financial vanguard july 23th edition by Vanguard Media Limited

JULY 23 , 2012

N275bn performing loans sale: 5 banks

allege CBN, AMCON inducement *It's not justifiable — Stakeholders BY PETER EGWUATU, MICHAEL EBOH & NKIRUKA NNOROM

here are indications that Central Bank of Nigeria (CBN) may have compelled five banks to sell their performing loans worth N275 billion to Asset Management Corporation of Nigeria (AMCON), which statutorily is only meant to buy non-performing loans from banks. Vanguard gathered that the five banks that were affected by the new move of the CBN to sell their performing loans against their corporate plans include First Bank Nigeria Plc, Diamond Bank Plc, Access Bank Plc, Guaranty Trust Bank Plc, and First City Monument

Bank (FCMB). Specifically, it was gathered that First Bank sold N100 billion debt owed by Seawolf Industries; Diamond Bank sold N25 billion debt owed by Geometric Power, while consortium of Access Bank, Guaranty Trust Bank and FCMB sold N150 billion debt owed by Zenon Petroleum to the banks. The sale of some performing loans at a loss to Asset Management Corporation of Nigeria (AMCON) by these banks partly explained the huge loan loss provisioning posted by banks for the operating year ended December 31, 2011. The hint that the CBN compelled banks against their corporate plans to sell

performing loans to AMCON emerged at the 44th Annual General Meeting (AGM) of First Bank Plc recently, where the Group Managing Director/Chief Executive Officer, Mr. Bisi Onasanya, explained to shareholders how the apex bank compelled the bank to sell N100 billion performing loans to AMCON at a 10 per cent loss. “Our headline loan growth rate of just 9.2 per cent does not take into account active switching of a substantial portion of intra-group and money market lines into corporate loans and the sale of over N100 billion of eligible performing loans to the Asset Management Corporation of Nigeria (AMCON), including 100

per cent of our exposure to Seawolf Oilfield Services (an action driven at reducing portfolio concentration and addressing single obligor concerns). Consequently, we recorded normalised loan growth of around 40.6 per cent year on year”, he said while reviewing the operations of the bank in the operating year ended December 31, 2011.” When pressed by a shareholder on the Seawolf Oil Services transaction, he explained that the company was doing well and that the loan was performing but the CBN insisted that the loan should be sold to AMCOM due to its size because of the possible impact on the bank and the industry if the loans become non-performing. “So they forced us to sell the loan to AMCON and we took a haircut (loss) of 10 per cent. The loan was sold without recourse to First Bank,” he stated. Stakeholders’ Position Continues on page 18

188.55

-0.40

2,233.00

+3.00

23.88

+0.63

106.31 91.21

From left: Lagos State Commissioner For Commerce and Industry, Mrs. Olusola Oworu; Minister of Trade and Investment, Mr. Olusegun Aganga; Director-General, Small and Medium Enterprises Development Agency of Nigeria, Mr. Muhammad Umos; and Statistician-General of the Federation and Chief Executive Officer, National Bureau of Statistics, Dr. Yemi Kale, during a two-day retreat of the Strategic Micro, Small and Medium Enterprises Policy/Programmes Technical and Implementation Committee in Lagos on Thursday.

CURRENCY BUYING

CENTRAL

CFA 0.2684 KRONER 25.3798 EURO 188.8795 POUNDS 242.7123 RIYAL 41.2943 SDR 233.1878 FRANC 157.2125 DOLLAR 154.87 WAUA 231.7188 YEN 1.9706 RENMINBI 24.2962

0.2784 25.4618 189.4893 243.4959 41.4276 233.9407 157.7201 155.37 232.4669 1.977 24.3751

-1.49 -1.45

SELLING 0.2884 25.5437 190.0991 244.2795 41.5609 234.6935 158.2276 155.87 233.215 1.9833 24.454

CBN Exchange rate as at 20/07/2012 C M Y K

18 — Vanguard, MONDAY, JULY 23, 2012

Cover Story

Youth restiveness and unemployment in Nigeria: The way out

N275bn performing loans sale: 5 banks allege CBN, AMCON inducement Continued from page 17 Stakeholders that spoke to Vanguard on the issue were unanimous in their submission that it was outside AMCON’s core mandate to have taken over performing loans from those banks. Chief Sola Abodunrin, Chairman, Ibadan zone of Shareholders' Association said that AMCON overstepped its bounds when it decided to leave its core mandate to take up performing loans from the banks. “AMCON was set up with the objective of purchasing the non-performing loans of banks so as to stabilise the banks. That was what was done to the eight ailing banks and that brought stability to the ones that survived CBN and NDIC nationalisation. However, if AMCON is now buying up performing loans, it means it is going outside its mandate and should be stopped,” he stated. Also lending his voice, Mr. Johnson Chukwu, Managing Director/CEO, Cowry Assets Management Limited, noted that there was no justification for AMCON to take over performing loans, saying that it was completely outside the Corporation’s mandate. “How would AMCON value the performing loans and what would be the motivation or incentive for the banks to sell such loans? I think it will amount to converting AMCON into a conventional bank or “a factor” if they start taking over performing loans,” he explained. “I don’t think that it is part of AMCON’s mandate to purchase performing loans. In the first place, AMCON is meant to be a bad bank, to assume the non-performing loans of banks. This is to relieve them of the burden of C M Y K

toxic assets, restore their liquidity as well as re-flate their balance sheet. There is therefore no justification for AMCON to take over performing loans,” Chukwu argued. On his own part, Mr. David Adonri, the Managing Director/CEO Lambert Trust and Investment Limited observed that although the law setting up AMCON mandates it to purchase a certain percentage of nonperforming loans from banks, nothing precludes the Corporation from factoring any performing loan by mutual consent with the banks. Already, the House of Representative’s Ad-Hoc Committee that probed the near collapse of the capital market has asked AMCON to reverse the transactions involving the Corporation, Seawolf and Geometric, saying that there was violation of extant regulations and laws in carrying out the transactions. As part of their observation, the House said: “Even performing loans are also being acquired rather than toxic assets as required by law particularly in transactions pertaining to Seawolfs, Geometric and the method of acquisition of performing and nonperforming loans of Unity Bank Plc.” They also observed that most of AMCON’s transactions are fraught with inconsistency and manipulation of the process and there are no uniform standards being followed. AMCON’s Explanation While explaining the rationale for buying performing loans, Managing Director of AMCON, Mustafa Chike-Obi, told Vanguard that the action was taken to stave off further risk to the banking system. He explained that under the

CBN’s guideline, the apex bank can designate loans to be systemically impotent and ask AMCON to buy it. He further told Vanguard that none of those debtors was happy to go from the banks to AMCON which is another thing that people say that is so ridiculous. Nobody is better off with AMCON than they were with the banks. When we did it, every one of those debtors came and said, ‘why did you do it’ and we said ‘it is none of your business; it is for the financial system stability.’ “After we bought the nonperforming loans, we went and looked at every large loan in every bank and we bought their performing loans at a discount. The banks didn’t like it because they look like a loss. They didn’t like it but we are not interested in the banks; we are interested in the financial system. They took a big loss. If you go back and look at the Year-on-Year losses the banks have in their books, it is because of some of those performing loans they had in their books and we took them at a discount,” Chike-Obi affirmed. According to him: “The Asset Management Corporation of Nigeria (AMCON) acquired the loans of Zenon Petroleum, Seawolf Industries and Geometric Power Industries. The three firms owe over N275 billion to various banks. Chike-Obi said that though the loans were performing, the Corporation decided to acquire the loans to take it off the books of the banks. He said, “Zenon is owing N150 billion, Seawolf is owing N100 billion and Geometric Power N25 billion. These are good businesses, but the loans are too large and may pose systemic risk. These are not loans that are problematic. We just think they could be and we just want to guard against that.”

land so by virtue of that, they should also be partakers of its benefits. This strife led to a rise in kidnapping and vandalization of oil pipelines as well as other vices that were being perpetrated. After someperiod of time, the Nigerian government intervened and the Amnesty programme was created to help deliver some of the promises which government had made to the youths in those areas. The baton was soon handed over to Eastern Nigeria. Increase in the rate of armed robbery attacks, kidnappings as well as unbridled thuggery became the order of the day. Today, the Northern part of Nigeria has literally erupted with unrivalled violence. Bomb

*From left: Area Director, British American Tobacco West Africa, Beverley Spencer Obatoyinbo, keynote speaker and Chairman, Access Bank, Gbenga Oyebode at the 2012 annual Women in Management and Business (WIMBIZ) CEO/Policymaker Interactive series held in Lagos.

HE words ‘youth’ and ‘restiveness’ have become so commonly used together in the last couple of years that it seems to have taken on a life of its own. In the last decade and more, there has been a proliferation of cases all over the country and indeed the world, of youth agitations which have tons of people dead and valuable infrastructure as well as personal properties lost and destroyed. A sustained protestation embarked upon to enforce a desired outcome from a constituted authority by an organised body of youths, fits the label of youth restiveness. It is also a combination of any action or conduct that constitutes unwholesome, socially unacceptable activities engaged in by the youths in any community. It is a phenomenon which in practice has led to a near breakdown of law and order, low productivity due to disruption of production activities, increasing crime rate, intraethnic hostilities, and harassment of prospective developers and other criminal tendencies. This scourge has been around for a long time and it looks as though it is defying solutions. Maybe the question that needs to be asked is what is truly responsible for this expression of dissatisfaction by the youth? Have their complaints over the years not been heard or attended to? Is there more to the killings and destruction than just drawing attention to the needs they want met? Are the youths trying to draw society’s attention to themselves more than the issues they appear to be fronting? These and more are the questions we would try to tackle head on today. In Nigeria for instance, the Niger-Delta region which is unarguably the bedrock of the oil industry in Nigeria permeated the news for a lengthy period of time as the youths of that region tried various means of getting government and oil companies to pay attention to their dire conditions of living and alleviate their sufferings since according to them, the resources which is building the nation is flowing from their

The Ministry of Youth Development said recently that there are 68 million unemployed youths in Nigeria

blasts, kidnaps and killings of Nigerians and others have become the prevailing trend. Despite beefing up of security in these areas, the problems still loom. This situation begs the questions, ‘’what is the government of the day willing to do to put a permanent end to these problems? STATISTICS The National Population Commission (NPC) has said the country’s population has risen from the 140,431,790 it was five years ago when the last national headcount was taken, to 167,912,561 as at October 2011.This represents an annual population growth rate of 5.6 million people. The Ministry of Youth Development, said recently that there are 68 million unemployed youths in Nigeria.

Vanguard, MONDAY, JULY 23, 2012 — 19

Some feedback on this column

ODAY, we publish some of the feedback received on this column. We will publish others as opportunity arises. We welcome reactions to this column. Keep your reaction short and please be civil in your language. Elder Otugo B. O Warri 08067557717 Please I read your Broken Links in Financial Vanguard of July 9, 2012 at page 19 with the caption: This government is walking on a tight financial rope. The write up is encouraging. The question is, how many Nigerians care as you have taken the pains to analyse the financial status of the country? These miscreants and myopic leaders in the NLC and TUC are after the total collapse of the economy and Nigeria as a nation orchestrated by the then NLC President, Comrade Governor Adams Oshiomhole of Edo State. He fought Petroleum subsidy removal by mobilising organised labour against the Federal Government. He is now

the executive governor of Edo State without an economic je ne sai quoi. Today, the trouble lingers. Where is Nigeria now; a catastrophic moment, purposeless, corrupt; and bad leadership? Well, people like you and I shall continue with the gospel of economic revival and survival. Ogundare aged 74 08033231735

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you can expect anything to work in Nigeria now. Honourable J. U. Obakpolo 08055536773 Dear Omoh Gabriel, your article on page 19 of Financial Vanguard of 21 May, 2012 refers. I appreciate your contribution especially the opening paragraph. This nation Nigeria urgently needs transformation in various sectors including aviation.

To accept deregulation from this government is going to be suicidal to the poor

Dear Gabriel, to accept deregulation from this government is going to be suicidal to the poor. Top government functionaries know where the billions are. Let them go and recover them. It cannot be worse than this for a poor man. Presidential audit panel for already wasted lives? If we have useless leaders and armed robbers as leaders, there is no way

’

Therefore, every effort of any individual in every sector to improve on the economy should be encouraged and supported with more ideas/facts and not to be discouraged, suspected nor opposed so as to hurt such initiator. Nigeria will be better for it.

08035990022 Mr. Omoh, it is a pity in the Nigerian way of doing things that the Aviation

Minister was not given the correct picture of what is obtainable in the first and business class fare disparity of British Airways and Virgin Atlatic in Ghana and Nigeria. May be she now has the true picture that these foreign airlines give bribes in complementary tickets to some big guns in government to fly free of charge. She now knows she is fighting a lost battle. 08133738287 Your article, Bill to castrate the CBN in whose interest? in the Financial Vanguard of May 14, 2012 refers. It is a beautiful work, but your headline and opening paragraph in my opinion, tend to portray you as taking sides with one of the parties involved which should not be. The Central Bank of Nigeria has failed in several areas of its core mandate. Legislators are meant to amend laws seen not to be promoting the economy of the nation. Therefore, such steps on the part of the legislators should not be seen as revenge except if such author is trying to intimi-

date the legislators. 08098160022 Dear Sir, it is a pity that members of the National Assembly always decide to dance naked and bring opprobrium to themselves. While the Senate will want to curtail the NLC because they championed the cause of the masses during the petrol price hike, members of the House of Representatives want to cut the CBN Governor to size because he let Nigerians know the insatiable greed of these members of the National Assembly. What Nigerians demand is worthy representation. Hassan Balogun. Mr. Omoh, I just read your beautiful piece titled: Hear this, bickering governors in the Financial Vanguard of Monday, April 16. 2012. But I think it should have been more appropriately titled: Hear this Mr. President and Bickering Governors. Obviously, the President and most governors do not have any plan B in case the ocean (sorry oil), runs dry someday. God save Nigeria.

BUSINESS & ECONOMY

Nigeria, Canada: Trade volume now N450 billion- High Commissioner By HENRY UMORU

HE Canadian High Commissioner to Nigeria, Chris Cooter has disclosed that bilateral trade volume between Nigeria and Canada has risen well above $3 billion (N480 billion), just as Foreign Direct Investment, FDI from Canada to Nigeria has also tripled giving the same figure. Speaking during a courtesy visit to the National Chairman of the Peoples Democratic Party, PDP, Alhaji Bamanga Tukur, the Canadian High Commissioner who noted that the relationship between the two countries was very good, stressed that plans were on by his country for the nation’s health sector especially in the area of maternal and child health where over $40million has been earmarked for assistance, up from about $10

million. Meanwhile, Alhaji Bamanga Tukur applauded the relationship between Nigeria and Canada, even as he expressed optimism that the relationship will get stronger with the es-

tablishment of a bilateral commission between the two countries. He, however, appealed to the Ambassador to work towards reducing the difficulties faced by Nigerians

in obtaining Canadian visa to enhance free movement of persons between the two countries and for business and investment to flourish. Ambassador Cooter who also told the PDP National Chair-

*From left: Mr. Sam Akerele, Secretary-General, Aviation Round Table; Captain Dele Ore, President and Mr. Chuks Iwelunmo, Chairman, League of Aviation and Airports Correspondents (LAAC) during a press conference by the Aviation Round Table held in Lagos on Wednesday. Photo by Lamidi Bamidele.

man that Canada was interested in investing in the area of mining in Nigeria, stressed that as a country which engages in that sector, it has over 350 mining companies. According to him, Canada plans to build a huge vocational training centre in Nigeria as that will help train the youth in line with the vision of President Goodluck Jonathan to provide more employment opportunities for the people. The Envoy, however, praised the positive role of Nigeria in world affairs especially what it has done in the resolution of the crisis in Cote D’Ivoire and Libya as well as its present effort in Mali and the nation’s stand on human rights and democracy. The High Commissioner who disclosed that Nigeria will soon witness the visit of more high profile Canadians in the coming months and years, however, called for more cooperation between the two countries, adding: “I hope you will remember Canada even though a lot of countries are competing for your attention.” C M Y K

20 — Vanguard, MONDAY, JULY 23, 2012

Business & Economy BRIEFS FG, Taraba partner IFDC to launch roots, tuber crops fertiliser blend HE International Centre for Soil Fertility and Agricultural Development (IFDC), in partnership with the Federal and Taraba State governments has launched the first fertiliser blend for roots and tuber crops. A statement by the IFDC made available to newsmen in Abuja, said that the new input was launched in Wukari Local Government Area of Taraba State under the cassava input initiative programme. The statement, signed by the IFDC Country Representative, Mr Scott Wallace, said that the blend included a higher ratio of potassium, which is critical for water retention. It said that the new input would go a long way in assisting cassava and yam farmers to increase their yields and maintain adequate soil fertility for future years.Wallace said that the new input would allow the state’s cassava farmers to take advantage of the Dutch Agricultural Development & Trading Company (DADTCO) guaranteed market. DADTCO is a Netherlands-based company with branches in Nigeria and whose primary goal is to initiate a rural development revolution by creating guaranteed markets for crops grown by small holder farmers in the West-African region.

UNCTAD rates Nigeria 1st on FDI in Africa

HE UN Conference on Trade and Development (UNCTAD) has rated Nigeria rd as first in Africa and 23 globally in the flow of Foreign Direct Investment for 2011. The Minister of Trade and Investments, Dr Olusegun Aganga, made this known in Abuja while briefing State House correspondents after the Federal Executive Council (FEC) meeting. The meeting, presided over by President Goodluck Jonathan at the Presidential Villa, was attended by Vice-President Namadi Sambo, ministers and other aides. Aganga said that the UNCTAD Report 2012 stated that Nigeria ranked first among five host economies for FDI in Africa at $8.91 billion in 2011 compared to $6.09 billion in 2010. The report said that Nigeria was followed by South Africa with $6.9 billion and Ghana with $3.2 billion.

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Doing Business: FG inaugurates technical committees to tackle investment bottlenecks HE Federal Government has inaugurated two technical committees for the Doing Business and Competitive Committee and InvestorCare Committee to tackle the problems militating against the ease of doing business in Nigeria; inflow of Foreign Direct Investment; and ultimately improve the country’s ranking in the Global Competiveness Index. The Minister of Trade and Investment, Mr. Olusegun Aganga, who performed the

inauguration ceremony in Abuja said that the exercise was a follow-up to the earlier inauguration of the Doing Business and Competitiveness Committee and AfterCare Committee(formerly known as Committee on Problems of Investors), by the Secretary to the Government of the Federation few months ago. The two committees have the Minister of Trade and Investment as the chairman. But the membership of the com-

mittees were drawn from ministries, departments and agencies of the Federal Government including Finance; Power; Mining, Justice, the Central Bank of Nigeria, Nigerian National Petroleum Corporation, Nigeria Immigration Service, Federal Inland Revenue Service and Nigeria Customs Service, among others. However, Aganga explained that the newly inaugurated technical committees were expected to address policy issues inhibiting

Nigeria’s competitive business environment; instill fair and transparent business operational procedures; enhance the image of the economy and build investors’ confidence. The committees are expected to meet twice a month to review their performance. He said that members of the two technical committees were selected by the Heads of their respective MDAs which constitute the Doing Business and Competitiveness Committee and Investor-Care Committees respectively. ganga said: “We have assembled very bright and seasoned officers from various ministries, departments and agencies who were selected by the Chief Executives/Heads to represent their MDAs in the Technical Committees of the Doing Business and Competitiveness, and After-Care Committees.The respective Technical Committees are expected to address policy issues inhibiting our competitive business environment; instill fair and transparent business operational procedures and enhance the image of the economy and build investors’ confidence. The Doing Business and Competitiveness, and After-Care Committees were already inaugurated by the Secretary to Government of the Federation few months ago after we got the approval from Mr. President. So, we thought it necessary to have the Technical Committee of the two committees.” Aganga stated that the inauguration of the committees came in the wake of various social and economic reforms being embarked upon by the Federal Government to transform the nation’s economy. He, therefore, charged members of the committees to work assiduously to ensure that the country significantly improves its investment climate and Doing Business Ranking as soon as possible. He said: “Suffice it to say that the downturn in the global flows of Foreign Direct Investment in recent years and the associated competition among various locations for FDI, and countries stepping up their efforts to attract FDI in-flows, Nigeria cannot afford to be left behind in this race.

From left Mr. Benson Evbuomwan, Director, Marketing, Honeywell Flour Mills Plc; Dr. Nino Ozara, Production Director; Mr. Babatunde odunayo, Executive Vice-Chairman/CEO and Mr. Rotimi Fadipe, Director, Logistics and Supply during the Honeywell Flour Mills Plc Baking School Certificate Award Ceremony held in Lagos on Friday. Photo by Lamidi Bamidele.

CBN, ILO to raise N1bn for women entrepreneurs By VICTOR AHIUMA-YOUNG HE Central Bank of Nigeria, CBN in collaboration with the International Labour Organisation, ILO, is preparing a “Iinancial Initiative Inclusion” that will make available about N1billion with a single digit interest rate to women entrepreneurs in Nigeria. Director-General of Nigeria Employers Consultative Association, NECA, Mr. Segun Osinowo who announced this said NECA’s Network of Entrepreneurial Women, NNEW, would be one of the beneficiaries. NECA NNEW was made a member of the task force at the meeting with the CBN Governor, ILO director and other

stakeholders including D-G, NECA The Director-General spoke at a meeting of NECA’s women group that brainstormed on networking as strategy to business growth. He challenged women to be more committed and ensure they go through the ILO capacity-building trainings to enhance the growth and stability of their businesses because the “only beneficiaries of ILO financial inclusion will be women who belong to an association like NECA’s Network of Entrepreneurial Women.” The President of the women group, Mrs Lola Okanlawon advised the women to leverage on the NECA platform, do face-to-face networking and social networking.

According to her, SMEs that could not afford high advert cost should not limit the growth of their businesses but should network at any given opportunity, saying ILO is spearheading an initiative on the financial inclusion of women entrepreneurs in Nigeria. This initiative aims at enhancing the capacity of financial institutions to address the specific and peculiar needs of women entrepreneurs. ”It is hoped that this initiative will assist in increasing the awareness of policy makers and the private sector, including commercial banks to understand that women entrepreneurs are not only a potentially lucrative untapped market but will also contribute to the economic growth and development of Nigeria.”

Vanguard, MONDAY, JULY 23, 2012 — 21

Business & Economy

CBN seeks more funds, autonomy for DFIs T

HE Central Bank of Nigeria (CBN) on Wednesday advocated that Development Finance Institutions (DFIs) in Nigeria be granted operational autonomy and repositioned to perform the role envisioned for them. Mallam Lamido Sanusi, CBN Governor made the call in Abuja in a keynote address rd presented at the 3 PublicPrivate Partnership (PPP) forum for private and public sectors stakeholders. The governor also urged that the funds

recovered from petroleum subsidy removal be diverted to strengthen governmentowned banks to enable them partake in infrastructure financing. The forum, which was organised by the Infrastructure Concession Regulatory Commission (ICRC) has the theme: Development Finance Institutions and Long-term capital for Infrastructural Transformation and National Economic Development. Sanusi in his paper entitled:

What Nigeria can learn from Brazilian Development Bank (BNDES) and Indian Infrastructure finance company, said that Nigeria should consider sustainable ways of supporting DFIs that could support the financing infrastructure. He noted that Brazil and India had demonstrated that an approach based on establishing an infrastructure bank could help unleash the required finance. While giving an insight into what Nigeria should consider

as a sustainable way of supporting DFIs, Sanusi said: “Nigeria could pursue such a model, whereby a new governmentowned bank could raise taxfree bonds to fund projects. “Alternatively, the mandate of an existing governmentowned bank such as Bank of Industry could be expanded to enable it to partake in infrastructure financing. The bank could be financed from funds recovered from petroleum subsidy removal, and equipped with professional and quali-

fied management recruited globally.” The governor said that the DFIs in Nigeria faced some challenges which include poor corporate governance, low capitalisation, inadequate skilled manpower and poor business models. “DFI in developing countries exist traditionally to address market failures and to complement government resources and market financing. The dual roles of these institutions involve financing development projects and acting as facilitator of finance in the broader industrialisation and economic development strategies of countries."

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22 — Vanguard, MONDAY, JULY 23, 2012

Banking & Finance ers are sold to investors for full private sector financing. It is worth emphasizsing that India plans to invest $1 trillion over the next five years, with 50 per cent expected to come from the private sector!

BRIEFS FRC certificate now mandatory for govt jobs

ROFESSIONALS who intend to transact business with Federal Government agencies must produce evidence of registration with the Financial Reporting Council of Nigeria (FRC). This is to deepen corporate governance in the public and private sectors accounting and facilitate registration of professionals. Chief Executive of the FRC, Mr. Jim Obazee, disclosed this during a visit by a team from the Fiscal Responsibility Commission to the corporate head office of the FRC in Lagos. Also, he added, the FRC has established regional offices in Abuja, Enugu and Port Harcourt to fasttrack the process. According to Obazee, this is in compliance with the provisions of the FRC Act 2011 which charged the FRC with the responsibility of registering professionals who render services for remuneration to public interest entities. He also disclosed that the FRC IFRS Academy which will be taking off in the Federal Capital Territory will help bridge knowledge gaps that exist between the practice of financial reporting in the country and the demands of International Financial Reporting Standards (IFRS), saying universities and other higher institutions' lecturers coming for the course would have their bills picked by the FRC.

CIBN inaugurates committees to drive activities HE Chartered Institute of Bankers of Nigeria has inaugurated various committees made up of high profile individuals and experts from within and outside the banking profession to drive the activities of the institute The committees which were approved by the Governing Council will have the responsibility of driving the affairs of the institute for the next two years by meeting on regular basis to articulate new initiatives, ideas and strategies aimed at transforming the institute and its activities while making recommendations that will enable the institute remain committed and focused on her vision of becoming “a worldclass institution in banking and finance education, ethics and professionalism.”

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*From left: Vice-President and Secretary-General, African Development Bank, Ms Cecilia Akintomide; Executive Director, New Faces New Voices, Ms Nomsa Daniels; and Founder/ Executive Chairman, Mandela Institute for Development Studies, Dr Nkosana Moyo at the World Press Conference organised on the second African Women’s Economic Summit held in Lagos by New Faces New Voices

Expert calls for specialised agency for infrastructure development By BABAJIDE KOMOLAFE & AHMED OLAWALE HE Federal Government should establish a specialized company that would identify and develop infrastructure projects to enhance planning and financing of such projects, says Mr. Taiwo Adeniji of Africa Finance Corporation (AFC). He made this call in a presentation on Developing an Appropriate Framework for Energy Infrastructure Financing in Nigeria, delivered at the 2012 Lagos Bankers' Night organised by the Lagos branch of the Chartered Institute of Bankers of Nigeria (CIBN). Emphasising the importance of long-term planning to infrastructure development, he said there is need to strengthen the infrastructure planning function in the country. He said: “It is all about planning. It takes time to develop infrastructure, and private investors need data for longterm decision-making. “Nigeria needs a clear integrated least-cost infrastructure development plan (15-20 years, with 5-year rolling plans), with an attendant integrated financing policy. Plan to be project-based, and prioritized based on sector needs, inter-sector linkages, scale/expected impact. Specif-

ic projects to be allocated for private sector participation should be identified. If possible, government should institutionalize a mechanism to limit/eliminate political interference and ensure timely completion of projects. “An example is the Indian Project Development Company (IPDC). It was established as a fully government-owned entity charged with develop-

ing projects across the different infrastructure sectors, almost to the point of bankability; with other specialized institutions such as Infrastructure Development Company of India (IDFC) and Power Finance Corporation providing requisite financing (debt, mezz and equity) at market terms. Projects slated for PPP implementation are then procured accordingly, while oth-

similar model could also be adopted for Nigeria in the name of Nigerian Infrastructure Projects Development Company. The new company will be backed by specialised financing institutions (Africa Finance Corporation, Nigeria Infrastructure Bank, National Infrastructure Fund, etc). This would also ensure the utilisation of a uniform approach to appraise projects and test their readiness for financing and implementation.” Adeniji, who is the Director, Financial Institutions and Advisory Services for the AFC, also called for regulatory measures from the CBN and Securities and Exchange Commission (SEC) to enhance ability of banks to finance infrastructure projects. He said: “Given the long-term nature of infrastructure investments, it is critical that the financial system be able to provide appropriate types of finance. Infrastructure projects require long-term capital at relatively low and stable rates. Nigerian commercial banks are limited in their ability to provide long-term loans for infrastructure projects, largely due to the short-term nature of their liabilities. “The CBN should therefore institute deliberate measures to enhance maturity transformation in the banking industry, to encourage commercial banks to lend to infrastructure projects.

'Why CBN budget should not undergo legislative process' By BABAJIDE KOMOLAFE HE dynamic nature of monetary policy especially sale of government securities to mop up excess liquidity makes it difficult to subject the budget of the Central Bank to legislative process for approval, says Dr. Okwu Joseph Nnanna, former Director-General at the West Africa Monetary Institute, Accra. Nnanna made this point in a paper titled: The Imperative of the Central Bank Independence: An analytical Framework- A case Study of the CBN, presented at the 17th annual seminar for financial journalists in Akure. He said that 80 per cent of the budget of the CBN goes

into the sale of government securities through open market opetarions (OMO). He said the amount spent on OMO, to pay for interest rate on government securities, is determined by the fiscal operations of the Federal Government. He said if the spending of the fFederal Government causes excess liquidity or it wants to borrow to fund its budget, the apex bank would have to mop up the excess liquidty by selling treasury bills or borrow for the government by selling bills. He said the challenge, however, is that the apex bank cannot determine in advance how many times it would sell treasury bills rather, this is determined as required by the spending acitivities of the Federal Government. He said the implication is that

if the CBN submits a budget to the National Assembly and the budget is approved, it will have to go back to the lawmakers everytime the need arises for it to spend money to conduct OMO beyond what is contained in the approved budget. This, he said, will lead to delay in conduct of monetary policy with severe implication for the economy. Corroborating Nnanna, Prof. Sam Olofin, an independent director on the Board of the CBN said: “The apex bank cannot possibly know its budget sum ex-ante because it could not possibly know how many banks it might need to bail out and how much mopping up it would need to do after each ‘inappropriate spending’ by the government.

Vanguard, MONDAY, JULY 23, 2012 — 23

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24 — Vanguard, MONDAY, JULY 23, 2012

Corporate Finance BRIEFS Guinness Nigeria hosts ICCN’S AGM

N fulfillment of its support for global economic growth, Guinness Nigeria, one of Nigeria’s foremost breweries, has sponsored the th 13 Annual General Meeting of the International Chamber of Commerce (ICC) Nigeria, which included the introduction ceremony of its new members recently, at the Metropolitan Club, Victoria Island in Lagos. The International Chamber of Commerce (ICC) is a representative body that speaks with authority on behalf of enterprises from all sectors in every part of the world. The fundamental mission of the ICC is to promote trade and investment across frontiers and help business corporations meet the challenges and opportunities of globalisation. In Nigeria, the ICC is made up of business leaders and blue-chip companies who come together to set global standards and move the nation’s economy forward.

Flour Mills to invest N100bn in Nigeria in five years By MICHAEL EBOH LOUR Mills Nigeria Plc said it will invest N100 billion in Nigeria within the next five years. The company, in a statement announcing its new organisational structure and investments, said N30 billion would be invested in the agroallied segment within the next five years to boost its manufacturing capacity and operations.

The company stated that it has reviewed its organisational structure and made a series of investments aimed at bolstering its strong market position in the Food and Agro-Allied sectors. Mr. George Coumantaros, Chairman, Flour Mills Group, said the company is committed to delivering on its promise to provide its customers and consumers across all of Nigeria and throughout West Africa with the highest quality food products at affordable

prices. “To this end, we have invested N70 billion over the past 10 years in food manufacturing assets and have plans to invest another N100 billion in the next five years.” Also speaking, Mr. Emmanuel Ukpabi, Group Managing Director, Flour Mills, said as part of the company’s ongoing strategic review, it now focuses on establishing profitable ventures that are crucial for the Nigerian economy and society.

TEF launches Legacy prize to reward academic excellence HE Tony Elumelu Foundation (TEF), a not-forprofit institution committed to the economic transformation of Africa by enhancing the competitiveness and growth of the African private sector, has announced that it will offer annual prizes in perpetuity to top performing graduating students at several universities across Nigeria. The annual prizes will be for top undergraduate and graduate (where relevant) students at the various universities in Economics, Business Administration and Medicine. An annual professional prize will also be provided through the Chartered Institute of Bankers of Nigeria to encourage excellence in the banking profession. The beneficiary institutions are Ambrose Alli University, Edo State; Delta State University; University of Jos, Plateau State; University of Lagos; University of Benin, Edo State; Usman Danfodio University, Sokoto State; University of Port Harcourt, Rivers State; University of Maiduguri, Borno State; University of Nigeria, Nsukka, Enugu State; and Benue State University.

C M Y K

He added that the company has appointed a new Managing Director for its Food Division, Mr. Ed Jackson, who will oversee the food manufacturing division and be responsible for flour and rice milling, sugar refining, pasta products and other processed foods; all wholesale and retail sales, distribution and logistics operations including the operations of Nigerian Bag Manufacturing Company Plc, BAGCO, operations. According to him, Ed brings to the job, 30 years experience in developing and implementing strategies in the food industry. He further stated that the company has deployed some of its most talented executives to drive its various investments, due to its realization that building its upstream value chains that link Nigerian farmers with industrial process is becoming more important to Nigeria’s future prosperity.

*From left: Ojeikere Aikhoje, organisers, Sports Brand Nigeria Award; Funmi Oshineye, Brand Manager, Nestle Milo, Nestle Nigeria Plc, receiving the Best Sponsorship of Schools Sport Award from Mrs. Braimah. MD/CEO, Neo Media & Marketing and Ehi Braimah at the award ceremony in Lagos.

Conoil records N4.4bn profit, declares N1.7bn dividend By PETER EGWUATU

HE Board of Conoil Plc has announced a profit of N4.4 billion for the financial year ended December 31, 2011, just as it recommended payment of N1.73 billion to shareholders as cash dividends for the period under review. The dividend recommendation was contained in the audited report and accounts of Conoil Plc for the year ended December 31, 2011 released by the Nigerian Stock Exchange (NSE). The gross dividend recommendation implies increase in dividend per share from N2 for 2010 business year to N2.50 for the 2011 business year. The 25 per cent increase in cash payouts was reflective of the impressive performance of the company during the year as

net earnings per share rose from N4.02 in 2010 to N4.25 in 2011. With these, Conoil has emerged as the best-return stock in the petroleum marketing sector with current dividend yield of about 12 per cent and earnings yield of about 20 per cent. These also placed the stock within the top-bracket of dividend paying stocks on the NSE. The report showed that the company grew sales by 53 per cent from N102.88 billion in 2010 to N157.51 billion in 2011. It further consolidated its profitability with profit before tax rising from N4.02 billion to N4.4 billion. Profit after tax rose from N2.79 billion to N2.95 billion. The report also showed a stronger balance sheet as retained earnings boosted shareholders’ funds to N16.82 billion in 2011 compared with N15.26 billion

in 2010. Total assets rose by 49 per cent to N61.84 billion in 2011 as against N41.49 billion in 2010. Market analysts said the impressive dividend and profit and loss accounts performance were in line with market’s expectations given Conoil’s consistent growth over the years.As earnings per share increased from N2.62 in 2008 to N3.33 and N4.02 in 2009 and 2010 respectively, Conoil had increased cash dividend per share correspondingly from N1 in 2009 to N1.50 and N2 in 2009 and 2010 respectively. In his comments on the results, Chairman, Conoil Plc, Dr. Mike Adenuga (Jnr), said the results were indicative of the commitment of the Board and Management to growing shareholders’ value irrespective of the operating challenges.

e disclosed that the company has appointed Mr. Paul Gbededo, as the new Managing Director of Flour Mills’ Agro-Allied business, adding that he will be responsible for handling all fertilizer, animal feeds, oil crushing, poultry and farming activities, including backward integration schemes at Kaboji, Sunti and other locations, as well as the processing of cassava into flour, sweeteners and starches. According to Ukpabi, Paul’s extensive agro-allied experience and track record in creating value in this important sector makes him the ideal person to drive our efforts in support of the Government’s Agricultural Transformation Agenda.” He said, “we have spent N10 billion over the past 10 years in agro-allied investments and have plans to invest another N30 billion over the next five years. “With 40 per cent of the Nigerian GDP in agriculture and 70 per cent of all Nigerian employment in this sector, it is our top priority to drive. “The future of Nigeria depends on those companies willing and able to invest in this sector and Flour Mills will lead the way.” The company said Mr. Ed Jackson, the new Managing Director, Food Division and Mr. Paul Gbededo, the new Managing Director, Agro-Allied Division, will be reporting to Ukpabi, Group Managing Director of Flour Mills of Nigeria.

Vanguard, MONDAY, JULY 23, 2012 — 25

Corporate Finance

he upward trend witnessed in the Nigerian Stock Exchange, NSE, in the last couple of days continued last week, as the value of listed equities appreciated by N89.73 billion. Specifically, equities value, represented by the market capitalization, rose by 1.24 per cent to close the week at N7.349 trillion, from N7.259 trillion at which it opened. The All-share index, another major performance indicator, appreciated by 1.56 per cent or 345.25 basis points to close the week at 23,095.31 points. Equity trading also appreciated by 11.99 per cent, as a turnover of 1.634 billion shares valued at N11.897 billion was recorded in 22,412 deals, in contrast to penultimate week’s turnover of 1.459 billion shares valued at N9.618 billion in 18,276 deals. The Financial Services sector recorded the highest transaction with 1.217 billion shares valued at N6.881 billion in 12,971 deals. This was followed by the Conglomerates sector with 130.220 million shares valued at N182.074 million traded in 909 deals. The turnover volume recorded in the top sectors was largely driven by activity in the shares of United Bank for Africa Plc in the Banking sub-sector; AIICO Insurance Plc, in the Insurance carriers, brokers and services subsector and Transnational Corporation of Nigeria Plc in the Diversified Industries sub-sector. Trading in the shares of the top three companies

BRIEFS CITIC to pay $310m for CLSA stake

*Ecobank Regional Head, Domestic Bank (North West), Saidu Umar presenting books donated by the bank to schools in Katsina State to the Deputy Governor, Alh. Barrister Abdullahi Garba Faskari and Commissioner for Education, Prof. Aminu Kado Kurfi (middle) as part of the bank’s corporate social responsibility activities.

Equities value appreciates by N90bn BY MICHAEL EBOH, CHINEDU IBEABUCHI & WILLIAM JIMOH accounted for 546.536 million shares, representing 40.78 per cent, 40.57 per cent and 33.45 per cent of the turnover recorded by the sub-sector, sector and total equities for the week, respectively. Guinness Nigeria Plc led 38 other companies on the price gainers’ chart, recording the most share price gain, with N11.40 to close at N239.40 per share from N228 per share at which it opened; Nigerian

Breweries Plc followed with a gain of N5.99 to close at N116 per share and Nestle Nigeria Plc garnered N5 to close at N500 per share. Other share price gainers include: Conoil Plc N4.40, Okomu Oil Palm Plc N3.39,Total Nigeria Plc N3, Lafarge Cement WAPCO Plc N2.50, Glaxo SmithKline Consumer Plc N2.05, Flour Mills Nigeria Plc N2.00 and UAC Nigeria Plc N1.63 among others. On the contrary, Mobil Oil Nigeria Plc led 29 other companies, recording the

most share price, with N6 per share to close at N125 per share, from N131 per share at which it started the week; Seven-up Bottling Company Plc followed with a loss of N2 per share to close at N40.12 per share and Nigerian Enamelware Plc shed N1.80 to close at N34.39 per share. Other share price losers include: Cement Company of Northern Nigeria Plc N1.14, Arbico Plc N1.05, Dangote Cement Plc N1.00, Presco Plc N0.76, Berger Paints Plc N0.42, Union Bank Nigeria Plc N0.39, Learn Africa Plc N0.31 among others.

ITIC Securities has agreed to pay $310.3 million for a near-20 per cent stake in French bank, Credit Agricole’s CLSA brokerage unit, with an option to buy the rest, underscoring the global ambitions of China’s biggest listed brokerage. CITIC has the option to buy the remainder of the brokerage for $910.7 million, which the banks said in a statement they expect it to exercise by June 30, 2013 at the latest. The Chinese brokerage had planned to buy into U.S. investment bank, Bear Stearns during the global financial crisis but later cancelled the deal. Chinese investment banks including CITIC Securities, China International Capital Corp and Haitong Securities Co are stepping up expansion abroad as growth in the domestic market slows, while China’s growing international clout creates opportunities overseas. “The investment in CLSA will enable CITIC to partner its strong franchise in China with CLSA’s established global clientele and bring capital market products and services from China to international clients,” CITIC chairman, Wang Dongming said in a statement.

Morgan Stanley may sell commodity stake to Qatar — CNBC

Oando shareholders seek increase in share capital M

organ Stanley (MS.N)

By PETER EGWUATU

gainst the backdrop of servicing banks' loan, shareholders of Oando Plc have called on the Board of Directors of the company to raise fresh funds by increasing its share capital. The shareholders at the company’s Annual General Meeting (AGM) held at the weekend in Lagos, noted the huge investment embarked upon by the company in its diversified strategy. Speaking at the AGM, Sir Sunny Nwosu, National Coordinator, Independent Shareholders Association of Nigeria (ISAN) said, “Information must get to the stock market at the right time so that the price of the company ’s share can be adequately priced even with the unfortunate challenges we

are facing in the capital market and economy in general. With information about the company more shares will be bought from the market and this will raise the price of our shares.” On the issue of increase in share capital, he said, “ It is necessary for the company to raise fresh funds either by way of rights issue or script issue. If the company wants to float rights issue, there must be attractive pricing, because the existing shareholders who had invested in the past should be able to reap bountifully from such transactions.. In fact, there is great future for Oando and we shareholders should rally around it and be patient because it takes three or more years to reap from huge investment in building subsidiaries.”

Chief Sola Abodunrin, Chairman, Ibadan Zonal Shareholders Association, commended the company’s diversification drive, saying it is good thing for the economy. According to him, “The investment by the company is a good one but it should be able to lead us to somewhere that the shareholders can benefit no matter how small. With Earning Per Share (EPS) of 165 kobo, the company should have been able to part something to the shareholders. Mr. Boniface Okezie, Chairman, Progressive Shareholders Association of Nigeria (PSAN), equally commended the company for the huge investment, saying, “We hope to reap in the nearest future. Furthermore there is need for the company to raise fresh funds because

we cannot continue to work for the banks by paying huge interest to them.” In response, Group Managing Director, Oando Plc, Mr. Wale Tinubu, commended the shareholders for their loyalty and support for the company. According to him, “Despite the challenges faced in 2011, we have positive outlook on 2012, especially with the expected additional production streams anticipated in the year. Furthermore, we are cautiously optimistic towards a resolution to the current impasse with the much anticipated passage of the Petroleum Industry Bill (PIB) by the National Assembly. Following our write-downs in 2011, we anticipate a robust performance in 2012, having dealt with all costs that could negatively impact future performance.”

is in advanced talks over selling a stake in its multibillion-dollar commodities trading division to Qatar ’s sovereign wealth fund, CNBC reported on Friday, citing people familiar with the matter. Talks have recently focused on the Qatar Investment Authority buying a minority stake, according to one of the people, CNBC reported on its website. It said a deal might be imminent, but cautioned the exact terms could not be determined and that discussions could still fall apart. A Morgan Stanley spokeswoman declined to comment. Morgan Stanley, whose commodity unit was one of the original “Wall Street refiners” that pioneered the energy derivatives market two decades ago, was first reported to be considering selling a stake a month ago. Earlier it was believed to be in talks with private equity funds, including Blackstone Group LP (BX.N). C M Y K

C M Y K

1.49

0.84 5.52 1.05 6.43 32.77

27.63 8.26

Livestock/Animal Specialities Livestock Feeds Plc

CONGLOMERATES Diversified Industries A.G. Levents Nigeria Plc SCOA Nigeria Plc Transnational Corporation Chellarams Plc UACN Plc

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

40.12

6.40 4.41 53.00 1.90 4.70 0.50

14.00 495.00

10.55 36.19 3.14 2.88

26.00 31.50

7.70 0.64 0.57 2.47 10.45 1.31 0.50 11.33 3.35 16.85 1.07 0.70 1.15 3.02 0.88 6.75 1.25 4.33 4.65 0.50 0.50 14.40

0.50 0.68 0.50 0.50 0.50 1.50 0.50 0.56 0.50 1.55 0.50 0.76 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.55 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50

0.50 0.50

0.50 2.02 0.50

Beverages-Non-Alcoholic 7-UP Bottling Company Plc

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

Food Products-- Diversified Cadbury Nigeria Plc Nestle Nigeria Plc

Household Durables Beta Glass Co Plc Nigerian Enamelware Plc Vitafoam Nig. Plc Vono Products Plc

Personal/Household Products PZ Cussons Nigeria Plc Unilever Nigeria Plc

FINANCIAL SERVICES Banking Access Bank Plc Afribank Nigeria Plc Bank PHB Plc Diamond Bank Nigeria Plc Ecobank TRANSNATIONAL INCORPORATION Fidelity Bank Plc FinBank Plc First Bank of Nig. Plc First City Monument Bank Plc Guaranty Trust Bank Plc NPF Micro-Finance Bank Plc Intercontinental Bank Plc Oceanic Bank International Plc Skye Bank Plc Spring Bank Plc Stanbic IBTC 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 AIICO Insurance Plc Continental Reinsurance Plc African Alliance Insurance Cornerstone Insurance Company Consolidated Hallmark Insurance Custodian and Allied Insurance Plc Equity Assurance Plc Goldlink Insurance Plc Great (Nig) Insurance Plc Guaranty Trust Assurance Plc Guinea Insurance Plc Intercontinental Wapic Insurance Plc International Energy Insurance Plc Investment and Allied Assurance LASACO Assurance Plc Law Union & Rock Insurance Plc Linkage Assurance 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 Universal Insurance Plc

Mortgage Carrier, Broker and Sector Aso Savings and Loans Plc Resort Savings & Loans Plc

Other Financial Institutions Crusader (Nigeria) Plc Deap Capital Management & Trust Plc Royal Exchange Assurance

7.77

3.29 228.00 5.98 105.70 0.89

Beverages-Brewers/Distillers Champion Breweries Plc Guinness Nigeria Plc International Breweries Plc Nigerian Brew Plc Premier Breweries Plc

HEALTHCARE Medical Supplies Morison Industries Plc Healthcare Providers

0.50

100.00

Real Estate Investment Trusts Skye Shelter Funds CONSUMER GOODS Automobile/Auto Parts DN Tyres & Rubber Plc

8.82

0.50 28.00 16.15

1st fTier Securities AGRICULTURE Crop Production FTN Cocoa Processors Plc Okomu Oil Palm Plc Presco Plc

Real Estate Development UACN Property Development

0.50

Oil and Gas and Products Petroleum Products Capital Oil Plc

Company

Opening Price (N)

Capital Market

7.39

0.50 2.02 0.58

0.50 0.50

0.50 0.67 0.50 0.50 0.50 1.50 0.50 0.56 0.50 1.60 0.50 0.72 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.53 0.50 0.51 0.52 0.50 0.50 0.50 0.50 0.50

7.50 0.64 0.55 2.32 10.10 1.33 0.50 11.70 3.30 16.85 1.07 0.70 1.15 3.00 0.88 7.00 1.19 4.18 4.26 0.50 0.50 14.70

26.00 33.00

10.55 36.19 3.21 2.88

14.87 500.00

6.60 4.75 55.00 2.01 4.69 0.53

42.12

3.29 239.40 5.98 116.00 0.89

0.50

100.00

9.52

27.63 7.21

0.96 5.52 1.10 6.43 34.40

1.49

0.50 31.39 15.39

0.50

Closing Price (N)

110,000

50 84,748 60,458

7,478 200,000

795,712 74,000 1,000 2,000 500 945,640 6,000 50 2,000,000 1,698,475 185,000 1,000,000 77,778 1,670,890 51,650 373,906 23,061 214,000 50 10,170 1,000 104,702 60,300 200,400 38,000 56,050 1,000 30,000

6,199,190 646,608 13,287,533 17,514,680 525,472 4,199,937 1,000 19,611,606 496,268 21,201,489 56,000 73,200 91,000 5,499,867 1,006,032 2,205,337 16,865,952 27,283,787 4,062,581 120,833 400 3,178,154

150,908 1,540,699

3,900 60 102,692 50

1,941,038 121,672

470,135 8,432,202 805,737 314,500 905,221 78,988

20,114

100 255,417 500 2,694,364 10,000

92,000

100,000

6,190,059

11,275 666

61,563 1,550 9,409,727 18,198 29,455

605,660

909 263,372 891,200

50,000

Quantity Traded

10.54

0.61 2.02 0.66

0.50 0.50

1.06 1.20 0.50 0.50 0.50 3.51 0.50 0.69 0.50 0.95 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.90 0.50 2.50 0.50 0.50 0.50 0.50 0.50 0.50

11.10 3.39 2.30 9.27 4.30 3.20 9.50 16.12 8.30 20.50 1.78 1.78 13.50 10.17 2.18 11.38 2.91 11.70 5.38 1.92 1.75 16.70

43.50 31.25

15.58 42.66 6.75 3.67

29.20 470.00

19.90 16.20 95.00 6.60 6.70 0.88

51.49

9.52

0.50 2.02 0.50

0.50 0.50

0.50 0.85 0.50 0.50 0.50 2.00 0.50 0.50 0.50 0.95 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 1.90 0.50 0.50 0.50 0.50 0.50 0.50

4.26 0.64 0.53 2.05 1.65 1.20 0.00 7.95 3.60 11.64 0.00 0.87 0.00 3.90 0.73 6.30 0.95 2.17 1.96 0.50 0.52 11.45

27.00 22.56

12.71 36.19 4.78 2.66

10.17 367.83

4.31 4.02 57.00 2.31 3.80 0.50

39.00

2.23 186.00 5.23 72.50 0.93

4.63

0.50

97.00

11.59

32.96 3.01

1.45 5.52 0.50 6.43 28.70

0.48

0.50 14.53 6.40

Year Low

255.00 7.10 100.00 1.01

0.50

100.00

20.15

62.26 8.28

2.54 8.28 1.82 7.60 42.50

0.66

0.64 24.58 8.30

Year High

0.00

0.00 0.00 0.03

0.00 0.00

0.09 0.10 0.00 0.00 0.06 0.43 0.00 0.00 0.00 0.08 0.00 0.00 0.00 0.02 0.06 0.10 0.00 0.10 0.36 0.01 0.01 0.14 0.03 0.07 0.00 0.00 0.00 0.00

0.80 0.00 0.00 0.00 0.28 0.22 0.00 1.34 0.69 1.61 0.00 0.18 0.00 0.85 0.50 0.54 0.22 0.13 7.59 0.11 1.34 1.57

1.29 1.32

3.90 1.61 0.70 0.00

0.28 15.94

0.54 0.71 4.50 0.26 0.73 0.06

3.70

12.12 0.35 4.50 0.00

0.00

11.75

1.66

3.26 3.66

0.28 0.35 0.22 0.31 7.03

0.04

0.01 7.94 1.80

E.P.S.

0.00

0.00 0.00 16.67

0.00 0.00

5.56 10.20 0.00 0.00 8.33 4.88 0.00 0.00 0.00 17.25 0.00 0.00 0.00 25.00 8.33 5.00 0.00 5.00 1.39 50.00 50.00 6.43 16.67 7.14 0.00 0.00 0.00 0.00

5.83 0.00 0.00 0.00 25.91 6.68 0.00 6.96 6.20 8.74 0.00 5.44 0.00 5.07 5.44 14.81 4.68 19.23 0.28 4.82 0.43 7.83

20.93 20.46

3.26 22.48 7.34 0.00

37.57 27.96

16.91 14.38 16.89 16.92 5.75 8.83

13.92

19.98 16.29 22.22 0.00

0.00

8.51

7.33

10.11 2.26

5.18 15.77 3.64 20.74 4.14

15.00

50.00 2.77 4.37

P.E. Ratio

0.50

Non-Metalic Mineral Mining Multiverse Plc

4.90 1.45 5.92

0.50

Road Transportation Associated Bus Company Plc

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

1.64 2.30 4.20 4.49

Speciality Interlinked Technologies Plc

0.50 Printing & Publishing. Academy Press Plc Learn Africa Plc Longman Nigeria Plc University Press

6.94 1.07

0.50

2.99

1.97 1.67

0.50

Media/Entertainment Daar Communications Plc

Hotels/Lodging Capital Hotel Ikeja Hotel Plc

Courier/Freight/Delivery Red Star Express Plc Employment Solutions C & I LEASING PLC

Automobile/Auto Part Retailers Incar Nig. Plc RT Briscoe Plc

Afromedia Plc

SERVICES

0.50

20.50 0.50 20.54 2.78 10.84 131.00 32.29 130.00

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

0.66 14.45

Intergrated Oil and Gas Services Oando Plc

3.98 12.71 13.28 4.30 1.05 2.92 0.66

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

1.44 0.50

1.23 0.50

Electronic and Electrical Products Cutix Plc Nigerian Wire & Cable Plc Mortgage Carriers, Brokers and Se Abbey Building Society Plc Union Homes Savings and Loans

0.50

Processing Sysetms Chams Nigeria Plc

1.38

Metals Aluminium Extrusion Ind Plc

Paper/Forest Products Thomas Wyatt Nig. Plc

6.00 10.60

NATURAL RESOURCES Chemicals BOC Gases Plc

8.26

3.10 1.87

9.10 8.54 23.14 5.39 116.00 0.50 0.54 42.00 2.38 2.28 10.93

Tools and Machinery Nigerian Ropes Plc

Packaging/Containers Avon Crowncaps & Container Nigerian Bags Manufacturing Company

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

0.50

Computers and Peripherals Omatek Ventures Plc

ICT Telecommunications Starcomms Plc

0.50

ICT Computer Based Systems108 Courteville Investment Plc

13.12 2.66

5.05 0.94 0.92 23.10 1.81 0.76 8.59 3.17

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

IT Services NCR (Nig) Plc Tripple Gee and Company Plc

0.50

Opening Price N Union Diagnostics & Clinicals Services

1.65 5.80

4.90

0.50

1.64 1.99 4.20 4.35

0.50

6.94 1.10

0.50

2.92

1.97 1.71

0.50

20.50 0.50 24.94 2.78 11.29 125.00 32.29 133.00

14.69

0.65

3.98 12.71 13.28 4.30 1.05 2.78 0.66

1.44 0.50

145 0.50

0.50

1.38

0.50

10.55

5.70

8.26

2.42 1.80

9.37 8.12 23.10 4.25 115.00 0.50 0.52 44.50 2.27 2.27 10.93

0.50

13.12 2.66

0.50

5.05 1.00 0.79 25.15 1.71 0.79 8.59 3.17

0.50

Closing Price N

8,000 651,130

800

1,442 272,350 4,322 176,099

55,000

50 528,560

100

64,950

240 115,355

500

82,191 8,000 105,751 164,528 3,310 50,794 2,010 472,582

458,238

2,534,114

6,888 1,000 100 29,198 200 84,311 2,749,340

2,000 1,000

640,862 4,000

1,000

822,500

105,000

3,500 3,718,622

92,769 76,134 3,983 95,700 605,917 100,000 29,000 5,225,521 8,500 21,000 875

10,000

958 750

1,000

2,000

168 106,050 274,400 362,271 815,112 331,599 1,927 50

90,320,000

Quantity Traded

2.78 11.75

5.15

0.80

8.00 6.82

3.68

0.50

400 2.07

1.64

3.67

4.33 3.65

0.72

600

1.57 6.50

4.90

0.50

4.60 3.60

3.17

0.48

3.00 1.33

0.90

2.65

1.97 1.30

0.51

141.00 63.86 195.50

163.50 2,100 240.00

27.99 0.50 0.50 5.71 3.89

1.87

3.98 12.71 13.97 3.60 1.05 2.92 0.63

1.33 0.50

1.62 2.58

0.50

1.38

0.50

10.70

6.80

8.26

5.94 1.47

12.00 8.10 15.16 4.16 95.00 0.50 1.02 36.58 5.11 0.51 10.93

0.50

3.25 3.25

0.50

5.31 0.70 0.83 2.58 3.61 0.95 0.95 4.28

0.50

Year Low

0.87

0.51 0.80

0.00

0.00 0.13

0.26

0.00

0.22 0.69

0.08

0.54

0.00 0.16

0.04

13.32 3.32 11.91

4.93 0.00 6.02 0.67

6.95

0.16

0.00 3.90 0.00 1.22 0.17 0.07 0.00

0.05 0.00

0.13 0.00

0.00

0.13

0.93

0.00

0.15 0.19

1.59 1.71 1.76 1.80 8.01 0.00 0.00 1.05 0.36 0.18 0.00

0.00

6.49 0.00

0.04

0.05

0.06 0.00 0.27 8.88 0.21 0.08 0.00 0.00

0.00

E.P.S

4.22 8.75

0.00

0.00 27.69

12.19

0.00

34.09 2.12

11.25

4.91

0.00 8.19

12.75

11.11 19.23 17.07

6.99

7.40 0.00

4.17

6.06

0.00 3.26 0.00 3.52 6.18 41.71 0.00

28.80 0.00

13.15 0.00

0.00

85.77

7.37

0.00

39.60 9.16

7.86 4.97 8.88 2.31 13.17 0.00 0.00 42.86 14.19 2.89 0.00

0.00

1.43 0.00

12.50

10.00

9.05 14.13 0.00 0.00

88.50 0.00 3.07

0.00

P.E Ratio

as at Friday, July 20, 2012

37.10 0.70 32.60 5.59

78.97

0.97

3.98 15.58 15.03 4.30 1.86 2.92 0.63

1.51 0.99

2.50 2.58

0.50

1.38

0.50

12.39

9.20

8.69

6.91 3.60

30.00 12.57 43.98 15.49 132.51 0.75 3.51 48.05 5.28 3.36 13.40

1.47

9.31 3.59

0.50

0.52

5.31 1.45 3.20 23.11 5.61 1.96 12.91 200

0.50

Year High

Stock Market Report

26 â&#x20AC;&#x201D;Vanguard, MONDAY, JULY 23, 2012

Vanguard, MONDAY, JULY 23, 2012 — 27

Homes & Housing Finance BRIEFS Firm sees growth of real estate market By EMMANUEL ELEBEKE Lagos-based real estate development company, Propertygate Development and Investment Plc, says there is a huge economic opportunities to be tapped in Nigeria’s real estate market. Managing Director of the firm, Mr. Adetokunbo Ajayi, disclosed this at the firm’s third annual general meeting held recently in Lagos. He said in 2011 alone, the company recorded a start-up of 44 housing units of various types, despite challenges like the violation of the global economy, difficulties at the home front and constraints in the real estate industry. According to him, cash inflows for the year rose to N434 million from N263 million in 2010; total current assets stood at N370 million compared to proceeding year’s N331 million; while gross earnings rose to N287 million in the year from N276 million. Ajayi said in 2011 the company recorded the highest number of development starts in a year since its commencement of business operations, while its past endeavours yielded startups and completion of 15 housing units with a market value of over N600 million.

•Beautiful prefabricated house – roadmap to affordable housing?

Presidential committee advocates housing as fundamental right for Nigerians Stories by YINKA KOLAWOLE Committee set up by Pres ident Goodluck Jonathan on the review of the nation’s constitution has recommended an amendment to the 1999 that will compel government to provide housing for Nigerians as a fundamental right. The Presidential Committee on the Review Outstanding Issues on Recent Constitutional Conferences headed by a former Chief Justice of Nigeria (CJN), Justice Alfa Belgore, wants Nigeria to join the league of welfare states like South Africa and countries in Europe where citizens can enforce provision of housing, health care and education as socio-economic rights. Presently, Nigerians do not have the right to invoke the courts to find government liable should it fail to provide the social services, since the rights are contained in Chapter 11 of the constitution titled Fundamental Objectives and Directive Principles of State Policy and are not justifiable. But the Belgore committee has recommended that these rights be merged with the fundamental human rights contained in Chapter 1V which are enforceable. Section 16(2) (d) of the Constitution which falls under the Fundamental Objectives and Directive Principles of State Policy states: “The state shall direct its policy towards ensuring that suitable and adequate shelter, suitable and adequate food, a reasonable national

minimum living wage, old age care and persons, and unemployment, sick benefits and welfare of the disabled are provided for all citizens.” But in Section 6(6), the constitution provides that “the judicial powers vested in accordance with the foregoing provisions of this section shall not, except as otherwise provided by this constitution, extend to any issue or question as to whether any act or omission by any authority or person or as

to whether any law or any judicial decision is in conformity with the Fundamental Objectives and Directive Principles of States Policy set out in Chapter 11 of this Constitution.” However, the Presidential committee recommended that these rights be taken out of Chapter II and taken into Chapter IV which contains enforceable rights. “The committee adopted the recommendation of the 2005 Conference

that the Fundamental Human Rights in chapters II and IV of the 1999 Constitution should be merged, where possible and should be made enforceable. “It further decided that aspects of Chapter 11, which underscore the fundamental objectives of the constitution, should be transferred to the general provisions whilst those that aggregate rights should be transferred to Chapter IV,” the Belgore committee recommended.

Lagos moves to tackle properties without titles *1,000 landlords get title documents AGOS State government has reiterated its desire to reduce the number of owners of landed property in the state without registered titles. Governor Babatunde Fashola made this known recently in Lagos during the presentation of registered sub-lease title documents to 1,000 property owners in government housing estates across the state, adding that government was concerned about the large number of properties in the state without titles. The beneficiaries constitute the second batch of property owners to be issued with registered titles among those who bought their properties from government agencies like the state Ministry of Housing, Lagos State Development and Property Corporation (LSD-

PC), and Lagos Building Investment Company Limited (LBIC) before the year 2000. Represented by the Commissioner for Housing, Mr. Bosun Jeje, the governor said the move is meant to ensure the registration of the properties and confer on their owners proper land titles. He noted that the beneficiaries had purchased the government properties before year 2000, but most of the allottees had only letters of allocation and other documents not legally recognised as documents of title. “On assumption of office for the first term in 2007, government decided to do a number of things to reduce the large number of properties without registered titles. This is not for economic benefit, but geared towards poverty alle-

viation and financial empowerment of the citizenry. An owner of property who fails to perfect his title is sitting on a dead asset. Such properties with registered titles, being legally recognised, can be used as security to obtain loans to raise needed finance,” he said. Fashola added that the Directorate of Land Regularisation was strengthened to enable it process more applications for regularisation of titles to land. “Let me say that the concern of this government in all of these efforts aimed at reducing the unacceptable number of properties without registered titles is not for economic benefit, but geared towards poverty alleviation and financial empowerment of the citizenry.

Nigeria set for fastest construction growth report by Global Con struction Perspectives and Oxford Economics has forecasted that in the next ten years, construction growth in Nigeria will be the fastest of all markets. The report says Nigeria remains the market where the fastest growth will happen as it will be the global hotspot from now to 2020 as the nation’s construction growth have risen higher than India’s, which reflects increased wealth. Head of Conference Programmes, The Economist Group, Dougal Thomson, in his introductory remarks at the The Economist’s Conference on Future Cities, predicted that African population is going to surpass that of China by 2050, citing International Monetary Fund (IMF) projection, which says that African GDP growth at the moment is 5.4 per cent per annum. He however, pointed out that Africans are still struggling to get going, noting that so much money is needed to transform cities in the continent.

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28 — Vanguard, MONDAY, JULY 23, 2012

Tax Platform

Frequently asked questions about self-assessment Why is the Service migrating from government assessment to selfassessment? The Service is not migrating but strengthening selfassessment because the Service did not get the policy right at the beginning. What is the difference between Administrative Assessment and Best of Judgement? Administrative Assessment means an assessment raised by a relevant tax authority where a taxpayer has failed to file returns and pay taxes due on or before the due date or where there is an understatement of tax in the returns filed. Best of Judgement (BOJ) is an administrative assessment, however, in issuing it, it shall be based on spot audit, third party information to identify material fact upon which the assessment will be raised. Is Spot Audit provided for in the tax law? Spot Audit and third party information is provided for by Section 26 of the FIRS (Establishment) Act. What is the difference between Administrative Assessment and Government Assessment? There is no difference between Administrative Assessment and Government Assessment. They are terminologies used interchangeably as assessment raised on behalf of government by the relevant tax authority. Will an objection arise under a self-assessment system? Ordinarily, under a selfassessment system, the taxpayer may not object against his own assessment, however, he may object against an assessment raised administratively. How does an Assessment Program differ from a Filing Compliance Program? Assessment program is used to raise assessment for taxpayers who fail to file on due date. However, Filing Compliance Program is used to enforce compliance to ensure all taxpayers file their tax returns and make payment of tax due on or before due date. What should be the relationship between RPP/ Audit/RAU? There must be collaboration between them and the chain must not be broken. RPP receives returns; carries out arithmetic checks and passes them to Tax Audit for RAU- a subunit of Tax Audit to carry out analysis for case selection. What are the KPIs for RAU? The Key Performance C M Y K

Indicators shall be set in line with the Risk Assessment benchmarks and agreed from time to time. The time spent on risk profiling of taxpayer data; the report generated on weekly basis not later 2-day after a week; the tax yield of the report. What should you do when you notice the basis period is not correct? It is RPP’s responsibility to *Ag. Executive Chairman, FIRS, Alhaji correct the basis Kabir Muhammad Mashi period, re-compute and notify the taxpayer for payment. Should all tax returns be risk profiled? Yes, all tax returns should automatically be risk profiled. After data entry, the taxpayer file is forwarded from RPPU to the Head of Audit for the Selection Criteria Analysis. Should RPPU be communicating directly with taxpayers? RPPU can communicate directly to/with taxpayer by notifying him when an error is observed during the review of returns. What action is to be taken when tax returns are not submitted on due date? FDAEU should visit the taxpayer immediately with a demand for the returns and inform the taxpayer of the consequences of having failed to comply with the due date. Administrative assessment procedure will commence after the visit. What happens to the seized books of a Taxpayer who was distraint; at what point do you return the books that were seized? Make copies of the seized documents and ensure it is endorsed by the taxpayer then return the books immediately in line with the provisions of Section 26 and 30(2) of FIRS (Establishment) Act, No 13 2007. When an Additional Assessment is raised, should it be back-dated to the due date of filing/payment? Yes, it should be effective from the time the payment was due. The penalty for late returns and penalty for late payment do not appear to be equitable. Could this be reviewed? A recommendation has been made for the review to make it a percentage of tax due. How do you encourage

taxpayers to file in their appropriate Jurisdiction? If the taxpayer has previously filed in a wrong jurisdiction, the taxpayer’s file should be moved to the jurisdiction within which his address falls. Then the taxpayer should be advised accordingly. What is the working relationship between Filing Debt Arrears Enforcement Unit (FDAEU) and the Returns Payment Processing Unit (RPPU)? RPPU conducts arithmetic checks of a tax return, captures data and refers a list of noncompliant taxpayers to FDAEU for further actions including a

returns have been done, are all the returns then passed to the Audit Unit? Yes, the Audit works on the result of the risk analysis to draw up its audit program for further action. In any case, RAU is a sub-unit of Audit. Presently there are no Audit Units in some ITOs what will happen to the audit functions in these offices? All offices are expected to have Audit Units by the time SelfAssessment is fully implemented. However, where there are no Audit Unit, the Regional Audit shall perform the audit. What is the process for approving a request for instalment payment of tax? Where a taxpayer intends to conclude instalment payments not later than due date of filing, the taxpayer is required to notify the tax office of his intention. However, where a taxpayer intends to conclude instalment payments beyond the due date of filing, he shall request for approval. In any of the cases, the taxpayer is expected to commence instalment payments before due date such that the final payment is made not later than due date. What are the conditions for granting extension of time for filing returns? Written application to be submitted before due date of filing returns and to show good cause for taxpayers inability to file by the due date. If the Board is satisfied with the cause, it may grant

FDAEU should visit the taxpayer immediately with a demand for the returns and inform the taxpayer of the consequences of having failed to comply with the due date; administrative assessment procedure will commence after the visit

visit to the taxpayer to find out why he failed to file and remind him of the consequences of late and non-filing. When is a Tax Clearance Certificate issued to a taxpayer? A Tax Clearance Certificate is issued only when tax liabilities including penalty and interest for the relevant assessment years are paid. The focus of Self-Assessment appears to be on only CIT. Is VAT not part of the SelfAssessment Process? Self-Assessment is a regime and covers all tax types After the risk assessments of

approval under the following conditions; upon sudden death of any Principal Officer of the Company; and Where the Company experienced Natural disaster. The approval to extend the time within which to file returns will not alter the time within which payment of tax is to be made. The law allows two months grace from due date of filing, does this now mean the grace period is eight months? With respect to Companies

Income Tax, a taxpayer is required to file tax returns and make payment of tax due not later than 6 months after the accounting year end. However, he has the option to make instalment payments of tax due in a manner that the final instalment is paid not later than 2 months after due date. What about the incentive for self-assessment filing, will taxpayers who file still enjoy this incentive? The incentive for selfassessment filing that existed up to 2007 was abolished by Companies Income Tax (Amendment) Act 2007. Considering the noncompliant culture of Nigerians, do you think that self assessment as a means to achieving voluntary compliance will work in Nigeria? Put in another way; are we ripe for voluntary compliance? The self-assessment tax regime is concerned with the provision of proper enablement for taxpayers and enforcement actions that will ensure compliance. My understanding is that the first instalment of tax payable should be paid on due date and the remaining maximum of five (5) instalments paid after due date but not later than November 30, 2011. In accordance with the self-assessment regulations, instalment payments may commence before due date of filing provided the final payment is made not later than due date. In addition, the regulation only provided for three (3) instalments. Note that the Companies Income Tax Act does not say six (6) instalment payments must be granted. When was the Taxpayers Service Policies, Processes and Programmes Department (TSPPPD) created and what is the purpose of creating the department at the Headquarters when Taxpayers Ser vice Unit already exists in all the Integrated Tax Offices? TSPPPD was created in April, 2011. TSPPPD at the Headquarters is responsible for generating procedures for delivering uniform taxpayer service, formulating the annual operating plan and providing headquarters support to ensure taxpayer service is effectively carried out in order to target compliance gap.

Vanguard, MONDAY, JULY 23, 2012 — 29

Insurance

GT Assurance transforms into Mansard Insurance By ROSEMARY ONUOHA

T Assurance Plc is now Mansard Insurance Plc. The new name was unveiled at the Corporate Head Office of the company in Lagos last week. Chief Client Officer of the company, Tosin Runsewe, who unveiled the new brand said that Mansard is another word for a roof and a roof is a symbol of protection. He said “The concept of a roof speaks to the consistency and dependability that our brand has with our customers. GT Assur has evolved into Mansard Insurance today, yet the same company continues with the same people and the same values.” It will be recalled that the Central Bank of Nigeria, CBN, two years ago mandated banks to divest from all non-banking subsidiaries in the country. As a fall out of this, Runsewe said that GT Assur was acquired by a consortium of five investors known as Assur Africa Holding wholly registered in Mauritius. He said “We have to conclude this whole process by re-branding, by coming up with our own brand which is a brand that we expect to not just step out with in Nigeria but to roll out eventually across West Africa in the next few years and we expect that

this brand will become a leading brand in Nigerian financial services sector and not just in the insurance sector.” Runsewe said that the company needed to re-brand because it has changed ownership, stating “We now have the opportunity to build an independent leading brand for ourselves. For as long we are subsidiary of a bank we are always going to

be subject to what they do but now we are independent and we want to build our own brand that will compete not just in the insurance sector but across Nigerian financial services industry and not just in Nigeria but hopefully across West Africa region.” Runsewe said that over the years they have seen the company grow rapidly and at the end of last year, business had grown by 33 per cent and at the end of the first quarter

this year, had also grown by 22 per cent. Runsewe added that the rebranding has enabled the company to develop bancassurance relationship with other banks, adding “Hitherto other banks could not close this relationship with us due to they taught we were the subsidiary of a bank. So becoming independent has suddenly made us very attractive to other banks who are now doing business with us in a much closer way, so we are having the opportunity to expand without compromising the existing relationship that we had before.”

*From left: Mr. Kunle Ahmed, Executive Director, GTAssurance now Mansard Assurance; Mrs. Yetunde ILori, CEO; Mr. Victor Osibodu, Chairman and Mr. Tosin Runsewe, Chief Client Officer, during the official unveiling of the new corporate identity of Mansard Insurance in Lagos. Photo by Lamidi Bamidele

Niger Insurance to expand distribution channels, products offerings NKIRUKA NNOROM & RITA OBODOECHINA

he board of Niger Insurance Plc has said that the company is repositioning itself to move to the top of the industry in the years ahead. Addressing shareholders at the company’s 42nd annual general meeting in Lagos last week, Chairman of the company, Alhaji Bala Zakariya’u said that the company ’s focus in the coming year will be to expand distribution channels, and improve product offering for better marketing of the company’s products. Zakariya’u said, “Our focus is on creation of special markets for National Insurance Commission’s (NAICOM) compulsory insurance policies and Market Development and Restructuring Initiative (MDRI) programme as well

as acquisition of modern tools for effective operations. We will also develop and deploy electronic platforms and facilities to all our regions and branches nationwide for quick and reliable service delivery.” He added that the company will rebuild and refocus its investment portfolios by taking advantage of opportunities in the fixed income securities for safe and guaranteed returns, adding “We will equally diversify into oil and gas, telecommunications and other safe areas to grow our investment income.” Meanwhile analysis of the company’s results for the year ended December 2011 shows that profit after tax stood at N1.23billion showing an impressive result from a loss position of N124million recorded in 2010. Gross premium income rose from N7.04 billion in 2010 to N7.81 billion in 2011, while

shareholders funds increased from N4.3 billion in 2010 to N5.5 billion, and total assets stood at N21.1 billion. During the year under review, the company achieved an underwriting profit of N1.54 billion, while its profit from deposit administration increased significantly from N120 million to N1.53 billion. Managing Director of the company,Mr. Justus Uranta said that the company recorded marginal profit, which is a modest achievement despite the harsh global economic climate. He said, “There is a huge untapped market here that will provide a dependable source of new business through development of new products and outreach programmes. The insurance industry stands to benefit from the needs created by the countless of challenges in the country.

Talking on the company’s transformation, he stressed that the company is still in tone with its human capital development by way of sending key staff to both local and international training, adding that the training school at Anthony village has been giving a face lift in readiness for more enhanced in-house training. According to him, the company’s former investment department has been enlarged and renamed treasury and investment department with a senior management staff as the new head. He said “Our recent move to inject fresh funds via the capital market came out successful, with over 75 percent subscribed, adding that the company also has to re-lunch some key products into the market, expand branch network and information technology, build business alliances, and embark on more aggressive marketing.

BRIEF Insurers to restrategise for better clients services NSURANCE operators in the country have commenced move to re-strategize their operations in order to serve their clients better and more effectively. President of Chartered Insurance Institute of Nigeria, CIIN, Mr. Wole Adetimehin, disclosed this during the institutes’ 2012 international education conference held in Abuja recently. He said “There is a genuine quest by all operators to seek ways and means of rethinking both governance and business models through fresh strategies.” He also added that in all circumstances, including the pervading instances of corruption and greed in governance, the pendulum of good reasoning must continue to swing in the direction of finding lasting solutions to the avoidable wastages in the systems. Continuing he said, the present atmosphere of insecurity in the country must be of concern to operators, adding however, that operators should exercise restraint in their reactions to the existing situation. He assured that the Institute will continue to strive to ensure that it achieves in all spheres of its statutory responsibilities. He said, “We shall continually strengthen the relevance of insurance education in Nigeria by means of the existing platforms such as the Conferences. Seminars, Workshops and exchange programmes, successful conduct of the professional examination in all the centers across the country and the offshore centre in Banjul, and Gambia. According to him, “The institute will sustain the international outreach programme for CEOs, reinvigoration of the Mandatory Continuing Professional Development (MCDP) programme. Furthermore, he said, there shall be repositioning of the Institute’s secretariat through strategic realignment of the staff organogram, expansion of the Institute’s revenue generation bases, as well as progressive construction work on the College of Insurance.

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30 — Vanguard, MONDAY, JULY 23, 2012

Aviation

Lagos international airport to have larger car park Stories By LAWANI MIKAIRU & DANIEL ETEGHE

u r t a l a Muhammed International Airport, Lagos will soon have a larger car. This was disclosed by the Deputy General Manager, Public Affairs, Federal Airports Authority of Nigeria (FAAN), Mr Victor Arisa. Speaking to newsmen at MMIA in Lagos, Mr. Arisa said that the management of FAAN was awaiting an approval of the new design of a larger capacity car park which was part of Federal Government’s remodelling exercise taking place at the airport. “FAAN management is worried and is not unaware of the over-stressed parks. We have come up with a design. We are awaiting the approval of the Ministry of Aviation to carry out a new construction and expansion that will have a larger capacity for parking,” he said. He said that the current car parks at the airport premises are safe to park cars, although cars are meant to be parked at owners' risk as it was obtained outside the airport

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premises. Mr. Arisa further noted that the airport management has security outfits, including armed policemen that patrol the parks every hour of the day, including at nights. “We try as much as possible to patrol the parks. We have

the policemen, aviation security personnel and the Nigeria Civil Defence Corps that patrol there every hour. We have never heard of car theft in our car parks and travellers often park their cars overnight, even for days, to travel and come back to pick

the car at the park,” he said. He said that the airport has a structure for cars to be parked overnight and for days. He noted that travellers making use of the special arrangement pay more than those parking on hourly basis. The manager, however,

noted that drivers pay a minimum of N100 per car whenever they make use of the parking facility at both the international wing and the General Aviation Terminal of the airport, (GAT).

Demuren calls for IOSA mandatory compliance for airlines

he Director-General, Nigerian Civil Aviation Authority, NCAA, Dr Harold Demuren has canvassed for all airlines operating in Africa to have IATA Operational Safety Audit,IOSA compliance. The IATA Operational Safety Audit (IOSA) programme is an internationally recognised and accepted evaluation system designed to assess the operational management and control systems of an airline. IOSA’s quality audit principles are designed to conduct audits in a standardized manner, reduce costs and audit resource requirements for airlines and regulators and continuous updating of standards to reflect regulatory revisions and the evolution of best practices within the industry. Dr Demuren who made the call at last week's five-day

country in mourning mood. He revealed that the current Nigeria Civil Aviation Act of 2006 that created an autonomous civil aviation agency and domestication of the Cape Town Convention for the acquisition of modern aircraft and other safety initiatives has resulted in enhancing safety measures, and Nigeria passing the ICAO audits and attainment of American FAA CAT 1 certification.

•Dr. Harold Demuren Africa Aviation Ministerial Conference on Safety in Abuja expressed shock at the crash of two Nigerian carriers recently which has left the

He noted that four months from celebrating six uninterrupted years of zero fatalities in domestic scheduled flight operations, disaster struck involving Allied Air in Ghana and DANA Airlines in Lagos, both carriers in Nigeria. According to him, these accidents occurred after successfully carrying out 50

million passengers, operated more than one million flights and grown the traffic by almost 40 per cent in the last five years. The D-G described the crashes as devastating blow to the industry and a major setback to the reform agenda that was being pursued . Dr Demuren urged Africa member-states to adopt the AFI safety improvement plan which will give them tools to improve the picture of safety in Africa, adding that towards this, the country was considering IOSA mandatory compliance for its airlines. In his words:”We must not relent. We must not blink, we must remain focused, we must forge ahead, above all, we must not be discouraged. Collaboration and cooperation among African states must continue.”

Vanguard, MONDAY, JULY 23, 2012 — 31

DIVERSIFICATION: Missing the boat on rubber – 1 “

T does not matter if the cat is black or white as long as it catches rats.” Malaysian proverb. (VANGUARD BOOK OF QUOTATIONS, p 26). The Malaysian proverb was offered to Nigerians at the second Nigerian Economic Summit in Abuja by the Guest Lecturer, a Malaysian, who had worked on that nation’s Vision 2020 programme. Unlike the two fraudulent Nigerian versions – VISION 2010 and VISION 2020 – the speaker made it clear that Malaysia, which was already light years ahead of Nigeria, planned to achieve the objectives of VISION 2020 in a generation – defined as thirty years. Unfortunately, the guest speaker was in the wrong country for his message. Nigerian policy fraudsters first hooked unto it to propose VISION 2010. Predictably, it flopped. Then another group of jokers drummed up VISION 20:2020. Even a fool knows that failure stares us in the face again. But, President Jonathan does not yet know that he is being deceived – just as Obasanjo merrily signed on the dotted line for the Millennium Development Goals, MDGs; which we are sure to miss. At least, the good Malaysian professor of eco-

nomics left us with material fit for the BOOK OF QUOTATIONS – for which I am grateful. The NES II focused on diversification of the Nigerian economy in order to avert the negative consequences of being a

’

ing more rubber because the revenue from that commodity will eventually exceed Nigeria’s income from crude oil; and, more importantly, it will be more sustainable. In 1995, the presenter estimated that if we moved quickly, as a nation, and increased produc-

Nigeria should concentrate on growing more rubber because the revenue from that commodity will eventually exceed Nigeria’s income from crude oil

mono-product economy. That was in 1995; and the fact that we are still a mono-product economy, almost 20 years after, is a testimony to our resistance to change – even when it is generally acknowledged. One of the most profound papers delivered at the NES II was from a fellow from Michelin, the tyre manufacturing company which left Nigeria, in disgust, several years ago. The message from Michelin, if I can be permitted to call it that, was simple. Nigeria should concentrate on grow-

’

tion by 10 per cent annually, we would by 2015 be earning about 50 per cent of crude oil revenue from rubber alone. Mr. Michelin, called that because I cannot readily locate the documents pertaining to NES II, was also speaking to the wrong audience and in the wrong country. Nigerians, including those in the private sector, are not interested in large scale farming and longterm economic prospects. The billionaires here prefer the forwarding and “backwarding” of fuel and the enormous gains from “subsidy” scams.

Yet, the opportunity is still there for Nigeria to become one of the leading world exporters of rubber-based intermediate and finished products – if we reject exporting raw rubber. It is estimated that about 15 billion kilograms of rubber are produced globally annually; out of which five billion are natural rubber. Low production of raw rubber provided the incentive for the production of synthetic rubber, which now accounts for two-thirds of rubber production. Yet, there is still a growing demand for natural rubber which Nigeria can tap into. Benign neglect of rubber as national policy Before embarking on writing this two-part series of articles on rubber, I undertook a study, together with paid readers, to go through the major Nigerian newspapers, for the last three years, with one objective in mind – to find out how often top government officials, including the President, had mentioned rubber, in their public statements. As a corollary to that, the quick study was designed to find out what our national policy on rubber production is. Little was expect-

ed; but the result was shocking. There was nothing on rubber – a product, which if widely cultivated can earn more foreign exchange than oil in the near future; and certainly more than cassava. No Minister of Agriculture has mentioned it; perhaps none has even thought about it. The incumbent Minister of Agriculture, Dr Adesina, has focused attention on the huge food import bill and the need to reduce it. That is a quarter of a step in the right direction. He has also raised alarm about the impending food scarcity which might result in widespread famine. That is another quarter step in the positive direction. But, his promotion of the cassava bread, at this time, represents a turn around from the steps taken. Substitution of wheat with cassav a i s n o t o u r p r i o r i t y. Growing more food locally, and a variety of food items including the lowly vegetables, is more of our need than the cassava bread option. More importantly, encouraging greater output of cash crops, rubber especially, will help to offset the food import bill. Fortunately, Nigeria, has a competitive advantage in rubber production – which we are not exploiting at the moment and have no plans to export in the future.

BUSINESS & ECONOMY

House of Reps must stop vendetta on Arunma Oteh *Recall by Presidency is good judgment By TONY NAVAH OKONMAH

N March 2012, I wrote in n article in the Vanguard “Allegation against Arunma Oteh wrong” that efforts were made in my commentary not to compromise the task facing the ad-hoc committee of the House of Representatives investigating the matter between Herman Hembe, Arunma Oteh and the collapse of the Capital Market. The reason was to allow the House the opportunity to conduct an unbiased and uninfluenced investigation with the hope of reaching a balanced and informed decision. Unfortunately, this is not the case with the report from the House of Representatives. It is a shame and most embarrassing that the House of a

Representatives would collectively exhibit clear vindiction against the DG SEC, Arunma Oteh in a high class matter that also attracts the interest of the international community. The report of the House of Representatives could not prove its case beyond reasonable doubt and could find nothing of inappropriate behaviour or case of fraud against the DG SEC. These were the key notes of their investigation and they failed to prove them. Instead, the House of Representatives has come out to tell Nigerians that Arunma Oteh should be dismissed because she did not meet the 15 years experience required for her appointment into the position of the DG, Security Exchange Commission of Nigeria (SEC). Was this what they

were asked to investigate or is it in any way connected directly or remotely to the crash of the capital market and the alleged case of fraud against the DG? The reason for the recommendation by the House to dismiss Arunma Oteh as DG SEC, was it what they were asked to do? It is sad that the House of Representatives either for lack of understanding of their scope of inquiry or a deliberate conscious exercise on a jamboree to spend tax payers' money on an issue they were very clear of their

position from start. I commend the report of the independent auditors (Price Water House/Coopers) for their courage to conduct a clear and unbiased investigation and for exonerating Arunma Oteh of any inappropriate behaviour or fraud. I also commend the Presidency for the boldness to make the right decision by re-instating the DG. The House of Representatives and other detractors should please allow Arunma Oteh to concentrate on the task of cleaning up the mess she in-

I commend the report of the independent auditors (Price Water House/ Coopers) for their courage to conduct a clear and unbiased investigation and for exonerating Arunma Oteh of any inappropriate behaviour or fraud

herited at SEC and restore the market to acceptable standard. Now that this matter has been conclusively decided fairly by the presidency, Arunma Oteh must focus on the job and not allow herself to be distracted. She must restore both local and foreign investors' and traders' confidence in the Nigerian capital market. She must extend “olive leaves” to both her supporters and detractors alike. She must swiftly conduct the healing processes vital for unity and team work. Arunma Oteh must not indulge in vendetta. I congratulate her for this victory. But it is victory for justice and truth. •Tony Okonmah, a financial and economic analyst wrote from London. C M Y K

32 —Vanguard, MONDAY, JULY 23, 2012

Interview By PETER EGWUATU

ith the Nigerian capital market making a gradual recovery in the aftermath of the financial meltdown, Mr. Oladele Sotubo, Chief Executive Officer, Stanbic IBTC Stockbrokers Limited, one of the ten market makers appointed by the Central Bank of Nigeria to stabilise and restore liquidity to the capital market, speaks on the significance of the development as well as other salient issues affecting the financial services industry in this interview in Lagos. Some operators have said the Market Makers (MMs) will have little impact because the secondary market is shrinking and there are no new issues coming into the system. Also, it is widely believed that liberalisation of the market was pursued without the right financial infrastructure, and the resultant capital inflows contributed in disorienting the health of the local financial system. Will you say that the steps taken so far by the regulators have been effective in strengthening and deepening the capital market? Regulators are doing a great job in deepening the market and this is seen in the recent review of the listing rule which now accommodates even companies which ordinarily will not have met the previous requirements in the areas of years of operation, free float and some other requirements. As we have it now, NSE has established a unit that will not only see to listing but work with the company to ensure they continue to benefit from being a listed company. One of the requirements is also that any new company seeking listing will appoint among other professionals a market maker. With the new regime, I believe we will see most of the companies that did Private Placement couple of years ago coming on board. Stanbic IBTC was recently named by the Nigerian Stock Exchange at the head of a tenmember list of market makers. How will you describe the development? This is a welcome development and a move in the right direction as it will help boost the liquidity level in the market and also help remove any form of trade imbalance in any stock. For the sake of enlightenment, what exactly C M Y K

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The need for a new product is clear to all stakeholders; recently, ETF was introduced and soon, we shall have MM, short selling, Securities Lending opportunities introduced to the market. By the time we have all these well grounded in the market; other sophisticated products will be introduced

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will be the role of the market makers? A market maker is a liquidity provider and the major role performed by any MM is ensuring a balance is maintained between the bid and offer volume and price of the stock they are marketmaking in. Each of the market maker reportedly met the minimum net capital requirement of N570 million, besides other pre-conditions. Do you think this requirement is enough to ensure liquidity of the market? It’s one of the many requirements considered for the selection of the Market Makers (MMs). It is important but not enough. Market makers will require much more to play their role hence, access to credit is very paramount. In operation, how will this development pan out? In other words, will the market makers operate as one unit intervening when the need arises or each is allowed to act as it deems fit? Rightly put, their role is that of intervention and ensuring that any imbalance on any stock is taken care of. However, they have a set volume and price limits within which they are permitted to intervene. Even though the appointment of market makers has been welcomed in many quarters, some people also believe that the intervention is belated given

•Mr. Oladele Sotubo....The market is a global village; any company that is seriously interested growth must be a listed company

Regulators are do great job in deep the stock market —Stanbic IBTC Chief that investor confidence in the market has ebbed considerably. What is your reaction to this? We cannot say because the confidence has ebbed we should fold our hands and do nothing. At this point, what we need to guarantee any investor is that; there will always be someone in the market to sell to or buy from at the prescribed price and

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We have continued to see gradual return of capital into the capital market especially from the offshore players; any investor that wants to enjoy that return should take advantage of the attractive valuations in the market having a long-term view

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Vanguard, MONDAY, JULY 23, 2012 — 33

Interview

ested in

volume limits. This alone is a confidence booster. Do you think that the appropriate infrastructure, structures and processes necessary for the effective running of the new regime have been put in place? The answer is no. All the stakeholders still have a lot to do in the area of infrastructure, legislation, knowledge and processes. But I can say all hands are on deck to ensure that this programme succeeds. A report claimed that the appointed 10 market makers would account for about 65 per cent of the entire market transactions, with the balance still largely exposed to the indifferent state of the market. Do you share this concern? This might not necessarily be the case as the role is majorly that of intervention. However, as the market grows, market makers will play a major role in determining volume and price movement. Banks have a pivotal role to play in providing the funding with which the market makers will execute their briefs. Do you believe the banks will be willing to provide the desired funding? Do you see the incentives for them to do so? Are you looking at other funding options? As you’ve said, a good credit

doing pening et line is a prerequisite for the effective functioning of any market maker. There is an initiative by the NSE, working with SEC and CBN to look at the CBN credit policy as it affects capital market. The three regulators must work together to open up this line for operators in the Capital Market especially MMs . Do you think there is merit in the agitation to compel multinationals to enlist on the

Nigerian Stock Exchange? Compel? I don’t think so but Encourage, yes. For the fact that these multinationals do their businesses in Nigeria, there should be opportunities given to Nigerians to share in the goods of these companies. We should go the way of moral suasion, tax holiday and other concessions that will encourage them to list. We MUST not go the way of nationalisation as this will spell doom for the current drive for FDI into Nigeria. Assuming there are indeed a lot of unlisted companies, what precisely will you say to their owners to make them have their companies quoted on the Exchange? The market is a global village. Any company that is seriously interested in growth must be a listed company. It gives access to capital, makes valuation possible, enhances good corporate governance and ensures that the business outlives the founders. Prior to the global financial meltdown, international rating agencies including the Renaissance Group, Fitch and Economist Intelligence Unit rated return on investment in Nigeria among the highest in the world. Have you seen any signs that investors would soon start seeing the returns that used to be a major attraction of the Nigerian market? The answer is yes. Going by the dividend yield from some of the results published by some listed companies, it ranges from 5 per cent up to 20 per cent. We have continued to see gradual return of capital into the capital market especially from the offshore players. Any investor that wants to enjoy that return should take advantage of the attractive valuations in the market having a long-term view. Both investors and operators would have learnt a number of useful lessons following the downturn in the capital market. Based on your experience, what lessons have been learnt on the side of the market? Specifically, have you noticed any changes in investor behavior? If there is any lesson learnt on the downturn, I think it’s the need to play the game according to the rule. In my own view, any player that wants to cut corners cannot last in this new regime as the level of awareness has greatly improved from what it used to be. Also, I believe all must

have learnt to curb their greed and do some portfolio diversification. As currently structured, the Nigerian capital market is predominantly equity-driven, a situation that limits the number of asset classes

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available in the market. What measures will you suggest to expand the market offerings? The need for new products is clear to all stakeholders. Recently, ETF was introduced and soon, we shall have MM,

This is one of the problems faced by the market as we have lots of investors' funds locked up in these Private Placements; the management of NSE is doing everything possible to get these companies on board

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•Mr. Oladele Sotubo

short selling, securities lending opportunities introduced to the market. By the time we have all these well grounded in the market, other sophisticated products will be introduced. Private placement in unquoted companies was recently fingered as being responsible for the plunge of the capital market. To what extent is this true? This is one of the problems faced by the market as we have lots of investors' funds locked up in these Private Placements. The management of NSE is doing everything possible to get these companies on board. With almost 18 per cent share of the market last year, Stanbic IBTC Stockbrokers Ltd was widely celebrated as Nigeria’s largest stockbroking firm. What is your current market share? We currently have a market share of 19.05 per cent. What is Stanbic IBTC Stockbrokers Limited doing in the area of human capital development as it affects your industry since you’re the market leader and you have a responsibility to enhance skill in the sector? Apart from our effort in ensuring that our staff get adequate training and exposure both locally and internationally, as an organisation, we sponsor a couple of academic awards of The Chartered Institute of Stockbrokers and also ensure that our staff participate in any knowledge-sharing exercise in the industry. The Stanbic IBTC Group is well known for its leadership role in organising public fora where initiatives and strategies that could help all stakeholders, especially investors and operators, are canvassed. The last forum organised by your Group held in March this year. How would you assess the outcome? The Stanbic IBTC Investors conference has become a must-attend conference in West Africa. This was the third year of the conference and another tremendous success, with 87 investors from 48 individual funds meeting with 31 corporates over the two days. At the end of the conference, the participants were unanimous that the prospects of Nigeria’s economic rebound are very bright as the economic fundamentals remain strong enough to sustain medium to long-term growth and development. Investors eagerly look forward to this conference as the quality of the organisation and content can compare with international standard. C M Y K

34 — Vanguard, MONDAY, JULY 23, 2012

Apointment & Promotions vicahiyoung@yahoo.com 08033348923

BRIEFS PENGASSAN rewards long serving staff

ATIONAL Secretariat of the Petroleum and Natural Gas Senior Staff Association of Nigeria, PENGASSAN, has rewarded its employees who have served the union for between 10 and 25 years. The presentation of the awards to the 18 serving employees, was part of the Staff Synergy Workshop held in Ogun State recently. While the GeneralSecretary, Bayo Olowoshile, got award for 25 years of service, Sunny Onyemachi, Saka Quadri and Tamuno Dappu were honoured with 20 years long service award respectively. Serekara Nwikiabeh and Ladi Daniel Saleh got 15 years long service award Those in the 10 years categories are Comrades Waziri Mohammed, Paul Seikigba Kpokporo, Olaoye Olufemi, Abai Peter Idemefe, Urete Blessing, Stella-Maris Binotibo, Uche GodsonNwankwo, Rachael Ebun Enwereji, Regina Ewah, Faith Odibo, Chris Odin and Olawale Ajayi.

NDE recruits 80 unemployed youths for agricultural Programme

OLLOWING the recent registration of unemployed youths in Enugu State, the National Directorate of Employment, NDE, in the state has commenced the recruitment of 80 youths for employment training in its Rural Agricultural Development Training Scheme, RADTS. A release by the NDE in Enugu said that the recruitment of the participants would cut across the 17 local government areas of Enugu State. The statement quoted the Coordinator of the NDE in Enugu State, Nnamdi Asomugha as saying that the participants would be trained in 12 areas of agricultural production including arable farming and livestock production as well as agricultural processing, management, marketing and entrepreneurship. The training would last for four months in theory and practices of agriculture in designated farms and the NDE Agricultural skills Training Centres. “The school leavers and C M Y K

Oyefeso now NIA governing member T

HE Managing Director of Staco Insurance Plc, Mr. Sakiru Oyefeso, has been elected Assistant Treasurer of the Nigerian Insurers Association, NIA. Oyefeso, whose election was ratified during the 41st Annual General Meeting, AGM, of NIA in Lagos, succeeds Mr. Segun Balogun, Managing Director, Intercontinental Wapic Insurance Plc. NIA, the umbrella association of all insurance companies registered to operate in Nigeria, was founded in 1971 as a nonprofit-making organisation and later incorporated as a company limited by guarantee under the Companies Act 1968. Oyefeso graduated from the School of Management & Business Studies Department of Insurance, Lagos State College of Science and Technology, now Lagos State Polytechnic in 1983 and qualified as Chartered Insurer

during his NYSC Programme in 1984. He is a seasoned insurance practitioner with more than 30 years experience in the field of insurance. Oyefeso started his insurance career in National Insurance Corporation of Nigeria, NICON, in 1978 and he has been active in the insurance sector since then. He worked with Rivbank Insurance Company Limited, Prudential Union Assurance Company Limited and Leadway Assurance Company Limited before joining Financial Assurance Company Limited as Assistant General Manager (Operations) in 1992.

Oyefeso left the company in August 1994 as Deputy General Manager (Operations) to join Standard

Airtel honours two directors, 18 others for long service

IRTEL Nigeria has honoured its Director of Regulatory and Government Affairs, Osondu Nwokoro, and the Director of Corporate

African Union Commission appoints first woman leader

FRICAN Union Commission, AUC, has appointed South African national, Nkosazana DlaminiZuma to lead the commission. She is the country’s Home Affairs minister and the first woman to be elected to the continent’s coveted post. She was elected at a summit of heads of states and governments in Addis Ababa, Ethiopia. In her response as the new AUC leader, Dlamini-Zuma said: “South Africa and the whole African continent is happy about the appointment.” Chichi Maponya, Chairman of the Board of Brand South Africa, in her congratulatory message said: “South Africa has for several years made the African agenda a central component of its foreign policy. The election of Minister Nkosazana Dlamini-Zuma as chairperson of the African Union Commission thus places South Africa in a leading position to further promote the continent’s role and vision in contemporary world affairs. “Minister Dlamini-Zuma’s appointment will furthermore improve South Africa’s global standing and influence in multilateral bodies such as the UN. Africa’s robust economic growth in the past decade, and the significant role it is yet to play in the future of the global economy calls for strong and capable

*Mr. Sakiru Oyefeso

Trust Assurance Plc (now Staco Insurance Plc) as its pioneer Managing Director. He has a Master of Business Administration degree (MBA) from the Lagos State University. Oyefeso is on the Governing Council of Chartered Insurance Institute of Nigeria, CIIN and Nigerian British Chambers of Commerce, NBCC, and on the board of Trustees of the LASUMBA Heritage, also a member of the Nigerian Institute of Management (NIM) and the Institute of Directors, IOD. He is a fellow of the Chartered Insurance Institute of London.

*Nkosazana Dlamini-Zuma leadership at the helm of the African Union."

Communications and Corporate Social Responsibility, CSR, Emeka Oparah, alongside 18 other employees for 10 years of dedicated and meritorious service. At an event in Lagos, hundreds of Airtel staff gathered to rejoice with their colleagues who have attained the one decade mark with the company. Speaking at the occasion, the Chief Executive Officer and Managing Director of Airtel Nigeria, Rajan Swaroop commended the recipients of the Long Service Awards, for their commitment and contributions to the growth of the organisation. According to him: “As an employer of choice, we have developed robust programmes to retain and motivate our employees just

as we are committed to building an organisation that will be managed by loyal and highly motivated Nigerians. Today, we rejoice with our colleagues who have put in so much effort and time in building this company and we thank them immensely for their good work.” Among other recipients of the 2012 Airtel Long Service Awards were Obianuju Kuye, Manager, International Carrier Services; Folake Ogunbanjo, Senior Manager, Special Projects; Evelyn Ezomo, Manager, Voice VAS & Content; Joseph Ebhomielen, Officer, Talent Development & Engagement; Folayemi Balogun, Manager, HR & Admin; Seun Keyede, Manager, Sales Logistics and Doris Okogwu, Assistant Manager, KM&VOC, Operations.

*From left: Chief Executive Officer and Managing Director, Airtel Nigeria, Rajan Swaroop and Director, Corporate Communications & CSR, Emeka Oparah, who is also a long service award recipient, during the celebration of loyal employees of the company in Lagos.

Vanguard, MONDAY, JULY 23, 2012 — 35

People in Business BRIEFS

We aim to be the leading energy solutions provider in Africa

China strengthens Africa ties with $20 bln in loans HINESE President Hu Jintao on Thursday offered $20 billion in loans to African countries over the next three years, boosting a relationship that has been criticised by the West and given Beijing growing access to the resource-rich continent. The loans offered were double the amount China pledged for the previous three-year period in 2009. The pledge is likely to boost China’s good relations with many African nations, suppliers of oil and raw materials to the world’s most populous nation. But the loans could add to discomfort in the West, which criticises China for overlooking human rights abuses in its business dealings with Africa. “China and Africa should strengthen political mutual trust,” Hu said in a speech to African leaders in Beijing at a summit held every three years. “We want to continue to enhance our traditional friendship...rule out external interference and enhance mutual understanding and trust.” Hu also pledged to “continue to expand aid to Africa, so that the benefits of development can be realised by the African people.”

— CHINEDU OKONKWO By EBELE ORAKPO

IQUEST Oil and Gas Limited is an indigenous company with focus on providing innovative energy solutions for the Oil and Gas industry. The company is also involved in haulage, environmental management and consulting. In this chat with Financial Vanguard, the Managing Director, Riquest Oil and Gas, Mr. Chinedu Okonkwo speaks of his journey into Petroleum marketing world and says the company is committed to the downstream sector of the Nigerian oil and gas industry. Excerpts: The beginning: According to Mr. Chinedu Okonkwo, Riquest Oil and Gas Limited came into being in year 2009. “I was a fleet/transport manager for a company in Lagos. One day, I had a dream and in that dream, I saw myself in Port Harcourt. I had a strong conviction and I was certain that being in Lagos then was not God’s plan for me. At that time, I was comfortable living in a three-bedroom flat. I woke up one morning, packed my luggage and left Lagos. Coming to Port Harcourt, I lodged in a hotel at Akapajo with the limited fund I had. God was in control because on the day I exhausted my money, my ex- boss called that I should assist him in loading his trucks. That was the beginning of my journey into the petroleum business.” Success factor: Okonkwo hinges his success on the grace of God upon his life, accurate positioning, integrity and customer satisfaction. Said he: “For me, I am not the smartest or the most intelligent in this business. I know that it is only God’s grace/favour that has brought me this far. Secondly, I believe in accurate positioning; that is being in the right place at the right time. What I mean is that today, I do far better than many of my friends in Lagos who have been doing the same business for a longer time. Lastly, I do not joke with some principles like integrity and customer

*Mr. Chinedu Okonkwo...I do not joke with some principles like integrity and customer satisfaction.

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I don’t encourage hoarding at all because it makes consumers suffer so much, and they lose a lot, including their lives, income, time and property

satisfaction. For example, if a customer pays and we assign him to load, let’s say at Masters Energy, if something happens, we will re-assign the customer to load in another depot just to make the customer happy.” This has paid off because according to him, the company has received so many awards from major companies that import petroleum products. Awards: “We have been adjudged the most valuable customer in the major companies that import petroleum products such as Oando, Shorelink and Master Energy where we won the Master Energy Best Customer Award. These awards are based on excellence and volume. In fact, in Master Energy Oil and

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Gas Limited, the first runner up by their rating came with 3,000,000 litres behind us,” he said.

r. Okonkwo who said he is greatly bothered by filling station operators who hoard products to create artificial scarcity noted: “I don’t encourage hoarding at all because it makes consumers suffer so much, and they lose a lot, including their lives, income, time and property. This is one of the errors we are coming to correct in the business when we come into the mainstream later this year, God willing.” Crude oil diversion: “I believe it is a deliberate sabotage by corrupt elements in government. We are still

loading petrol but there is no diesel and kerosene. You know if there is no kerosene, the poor masses are affected. As a cushion to the delayed loading at PPMC depot, Riquest Oil and Gas sells petrol, diesel and kerosene through private tank farms to independent marketers in the South-South and South-East regions. This has helped to make the product available in the two zones.” Solution to fuel scarcity: The boss of company which has about 30 people in its employ and lifts about one million litres of petroleum products daily, praised the Rivers State Government for donating vast acres of land to build a park for petroleum tankers. “The park will be built using PPP model in Eleme Local Government, and interested investors should liaise with NUPENG or Rivers State Ministry of Energy. Riquest Oil and Gas is currently open to partner investors to build tank farms and refinery in Port Harcourt. This, I believe, will provide a permanent solution to fuel scarcity in the region.”

National Industrial Court to hold inaugural sitting in Calabar — Chief Registrar

HE National Industrial Court of Nigeria, Calabar Division, will hold its inaugural sitting on Friday at the Permanent Court Complex, Murtala Mohammed Highway, Calabar, Cross River State. This is contained in a statement signed by the Chief Registrar of the Court, Mrs Rakiya Haastrup, and made available to the News Agency of Nigeria (NAN) in Calabar. It indicated that the inaugural sitting would be presided over by the President of the court, Justice Babatunde Adejumo. It stated that henceforth, the court would have its sittings at the New Court Complex in fulfilment of its constitutional responsibility as enshrined in section 254(C) of the 1999 Constitution as amended. According to the statement, the Nigerian constitution “gives the Industrial Court exclusive jurisdiction over matters arising from employment, labour, trade dispute, industrial relations and environmental and conditions of work among others.” C M Y K

36 — Vanguard, MONDAY, JULY 23, 2012

Agric BRIEF Helping develop national rice statistics in Africa

gricultural data can be difficult information to collect. However, the availability of accurate and detailed information on agricultural production, processing and consumption is extremely valuable when planning agricultural campaigns, especially at the national level, to increase the overall availability of food on the market. Since December 2007, AfricaRice has led an initiative to improve the timely availability, reliability and relevance of rice statistics and information needed for quality rice research, evidence-based policy formulation, and monitoring and evaluation of rice-related investments in sub-Saharan Africa. "We always work with national partners, as it is the only viable route to cover the whole continent," said Dr. Aliou Diagne, AfricaRice Program Leader for Policy, Innovation Systems and Impact Assessment. When the rice price crisis struck Africa in 2008, AfricaRice worked with many partners to develop an emergency response and also to strengthen the ability to develop policies so that the countries could avoid similar crises in the future. Its project to develop the national rice statistics got support from the Japanese government through the Emergency Rice Initiative (ERI) launched in the wake of the crisis to help countries with seed systems and policy support tools. AfricaRice collaborated with the national agricultural research systems (NARS) and the national agricultural statistical services (NASS) of 21 country members of the Coalition for African Rice Development (CARD) to collect large detailed rice statistics and information from nationally representative samples. CARD was launched by the Japan International Cooperation Agency (JICA) and the Association for a Green Revolution in Africa (AGRA) in 2008 as a consultative grouping of bilateral and multilateral development partners and African and international institutions to double rice production in Africa by 2018. As part of ERI, AfricaRice facilitated capacitybuilding workshops to guide NARS and NASS personnel in the design and implementation of surveys to collect detailed and reliable crop-specific data. C M Y K

*From Left: Mr. Jean-Louis Ekra, President of Afrexim Bank, Mr. Zhu ,Xianqiang,Vice-President,China Exim Bank, Mr. Emeka Ugwu-Oju,President,South-East South-South Professionals of Nigeria, Dr.Francis Mbroh, Director, Research and International Cooperation, Afrexim Bank during an investment forum with the theme: "Africa-China Partnership for Economic Growth and Long-Term Prosperity" was jointly organised by Afrexim Bank and China Exim Bank

‘Fisheries, aquaculture major employers of people’ ... provides 4.3bn people with animal protein

he Food and Agricul ture Organisation (FAO) has revealed that sustainable fisheries and aquaculture play a crucial role in food and nutrition security. Fisheries and aquaculture according to the report is a source of income for 55 million people, thus providing for the livelihoods of millions of people. The body's latest flagship publication on the state of fisheries and aquaculture highlights the sector's vital contribution to the world's well-being and prosperity. Theworld Fisheries and Aquaculture report reveals that the sector produced a record 128 million tonnes of fish for human food - an average of 18.4 kg per person providing more than 4.3 billion people with about 15 percent of their animal protein intake. "Fisheries and aquaculture play a vital role in the global, national and rural economy," said FAO Director-General José Graziano da Silva. "The livelihoods of 12 percent of the world's population depend directly or indirectly on them. Fisheries and aquaculture give an important contribution to food security and nutrition. They are the primary source of protein for 17 percent of the world's population and nearly a quarter in lowincome food-deficit countries." Árni M. Mathiesen, head of FAO's Fisheries and Aquaculture Department, said: "Fisheries and aquaculture are making a vital contribution to global food security and economic growth. How-

ever, the sector faces an array of problems, including poor governance, weak fisheries management regimes, conflicts over the use of natural resources, the persistent use of poor fishery and aquaculture practices. "And it is further undermined by a failure to incorporate the priorities and rights of small-scale fishing communities and the injustices relating to gender discrimination and child labour."

Boosting governance FAO is urging governments to make every effort to ensure sustainable fisheries around the world. The report notes that many of the marine fish stocks monitored by FAO remain under great pressure. According to the latest statistics available, almost 30 percent of these fish stocks are overexploited - a slight

decrease from the previous two years, about 57 percent are fully exploited and only about 13 percent are non-fully exploited. "Overexploitation not only causes negative ecological consequences, but it also reduces fish production, which leads to negative social and economic consequences," the report says. "To increase the contribution of marine fisheries to the food security, economies and the well-being of coastal communities, effective management plans must be put in place to rebuild overexploited stocks". Strengthened governance and effective fisheries management are required. The report argues that promoting sustainable fishing and fish farming can provide incentives for wider ecosystem stewardship and advocates enabling mechanisms such as

the adoption of an ecosystem approach to fisheries and aquaculture with fair and responsible tenure systems.

Global fish production Capture fisheries and aquaculture supplied the world with about 148 million tonnes of fish in 2010 valued at US$217.5 billion. Production growth from aquaculture keeps outpacing population growth, and it is one of the fastest-growing animal food-producing sectors - trends that are set to continue. Fish and fishery products are among the most-traded food commodities worldwide. Following a drop in 2009, world trade in fish and fishery products has resumed its upward trend driven by sustained demand, trade liberalisation policies, globalisation of food systems and technological innovations.

GES scheme will eradicate poverty, says Perm Sec

r Ezekiel Oyemomu, P e r m a n e n t Secretary, Federal Ministry of Agriculture and Rural Development, has said that the Growth Enhancement Support (GES) Scheme will eradicate poverty in the country. Oyemomu made the statement in Uyo on Friday at the inauguration of the GES programme and distribution of seeds and fertilisers to farmers in Akwa Ibom. "The scheme is expected to bring about increase in productivity and household income thereby reducing poverty in our rural communities where majority of the resource-constrained farmers reside.

"The flag-off marks the beginning of the distribution of seeds and fertilisers throughout the redemption points in the state for the next six weeks, " Oyemomu said. He advised farmers who had registered to visit the redemption point nearest to them for their inputs while those yet to register were advised to do so. The permanent secretary added that the GES scheme was initiated by the Federal Government to address the challenges of the past system of inputs distribution and subsidy administration in the agricultural sector. According to him, this system has been inefficient. He disclosed that under the GES scheme, 4.3 million farmers

had been registered in the national farmers’ database, adding that, 20 million farmers were expected to register over the next three years. The permanent secretary said that fertilisers supplied to farmers were subsidised by 50 per cent by Federal Government, adding that State Governments contributed 25 per cent while farmers paid the remaining 25 per cent. In his speech, Gov. Godswill Akpabio of Akwa Ibom, said that agriculture was of interest and critical to the industrialisation policy of government. Akpabio, who was represented by his deputy, Mr Nsima Ekere, said the State Government had strengthened the sector to be one of the engines to drive the industrialisation of the state.

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Technology News & Reviews BRIEFS MTN, NCC join forces against sales of preregistered SIMs

art of the beauty of N i g e r i a ’ s telecommunications industry is the ability of stakeholders to always overlook their differences in order to forge a common front to pursue growth of the sector. This scenario is playing out now as telecommunications operator, MTN Nigeria, just recovering from payment of a huge fine imposed by the Nigerian Communications Commission, NCC, over quality of service, has joined the regulator in fighting those selling pre-registered SIM cards in the country. It could be recalled that NCC had embarked on an enforcement action against sales of pre-registered SIM cards following alerts in the media. Several people have since been arrested and the regulator said they would soon be prosecuted. MTN’s Corporate Services Executive, Mr Akinwale Goodluck , who revealed this partnership to journalists in Lagos, said that MTN has zero tolerance for the sales of prereregistered SIMs or any activity that contravenes laid-down procedure as advised by the NCC and therefore has decided to work closely with the regulator and other relevant law enforcement agencies to stamp out this dangerous trend. Goodluck noted that for MTN, one of the benefits of the recently concluded subscriber SIM registration, which is the process of capturing and recording personal details of a subscriber, was helping the company to know its customers better and to support the government in safeguarding the public against acts of insecurity . Some of these acts, according to him, are perpetrated by elements who seek to take advantage of the anonymity offered by prepaid mobile phones to commit crimes. He also revealed that with the record of its subscriber details including name, date of birth, gender, address, phone number, the subscribers’ facial picture s and fingerprints, MTN has been able to segment its customers better and to design bespoke products and services to further enrich C M Y K

NASS tasked on Act backing telecom as national infrastructure By PRINCE OSUAGWU

he Senate Committee on Communications last week listened to appeals on why it should consider an Act that makes telecommunication infrastructure strategic critical national infrastructure. The committee listened to a 24-page paper presentation by a media group, the ICT publishers Alliance at its hearing in Abuja, on problems associated with quality of service in mobile phone operations in Nigeria and co-location. The Committee chaired by Gilbert Nnaji held for two days and took both oral and paper presentations from stakeholders in the telecom industry. In a paper presented by its Chairman, Mr Aaron Ukodie, the Alliance said that telecom services should be considered as Strategic National Services so as to free it from the debilitating effect of multiple taxation and regulation from various government agencies at the three tiers of government. According to the Alliance perception today among different strata of government is that telecom operators are cash-cows that should be milked to no end such that taxations at even council levels are notoriously and arbitrarily imposed in such a way that continuous or seamless service delivery becomes impossible. This year alone, the NCC has had to intervene in several locations where telecom infrastructures have been shut down by council officials enforcing compliance with imposed taxes by local councils, the Alliance said. “Although cases of multiple regulation and taxation may not be limited to Nigeria alone; our position is that Nigeria can eliminate such cases and become an example to other countries and regions. “It is the responsibility of lawmakers, as the repository of the people’s destinies, to ensure that laws made do not run counter to the needs, desires and social wellbeing of the people they represent”, the Alliance noted. The Alliance said further that a situation where every agency of government taxes telecom just because they see the industry as the cash-cow, does not and will not augur well for the country's fledgling telecom industry. “All of a sudden, for instance, every state government, every local government, and every community has become a law maker unto themselves, churning out one law after another nearly every month or

quarter of the year, all targeted at milking telecom operators”, according to the Alliance. It said the National Assembly needs to put all these in check - if the telecom

•Telecom mast

industry, especially mobile operators - is to continue to grow and deliver quality services to the people. The Alliance said that the gazetting of the Quality of Service Regulations by the F e d e r a l Ministry of Justice is a right step in the right direction to strengthen the NCC to take some severe measures when s e r v i c e providers are found wanting and that the NCC must also sustain its efforts in the engagement of D r i v e - Te s t contractors to carry out continuous quality of service drive-testing in the six geopolitical zones and Lagos. The Alliance said however that while it

agrees that the challenges the operators face in delivering good quality service are huge, it believes however that the operators themselves still have a role to play to stem the increasing poor state of telecom services in the country by infusing more resources into expanding the capacity and optimization of their networks. While aligning itself with the view of the NCC and the I n t e r n a t i o n a l Telecommunication Union (ITU) the Alliance said network optimisation is feasible so as to reduce frequent glitches in operators’ networks. “We are inclined to accept the viewpoint of the regulatory authority that “current mobile network in Nigeria is not fully optimized as the nation can derive more value from an enhanced and optimized mobile network, especially in the area of improved Quality of Service”, the Alliance noted. Operators can and should invest more in Network Optimisation as this would reasonably address three key components of good quality of service: network coverage, service accessibility and service retain ability.

Telecoms: When lawmaking endangers industry progress By OSALUMESE ANEGBE

here does somebody begin this story - the story of the Nigerian C o m m u n i c a t i o n s Commission (NCC) and the National Environmental Standard Regulatory Agency (NESREA) which festered for a time before medications became expedient? The sealing up of a particular base station in Abuja and the opening of same, and the re-sealing of that very base station seemed to have brought the differences between the two government organisations to the fore and of course also heightened the noticeable effects of such differences on the entire telecom industry. When you shut a base station you shut out phone users depending on that station to communicate. However commonsense eventually prevailed as the two ministries, Communication Technology and Environment and their agencies sat together to resolve what seemed an intractable relationship. Mainly on issue was the distance of base stations from dwelling apartments. While the NCC approval to operators is five metres, NESREA says only ten metres is safe enough for people living near base

stations. NESREA canvasses a position that harmful effects of base station especially radiation could be a health hazard and therefore has to take all actions including shutting base stations in order to protect the Nigerian people. The question could be asked, was the fears or concerns of NESREA empirically based or based on mere gut feelings? Militant and near patriotic as NESREA action was, that position, from industry knowledge was based on ignorance and makes the country a laughing stock before the international community. From all indications, no research has been able to link base station emissions to radiation. Thus it became more absurd and extremely laughable when the House of Representatives Committee on Environment went into a dying fire of hate to invite the NCC to begin to relive all over, the trouble that was being conveniently laid to rest. The Committee obviously nursed a paternalistic protection for NESREA. Perhaps responding to some vexatious questions from the National Assembly,the NCC EVC, Dr. Eugene Juwah , explained that the regulator follows the Act setting it up and other international standards to superintend the telecommunications industry. His remarks: “The major cause of the conflict comes from the fact that NESREA Act

came four years after the establishment of the NCC. So, adequate care was not taken to harmonise certain conflicting issues that were inherent then, but moves are on to resolve those issues. “The issue of setback of five metres is not in any Act. They are contained in our regulations. The law empowers us as regulators to make regulations and they become subsidiary laws. It is just that in harmonising, we did not quite agree, which is what is causing this conflict. So, the issue of setback does not require any amendment. “As a matter of fact, the radiation from a telecommunications mast is less than what we get from our television. This is empirical that can be measured. So the issue of pollution is very minimal.” So many people including the former EVC of the NCC, Engr Ernest Ndukwe hold same view as Juwah's that emission from a base station is far less than that of a domestic TV or radio. But why would the House Committee on Environment goad the activities of an ancillary agency instead of touching base with the House Committee on Communications and probably compare notes? •Mr. Anegbe writes from Port Harcourt, Rivers State

Vanguard, MONDAY, JULY 23, 2012 — 47

Advertising, Media & Marketing

MTN Automania: Empowerment through loyalty reward ...gives out 14 cars in Enugu Stories by PRINCEWILL EKWUJURU

OR 100 days, that’s three months and 10 days precisely, MTN Communications reiterated its resolve to reward subscribers with 100 ix35 Hyundai cars, with 68 cars left, empowerment and reward for loyalty seems to have berthed with the testimonies of Enugu winners where a total of 14 cars were given to subscribers from different parts of the country. Before now, this could not happen but overtime, with the establishment of regulatory authorities responsible for the regulation and monitoring of promotional games like MTN Automania, things seem to have changed, because regulators insist that gift items promised by promo organisers are delivered. With this, regulatory bodies now attend promos to authenticate such, consequently, organisers are put on their toes by the powers vested on the Consumer Protection Council (CPC) and the National Lottery Regulatory Commission (NLRC) that ensures consumers are not at the receiving end. Consequent upon this, consumers' confidence in promos is beginning to return as a result of promo (s) monitoring by regulatory bodies and organisers' knack to shore up their market share if they fail not in their bid to honour consumers' loyalty. To this end, Mr. Emmanuel Jeminiwa, Ag Director, Regulation & Monitoring, National Lottery and Regulatory Commission (NLRC) who stood on behalf of the DirectorGeneral of the commission, said the commission was duly contacted before the commencement of the game, but pointed out that winners are not selected, winners emerged through a process and that process is very transparent. “It is a computer thing, the system cannot be manipulated, how the winners emerged is a testimony on its own. “Just like somebody said, it is the Lord’s doing. If a thing is destined for you, no one can change it. I am standing on behalf of the Director-General of the NLRC to declare to everyone in this house and of course, as many ears that are hearing me this afternoon,

that we are carriers of this message, that everything that has to do with lottery business, if it is not properly regulated, such lottery business becomes illegal, you will never see the commission standing in such gathering to attest to what the operator has done, instead, the long arm of the law will catch up with such group. This is to attest that what MTN is doing, what they did before and still going to do in future, as far as

this game is concerned, is very transparent.” However, at the delivery point of the cars in Enugu for the trivia game, Mrs. Adline Okeke, MasterBrand Specialist, MTN Nigeria, said that the MTN Goodwill Automania is a reiteration of the brand’s commitment to constantly reward and delight its customers. According to her, MTN is seizing every opportunity to engage, delight and enrich the lives of its customers.

Definitely, if anyone had told Eze .O. Kingsley that he would become a brand new car owner in 2012 and a winner of N10,000, he would have definitely considered it far from possible. For Pastor Chimezie Donatus, one of the winners who sang praises to God, said he is short of words, whilst praying for MTN’s progress. It looks like a dream , I had considered buying as econd hand car, but today through MTN automania, am a proud owner of a brand new car “It is only God that can do this.”

*From Left: Nollywood actor, Mr. Tom Njemanze, winner, Mr. Chimezie Godwin, representative of the Director-General, National Lottery Commission, Mr. Emmanuel Jeminiwa, Ag Director, Regulatory and Monitoring, ace comedian, Chief Chika Okpala and Mrs. Adline Okeke, Masterbrand Specialist, MTN Nigeria during the presentation of Hyundai SUVs to winners of the MTN Goodwill Automania in Enugu.

Legend promo winners recount experiences FTER rewarding its consumers, the Legend Real Deal promo organised by Nigerian Breweries Plc finally came to a climax penultimate week. The promo which kicked off on May 1, 2012, may have given a new meaning to the concept of consumer reward schemes in the country. From a phone repairer who went to take delivery of N5,000 pre-loaded ATM card he won in the promo, only to win another prize at the Redemption centre; to a woman whose home has practically turned into a cinema, to a bar tender who collects Legend crown corks, to a widow who now goes by the moniker ‘Mama Legend’, the tales that trail the Legend Real Deal promo, will certainly make for a good story. So far, hundreds of TV sets, Blackberry phones

and generating sets; as well as thousands of recharge cards, TShirts and face caps have been won in the consumer promo. This was in addition to other prizes including ATM cards preloaded with N5,000 cash as well as thousands of free drinks. For customers of the fastest growing stout drink, it has surely been a season to savour as they smiled home with prizes. Take Bimbo Jegede, a Lagosbased phone repairer for instance. The Lagos State- born native is a double winner after he walked home with two prizes courtesy of the promo. Jegede, is now the proud owner of N5,000 pre-loaded ATM card he won earlier. “I am so happy that I stayed with this brand. I have been taking Legend for years and now my loyalty to the brand has been

rewarded,” Jegede stated. Indeed, the manner in which he won both prizes was intriguing. Having confirmed the first prize, an ATM card preloaded with N5, 000, an elated Jegede made his way to the redemption centre to pick up his prize. Little did he know that fate had another Legend prize in store for him. “I was reeling from the joy of winning the N5000 ATM card. I went to the redemption centre to pick up my prize when some staff of Nigerian Breweries Plc jokingly advised me to drink a bottle of Legend that I would get lucky again. For some reason that I really cannot understand, I bought the drink and when I checked under the crown cork, I saw that I had won a BlackBerry smart phone. I was speechless,” he said.

dvert

BRIEFS Oke emerges AAAN president RS. Bunmi Oke, Managing Director of 141 Worldwide, a creative Advertising Agency has become the president of the Association of Advertising Agencies of Nigeria, the umbrella body of all advertising agencies in Nigeria. With her assumption of office, she becomes the second female president of the association in its 39 years of existence. Oke before her present position had worked with LTC-JWT, worked as the media Director for the US-Nigeria Development Institute and eventually the National Open University of Nigeria (NOUN) as the pioneer Chief Public Affairs Officer before she moved to 141 in 2005 as the pioneer Chief Operating Officer/Business Director and an Executive Director in 2008. Bunmi has worked in several capacities in the association including the position of vice-president, having proven her competence as chairman of the Lagos Advertising and Ideas Festival (LAIF), an award organised by the association to celebrate creative excellence within the industry. The new AAAN president explained that her priority is to engender continuity, consolidation and revitalization.

Seaman’s Schnapps partners Osun Oshogbo Festival N line with its brand positioning, Seaman’s Schnapps, a spirit drink from the stable of Grand Oak Ltd has concluded plans to sponsor this year’s Osun Osogbo Festival. Making the disclosure at the formal media unveiling of the festival held at the Ikeja Airport Hotel, Category Manager of Grand Oak Ltd, Mr. Ayodeji Abiodun said the decision to sponsor the popular yearly festival was not unconnected with the importance the brand attached to it. Besides, he said Seaman’s Schnapps, the number one original prayer drink will be partnering on the festival because the brand is about culture and tradition, and as such, the Osun Osogbo Festival provides relevant platform to associate and bond with key target audience. “If you look at the origin of the Seaman’s Schnapps in the market, it is about culture, it is about tradition, it is about associating with the lifestyles of the consumers, and for Seaman’s Schnapps, the original prayer drink, we want to celebrate with our consumers.”

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48— Vanguard, MONDAY, JULY 23, 2012

0817 002 3569

Is fuel scarcity inevitable this year?

ttrition, social stress and economic losses experienced during extended periods of fuel scarcity would make Nigerians pray that such traumatic situations do not arise. However, we recall the media interview with Dr. Okonjo-Iweala, Finance Minister and Coordinating Minister of the Economy, in June this year; in response to a question as to whether subsidy payments were ongoing, she confirmed that out of N888bn budgeted for subsidy in 2012, N451bn had already been paid out, well before the end of the second quarter! Incidentally, the N451bn was in addition to about N1 trillion already paid to oil marketers to settle part of 2011 subsidy claims! The Minister explained that the rapid depletion of the provision for subsidy has therefore necessitated a slowdown in the payment of claims of marketers. Indeed, according to the Minister, only N17bn had so far been released for 2012 claims! (See pg 19, Punch, 18/6/ 2012). Such reality can only make oil marketers jittery with regard to commitment for future deliveries. Besides, in spite of the collateral of sovereign guarantee for fuel imports, banks are still concerned by the very late liquidation of loans by oil marketers. Marketers are also concerned that these late payments

would increase their cost of funds, and may ultimately leave them with little or no margin in this enterprise. Worse still, crude prices in excess of $100/barrel together with naira depreciation in the last four months may also make subsidy payments predicated on this benchmark inadequate to cover import loans obtained by marketers, especially when repayment is compounded with excessive charges for almost six months’ late payment. In a media comment on delayed subsidy payments, a major oil importer confirmed that “the banks give us loans based on 21% and they usually apply a default rate of 35%.... Many of us have not been paid for imports made in February 2012! A lot of marketers are still being owed subsidy arrears for 2011.” The spokesman of another major oil marketer disclosed that “the banks are already getting impatient with delayed loan repayments” (Punch, 19/6/ 2012). What immediately becomes obvious from the above is that if some marketers are yet to receive payments for supplies made in 2011, it is just possible that much of the provision of N888bn in the 2012 budget may be applied for settlement of last year’s subsidy claims! It is

worrisome that the Finance Ministry together with other related agencies are yet to fully reconcile the actual daily national fuel consumption nor have they fully identified those who submitted false claims for subsidy. More worrisome still, is the fact that the relevant authorities failed woefully to alert the government on the

staggered; according to her, “we just slowed down the payments; once we have verified that payments already made are genuine, we will commence payment again, but we will not be stampeded into making payments until we are sure of them”. Evidently, things have gone awry with fuel supply and subsidy

The consequent stalemate in imports because of above factors, will lead to a huge drop in fuel importation, and it may once again be crying time nationwide, as fuel scarcity disrupts normal life

inadequacy of the 2011 budget provision of less than N300bn for subsidy. Furthermore, the constitutional illegality of extra-budgetary spending of over six times the approved appropriation for subsidy seems to have been glossed over. In an attempt to manage this awkward situation, Okonjo-Iweala indicated that subsidy payments for 2012 would be

management. In addition, the Minister has now acted on a presidential recommendation to establish a company “that will certify the discharge and also verify the payments that will be made for fuel imports”. The Minister revealed that the contract with the erstwhile official auditors of this process has now been terminated. (Daily

Independent, 17/6/2012, pg. 28). Presumably, the new company is an internal department of the Finance Ministry; even if this new arrangement allows for easier and direct supervision by the ministry, it is not yet clear why we should expect this internal audit unit to do a better and more transparent job than the team of independent, private auditors! It is rather disconcerting that 12 months or so after her second coming, Dr. Iweala still does not know the average volume of fuel consumption in Nigeria. It is sad that under her purview, the fuel subsidy budget for 2011 was brazenly exceeded without as much as a whimper of protest from her ministry until after the bubble burst in the first quarter of 2012! The consequent stalemate in imports because of above factors, will lead to a huge drop in fuel importation, and it may once again be crying time nationwide, as fuel scarcity disrupts normal life. That notwithstanding, it will be market day once again for those nefarious hoarders of fuel. Nonetheless, Nigerians are keeping a close watch, to thwart the large-scale fraud and theft witnessed lately in this commercial subsector. SAVE THE NAIRA, SAVE NIGERIANS!

BUSINESS & ECONOMY Emerging markets to contribute 30% of global revenue by 2016 — PWC cent of its global revenue would come from emerging markets on the African continent like Nigeria and other markets, given that Africa is an important part of

By PROVIDENCE OBUH HE Pricewaterhouse Coopers has projected that by the year 2016, 30 per

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

Group Business Editor Acting Finance Editor Energy Editor Head, Capital Market Snr Bus. Correspondent Insurance Correspondent Maritime Correspondent Maritime Correspondent Energy Correspondent Energy Correspondent Industry Reporter Capital Market Reporter Energy Reporter Maritime Reporter

CONTRIBUTORS Princewill Ekwujuru Naomi Uzor Providence Obuh LAYOUT

Media/Marketing Industry Capital Market Graphics Department

growth strategy, says Mr. Dennis Nally, Chairman of PricewaterhouseCoopers International Limited. Nally made these statements during a media parley with Business Editors in Lagos, stating that government is responsible for creating the enabling environment and opportunities for business to thrive in any country. According to him: “Government today is much more involved in business than ever before, this trend will make Chief Executive Officers (CEOs) and government to collaborate on understanding business models. “Private sector is partnering with government on creating relationship on businessfriendly environment in the world. We know from experience that a regional investment strategy makes sense, not just in Africa but globally.” Meanwhile, Nally’s visit

to Lagos, Johannesburg, Capetown (South Africa) in the week, is to announce the next phase of PwC’s regional investment model in Africa and also to support closer alignment between PwC firms in Africa through a new leadership structure. On his part, Country Senior Partner, PwC Nigeria, Mr. Ken Igbokwe said: ‘In West African markets like Nigeria, we are seeing many local businesses expanding regionally. Their needs differ substantially from an inbound multinational.” Igbokwe also noted that Nigeria’s problem goes beyond corruption at all levels, saying that corruption is a global menace. “You will accept with me that there is no country without corruption, the real

issue is that we have missed the point, and our corruption is in such a scale that it is holding us back from moving forward, and we have to address it. Corruption is holding us back because at the leadership level, we are not doing what we should. “We need to balance our yearning to move forward quickly, violence cannot solve anybody’s problem, business cannot thrive in an environment where there is security challenge.” Exceptional growth opportunity In Nigeria, confidence is higher than in any other market. A survey by PwC shows that growth opportunities are unprecedented in Africa, leading to higher CEO confidence than ever before.