 2.02 20.00 552.20 0.78

0.00 0.50 2.02 8.57 552.20 0.50

0.19 0.00 0.00 2.03 12.68 0.13

9.16 0.00 0.00 9.85 43.55 6.00

236,686

1.42 0.90 2.81 0.43 0.00 2.10 0.71 0.54 0.67 0.00 0.00 1.34 2.09 0.00 0.50 0.14 0.02 0.50 0.28 0.01 0.00 0.03 0.01 0.00 0.02 0.00 0.00 0.03 0.16 0.00 0.37 0.02 0.03 0.06 0.04 0.09 0.00 0.00 0.00 0.02 0.00 0.07

8.73 8.34 5.00 7.93 0.00 12.39 9.15 5.43 11.19 0.00 0.00 0.43 10.24 0.00 22.20 6.79 27.30 10.00 7.43 50.00 0.00 16.67 50.00 0.00 25.00 0.00 0.00 16.67 16.19 0.00 2.19 26.00 16.67 15.50 12.50 5.65 0.00 0.00 0.00 25.00 0.00 15.43

103.50 15.39 1.15

Closing Price N 103.50 15.45 1.14

Quantity Traded

Year High

820,629 23,714,621

103.50 15.69 1.41

Year Low

103.50 10.64 0.03

E.P.S

10.56 0.87 0.21

2.01

2.23

785

10.54

9.52

0.00

0.50

0.50

400,000

0.50

0.50

0.00

4.32 4.10 2.04 55.00 2.94 1.27 8.17 1.87

4.80 4.49 2.05 55.00 2.70 1.38 7.36 1.87

400 738,256 1,091,020 2,228,349 430,538 101,896 412,477 16,993

5.31 1.45 3.20 23.11 5.61 1.96 12.91 200

5.31 0.70 0.83 2.58 3.61 0.95 0.95 4.28

0.19 0.44 2.62 0.20 0.09 0.00 0.00

P.E Ratio

9.71 18.03 6.71

0.00 0.00 88.50 0.00 3.07 9.05 14.13 0.00 0.00

ICT Computer Based Systems108 Courteville Investment Plc

0.68

0.64

304,731

0.52

0.50

0.10

10.00

Computers and Peripherals Omatek Ventures Plc

0.50

0.50

100,000

0.50

0.50

0.00

12.50

18.70 2.29

18.70 2.29

790 2,000

9.31 3.59

3.25 3.25

0.00 0.01

1.43 0.00

50

50

5,700,100

50,000

0.50

0.50

2,307,692

1.47

0.50

0.00

0.00

26.65 9.26 45.15 10.00 190.00 0.50 1.48 99.75 6.40 1.84 10.93

26.65 9.26 45.15 9.90 190.00 0.50 1.48 99.75 5.78 1.66 10.93

281,795 9,401 185,026 502,826 232,677 2,000 10,000 153,500 3,238,000 371,062 40

30.00 12.57 43.98 15.49 132.51 0.75 3.51 48.05 5.28 3.36 13.40

12.00 8.10 15.16 4.16 95.00 0.50 1.02 36.58 5.11 0.51 10.93

2.14 1.09 2.28 1.47 7.56 0.00 0.00 4.10 0.44 0.23 0.00

7.86 4.97 8.88 2.31 13.17 0.00 0.00 42.86 14.19 2.89 0.00

1.99 2.70

2,000 2,717,101

6.91 3.60

7.85

7.85

40

8.69

8.26

67,934

9.20

6.80

IT Services NCR (Nig) Plc Tripple Gee and Company Plc Processing Systems Chams Plc 4.11 4.73

Opening Price N

as at Friday, July 19, 2013

ICT Telecommunications Starcomms Plc INDUSTRIAL GOODS Building Materials Ashaka Cement Plc Berger Paints Plc CAP Plc Cement Co. of Northern Nig. Plc Dangote Cement Plc First Aluminium Nigeria Plc DN Meyer Plc Lafarge WAPCO Plc Portland Paints & Products Nig Plc Paints & Coatings Manufacturers Premier Paints Plc Packaging/Containers Avon Crowncaps & Container Nigerian Bags Manufacturing Company

1.99 2.74

5.94 1.47

0.5 0.25 0.00

0.00

7.50

6.77

Metals Aluminium Extrusion Ind Plc

10.55

10.55

500

12.39

10.70

0.13

85.77

Non-Metalic Mineral Mining Multiverse Plc

0.50

0.50

5,000

0.50

0.50

0.01

0.00

Paper/Forest Products Thomas Wyatt Nig. Plc

0.98

1.32

97

1.38

1.38

0.00

0.00

Electronic and Electrical Products Cutix Plc Nigerian Wire & Cable Plc

1.90 0.50

1.98 0.50

407,300 1,318,179

2.50 2.58

1.62 2.58

0.11 0.00

13.15 0.00

Mortgage Carriers, Brokers and Se Abbey Building Society Plc INDUSTRIAL GOODS Packaging/Containers Abplast Products Plc Beta Glass Co. Plc Greif Nigeria Plc Nampak Nigeria Plc Poly Products (Nig) Plc Studio Press (Nig) Plc W.A. Glass Ind. Plc OIL AND GAS Energy Equipment and Services Japaul Oil & Maritime Service Intergrated Oil and Gas Services Oando Plc Petroleum and Petroleum Products African Petroleum Plc Beco Petroleum Plc Conoil Eterna Oil and Gas Plc Forte Oil Nig Plc Mobil Oil Nigeria Plc MRS Oil Nigeria Plc Total Nigeria Plc Hospitality Tantalisers Plc SERVICES Afromedia Plc Automobile/Auto Part Retailers RT Briscoe Plc Courier/Freight/Delivery Red Star Express Plc Trans-National Employment Solutions C & I LEASING PLC Hotels/Lodging Capital Hotel Ikeja Hotel Plc

0.78

39.60 9.16

7.37

1.44

1.44

2,000

1.51

1.33

0.03

28.80

3.98 11.00 12.68 4.30 1.05 2.92 0.66

3.98 9.50 12.68 4.30 1.05 2.78 0.66

6,888 1,500,100 500 29,198 200 84,311 2,749,340

3.98 15.58 15.03 4.30 1.86 2.92 0.63

3.98 12.71 13.97 3.60 1.05 2.92 0.63

0.00 3.90 0.90 1.22 0.30 0.07 0.00

0.00 3.26 0.00 3.52 6.18 41.71 0.00

0.53

0.51

4,338,187

0.97

0.87

0.19

6.06

13.69

13.50

12,936,604

78.97

27.99

1.73

4.17

20.50 0.50 23.00 3.15 27.06 117.81 22.99 159.99

20.50 0.50 25.30 3.20 29.76 117.81 25.28 159.99

82,191 27,850 317,509 347,923 333,760 8,154 286,545 38,137

37.10 0.70 32.60 5.59

0.50 0.50 5.71 3.89

4.93 0.00 4.25 0.61

6.99

163.50 2,100 240.00

141.00 63.86 195.50

6.11 2.98 14.63

11.11 19.23 17.07

0.50

0.50

1,000

200

0.50

7.40 0.00

0.01

0.50

500

0.72

1.55

1.52

3,221,230

3.65

1.30

0.21

8.19

4.75

4.75 2.26

114,500 1.99

3.67 76,160

2.65 0.25

0.60 11.12

4.91

0.50

54,198

1.64

4.59 0.94

5,000 3,729,425

400 2.07

0.50 6.27 0.94

0.51

0.90 3.00 1.33

0.00

0.04 0.34 0.92

12.75

11.25 34.09 2.12

Media/Entertainment Daar Communications Plc

0.50

0.50

1,000

0.50

0.48

0.00

0.00

Printing & Publishing.

Academy Press Plc Learn Africa Plc Studio Press Nig. Plc University Press

1.80 1.80 2.52 4.80

2.04 1.80 2.52 4.80

57,150 1,568,480 500 143,590

3.68

0.25

12.19

0.00 6.82

3.17 0.30 0.00 3.60

0.54

27.69

0.00

0.00

Road Transportation Associated Bus Company Plc

110,191,025

0.80

Speciality Interlinked Technologies Plc

4.90

1.29

129 4.90

1,050

5.15

4.90

0.50

0.00

0.00

Transport-Related Services Airline Services and Logistics Plc Nigerian Aviation Handling Company

4.46 7.00

4.46 7.25

5,100 13,314,487

2.78 11.75

1.57 6.50

0.60 12.53

4.22 8.75

26 —Vanguard, MONDAY, JULY 22, 2013

Capital Market

Vanguard, MONDAY, JULY 22, 2013 — 27

International Business

ECOWAS calls extra-ordinary summit on regional integration

By VICTORIA OJEME

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COWAS leaders are to meet in Dakar, Senegal in October in an extraordinary session to decide on three issues critical to the financial health of the region – the Common External Tariff (CET), the Community Levy and the lingering Economic Partnership Agreement (EPA) negotiations with the European Union (EU).

The just-concluded rd 43 Ordinary Session of the Authority of ECOWAS Heads of State and Government in Abuja, which was dominated by the political and security situations in Mali and Guinea Bissau, touched on the three issues, but deferred decisions on them until the Dakar summit, whose actual date would be communicated to member states.

The CET is a precursor to a regional Customs Union, which is predicated on the harmonisation and convergence of national fiscal, monetary and trade policies of member states for the attainment of economic integration by the 15nation economic community with a combined population of more than 300 million people.

At their March meeting in Praia, Cape Verde, regional ministers of finance had endorsed a new five-band tariff regime for West Africa, subject of ten years of internal negotiations driven by the technical committee of the Commissions of the ECOWAS and the eight member West African Economic and Monetary Union (UEMOA) following the 2006 decision by the ECOWAS Heads of State and Government.

Some 5899 tariff lines are covered under the new tariff regime with tariff ranging between zero and 35 percent for the 130 tariff lines that fall into the category of specific goods that contribute to the promotion of the region's economic development.

Under the new regime, five percent duty is applicable for 2146 tariff lines under

the basic raw materials and capital goods category, 10 percent for the 1373 tariff lines that qualify as intermediate products category while 20 per cent duty is reserved for the 2165 tariff lines under final consumer products.

The ministers agreed that the concerns expressed by some member states such as the treatment of raw sugar, and the request for special treatment for Cape Verde because of its location and vulnerabilities should be addressed within the framework of trade defence measures.

They also agreed on the creation of a 1.5 percent Community Integration Levy whose scope and operationalisation would be the subject of further regional reflection as part of the mechanisms to enable the region cope with the challenges of implementation of the new tariff regime. The levy will replace the two existing community levy

regimes in the region the ECOWAS Community levy and the counterpart Community Solidarity levy - for the UEMOA, the major sources of funding for the two Commissions.

The replacement will also help ensure uniformity in port charges in compliance with the requirements of the World Trade Organisation (WTO).

For the effective implementation of the new CET, the ministers had also urged the ECOWAS Commission to expedite the finalisation of the trade defence and other support measures.

The Dakar ExtraOrdinary summit to be attended by the Council Ministers, Ministers of Finance and Trade, will take a decision after examining the pros- and cons on the CET arguments and also agree on measures to fast-track the negotiations on the EPA between ECOWAS and the EU.

Ghana poised for economic stability, says VP

G

hana's Vice President, Kwesi Amissah, says the government is poised to create structures that will boost economic stability in the country.

This is contained in an online statement from the Presidency which was made available to the News Agency of Nigeria.

The statement quoted Amissah as saying this in Accra at a meeting with the Governing Council of the Private Enterprise Foundation (PEF). “Ghana is not broke, it is true that an exceptional fiscal situation last year created challenges; we only need to put measures in place to pursue growthenhancing programmes.

Government is considering the use of tariffs and leveraging the private sector, to team up with government in delivering on investment," the statement quoted him as saying.

The vice president said there was need for a change of attitude to tariff adjustments in order to achieve the objectives of the nation’s economy measures. He expressed the hope that the country's economy would

do better if the government puts in place the right measures in the face of the challenges facing the economy. “Every country has challenges, but what we decide to do in the face of these challenges is of essence, in the case of Ghana, there is hope," he said.

The statement also quoted, Mr Asare Akuffo, President of the PEC council, as describing the interaction with government as crucial given the economic challenges facing the country.

He said it was unfair for the government to add to the burden of businesses in the country through increased taxes, even with the acute and persistent power outages. Akuffo said recent re-introduction of taxes through the National Fiscal Stabilisation Levy would have negative effects on Ghanaian businesses at the global level.

Ghana's parliament approved the National Fiscal Stabilisation Levy and the Special Import Levy Bills to shore up revenues to bridge the 2013 budget deficit.

C M Y K

28 — Vanguard, MONDAY, JULY 22, 2013

Interview

Politicizing appointments in steel sector stunts growth, says Ugwu-Oju *Steel sector needs right policies to grow

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meka Ugwu-Oju is the Deputy Chairman, Nigerian Association of Cold Rolled Steel Manufacturers, in this interview with NKIRUKA NNOROM, he regretted that past government policies have aided in crippling the steel sector in Nigeria. He said that the Federal Government must as a matter of importance support the growth of indigenous industries. He also noted that the country should emulate the various developmental efforts that made China an economic power among other issues. The Excerpt:

Emeka Ugwu-Oju is what we have started doing because at the end of the day, you show what you can do, not talk. That is what WEMPCO STEEL MILLS (WSM) has done.

That was why we invited the president and the whole Nigeria to come and see what the private sector can

,

The plan to develop the iron and steel sector began with Yakubu Gowon regime with the formation of National Steel Development Authority (NSDA) in 1971. Looking at the low level of steel production in this country, where and how do you think we missed it?

I think I should start by situating the context of steel development. In any productive economy, steel has a major role to play. For instance, the materials used in a lot of productive activities like car production and others are derived from steel. At a point in time, a country ’s level of development will be gauged by the level of steel it consumes.

As at today, the foundation of any strong manufacturing economy is based on steel. It is under that concept that Nigeria wanted to have a strong steel sector and it was reflected in our earlier development plan, which led to where we had Ajaokuta Steel Mill and the other ones in Katsina and the rest. The plan seemed okay, but some things went wrong and today, Ajaokuta Steel Mill has not delivered. Most of the steel rolling mills are either comatose or waiting for revival in one way or the other. We have not been able to achieve much based on our plan, maybe because it was public sector based. But I would not say it is just because of that, but the way things have turned out, I would not be too wrong in saying it has had a lot of impact in our not actualising our steel goal. That is the reality of how the public sector operates. We lack continuity in governance; we have a situation whereby funding is not provided as at when due and we also have situations whereby appointments are politicised.

Like making a person the Managing Director of Ajaokuta Steel Mill without looking at how effective the person can be.

Such has hindered us from the ability to deliver a strong steel sector. But that was yesterday, we are here today saying we can turn things around and that

Ajaokuta would have done once the correct policies are effected and correct tariff protection is provided.

At what stage did the private sector come into steel production in Nigeria, because we know that from inception, it was the Federal Government that was mainly

The governance structure we have in the public sector; It sometimes does not give room for meritocracy and continuity in projects implementation

do so that there can be creation of enabling environment for us to continue to do what we want to do. We really want to do backward integration so that not later than 10 years from now, we would have done a lot more than

,

involved in it?

If you follow the history of our development, you will know that the steel sector was one of the areas listed for privatisation. The government at a point saw that it could not do this alone, that was when they came up with the issue

of setting up Committee on privatisation. The steel sector was one of the areas that was put forward for privatisation.

This, of course, meant transferring the ownership to the private sector, but it looks like there have been a lot of challenges in that regard.

Ajaokuta has been in and out of court for some time, I cannot really say what the status is at the moment.

Privatisation has not really gone the way it should. Be that as it may, it is still a step in the right direction. Some of us are starting because a conducive environment for it has been provided. There should be one or two government founded projects that we think we could turn around and position as part of our backward integration strategy.

Can you itemise the specific factors that worked against the public sector on steel production and what efforts you are making to stop them from reoccuring?

I tried to state that it was because of the governance structure we have in the public sector; It sometimes does not give room for meritocracy and continuity in projects implementation. Also there is lack of incentives, because one of the key things in the private sector is that of profit motive. You try to do your business to ensure that your income is more than your cost. But you found out that in government projects, because the amount is budgeted every year, some people do not really care whether the business is profitable. Then when you add that to the issue of federal character, some people would say “it is now our turn to run this company” and “our turn” means different thing to different people. It might mean let us bring in our own people as employees, even if they are not the right calibre or not productive. Of course, you are laying the foundation of the death of that project.

These are part of the hindrances in our public sectors. In the private sector, you are straight because you are in business to make profit.

If you are not profitable, your will go out of business, and I do not think you will want to invest in a business you will not survive in, unless some external factors do not make it possible for you to survive.

This is what we are saying when we ask the government to give us the right environment.

The government should also protect the interest of private sector even in policies that have to do with international

trade. Suddenly, we found ourselves in a situation whereby people dump goods from foreign countries at the expense of our infant industries. We don’t have control over that and that is where the government should come in by ensuring that the private sector is protected in the international trade.

How indigenous is WEMPCO, does it have the capacity to produce other raw materials apart from steels like chemical, tar and others?

I think the history of WEMPCO is interesting. We have come a long way. A lot of the employees are Nigerians, while few of them are Chinese. The group is also sensitive about ensuring that as many Nigerians as possible are employed because it is more economical to employ a Nigerian than a Chinese, who will have to go home two or three times a year. We did not come here to run a charitable organisation; we are in business. Of course, at times, you must have to play by the rules, so you do not compromise. Most of the technologies we use are from Germany, United States and China, so some of the nationals of these countries work with us in their different areas of specialisations. We are trying to ensure that Nigerians learn the requisite skills so that they can take over. We need to do what the Chinese are doing so we can take over the steel sector because this is more economical. We need to be ready to do what the Chinese are doing in terms of industralisation.

When President Jonathan came to commission the WEMPCO Steel Industry, he specifically said the sector is key to his administration’s transformation drive. With that statement, would you say the present administration has provided an enabling environment for the steel sector to thrive?

I think we got some support from the government, starting with the Coordinating Minister for Economy and Finance Minister, Ngozi Okonjo-Iweala, who did not only visit but also gave advice and we had some incentives when the company was undergoing construction in terms of exempting some of the materials used in the factory from duty and others.

The Minister of Industry, Trade and Investment, Olusegun Aganga, has always tried to be supportive in ensuring that when we have challenges it is addressed.

Vanguard, MONDAY, JULY 22, 2013 — 29

Homes & Housing Finance BRIEFS Edo, developers sign MoU on shopping mall

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Building with alternative technology

Stories by YINKA KOLAWOLE Federal Mortgage Bank of Nigeria (FMBN) is wooing Ekiti State government to return to the National Housing Fund (NHF) scheme, fourteen years after it pulled out. The state pulled out from the scheme in 1999 due to some misunderstandings and misconceptions about the scheme.

FMBN Board of Directors led by its Chairman, Chief Bisi Ogunjobi, on a recent visit to the Ekiti State Deputy Governor, Prof Modupe Adelabu, in Ado-Ekiti, urged the state government to return to the sbecause of its potential benefits in making housing accessible to the people of the state.

Ogunjobi said the FMBN delegation was on an advocacy visit to the state to sensitise the government on the benefits of participating in the NHF scheme with regards to housing development. He noted that the bank had in the past given the state N500 million estate development loan (EDL) through Shelter View for construction of 220 housing units and another N197 million NHF loan.

Another benefit the state stands to enjoy by rejoining the scheme, according to Ogunjobi, is access to N800 million loan facility already approved by the bank for Ekiti State Housing Investment Corporation. also appealed to the state government on issuance of Certificate of Occupancy (C of O) to the land acquired by FMBN for C M Y K

FMBN woos Ekiti back to NHF scheme the construction of its office complex in the state.

He said the bank has rebranded and expanded to accommodate more contributors, the hope that the visit will lead to the resolution of all the knotty issues between the parties. “It is hoped that the state

government will commence deduction and remittance of NHF contributions to FMBN,” he said, adding that this will enable contributors the fund and also help the government consolidate the ongoing infrastructure development of the state.

In her remarks, Adelabu

who stood in for Governor Kayode Fayemi, noted that the state g o v e r n m e n t ’ s development plan to build two housing estates in each of the senatorial in the state will require partnership with organisations such as FMBN.

ASO funds development of Police housing estate in Lagos A

SO Savings & Loans (ASL) Plc said it financed the development of the 200-unit housing estate for the Nigeria Police commissioned by President Goodluck Jonathan, Friday, in Idimu, Lagos.

Managing Director, ASL, Mr. Hassan Usman, who disclosed this in a media chat at the commissioning ceremony, said the mortgage bank provided the required fund for the developers of the project, Remax Realtors. "We funded the developers Remax Realtors, who are our customers. They came to us with a proposal from the Police, we gave them the money, they built the houses and the Police Cooperative paid them off. So we funded the entire development," he said.

In his welcome address at the occasion, Inspector General of Police, Mohammed Abubakar, said the Goodluck Jonathan Estate

located is made up of three bedroom flats with each flat going for N8 million each. He said the houses are available to officers and men of the Police, adding that the money would be paid back through a special mortgage arrangement with Federal Mortgage Bank of Nigeria, FMBN. The IGP said the estate was named after the president because of his "unparalleled" support for the Nigeria Police.

Unveiling the project, President Jonathan said the Federal Government is committed to improving the welfare of security personnel in the country to encourage them in carrying out their duties more effectively. "It is noteworthy that for the first time in recent memory the Nigeria Police Force, through its own efforts and initiatives, is working hard to improve welfare of its men through housing.

This estate represents another successful

outcome of the publicprivate partnership, PPP, initiative of this administration to compliment government efforts towards meeting the infrastructure needs of our people. With the successful outcome of this PPP initiative we are witnessing here today, I encourage other government organisations to partner with the private sector to meet the housing needs of their employees," he stated.

Jonathan said his administration placed a high premium on the provision of affordable housing in the country. He noted that this prompted the decision of the Federal Government to facilitate the establishment of a Mortgage Refinancing Company before the end of the year, for which the government has secured a $300 million (about N48 billion) liquidity facility from the World Bank.

DO State Government has signed a Memorandum of Understanding (MoU) with Resident Africa Real Estate Limited and Median Infrastructure Development Company Limited for the development of a world class shopping mall in Benin City.

Secretary to the State Government, Professor Julius Ihonvbere, signed the MoU in Government House and formally presented the site survey plan for the shopping mall to the leader of the delegation, Median Infrastructure Development Company Limited, assuring government’s support at all levels towards ensuring the rapid commencement of the project. He noted that the state government take the challenges of economic development seriously, noting that the signing of the MoU was a demonstration of the determination of the present administration to attract more investors to the state.

Speaking, Chief Executive Officer, Median Infrastructure Development Company Limited, Mr. Olumide Akinsanya, said the shopping mall will be completed and delivered in 24 months.

US mortgage rate slides to 4.37%

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he average 30-year fixed rate mortgage in US fell to 4.37 percent for the week ending July 18, as Federal Reserve Chairman Ben Bernanke helped ease market concerns about the US central bank tapering its monthly $85 billion bond purchases.

The 30-year fixed rate was 4.51 percent the previous week and 3.53 percent a year ago. The 15-year fixed rate mortgage averaged 3.41 percent, down from last week’s 3.53 percent. A year ago at this time, the 15-year fixed rate mortgage averaged 2.83 percent.

Bernanke indicated recently that the US economy still needed a “highly accommodative monetary policy”. In testimony before US lawmakers last week, Bernanke seemed to be more careful with his tone, understanding the effect of his words on investors.

30 — Vanguard, MONDAY, JULY 22, 2013

C M Y K

This NASS is nasty on 2013 budget amendment moment. For once, the President and the Finance Minister have my total support. The facts are indisputable. Every budget proposal is based on assumptions about the future which nobody can absolutely predict. Invariably, certain assumptions turn out to be slightly off the mark; occasionally, the roof caves in on a nation as when the tsunami devastated the Japanese nuclear plant supplying power to an entire Prefecture which also happens to be home to three car manufacturers.

When unexpected catastrophe occurs, there is no substitute for reevaluation and perhaps for adjustments to the annual budget.

In the first half of 2013, Nigeria had experienced the worst variance from budget since the Structural Adjustment years of 1986-92. Crude oil exports are down by a higher percentage than in any year in recent memory. Total revenue is down and some of the sector estimates are also off the mark calling for more adjustments. When revenue collections are down by over twenty-five per cent, the Executive branch has one of two choices – it could fail to implement the budget on account of low funds or it could request for an amendment, as it is doing now. Doing nothing is no option.

Time is also not in anybody’s favour; 2013, like other years, will pass into history on December 31. One needs no intelligence

or wisdom more than those possessed by a fifteen years old boy or girl to understand the importance and urgency to the nation. That is why the nonchalance with which this matter is being treated by the NASS is so baffling and annoying. They are toying with our lives – all 167 million of us.

Would we need an Arab Spring demonstration to get the NASS to act? One only hopes they have time to watch CNN or BBC. More annoying are the reasons given for the delay in addressing the amendment. Senator

,

“What we find it not to our liking when a comment is made that tends to say that government will shut down if the National Assembly doesn’t do anything. We do not agree with that”, Senator Abaribe.

The Federal Minister of Finance, Dr Ngozi OkonjoIweala, and Coordinating Minister for the Economy, is the second member of the Federal government executive branch to get my sympathy in two days.

Regular readers of this page would recollect my welcome article addressed to her when she accepted to return as Finance Minister under Jonathan. I had saluted her courage but also warned that unlike the first time around, when she got Nigeria off the debt trap, by paying too much, this time, there would be no easy victories. If care is not taken, she might leave the office literally in tears. She was also advised not to start with fuel subsidy removal – otherwise she would lose followers; despite her astonishing credentials and achievements. Unfortunately, she was caught in the maelstrom of events which led to the attempt by the President to raise fuel price from N65 to N141. She used up a lot of her credit on that misadventure. Today, the monument, SURE-P, built on the ashes of that attempt to totally erase “subsidy”, is not enhancing her reputation and may even reduce it further. It is still too early to tell.

One thing which is not in doubt is the need to amend the 2013 Budget proposal in line with the objective realities at the

amendment is longer than the original bill. Finally, they inform us, their employers (i.e Nigerians) that their vacation is more important than the national economic interest. The answers to their complaints would be rendered in reverse order. When public servants announce that going on leave is more urgent than attending to the public welfare, for which they sought office and were elected, it is better for those who feel that way to resign and go home.

Nigerians are not paying them the rumoured astonishing

The Nigerian government will almost grind to a halt without a budget amendment which cannot wait until NASS members finish their vacation

Abaribe’s abbreviated statement was the most responsible out of the ones, on record, out of the many. Even he made a harsh of it when he later said: “there is no way the Senate and indeed, the National Assembly can consider these amendments until we come back from our vacation this year”. Later he also said: “we already have other things that we have to deal with”.

Summed up, the National Assembly amounts to these. First, they are angry that the Minister of Finance told Nigerians that government will run out of money if action is not taken.

Then, they grumble that the

,

salaries and entitlements only to listen to them complain about overwork. There are hundreds of thousands of Nigerians who will work themselves to death to take home what our lawmakers collect as entitlements. Second, the complaint about the length of the amendment highlights what is wrong with our polity. One of my friends in Boston in the late 1960s to 1974 was a Congressional aide to late Senator Kennedy. He was only one out of over a dozen full and part-time workers attached to the Senator. Other Senators also employed their own assistants.

The primary function of the

assistants was to read the voluminous proposals which every Senator or Congressman received, to summarise them and to prepare options for the lawmakers intervention. To the best of my knowledge, no Senator ever complained about the length of a proposal because he had his assistants employed to plough through them. By contrast, Nigerian NASS members don’t want to spend a farthing out of their huge entitlements to engage the assistants they need. That is not the fault of the President or the Minister of Finance; it is their own individual and collective greed which gave rise to that complaint.

Finally, taking umbrage at the Minister’s revelation that government might grind to a halt in September if urgent steps are not taken amounts to blaming Noah for warning that the flood was coming to wipe the community away. Would they have preferred that she kept quiet until calamity overtook our economy? If she did not say it, as she is being forced to declare, then let somebody else say it. The Nigerian government will almost grind to a halt without a budget amendment which cannot wait until NASS members finish their vacation. Given the little they have achieved in the last two years, many Nigerians can be forgiven for assuming that they were on leave all along.

Vanguard, MONDAY, JULY 22, 2013 — 31

Insurance

By ROSEMARY ONUOHA

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S part of efforts to eradicate the menace of rate cutting in the insurance industry, operators are in the process of gathering data to determine minimum rates for different classes of insurance.

Because the challenge of rate cutting has been the bane of the industry, a Rating Committee led by Managing Director of Sovereign Trust Insurance Plc, Mr. Wale Onaolapo was set up to look into the issue and come up with solutions.

Accordingly the Committee has embarked on data gathering to enable the industry determine the minimum rates for different classes of insurance.

Director General of Nigerian Insurers Association, NIA, Mr. Sunday Thomas, said the committee has collected some data, adding that effort is being made to add more to enable them have sizeable number that can give a reliable figure in terms of rating of different classes.

He said, “I am aware that they have been able to collect some data, and they are trying to add more, so that they can have sizeable data that can give a reliable figure in terms of rating of different classes.”

He said that aside determining the minimum rates for all classes of insurance, the committee is also charged with the responsibility of recommending sanctions for non compliance with the rates.

It will be recalled that former Chairman of NIA, Mr. Olusola Ladipo-Ajayi, once said the menace of rate cutting

Insurers re-strategise to curb rate cutting is one of the dark spots in his tenure.

“I did not succeed in that regard. That is the simple truth. It is a pity” he said.

He noted that the industry is its own worst enemy, because operators have allowed competition to drive down prices, adding that with the continuous fall of rates, businesses are now unprofitable.

“We are running ourselves below profitable level due to pressure in the competitive

market that is why we cannot grow beyond what we are doing at present,” he added.

Meanwhile, Thomas said that a pool of independent investigators to investigate the genuineness of claims above N500 million is being assembled.

According to Thomas the association is working hard to ensure that the pool is made up of experienced people, adding that the task is beyond the capacity of few individuals.

From left: President of Chartered Insurance Institute of Nigeria, CIIN, Mr. F.K Lawal; Dr Saheed Timehin, guest lecturer; Dr Surajudeen Junaid; Mr. Shakiru Oyefeso, MD, Staco Assurance and Alhaji N.O Adiro during CIIN’s ramadan lecture held last week in Lagos

Africa Re expands to Brazil, confirms AM Best rating

BY FAVOUR NNABUGWU

A

FRICA Reinsurance Corporation, Africa Re, has been issued a license to operate as a reinsurer in Brazil.

The license to operate as a reinsurer in that country will pave the way for Africa Re to expand its operations for the first time in Latin America, in addition to its operations in Africa and Asia.

More so, a Framework for Cooperation in Reinsurance Business has been signed between Africa Re and IRBBrasil Re, the leading reinsurance company in Brazil.

Africa Re will start to write some businesses from the Brazilian market and benefit from exchange of competence

He said, “The first point of call is to have a pool of investigators that would carry out that assignment on behalf of the association. That is the stage that we are. We are trying to have a pool of investigators that would handle the task, for the assignment is beyond what a person can handle.”

He said the decision to institute the investigative pool was reached at the Association’s Chief Executive Officers (CEOs) retreat held

through cross-attachment of technical staff, increase of shares in retrocession program and extended underwriting capacity. Later, Africa Re shall register as an Admitted Reinsurer.

Africa Re’s Group Managing Director, Mr. Corneille Karekezi confirmed the latest development and achievements after the successful Annual General Assembly of the company in Dakar, Senegal.

Buttressing the financial muscle and capacity of Africa Re, A.M. Best and Standard & Poor’s have affirmed the Financial Strength Rating and the Issuer Credit Rating/ Anchor of the African Reinsurance Corporation. It retained its impressive A- in both Financial Strength Rating

and Issuer Credit Rating/ Anchor.

The A.M. Best ratings of Africa Re reflect its strong riskadjusted capitalisation and operating performance, as well as its established market position across the African reinsurance market. Although Africa Re is exposed to the unstable political and economic environment in some regions of Africa, these risks are largely mitigated by its geographic diversity, asset-liability matching strategy and the ease with which the corporation can shift its operations between its regional offices.

The Standard & Poor’s ratings - after Insurance Criteria change- reflect their view of Africa Re’s satisfactory business risk profile and strong financial risk profile, built on a

strong competitive position in Africa’s reinsurance market, as well as its very strong capital and earnings. S&P derives their ‘a-’ anchor for Africa Re from the combination of these two factors and view potential modifying factors - adequate Enterprise Risk Management (ERM), satisfactory management and governance, and exceptional liquidity - as neutral for the ratings. The S&P ratings on Africa Re reflect the company’s stand-alone credit strengths and do not include any uplift for support from the Nigerian sovereign. At the same time, the ratings are not constrained by the sovereign rating due to Africa Re’s significant asset and premium diversification.

In the financial year 2012, Africa Re reported a 35 per cent increase in pre-tax earnings to USD 93 million. Results were supported by a rebound in the equity markets, resulting in higher investment returns (including fair value gains) of 5.7 per cent (2011: 3.7 per cent), and a stable combined ratio of 91 per centy.

BRIEF Gambia honours Justus Uranta

BY FAVOUR NNABUGWU

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HE immediate past Managing Director of Niger Insurance Plc, Dr. Justus Clinton Uranta, received an award by the West African Insurance Institute (WAII), Banjul, The Gambia, in recognition of his exemplary and invaluable contributions to the development of the institute.

Uranta, who was the Vice Chairman of WAII Governing Council from July 2010 to July 2013, was acknowledged as having rendered meritorious service to the institute during the three year period.

Specifically, it was during his tenure that the 35 year old institute commenced the construction of a huge amphitheater for classrooms and lecture halls which are now nearing completion, among other several milestones achieved.

It was also gathered that his tenure brought an increase in the number of students intake, facilitated increase in the number of lecturers, as well as led to an increase in the percentage of passes in both the school diploma and professional exams of London and Nigeria.

Besides, he was also said to be instrumental to the affiliation of WAII with other international academic bodies such as the University of South Africa. Again, Uranta regularly contributed written articles to the WAII academic journal while serving on the institute board.

Uranta who was the MD/ CEO of Niger Insurance for seven years voluntarily resigned from the organisation in December 2012 after having spent 35 years in the Nigerian insurance industry.

He began his working career in 1977, as an assistant officer in the Federal Ministry of Trade. He joined Unity Life and Fire Insurance Company as an officer in 1978 and was with the organisation until 1980 when he proceeded to BCM Insurance Brokers Limited as a Marketing Manager between 1980 and 1981. From 1988 to 1990, he was the General Manager, Veritas Insurance Company Limited.

32 — Vanguard, MONDAY, JULY 22, 2013

Vanguard, MONDAY, JULY 22, 2013 — 33

Agric Boosting food security through mechanisation, the way forward for Nigeria Organisation (FAO). For Nigeria to be able to feed its growing population, therefore, there is a need for investment HE present administration has in mechanisation both on the part of the come up with the Agricultural private and public sectors.

Transformation Agenda (ATA) in a Dr. Ahmed Adekunle, , Special bid to earn foreign exchange from Assistant to the Minister of Agriculture, agriculture and make the nation selfDr. Adesina Akinwumi, said Nigeria sufficient in food production. But, with has the lowest tractorization in the the continual drift of the young world. mechanization in the country population of young Nigerians moving right now is of the lowest in terms of away from the rural areas to the urban density and intensity, “So currently in search of white collar jobs and away what we are putting is like dropping a from the drudgery of manual farm needle in the ocean, but we have to start labour, self sufficiency in food from somewhere, even today, if they say production is becoming a herculean they are giving us one million tractors, task. to mechanize the agriculture of this Seasonal shortage of food is becoming country right now we need a minimum apparent as a result despite the fact that of about 75,000 tractors. many labourers lack the incentive or For long, the public sector has been tools to perform the high quality work in control of tractors with little needed to improve productivity. So, contribution from the private sector. feeding the increasing Federal and state population cannot be done governments bought with the cutlass and hoe or tractors for farmers, but an agricultural system that most often they ended relies on human muscles. In up in the government developed countries, houses as public mechanisation has taken relations tools for the over from the use of raw government.

The human power as is still the public control of case in Nigeria.

Nigeria’s tractor The policy challenges of market by the public mechanisation, or lack of it, sector has resulted in are of far reaching inefficiency and market Agriculture Minister, significance. The use of distortion as federal Dr. Adesina Akinwumi and state governments poorly-yielding varieties of planting materials even bought tractors and compound the problem further as crops sold at subsidised rates to public agroyields across the nation have centres, farmers’ association and other remained relatively stagnant and low organised buyers over time, posing serious policy Oyo State government only recently challenges that require urgent inaugurated 320 tractors to promote intervention.

Agricultural what it called a new and improved mechanisation, embracing the use of farming system, saying youths would tools, implements, and machines for a be encouraged to engage in farming. wide range of farm operations such as “This will thereby make the sector more land preparation, planting, harvesting, profitable, sustainable and on-farm processing among others, technologically-driven.’’

The therefore becomes desirable. government said. Just like every other There is an added dimension of soil, state that has invested in the purchase water and forest conservation practices of tractors, Governor Abiola Ajimobi, that need to be built into the larger said the state government purchased framework of environmental impact of the tractors to meet the peculiar needs agriculture, climate change and food of the people, as well as to improve security. The constraint posed by the agriculture and develop rural prevailing land tenure system on communities. mechanisation is such that agricultural Some farmers have come to see the lands in many parts of Nigeria are not involvement of government in the easily made available for farming handling of tractors as not serving the because of extant influences such as needs of the farmers. Uwa Osunbor, a ownership structure and the stiff lady farmer based in Benin City, said competition for estate development it was always difficult accessing tractors today, which is exerting dangerous from the government. “Preparing the influence on agriculture and the land is what discourages people from prospect of feeding the nation. farming,” she said.

The International Food Policy Dr. Olufemi Faniyi, a farmer in Ogun Research Institute (IFPRI) reckons that State decried the lack of tractors in Nigeria is still at the early stage of the state when he disclosed that they agricultural mechanisation; even at had to queue to make use of that, it notes that the mechanisation of government tractors in the state. He power-intensive operations has been lamented that “major personalities in slow. A significantly higher proportion this country have oil palm plantation in of farming area is still cultivated by this area. You will not believe it that hand tools in Nigeria and West Africa most of us get our machinery from Benin compared to other developing countries Republic.

Statistics had it that, last year, a total “We buy machinery to crush our oil. of 3,012,360 ha of land was expected It tells you in a simple manner how to be put under cultivation in the things are. The government has a Nigeria with a tractor population of tractor which you can hire. In that place, about 40,000 with a tractorisation the government has just one tractor. We density of 0.1 hp/ha. The tractorisation all have to queue to have this one tractor density of the country fell short of the and it is so exorbitant. They charge recommended 1.5hp/ha by the United about N50, 000 per hectare.”

Nations’ Food and Agriculture

By JIMOH BABATUNDE

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34 — Vanguard, MONDAY, JULY 22, 2013

Appointment and Promotions vicahiyoung@yahoo.com 08033348923

TCN elects SSAEAC officers

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embers of the Senior Staff Association of Electricity and Allied Companies, SSAEAC, Transmission Company of Nigeria, TCN, branch, have elected officers to run the affairs of the branch.

The elected national branch officers are Ajugba A.L, (President), B. Chika (Secretary), Hammed B.M (Assistant Secretary), Henry Ofolue (Treasurer), Ali Cyril (Trustee) and Kamorudeen A. (Trustee).

Others are James Tugudu (Trustee), Ezemobi C.B (Auditor), Dairo Abidemi (Public Relations/Welfare Officer), Taiwo Onabajo (Vice President Abuja Region), Comrade Olaniyi Y G (Vice President Osogbo Region), Akoma E.O (Vice President Port Harcourt Region), Sahahu Bala (Vice President Shiroro Region), Ashogbon Tokunbo (Vice President Lagos Region) Initorufa A.L (Vice President Benin Region), Ubawachi C.P (Vice President Enugu Region), A.G Adamu (Vice President Bauchi Region) and Andrew Odihi (Vice President Kaduna).

The officers were inaugurated

by President General of SSAEAC and Deputy President of Trade Union Congress of Nigeria, TUC, Bede Opara .

In his acceptance speech, TCN branch President, urged management led by the Chief Executive Officer, Don Priestman, to see the association as a partner in progress.

He highlighted some of the challenges facing the transmission staff to include dilapidated and obsolete equipment, working tools, staff shortage, delay in staff salaries, training, poor medicare, poor hazard allowance among others.

Responding, Priestman, congratulated the association and noted that the management was impressed by the conduct of the association, promising that the challenges highlighted would be addressed, as some of them were be captured in the company’s next year budget.

•Bede Opara, President General of SSAEAC

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RICEWATERHOUSE Coopers, a multinational professional services company, Nigeria, has announced the appointment of three new partners.

They are: Sam Abu, Partner, Financial Services; Edafe Erhie, Partner, Consumer and Industrial Products and Services; and Darrell McGraw, Partner, Energy, Utilities and Mining.

Ken Igbokwe, Country Senior Partner (Nigeria) and Regional Senior Partner (West Africa), said the appointments were part of the firm’s on-going commitment to develop the next generation of partners.

According to him, “I congratulate these new partners. This class of 2013 represents our first group of integrated PwC Africa partner appointments and it is a testament

PwC Nigeria appoints new partners to their visionary leadership qualities, contributions to our clients and the PwC firm; I am excited at the energy and skills which they bring. I know that they will continue to impact our clients’ businesses and the PwC network of firms.”

ABU has over 13 years extensive assurance and related experience in Nigeria and the United Kingdom, and has had managerial involvement in the assurance engagement of several large financial services.

He is a technical resource for International Financial Reporting Standards (IFRS) engagements in the Financial Services and is currently involved in a number of IFRS conversion projects across the

Nigeria firm of PwC. ERHIE has offered over 15 years of professional service to clients in Nigeria and the United Kingdom.

His experience spans the Financial Services, Energy, Consumer and Industrial Products and Services, Public and Government, Technology, Infocomms and Entertainment and Media sectors.

He is a Fellow of the Institute of Chartered Accountants of Nigeria, a member of the Technical Committee in Nigeria and trained IFRS Financial statement reviewer, a Methodology Implementation Manager, and has been in the forefront of driving quality in our audit process.

McGraw has over 12 years of professional International Financial Reporting Standards (IFRS) experience.

He has served clients in the Energy, Consumer Products, and Financial Services sectors.

Prior to starting his secondment in Nigeria, Darrell was a Director within the Global Capital Markets Group of PwC, based in the USA, while delivering value to clients both in Europe and Latin America.

He holds an undergraduate degree from Harvard University, and completed post graduate studies at Pembroke College, Oxford University. He is a Chartered Accountant.

NITDA inaugurates board of trustees for outsourcing companies •Sam Abu

•Edafe Erhie

•Darrell McGraw

ILO launch project to reduce trafficking of girls, women

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NTERNATIONAL Labour Organisation, ILO, has launched a new project called “Work in Freedom” to provide women migrant workers from South Asia with a more secure future.

The project is funded by the UK Department for International Development to the tune of 9.75 million pounds over five years.

The initiative focuses on domestic workers and garment workers.

IndustriALL Global Union is a partner in the project.

The aim is to provide the women and girls with practical support and advice to enable them to avoid the pitfalls of trafficking and to contribute to a better lifestyle for their families.

At the meeting held in London some success stories were applauded, such as the Nepali trade union centre GEFONT which has set up support committees for Nepali migrant workers in the most important receiving countries, SEWA, the Indian Selfemployed women’s association which has successfully organized informal women workers and the Jordanian textile

union which also organizes migrant workers.

The ILO Better Work program focuses on garment workers. In Jordan 40,000 people work in the garment sector, 30,000 of whom are migrant workers. 65 per cent of the workers are women.

The issues where the Better Work program has made a difference are in stopping the confiscation of documents, the elimination of the nightly curfew, limiting compulsory overtime and changing the recruitment process.

Guy Ryder, DG ILO

Recently a collective agreement was signed in Jordan, which can be considered to be an achievement for the region. The contract regulates wages, working hours, union representation and dues checkoff, while giving the union the opportunity and the responsibility to represent migrant workers.

This contract goes a long way toward ensuring migrant workers’ rights. In Jordan migrant workers have two to three year contracts, whereas Jordanian workers have open-ended contracts. The minimum wage in Jordan is 185 USD per month plus food and accommodation, thus attractive conditions for workers from Bangladesh.

Precarious work aids and abets trafficking. In the meantime industry and consumers are required more than ever to abide by ethical manufacturing principles. This can mean hope for the women who migrate to the Middle East looking for a better life.

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HE National Information Technology Development Agency, NITDA, has inaugurated board of trustees for outsourcing companies tasking the board to work hard on developing the sector.

Members of the board include Mr. David Onu, CEO Interra Networks Ltd., Mr Ikenna Odike, Managing Director, Customer Contact Solution Nigera Ltd, Mrs Florence Seriki, Group Managing Director, OMATEK Venture Plc, and Jacqueline Yemi Acting Director- General of NITDA, Dr Ahiru Daura, gave the advice in Abuja, while inaugurating the board of the association.

He said that the inauguration of the board was a milestone toward developing Nigeria’s outsourcing sector and told the members that the journey actually started in 2011, when an outsourcing conference was held in the country.

Daura said that the resolution of the conference was to have a board to oversee and guide outsourcing activities in Nigeria as obtain in other countries.

“Your board is the highest body to give directions, policies and all that is needed is to drive the association forward. I will therefore urge that we work hard so as to move the association forward and make Nigeria very important outsourcing hub not only in Africa and beyond.”

Vanguard, MONDAY, JULY 22, 2013 — 35

Micro-Finance

From Left: Acting Company Secretary, Okomu Oil Company Plc, Ms Abisola Onadipe; Chairman, Mr Gbenga Oyebode and Managing Director, Mr Graham Hefer, at the

Reviving palm oil production:

The Okomu success story P

alm oil refining and production has in the past, and in recent times become a lucrative business in Nigeria. In fact, some might refer to it as a ‘liquid gold’ that could potentially be the saviour of the Nigerian economy, improving its economic outlook in the International community and bringing it out of the doldrums that has plagued it for over three decades, however, Okomu Oil Plc has shown that this is in fact possible.

At its just concluded 33rd Annual General Meeting (AGM), held at the Nicon Hilton Hotel in Abuja, the company published its financial records for the past fiscal year ended 31st December 2012 where a number of firsts were recorded.

The company demonstrated to its profitability to investors by paying the highest dividend in its history to shareholders.

The dividend payment of N7.00 per share of 50k, which is 29 per cent higher than the total dividend paid to shareholders in 2011, translates to a total payment of over N3 billion.

The company ’s annual report, presented by Chairman of the Board of Directors, Mr. Gbenga Oyebode, declared that the company is in the process of expanding its oil palm and rubber plantation and has also begun expansion of its oil mill from 30 tons per hour to 60 tons per hour.

“More feathers were added to the company ’s hat this fiscal year irrespective of the current negative economic circumstances prevailing in the country and in the world. The oil mill, which will be the largest in Africa, is scheduled for completion in 2014,” Oyebode hinted.

Okomu Oil has consistently posted profits in the last 10 years, a period during which most other agricultural initiatives in the country had either folded up or were performing sub optimally.

Shareholders are of the view that the company is inspiring, not just the

growth and profitability, but the fact that the company is ranked 10th among listed companies with the largest turnovers quoted on the Nigerian Stock Exchange (NSE).

It is the only agric-business in the NSE’s top 16 companies with the largest turnovers. The company quoted Bottom Line Magazine, to define it as “the ninth company with the highest profits before tax among companies quoted on the NSE, and the only agro-business on the Exchange’s top 16.”

Okomu Oil Palm Company has come a long way since it was established in 1976 as a Federal Government pilot project aimed at rehabilitating oil palm production in Nigeria. Today, the company has been transformed into an economic success; earning commendations and recording over 300 percent rise in profit after tax (PAT) from the preceding fiscal year.

Also, it has since grown to become Nigeria’s leading oil palm company with 8,800 ha of mature palm, a young extension of 4,000 ha of rubber, and a palm oil mill of 30 tons per hour capacity. Just as it is expanding in size, its corporate environment is also expanding. Currently, the company employs over 800 permanent and several independent sub-contractors.

All these have added up to place it on top in the burgeoning oil palm business and to position it as an emerging leader in rubber production.

Stakeholders agree that the privatisation of Okomu Oil has been a great success and a huge encouragement for the Nigerian agricultural sector for the future, with profound positive consequences of stable socio-economical growth for the region where it is implanted. The success of the company has further exemplified that palm oil production in Nigeria can be revived and rejuvenated with major players in the industry like Okomu Oil Palm Plc at the forefront of the palm oil revolution.

36 — Vanguard, MONDAY, JULY 22, 2013

Vanguard, MONDAY, JULY 22, 2013 — 37

International Business

Bribery allegations: FG should scrutinise GSK Nigeria’s activities — Operators

By PETER EGWUATU & NKIRUKA NNOROM

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•SEC should strip company’s owners' voting rights •As shareholders kick

HE government should also mount searchlight on the operations of GSK Nigeria to ensure that the company is not employing the same unethical practices it is being accused of in China to boost the Nigerian operations, said capital market operators.

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Oscar Onyema, CEO, NSE operations, saying, “I do not believe the Nigerian subsidiary should be punished for the activities of GSK overseas. It could not have been the global corporate policy of GSK to direct their officers to cut corners, rather it is the individuals working for GSK in the various jurisdictions that committed the crimes, possibly due to profit/bonus pressure, for which GSK is now being held vicariously liable.”

Also reacting, Mr. Johnson Chukwu, Managing Director, Cowry Assets Management Limited, stated that there might be no material impact of the offshore subsidiaries scandals on GSK Nigeria’s operations due mainly to the low level of public awareness in the country and the weakness or near absence of government structures that should

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Nigerian shareholders should also consider an outright buy out of Galxosmithkline Consumer Nigeria plc to protect their interest as well as retain the image of the company as a going concern.

The advice came on the heels of the bribery allegations leveled against the China subsidiary and initial fines paid as restitution for earlier infraction in the US as well as the bid by the parent company, GSK UK, to up its stake in GSK Nigeria to 75 percent.

Various independent analysts and capital market operators, who spoke on separate occasions to Vanguard, also said the bid by GSK London to increase its holdings in the Nigeria subsidiary is a wake up call to the regulators of the Nigerian capital market to strengthen the existing rules and regulations in the market with a view to stripping promoters of companies of their voting rights.

Speaking to Vanguard in Lagos, Mr. Wale Oluwo, an economist and former Managing Director, Investment Banking Group, BGL Securities Limited, said an outright buy out would be a preferred option if the various scandals involving the offshore subsidiaries are suspected to have the capacity of posing danger to the operation of the local firm.

Citing example, Oluwo said that Arthur Anderson’s transformation to Accenture after the AA scandal involving Eron’s account could be replicated in Nigeria.

He said, “Nigerian shareholders should not hesitate to take steps to protect the Nigerian subsidiary where it is apparent that the activities of offshore operations will have significant negative impact that may threaten the going concern of the entire GSK Group. That protection can be in the form of Nigerian shareholders insisting to buy out the troubled offshore shareholders and rebrand the company to eliminate the GSK name.

“While giving the offshore subsidiaries the benefit of the doubt in line with the provision of the law, I also note that GSK does not particularly have a good track record when it comes to corporate misconduct, having been made to pay fines as restitution for earlier infraction in the US.” He, however, counseled the Nigerian stockbrokers, shareholders and other stakeholders to look into the fundamentals and corporate governance practices of GSK Nigeria before rushing into judgment on the Nigerian

•Taiwo Oderinde, a shareholder activist operations in Nigeria.

“Interestingly, neither of these is the case with the perception of Nigerian investors. Rather, investors have been preoccupied with protests over GSK London’s plan to increase its stake in GSK Nigeria by buying out some

Nigerian investors.”

Hostile bid to buy out Nigerian shareholders he operators insisted that there was need for the Securities and Exchange Commission to tighten its rules to

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forestall incidences of multinational companies operating in Nigeria buying out Nigerian shareholders or delisting at will.

They noted that such rules should exclude the majority shareholders from voting on issues for which

The lawyers and our operators in the market are supporting this idea because of the money they would make from the deal

supervise and ensure adherence to best corporate governance practice and ethical standards by corporate organisations operating in the country, adding “ In some other countries, GSK operations would have come under severe scrutiny to ensure that they are not using the same unethical practices alleged to have been employed by them to boost their sales in China.”

Continuing, he said, “I have not seen any evidence that Nigerian investors are reacting to the negative news emanating from China on GSK. “Ideally, the expected reaction would have been a dumping of their shares if Nigerian investors have doubts about the integrity of the company ’s operating activities or expect the government to take measures to constrain their

,

they are the majority beneficiaries.

“In view of the GSK UK’s bid to increase its stake in GSK Nigeria, coupled with the case of Coca Cola and NBC, other multinationals may be tempted to do the same and that will leave us with an equity market that is predominantly made up of the Dangote Companies and the banks. The regulators should seek to amend the existing laws, rules and guidelines,” said Mr. Tola Odukoya, Vice-President, Dunn Loren Merrifield.

For, Johnson Chukwu, the Nigerian Stock Exchange and the SEC should consider updating the rules or guidelines on rights of minority shareholders such that the majority shareholders are excluded from voting on issues for which they are the sole beneficiary

or which enhances their voting powers and influence in the company.

He said, “I don’t think that there is any motive to the plan by GSK London to increase its holding in GSK Nigeria, other than business consolidation and profit maximisation.

The Nigerian business environment presents strong income potentials, which explains why the multinationals are investing more economic resources into their Nigerian subsidiaries to expand their operational base, while at the same time buying out Nigerian investors so as to appropriate most of the benefits of the expected improvement in returns.”

According to Mr. Taiwo Oderinde, National Coordinator, Proactive Shareholders of Association of Nigeria (PROSAN), “The recent international allegation against GSK UK shows they are fraudulent and an attempt to swindle unsuspected Nigerian minority Investors. This singular act will show the type of regulators we have, whether they want to protect our market or not.

We don’t care if other shareholders associations support this evil proposal, my group will not support it.

Lastly, I am using this opportunity to call on Nigerian investors to come out and vote against this evil proposal. This type of proposal can only be possible in a country like ours where everything goes.”

Although Wale Oluwo said that he does not object to GSK increasing its shareholding, he affirmed that the challenge for the Nigerian regulators should be to ensure appropriate valuation of the shares being sold so that Nigerian investors are not shortchanged. Disagreeing with others though, Oluwo said, “Owners of companies must be allowed to restructure their capital as long as there is level playing field for Nigerian and foreign investors.

Seeking extra-legal protection for Nigerian minority shareholders will be unfair to the foreign investors, and will offend the extant provisions of the Investment & Securities Act, the Investment Promotion Act, and the Companies & Allied Matters Act. The Nigerian Investment Promotion Act allows foreigners to own 100 percent shareholding in Nigerian companies so long as it is legally done. This scheme of GSK will be approved by the regulators, the shareholders and the court, so it is legal.”

“The majority must have their way, while the minorities have their say. All shareholders must be treated equally because the GSK shares of the local and the foreign investors are of the same class, ranking pari-passu. GSK UK, by Nigerian laws cannot be

disqualified from voting their shares in the type of major capital restructuring transaction that is being contemplated by GSK Nigeria at the moment.

“The lesson for Nigerian investors is to set up and run their own companies professionally so they can call the shots. It is wishful thinking to want to call the shots in another man’s company where you are a minority. We should emulate serious businessmen like Dangote, Mike Adenuga, Fola Adeola, Jim Ovia, Oba Otedeko among others, who have demonstrated that local corporates can compete and outperform their foreign competitors by relying on local experience advantage,” he added.

“Nigerian shareholders who disagree with the GSK transaction, as proposed, should seek the intervention of the courts for redress (but they must not forget to first reject the money being offered by GSK UK, as this may create a credibility crisis for their case in court),” Oluwo enthused.

Minority shareholders kick eanwhile, the Nigeria’s minority shareholders have condemned the act of forcing them to sell their shares to the foreign majority shareholders, saying it amounts to neocolonialism and outright corruption by the foreign investors.

According to Taiwo Oderinde, “The issue of GSK forcing Nigerians to sell their shares to the foreign shareholders is an act tantamount to neo- colonialism and this can only take place in a corrupt society like ours perpetrated by the international fraudsters like GSK UK.” In how own reaction, Chairman, Progressive Shareholders Association of Nigeria, PSAN, Mr. Boniface Okezie said, “ This act is a fraudulent practice where shareholders are coerced to sell their shares at a lower market price. I call it madness; it also shows how regulators are watching and letting everything to go. This is what Nigerian Bottling Company (NBC) did. So, the UK inclined companies are beginning to toe that line. You will recall that NBC was not doing well at a point in time and later on the company bounced back to profitability, only for them to say they want to delist from the Exchange, which they eventually did at the detriment of the Nigeria’s minority shareholders.”

Continuing, he said, “The lawyers and our operators in the market are supporting this idea because of the money they would make from the deal. It is not good for our country. Why do you have to force shareholders to sell their shares even at a lower market price than at a higher price? The intention of this GSK UK is to delist the company from the Exchange eventually. This is not good for our country because this people will make the money in our country and repatriate it to their own country. This is another act of colonialism and we are saying no to this wicked act.”

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38 — Vanguard, MONDAY, JULY 22, 2013

ICT

Ericsson boosts African telecom with 2 service centres Stories by PRINCE OSUAGWU

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ELECOM equipment and infrastr ucture provider, Ericsson, last week, announced the establishment of two new service delivery facilities in Nigeria and the Democratic Republic of Congo to enhance support for its customers in Africa. These centres, according to the company’s country manager, Mr Kamar Abass, would assist telecom operators manage the complexities of voice and data networks.

The new centres are going to benefit the over 40 million African customers out of an estimated 1 billion subscribers who Ericsson’s managed services cater for on its services.

The company also revealed that there was a huge demand from network operators in Nigeria and across Africa for innovative solutions saying the development would aid the expansion of telecoms infrastructure in the region.

Its view is supported by reports

which have shown that mobile connections in Sub-Saharan Africa increased 20 percent to 500 million in 2013 and is expected to increase by an additional 50 percent by 2018.

Abass who along with Head of region, Ericsson Sub-Saharan Africa, Frank Jejdling and Director Marketing and Communications, Omasan Ogisi, spoke to journalists at the weekend in Lagos, stated that the facilities will support the company’s leadership position in managed services, as well as enhance the delivery of its services portfolio across sub-Saharan Africa.

Part of the factors considered by Ericsson before opening up the two strategic centres include enabling the company better support partners and operators in delivering superior network performance.

These centres, will also strengthen existing competence and delivery capabilities through structured training, competence transfer and graduate recruitment; and push initial focus on managed services to be expanded into other service areas.

Galaxy Backbone emerged United Nations Public Service Awards 1st Place winner in “Promoting Whole-of-Government Approaches in the Information Age”, While Federal Capital Territory Administration emerged 2nd Place winner in “Improving the Delivery of Public Services at the United Nations Public Service Awards for “1-GOV.NET” initiative and Mobile Integrated Primary Health Care Service Delivery “MAILAFIYA”, respectively

Main One heads South West with launch of connectivity services in Ibadan

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ABLE Company, Main One, has opened its enterprise and connectivity solutions for people in the South West region of Nigeria to access.

The company used the opportunity of its Business Connectivity event in Ibadan last week, to announce the new development.

For the company, this will rapidly enhance broadband penetration across the country, as it would leverage the opportunity of excellent broadband solutions to educational institutions, government agencies and commercial concerns in Oyo State and environs.

The Connectivity event was done in collaboration with Phase 3 Telecom as MainOne promises to activate its alliance with various telcos to offer enterprise customers in the South West region the ability to deploy, manage and automate network and compute resources in Nigeria, remotely from any location.

Main One says it’s expansion into the region was driven by the growing demand for reliable connectivity solutions, increased need for virtual C M Y K

private networks between organizational branches, as well as increased security challenges faced by businesses and institutions in the South West region of the country.

Speaking at the seminar, Head, Sales, Nigeria, Main One, Bolanle Ogundogba, said that “most multinational and businesses enterprises are increasingly looking for growth opportunities in the South West states; Ogun, Oyo, Osun, among others.

This expansion creates connectivity challenge for the average IT Head who needs to interconnect his branches, using fast and reliable access to enhance business-critical systems without the significant CAPEX budget required to build infrastructure locally. The proliferation of educational institutions and learning centres in the region also provides Main One the opportunity to meet customer demand for scalable services in Oyo State and its environs, and ensure its reliable connectivity solutions keep your organization at pace with the speed of business transformation, and also pave the way for future growth.”

Vanguard, MONDAY, JULY 22, 2013 — 39

Advertising, Media & Marketing

CHI Foundation donates borehole to Lekki community Stories by PRINCEWILL EKWUJURU

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HI Foundation, the Corporate S o c i a l Responsibility (CSR) arm of CHI Limited has donated a borehole constructed at the cost of five million naira to Lekki community in Ibeju Lekki Local Council Development Area (LCDA) of Lagos State.

The Chairman of Chi Foundation, Oluranti Odubogun, who handed over the facility to the community, said it would be of immense benefit to the residents because before now they had

been drinking from wells.

He promised that the foundation would maintain the project which comes with a generator for 24 months.

He appealed to the community to protect the project in order to sustain it for a long time.

The water project, according to him was installed with treatment facility and has backwash equipment.

Oba Liasim Olumuyiwa, the Onileki of Lekki, commended the foundation and appealed for the maintenance of the project.

Vanguard gathered that Lekki as a name was derived from the Portuguese sailor named Lecqi who was a slave trade merchant in the area.

“Because the community could not pronounce his name, they simply called him Lekki”, Femi Ogunbogun, a medical doctor from the area, said.

The highpoint of the commissioning was when members of the community, mostly women sang and danced in appreciation of the project which is the foundation’s social responsibility initiative to reduce water-borne diseases such as dysentery, diarrhea, typhoid and cholera among others often contacted by members of the community through untreated well water.

Chi Foundation is set up by Chi Limited and associate companies of TGI Group and in the last two years, the foundation has sited about seven projects within the South West region.

FROM LEFT: Carol Abade, CEO Exp Group; Dan Hanover, Editor & Founder of Event Marketer Magazine (USA) and Kim Skildum-Reid, Sponsorship Author & Consultant (Australia) at 2013 African Experiential Marketing Summit (AEMS) held in Lagos recently.

Sweet Sensation introduces Feli-Feli

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WEET Sensation Confectionery, one of the Quick Service Restaurants (QSR) brand in Nigeria has undertaken a brand extension, introducing a kiosk attachment christened Feli-Feli in Festac.

Mrs. Kehinde Kamson, managing director /CEO of the restaurant said that SS Feli-Feli, was the first of its kind in the Nigerian QSR industry, “it comes in a Kiosk attachment to an already existing Sweet Sensation outlet and provides complimentary products and services, but not the usual Sweet Sensation traditional restaurant model, yet it still carries the sweet signature of the brand.”

Kamson stated that SS FeliFeli was borne out of a strong desire to provide another sweet experience to its ever increasing and loyal customers, who always expect trend setting innovative products and brands C M Y K

Corroborating the managing director’s statement, Oluyemi Yusuf, head, Marketing, said that SS Feli-Feli was a promise kept by the restaurant to always be ahead with

innovative products that perfectly meet customer’s needs. “We plan to replicate this with a roll-out campaign beginning from the Festac outlet, where customer demands meets with space availability,” he noted.

TVC News to fight misperceptions about Africa

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HE misrepresentation about the African continent will soon come to end as Pan-African Channel, TVC News, from the stables of the Continental Broadcasting Service Limited is launched on UK’s BskyB platform (EPG 572).

With this launch TVC News aims to challenge stereotypes and correct factual inaccuracies and misperceptions about Africa and her people.

Nigel Parsons, Chief Executive Officer, TVC News and former head of Aljazeera

English, said: “Without shying away from reporting the conflicts or the corruption, the famines or the wars, the mission of TVC News is also to tell the many positive stories coming out of Africa. Stories – good or bad – will be told ‘Through African Eyes’.”

The news channel serves as a medium for Africans in every part of the world to be heard on the global scene. Through its fair and fearless reporting, TVC News will tell the unreported stories from under-reported regions across the continent, all from an African perspective.

Can you “Feel” Your Service?

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UST how good is your service? How do you know?

If you’re like most people, you’d easily point to the last customer satisfaction survey conducted by your company to buttress your stand. That’s ok. Ours is an age ruled by statistics. If 90 percent of our customers claim to be satisfied with our service, we pat ourselves on the back. But what about the other 10 percent? We can simply rationalize their grumpiness. They’re the perpetual complainers. They’re never satisfied with anything we do. Anyway, they’re not even among our most profitable and loyal customers. And so on.

But wait a minute. In the age of information, statistics could sometimes lie and deceive. The story is told of an American company where all key performance indices – sales, profits, market share – were going down while customer satisfaction (CS) was going up! In fact, the only thing that was improving in that company was the result of CS surveys. So what happened? Well, those surveys were administered by sales people on their customers. The smart guys they were – the sales people knew how important the surveys were with top management. So they simply administered the surveys on their happiest and most friendly customers who were always willing to give them the thumbs-up.

Well, don’t get me wrong. We need statistics in customer service. They’re very useful. But service is about people.

It’s about emotions. It’s also about processes. It’s difficult to capture all the nuances of customer satisfaction quantitatively. If you depend solely on statistics, you may loose some qualitative dimensions of excellent service. I suggest that while you obtain and study the latest CS figures, you should do yourself some good by looking at the qualitative side of things. Try the following informal but practical techniques for getting a “feel” of your service. The idea is to help you see your service from the customer’s perspective.

Experience your service “Tis an ill cook that cannot lick his own fingers.” Those are the sage words of William Shakespeare and I agree completely with him. You need to taste the service you dish out to others. Take your time to experience the service process that your customers go through everyday.

Avoid shortcuts. Make sure you’re not given special treatment because you’re “oga (at the top?).” If you work in a very big organization, you may want to go to a branch where you may not be so easily recognized. Try your service at peak periods. You’ll probably learn one or two things. Just keep an open mind. And be patient.

After all, your customers go through this all the time.

Ask yourself: “If I were not working for this organisation, would I like to have the experience again and again?”

Your answer will tell you what you need to do.

Call your office t’s as simple as it sounds. Call your office to make an enquiry, lodge a complaint – just anything to get a response from your people. Of course, you need to do this incognito. Pretend to be a customer. If you like what you hear, that’s great. Your people are doing well. Otherwise, you have some work to do. The idea is not to rail at someone – or indict her – when you get back to the office. It’s a coaching opportunity for you.

On the other hand, if your people do well, remember to praise them.

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Call your Customer Care Line t will be nice to feel the amount of “care” you give on your customer care line. How easy is it to navigate through the menu? How many times do you have to punch the keypad to get to a live person? When you get through, are all the consultants busy? Are there 91 people waiting to talk to the consultants? Do you have to wait for 50 minutes to talk to someone? Just be patient. You’ll get a “feel” of your caring culture.

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40 — Vanguard, MONDAY, JULY 22, 2013

Email:lesleba@lesleba.com, lesleba@gmail.com Blog page:www.lesleba.com/blog2 Website: www.lesleba.com Tel:0805 220 1997

Sanusi’s tall story on high interest rates goods and services would ultimately rise or fall in relation to the prevailing cost of borrowing, which, itself, is predicated on CBN’s benchmark lending rate to the banks. Notwithstanding, Sanusi maintains that “the likelihood of the interest rate coming down in the current environment is very low; in fact, there is a higher likelihood of interest rate going up than coming down”, because, according to the CBN Governor, low interest rates will “reverse all the gains we have had on stability”.

Discerning observers may however, consider this assertion to be a deliberate misrepresentation of the apex bank’s performance under the existing 2007 CBN Act, which defines the CBN’s core mandate, in Sanusi’s words, as the “delivery of price stability, protection of the external value of the nation’s currency, management of the country’s reserve and ensuring financial stability”.

Regrettably, although Nigeria’s current year-on-year average inflation rate may indeed have remained stable at an average of about 10% over the years, but certainly, such high inflation rate, which obliterates income values every 10 years, actually, poisonously underpins our beleaguered economy with the consequences of rapidly dwindling purchasing power and consumer demand with reduced employment opportunities.

Paradoxically, Sanusi blames this debilitating state of affairs on the fiscal policies of the

federal government, and insists that “we can only see a moderation in the lending rate, when government borrows less, and (if) the rates paid by government for such borrowings come down…. If government is borrowing at 13 - 14%, and funds huge fiscal deficits, (i.e. government expenditure exceeding revenue), the private sector will have to pay even higher interest rates”.

Regrettably, however, there is little hope that such

,

N

igeria’s hope of early economic rejuvenation and growth may have been sadly foreclosed by Lamido Sanusi, in a recent presentation to the House Committee on Banking and Finance in Abuja, when he noted, in spite of the clarion demand by industrialists that “although the CBN has put in place several monitoring measures to ensure stability in the economy, it was not possible to guarantee the delivery of low interest rate, due to the harsh business environment in the country”.

Consequently, while the Central Bank benchmark rate in those successful countries with inclusive growth and supportive social welfare is generally below 3%, our CBN policy rate may rise above the current outrageous level of 12%, and sustain cost of funds to a beleaguered real sector at well-over 20%. Undeniably, no economy can grow optimally without those loans, which are universally, primarily provided by commercial banks.

A banking licence from any country ’s Central Bank permits domestic banks to lend up to 10 times the value of cash deposits collected from customers; the banks would in turn cover the inevitable cash short-falls from such lending, whenever necessary, by borrowing directly from the CBN at marginally lower rates.

Consequently, the level of inflation in any country is primarily a product of demand and cost of funds, as prices of

Ultimately, the truth of course, is that cost of funds will never be industrially friendly, so long as CBN continues to create the spectre of excess cash every time, it substitutes naira allocation for dollarderived revenue.

,

fiscal deficits would be reduced anytime soon, especially when the Coordinating Minister of the Economy, Dr. Ngozi Okonjo-Iweala, recently expressed concerns about revenue shortfalls caused by massive crude oil theft and dwindling export demand.

In reality, Sanusi is actually being economical with the truth on the impact of cost of government long term borrowing as the cause of high interest rates. The CBN has

activities is not so much the result of high interest rate but the result of our infrastructural deprivations, such as power, security, or indeed, storage facilities and cold rooms”….

It is not about moving interest rate down or up; most of the SMEs do not have access to credits because the environment does not allow businesses to thrive”. Haba!

Mr. CBN Governor. Who is the government?

Indeed, if lending rate to SMEs, for example, was as low as 3% as in successful economies, rather than the current level of over 20%, surely, there will be greater motivation for entrepreneurs to borrow and “conveniently” accommodate the forced additional cost of power, security, storage, etc, from the savings of a benign interest rate regime! The cost of procurements for both machinery and materials in all sectors, including agriculture, which are dependent on credit for operational growth, would fall and ultimately translate into a more competitive economic and business environment with unbound employment opportunities, with industrial regeneration and improvement in mass social welfare.

Ultimately, the truth of course, is that cost of funds will never be industrially friendly, so long as CBN continues to create the spectre of excess cash every time, it substitutes naira allocation for dollar-derived revenue. Curiously, while the CBN’s self-styled own dollar reserves continue to bloom, ravaging poverty deepens nationwide.

in fact, successfully hoodwinked Nigerians, including the National Assembly and the media from recognizing the negative impact on interest rate, whenever the apex bank itself, borrows from the money market in order to control perceived “excess” money supply in the system, with its sale of treasury bills bearing over 10% interest rate, when, in fact, similar loans in better managed economies may not exceed 2%. It is obvious hypocrisy for Sanusi to decry the cost of government’s long term loans (3 – 10 years) at 13 – 14%, while remaining silent on CBN’s reckless constant crowding out of the real sector in the credit market, when the apex bank borrows hundreds of billions of naira it intends to simply keep idle at rates above 12% (for short term – 360 days loans).

T

he stupendous profits posted by Nigerian banks at a time of contracting industrial activities and the current high unemployment rate is ample testimony of who are the actual beneficiaries of CBN’s curious strategy for maintaining economic and price stability.This obtuse monetary strategy also encourages foreign investors to borrow at less than 3% from abroad and obtain returns of up to 12%, when such foreign loans are deployed into the purchase of ‘risk-free’ treasury bills issued by the CBN! Alarmingly, however, Sanusi also maintained that “the low rate of industrial

SAVE THE NAIRA, SAVE NIGERIANS.

Cover

NSE set to expose high risk practices in capital market

By NKIRUKA NNOROM

T

HE Nigerian Stock Exchange, NSE, said it is planning to bring to the fore issues and business practices among the stockbrokers that pose the highest risks to the investing public in order to strengthen the integrity of the market.

The supervision priorities, which would address the several risk areas, as well as supervision priorities that apply to all operators in the market, would be published by the Broker Dealer Regulation Department, BDR, of the NSE. In a notice to dealing C M Y K

member firm, the NSE observed that the supervision priorities would enable firms build risk management programs to mitigate these risks to support the Exchange’s regulatory objective to protect investors, and to maintain a fair, orderly and efficient market.

The Exchange identified the areas of its supervision priorities to include fraud detection and prevention, unauthorized sales, market manipulation, insides trading, commingling of clients assets and segregation of accounts, corporate governance and enterprise risk management, conflicts of interest, technology and sales practices/frauds.

Others are trading, capital, Anti-

Money Laundering and Combating Financing Terrorism (AM/CFT), uniform financial year end, International Financial Reporting Standards, IFRS, annual recertification of approved persons, criminal investigation and escalation, manipulation of financial statements and inter-member transfers from inactive firms.

According to the NSE, “These priorities are set by the management of The Exchange to improve compliance, prevent fraud, inform policy, monitor firm-wide and systemic risk and ultimately to restore investors’ confidence.”

The notice further stated that the supervision priorities and focus areas for 2013 were selected by the Exchange based on

the Exchange; industry and media publications; comments and tips received directly from investors and market operators, as well as interactions with market operators and other stakeholders.

assessment of a variety of information, including, information gathered through inspection conducted by the BDR department; information reported in regulatory filings with

OUR TEAM Omoh Gabriel Babajide Komolafe Clara Nwachukwu Peter Egwuatu Yinka Kolawole Favour Nnabugwu Godwin Oritse Godfrey Bivbere Michael Eboh Franklin Alli Ebele Orakpo Ifeyinwa Obi

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