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The Central Bank of Nigeria (CBN) has approved a new chairman and board of directors for Keystone Bank.
This was confirmed in a statement on Wednesday by Keystone bank, in which it noted that the move was part of the apex bank’s strategy to ensure sustained growth for the financial institution.
The CBN appointed a new board chairman, five non-executive directors and two new directors.
Recalls the CBN had confirmed in January that it had dissolved the board and management of Union Bank, Keystone Bank, and Polaris Bank.
The apex bank, in a statement signed by its acting director of Corporate Communications, Sidi Ali Hakama, said the move became necessary due to the non-compliance of these banks and their respective boards with the provisions of Section 12(c), (f), (g), (h) of Banks and Other Financial Institutions Act, 2020.
According to the fresh statement on Wednesday, Lady Ada Chukwudozie has been appointed as the new board chairman.
The five other non-executive directors are Abdul-Rahman Esene, Mrs. Fola Akande, Akintola Ayodeji Olusoji, Obijiaku Samuel, and Senator Farouk Bello.
In addition, the CBN also named two new executive directors, Ladi Oluwole and Abubakar Usman Bello.
Lady Ada Chukwudozie, a prominent figure in Nigeria’s corporate sector, brings nearly three decades of experience in business strategy, management, and administration.
Her expertise cuts across multiple industries, including De-Endy Industrial Company Limited, Dozzy Group, the Manufacturers Association of Nigeria, and Vogue Afrique Magazine.
Abdul-Rahman Esene, with over 43 years of experience in banking, investment management, and corporate finance, has held leadership roles in major institutions such as Fidelity Bank, Afrinvest, and Global Arbitrage International Inc.
Mrs Fola Akande boasts over 25 years of experience in legal, compliance, and risk management, having worked with global brands like Cadbury, Stanbic Chartered Bank, and Shell.
Akintola Ayodeji Olusoji has a distinguished 30-year career in accounting, finance, and business development, having served at institutions such as Sterling Bank, Access Bank, and Intercontinental Bank.
Obijiaku Samuel, with more than 35 years of experience in banking and treasury operations, has left a significant mark on Nigeria’s financial sector, previously working with Zenith Bank and Fidelity Bank.
Senator Farouk Bello, a seasoned banker with over 20 years of experience, has led initiatives across both the public and private sectors, including the National Assembly and Guaranty Trust Bank.
Meanwhile, the two new executive directors bring their vast expertise to the table. Ladi Oluwole, the new Executive Director of Risk Management, comes with over two decades of experience in credit and enterprise risk management, including previous roles at Bank of America. Abubakar Usman Bello, Executive Director for the Northern Directorate, has extensive experience managing corporate, retail, and public sector clients.
Speaking on the appointments, Keystone Bank’s Managing Director and CEO, Hassan Imam, expressed confidence in the new board members, stating that their wealth of experience would play a crucial role in the bank’s continued repositioning and growth.
“We are pleased to welcome the new chairman, non-executive directors, and executive directors to the board of Keystone Bank. We are confident that their extensive experience will be invaluable as we continue to reposition the bank to seize emerging economic opportunities while maintaining strong corporate governance and providing our customers with a secure and reliable banking experience,” Imam said.
The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has denied suggestions that the Nigerian National Petroleum Company Limited (NNPCL) has been allowed to usurp its powers by determining the price of petrol coming from Dangote Refinery.
The NMDPRA maintained that the deal between Dangote Refinery and NNPCL was based on a willing seller and willing buyer relationship.
The Chief Executive Officer of NMDPRA, Engr. Farouk Ahmed, who made the submission, said in line with the provisions of the Petroleum Industry Act (PIA), 2021, the interaction of market forces is what determines the price of petrol in the country since the government has deregulated the sector.
He added that the role of the NMDPRA is not to allow anyone to go overboard by exploiting the market or the final consumers.
Naija News recalls after lifting petrol from Dangote Refinery as the sole buyer of products from the facility, the NNPCL released a price template which indicates ₦950.22 as the average price of a litre in Lagos State, and ₦1, 019.22 per litre for Borno State, the longest and extreme end of the supply route.
This development raised concerns among stakeholders and industry watchers, with insinuations that the NNPCL had taken over one of the key functions of the NMDPRA.
But speaking in a chat with Daily Trust on Tuesday, Engr. Ahmed said the controversy generated by the action is needless.
He submitted that the pump price announced by the NNPCL was meant for its outlets across the country, and other marketers are not bound by the prices.
“We try to restrain ourselves from needless controversy,” he said.
“But to put the record straight, the recent transaction between NNPCL and Dangote Refinery is strictly based on a willing buyer and a willing seller.
“But I know you will ask me that the supply is not sufficient in Nigeria, hence the high price. Of course, things would work fine when we have more players in the sector.
“But in a situation whereby some Nigerians expect us to regulate the price, it then means that the sector has not been deregulated; and it means we would continue to have problems,” he added.
More controversy has emerged in the execution of a sale-purchase deal on premium motor spirit, otherwise known as petrol, between the Nigerian National Petroleum Company Limited, NNPCL, and Dangote Refinery.
Findings by Vanguard yesterday indicated that while the NNPCL believes Dangote cannot supply an adequate quantity of the product, Dangote told Vanguard it had already delivered 111 million litres of the product within three days (last Sunday to yesterday), adding that loading was still ongoing steadily.
NNPCL last weekend said Dangote could only deliver 16.8 million litres out of the 25 million litres it initially agreed with NNPC.
A source at the NNPCL also told Vanguard, yesterday that the refinery is struggling to deliver the 16.8 million litres it promised.
But with the latest delivery figure it disclosed, Dangote must have significantly surpassed its promised delivery as well as the national demand put at over 40 million litres per day.
This also means that Dangote can make further petrol importation unnecessary.
But against the backdrop of this latest development, Vanguard learned that importation by NNPCL may have intensified with several consignments, totalling over 135 million litres, within three weeks from September 27, 2024, with the latest import arriving Friday.
This also implies a sudden excess supply of petrol barely a few days after the country was suffocated by acute shortage of the product, resulting in a sharp rise in the price.
Speaking to Vanguard on the development, the Group Chief Branding and Communications Officer of Dangote Refinery, Anthony Chiejina, stated: “We have already loaded 111 million litres of petrol and the exercise is ongoing.
“We are refining and have no reason not to load. So, loading is ongoing and we would continue to provide the product to the market.”
More imports by NNPC
However, Motor Tanker Vessels Report, sighted by Vanguard, yesterday, indicated as of September 13, 2024, vessels such as Mia Grace, Valle Azzurra, Hafina Lioness and Clean Justice brought in 37,000 metric tonnes, 37,234 metric tonnes, 24,352 metric tonnes and 36, 934 metric tonnes of imported petrol into Nigeria for the government.
Also, another vessel, known as Savanna, brought in 20,000 metric tonnes of import petrol through Mainland for distribution in Calabar while Mycroft brought in another 20,000 metric tonnes of diesel for Total Oil for distribution in Port Harcourt, Rivers State.
Two vessels – Ostria and Moriarity – brought in 15,000 metric tonnes each through Taurus and Awariste for distribution in the Warri, while Bedford brought in 12,000 metric tonnes of diesel.
Also Zonda and Capt. Gregory brought in 15,000 metric tonnes of petrol and diesel for Nepal and Awariste respectively, while Matrix Pride and Stellar also brought in 15,000 metric tonnes of petrol.
NNPCL did not respond
Efforts to get NNPCL to officially comment on the latest delivery figures from Dangote failed as the Chief Corporate Communications Officer of NNPCL, Mr. Olufemi Soneye, did not respond to questions from our reporter.
But in its earlier statement, the company had stated that 16.8million were available for loading from the refinery to its filling stations.
Why marketers can’t import petrol, lift from Dangote — NNPCL
Meanwhile, the Executive Vice-President, Downstream at NNPC, Adedapo Segun, said oil marketers have not been able to import petrol, despite the import permits granted them.
He said: “When the marketers go to Nigerian Midstream and Downstream Petroleum Regulatory Authority, NMDPRA to get the permit or licence to get the import, typically they will say they want to import amount of automotive gas oil (AGO), aviation turbine kerosene (ATK), and some of them actually include petroleum motor spirit (PMS).
“They then go to market, check the market indices and say to themselves: PMS is still being sold below cost; if I bring it in, I’ll make a loss.
“Now they have approval to bring in ATK, AGO, and PMS, but they end up bringing only AGO and ATK.
“They do not bring in that PMS because the market is still not right for them. So, it is not because NNPC wants to be the sole importer or provider of PMS, it is because the other marketers won’t do it if it’s not profitable.”
Segun, who said marketers could also not purchase petrol directly from Dangote refinery, stated: “That is the same thing happening with Dangote. I said earlier that Dangote is a company and it is going to sell at market price.
“Basically, the situation has not changed there. So, NNPC off-taking is only because the others would not buy at the price Dangote will be willing to sell, which is reasonable. As soon as the price allows for it, you will see the marketers go to Dangote and buy.
“So, instead of saying NNPC is the only off-taker, let’s put it this way: NNPC is the only entity that is willing to off-take because NNPC has a role under law to be the energy provider of resort.”
FG should provide welfare packages — CPPE
Reacting to the development yesterday, the Chief Executive Officer, Centre for the Promotion of Private Enterprise, CPPE, Dr Muda Yusuf, said the recent upward review of petrol price has worsened the plights of most Nigerians and, of course, businesses.
“I think we need to go back to the drawing board, the social safety net in Nigeria is exclusively very weak, the people are suffering seriously and there is a limit to what they can absorb in terms of the pains of all these policies
“The government should wade into this and see how they can restore normalcy as the citizens should not be exposed to commercial pricing of petroleum products.
“The citizens are not finding it easy at all. Most recent increases have even further fuelled inflation as many citizens are trekking to places where they would have taken buses and so on. So, we are praying for an urgent intervention from the presidency on this matter.”
President Bola Tinubu is reportedly preparing to reshuffle his cabinet in anticipation of Nigeria’s Independence Day celebrations on October 1.
Sources within the presidency revealed to BusinessDay that this decision is a direct response to growing criticisms regarding the administration’s handling of the economy.
Reliable insiders indicated that several key ministries are likely to be affected by the upcoming reshuffle, including the Ministry of Petroleum Resources, Ministry of Power, Ministry of Transport, Ministry of Water Resources, Ministry of Environment, and Ministry of Defense.
Discontent has been brewing within the ruling All Progressives Congress (APC) regarding the current administration’s performance, with party members expressing concerns that without significant changes in economic management, the party may struggle to retain power in the 2027 elections.
A chieftain of the APC, speaking on the condition of anonymity, voiced dissatisfaction with President Tinubu’s economic policies, highlighting the urgent need for improvement to regain public confidence.
The APC chieftain said, “We do not understand why he is finding it difficult to replace Simon Lalong, former labour and employment minister long after he officially announced his resignation from the cabinet.
“Look at the Humanitarian Affairs Ministry, one of the most strategic ministries designed to give welfare to Nigerians, especially members of our party. It has been vacant without a minister. The president cannot tell us that we do not have a competent person within the party to take over that ministry since the suspension of the former minister.
“Even if they want to recall her, she can be reassigned to any other ministry, but there is no justification for leaving that ministry vacant.”
The APC chieftain revealed that all is not well with the party, noting that 2027 political consideration is being elevated above current challenges facing the nation.
Recall that while Simon Lalong representing Plateau State in the Tinubu’s cabinet, resigned to take up his seat at the Senate, Betta Edu, representing Cross Rivers State, was suspended over alleged corruption in her ministry.
According to BusinessDay, the President will announce the cabinet reshuffle ahead of the October 1st celebration.
The source revealed, “The president has concluded plans to reshuffle the ministers, and it will be done before or on the 1st of October broadcast.
“I may not be able to tell you those that will be dropped or those that will go, but remember that the president has been monitoring the performance of the ministers. So, he knows those that are performing and those that are not.”
The Federal Government says the 115 Federal Unity Colleges, FUCs, in the country will soon be unbundled into basic and secondary schools.
The Minister of State for Education, Dr Yusuf Sununu made this known during the opening of the Annual General Meeting of Principals of Unity Colleges in Abuja on Tuesday.
The event has the theme: ”Entrepreneurship Education: A Panacea for Self Reliance and National Development”.
Mr Sununu said that the plan to unbundle the unity colleges was in line with the National Policy on Education, NPE.
The Minister explained that the unbundling of Federal Unity Colleges would among other things attract more funding to improve infrastructure, address teachers’ welfare and create employment opportunities, among others.
He added that the Ministry, with the support from relevant agencies of government, would ensure it was achieved at the shortest possible time.
“I want to emphasise the significance of fostering an entrepreneurial spirit in our youths, a spirit that will propel them toward self- reliance and contribute meaningfully to our nation’s development.
“Unemployment remains a pressing concern, and it is our collective responsibility to equip our students with the skills and mindset necessary to succeed.
“Entrepreneurship education offers a solution to this challenge as it prepares students to think creatively, innovatively, and develop the confidence to take calculated risks,” he said.
Mr Sununu called for the collaboration of the Principals as critical stakeholders to improve the educational landscape of the schools.
He further urged them to curb social vices, instil the maintenance culture on the students and co-operate with their host communities for the overall security and growth of the Colleges.
Also, the Chairperson, Principals of Federal Unity Schools Colleges, Dr Idowu Akinbamijo said the meeting was to set the agenda for the coming year and build capacity for the task ahead.
NAN
Residents of Abuja living at Mpape in Bwari Area Council have been thrown into panic over continued suspected tremor and vibration in parts of the city.
Dr Ebenezer Adebisi, the Chairman, Mpape Hills Landlord Association, told the News Agency of Nigeria on Tuesday that the residents had been experiencing the vibration in the last five days.
Mr Adebisi, who is a retired Corps Commander of the Federal Road Safety Corps, FRSC, said that was not the first time the resident of the area were having such experience.
He said although it happened some years ago, it had become more consistent in the past five days.
According to him, residents of the area felt the tremor and vibration were more than the usual ones they experienced during the blasting of rocks in the area by quarry companies.
He said the vibration was more intense throughout Sunday and Monday night, adding that, “we don’t really know what would have caused the vibration”.
“I have also confirmed that those in Gwarinpa and Katampe areas are also experiencing the same thing, but the government has not said anything officially up till now.
“It is important we let Nigerians know the situation now; we are calling on the Nigerian government and the Nigeria Geological Agency to come to the rescue of the resident.”
He said urgent measures needed to be taken before things got out of hand, urging the government to advise the residents on the next line of action.
Florence Ilesanmi, a resident of Gwari Village, Mpape also told NAN that she had been experiencing the same thing.
Aisha Lawal, a resident at the Crushrock area of Mpape shared a similar experience with NAN, saying that the interval of the vibration was a source of worry.
An official of the Nigerian Geological Survey Agency who spoke on condition of anonymity because he was not authorised to speak, urged the residents to consider temporary relocation if the tremor continued.
The official told one of the residents who contacted him that the residents should continue to record the frequency of the vibration.
“I `googled` the Nigerian Geological Survey Agency (NGSA). They told me I should be recording anytime the vibration occurred again.
“I was able to speak with one of the officers of the agency, who confirmed that all their equipment are already on ground to forestall any emergency.
“They said if the vibration is heavy we should try and evacuate from the premises for now,” the resident said.
NAN
The Labour Party (LP) has said the Independent National Electoral Commission (INEC) lacks the power to deregister the party.
The party’s National Publicity Secretary, Obiora Ifoh, said this in a statement yesterday in Abuja.
The party described comments allegedly attributed to the caretaker committee chairman of the party, Nenadi Usman, that its intervention saved the party from being deregistered by INEC as “ludicrous, unattainable, unsubstantiated and a pack of lies”.
It reads: “The attention of the leadership of the Labour Party has been drawn to a statement issued by Senator Nenadi Usman, a card-carrying member of the Peoples Democratic Party (PDP), wherein she claimed that the quick intervention of some leaders of the party at the September 4, 2024 stakeholders’ meeting in Umuahia (Abia State) saved the party from being deregistered by the Independent National Electoral Commission (INEC).
“The Labour Party leadership wishes to refute that statement as ludicrous, unattainable, unsubstantiated, and a pack of lies. We wish to state emphatically that the Labour Party is in a good shape at the moment, having fully abided by the laws of the land and therefore cannot be deregistered by INEC.
“These leaders have also mischievously leveraged INEC’s misinformed and erroneous disposition that the tenure of the party’s current executives has expired. It is paradoxical that some of these leaders, who were victims of INEC’s mismanagement of the 2023 general election, are now the ones quoting INEC, in order to victimise the leadership of the Labour Party.
“As we have maintained earlier, the September 4 stakeholders’ meeting held in Umuahia is unconstitutional and illegal as the party’s constitution clearly states all the organs of the party, of which Stakeholder is not one of them. The stakeholder group which produced Senator Usman as its leader has no foundation whatsoever, and therefore, its existence is delusional and can never be recognised by INEC or any law of the land.
“Senator Nenadi’s claim that the Stakeholders saved the party from being deregistered by the INEC is equally preposterous.This us because the existence of the Labour Party is not under any threat.
“Perhaps, Nenadi Usman is not aware that Appeal Courts, both in Edo State and the Federal Capital Territory (FCT), have affirmed Julius Abure as the rightful National Chairman of the party. She is probably unaware that a Federal High Court in Abuja, presided over by Justice J. K. Omotosho, had also declared that the national convention of the party held in Nnewi on the March 26, 2024 is valid and was conducted in line with the requirement of both the 2022 Electoral Act and Labour Party constitution.
“We wish to remind Senator Usman that even the Supreme Court in several judgments had ruled that Issues regarding delegates at a national convention or how the convention is planned and executed by a political party are outside the jurisdiction of any court of the land being internal affairs of a party
A delegation of the House of Representatives has visited Maiduguri, the Borno State capital that has been ravaged by devastating flood.
Led by the Chairman of the Northern Regional Caucus, Alhassan Doguwa, the lawmakers sympathised and commiserated with the government and people of the state over the unfortunate incident.
The delegation met with the state governor, Babagana Zulum, where Doguwa announced the intervention of the House on behalf of the Speaker, Tajudeen Abbas.
Addressing reporters at the Government House in Maiduguri, Doguwa commended President Bola Tinubu for his prompt and effective response to the plight of the people of Borno State.
He expressed appreciation to the President for pledging the Federal Government’s support to the state government and the affected victims.
“We are here on behalf of the Speaker, Rt. Hon. Abbas Tajudeen, PhD, and all members of the House to express our heartfelt condolences to the Government and people of Borno State,” he said.
“This donation of ₦100 million is a testament to our commitment to standing with Borno during this difficult time. We remain dedicated to supporting the state as it recovers from this disaster.
“We pledge the National Assembly’s readiness to liaise with the Federal Government to develop a legislative framework or any possible budgetary intervention to assist state governments in addressing the impacts of flood disasters in the country.”
Receiving the delegation, the governor commended the House of Representatives for their swift response to the crisis.
“On behalf of the people and Government of Borno State, I sincerely appreciate the Speaker, the House leadership, and all members for their quick and timely intervention,” he said.
“This prompt action will greatly assist in alleviating the suffering of our people and helping us manage the aftermath of this unfortunate disaster. The responsiveness of the House of Representatives in moments like this is truly reassuring.”
The candidate of the Labour Party (LP) in the 2023 presidential election, Peter Obi on Tuesday led the leadership of the party and the Obidient Movement to Maiduguri, the Borno State capital to condole with the state over the flood disaster that befell the state recently.
Obi who visited the state governor, Babagana Zulum and Shehu of Borno, Abubakar Ibn Umar Garba Al Amin El-Kanemi, was accompanied by his 2023 running mate, Dr Datti Baba-Ahmed, and Chairman of the party’s National Caretaker Committee Senator, Nenadi Usman.
The former Anambra State governor donated the sum of N50 million to the emergency relief fund of the state Government.
“We will continue to stand with the people of Borno, providing aid and resources to help them rebuild and recover from this tragedy,” he said in a statement by his media aide, Ibrahim Umar.
He told the people of Borno that as they navigate the challenging time, “We want them to know they are not alone.
“We are dedicated to helping alleviate the suffering and hardship caused by the floods, which have submerged over half of Maiduguri and displaced thousands of residents.
“Our thoughts and prayers are with the affected families, and we will do everything in our power to support them.”
Three major oil marketers are expecting vessels of imported Premium Motor Spirit, popularly called petrol, this week barring any unforeseen circumstance, it was gathered on Tuesday.
Dealers said about 141 million litres of PMS are being conveyed to Nigeria by the vessels following the full deregulation of the downstream oil sector by the Federal Government.
They also noted that the recent hike in the pump prices of petrol produced by the Dangote Petroleum Refinery and released by the Nigerian National Petroleum Company Limited on Monday had allowed room for PMS imports.
This came as the Nigerian Midstream and Downstream Petroleum Regulatory Authority declared that all imported PMS would be subjected to at least three major tests by the agency before being allowed for sale across the country.
On Monday, NNPC announced that it would sell the petrol lifted from the Dangote refinery at a price above N1,000/litre in the far north.
Its spokesperson, Olufemi Soneye, disclosed in a statement titled, ‘NNPC Ltd Releases Estimated Pump Prices of PMS from Dangote Refinery Based on September 2024 Pricing’.
Soneye explained that the price may go for as high as N1,019/litre in Borno State and N999.22 in Abuja, Sokoto, Kano, and others.
In Oyo, Rivers, and other areas in the South, it will be N960/litre. The lowest price, according to an infographic released by the NNPC, is N950 in Lagos and its environs.
Reacting to this on Tuesday, a major marketer confirmed that the deregulation of the downstream sector had fully set in, stressing that three dealers are expecting their products (PMS) this week.
The marketer, who spoke to our correspondent in confidence due to lack of authorisation to speak on the matter, stated that each vessel would bring in about 35,000 metric tonnes of PMS.
This means the three dealers are expecting about 105,000 metric tonnes of PMS this week, all things being equal.
Going by the conversion rate of 1,341 litres to one metric tonne, it, therefore, implies that the marketers are bringing in about 141 million litres of petrol.
“Most marketers often import three parcels for this kind of transaction and the lowest parcel is about 35,000 metric tonnes of PMS. Now, because of how the business is run, you see marketers bringing in between two and three parcels.
“This week, we expect about three marketers to bring in products. However, some of these imports are not cast in stone, in the sense that the influence of many regulatory authorities is still there. So it is not that you will just go and bring in products and you then start to sell them.
“The regulators, such as the NMDPRA, have to look at the quality, flash points and so many other things that should be taken into consideration before the product comes in. And when it lands, they will take samples and check them in their labs,” the marketer stated.
On whether the three parcels of each of the marketers would land this week, the dealer replied, “All of them are not going to bring in the three parcels at the same time. They bring in a parcel first and later, say in one week time or so, another parcel comes in. All these imports have storage implications.
“It is not something you do in a day. You can’t bring in one vessel today (Tuesday) and you bring in another one on Saturday. No, it is not done like that. This is not the importation of 20,000 or 30,000 litres of PMS.”
When contacted, the spokesperson of the NMDPRA, George Ene-Ita, said marketers with approved import licenses were free to import PMS, but stressed that the products must be subjected to three major tests by the agency.
“The products must be subjected to our testing protocols at the ports. The products must conform to stipulated standards before we give them the authorisation to offload to their terminals.
“Also, before the smaller vessels bring it further inland to Nigeria our people will fly to the place to see the product and carryout some tests to ensure the right specification is upheld.
“Tests are also done at the products’ origins. And when the products come in, before they are released to the market, further tests would be conducted to ensure that they meet the specifications,” he stated.
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The presidency says President Bola Tinubu did not ask Yemi Cardoso, governor of the Central Bank of Nigeria (CBN), to resign.
According to a report on Tuesday, the president reportedly asked Cardoso to resign from his position owing to his inability to stop the poor performance of the economy, most especially, the free fall of the naira.
The report also alleged that Tinubu instructed Cardoso to step down before his departure to China, despite alleged efforts by prominent Yoruba leaders to retain him in the role.
“Cardoso, who reportedly secured the nomination for the plum job through the Yoruba Elders, allegedly lacks the knack to turn around the troubled institution and the poor economy he inherited,” the report said.
“Cardoso’s undoing, according to insiders, is his inability to live up to the promise he made to President Tinubu in January to salvage the Naira and return it to between N700 and N900 to $1 before May 29, 2024, and also, save the economy from the ruins it currently lays.”
Addressing the claim via his X handle, Bayo Onanuga, special adviser to the president on information and strategy, called the report false.
“It’s all lies. President Tinubu has not asked Yemi Cardoso to resign,” Onanuga said.
Cardoso was appointed by Tinubu on September 22, 2023.
Within the first year of Cardoso’s tenure, the naira has depreciated by 124.39 percent in the official window and depreciated by 66.83 percent in the parallel market.
When Cardoso assumed office, the naira was N738/$ in the official window however, almost a year later, the naira has depreciated to N1,656 per dollar in the official market as of Tuesday.
Also, in the parallel market, the naira has depreciated to N1,660/$ as of Tuesday, from the N995/$ reported when he began his tenure.
The Nigeria Hydrological Services Agency (NIHSA) has issued a flood alert to Nigerians as the management of the Lagdo Dam in Cameroon is set to begin regulated water releases into the country.
In a statement on Tuesday, Umar Mohammed, NIHSA’s director-general, said the dam’s regulated water releases will commence on September 17.
Mohammed said the dam managers intend to release the water gradually so as not to exceed the transfer capacity of River Benue and cause major flooding in Nigeria.
He said the water will be released at an initial rate of 100 cubic metres per second (m3/s) — 8.64 million cubic metres per day, and gradually increased to 1000 m¾s in the next seven days.
“Notwithstanding, it is highly imperative for all states that are contiguous to the Benue River system, namely —Adamawa, Taraba, Benue, Nasarawa, Kogi, Edo, Delta, Anambra, Bayelsa, Cross Rivers, and Rivers; the government at all levels (Federal, State, and LGAs) to step up vigilance and deploy adequate preparedness measures to reduce possible impacts of flooding that may occur as a result of increased flow levels of our major rivers at this period,” the statement reads.
Mohammed added that the agency would ensure that it closely monitors the flow situation to forestall further flood disasters.
He assured Nigerians that there is no cause for alarm, noting that the flow levels along the Benue River are still within the warning levels.
On September 10, residents of Maiduguri were displaced from their homes following a devastating flood caused by the collapse of Alau Dam, which has been at full capacity for the past week.
The National Emergency Management Agency (NEMA) said more than 30 persons lost their lives and over 400,000 displaced due to the floods.
Debt servicing costs incurred by 29 state governments consumed 80.7 per cent of their Internally Generated Revenue during the first six months of 2024, highlighting the significant financial burden the sub-nationals currently face, The PUNCH reports.
The dire situation also forced the governors to borrow a total sum of N446.29 billion within the same period despite a 40 per cent increase in its statutory allocation from the Federation Account.
The latest information is according to an analysis of data obtained by our correspondent using the budget implementation reports from each state’s website and Open Nigerian States. This BudgIT-backed website serves as a repository of government budget data.
The performance report is prepared quarterly and issued within four weeks from the end of each quarter.
This heavy burden underscores a critical issue in fiscal management, as the vast majority of the revenue that states could otherwise allocate to essential public services and development projects is being diverted to meet debt obligations.
It also reveals the severe constraints faced by state governments in managing their debt burdens inherited from previous administrations and addressing the needs of their residents.
Nigerians had hoped that with an increased statutory allocation of 40 per cent from the central government, state governors should have more than enough to fulfill their statutory obligations.
In 2023, state governors got the most FAAC allocations in at least seven years. The rise in FAAC allocations to the three tiers of government, especially states followed the petrol subsidy removal and currency reforms of the current administration.
The reforms have reportedly led to a 40 per cent boost in income. Experts believe the revenue increase should have reduced state governments’ appetite for more borrowing.
Instead, the sub nationals are spending a large chunk on repaying loans and taking more loans.
Recall that the PUNCH had reported that most of the Federal Accounts Allocation Committee funds for Osun, Ondo, Kaduna, and Cross Rivers states will be used in servicing debts this year.
This is because these states currently have a deficit of N10.94bn, N27.72bn, N15.83bn, N10.02bn respectively following debt servicing deductions by FAAC.
With such a large portion of revenue being used to service debt, it becomes increasingly challenging for states to achieve long-term economic stability and improve the quality of life for their residents.
Earlier this year, Kaduna State governor, Uba Sani had complained vehemently about the huge debt burden inherited from previous administrations, lamenting that it had stopped the prompt payment of salaries and more borrowings in the last nine months of his government.
The governor who made this known while addressing a Town Hall Meeting at the late Umaru Musa Yar’Adua Hall, stated that his administration inherited a total of $587m, N85bn, and 115 contract liabilities.
He said, “Despite the huge debt burden of $587m, N85bn, and 115 contractual liabilities sadly inherited from the previous administration, we remain resolute in steering Kaduna State towards progress and sustainable development. We have conducted a thorough assessment of our situation and are sharpening our focus accordingly.”
The PUNCH had reported that state governors faced an uphill task of stimulating the economies of their respective states after they inherited at least N2.1tn in domestic debts and $1.9bn in external debts from their predecessors.
This was as 22 states spent a total sum of N251.79bn to service debt borrowed by past administrations within nine months of assuming office (July 2023 and March 2024).
The situation also forced the state governments of Ekiti, Cross River, and Ogun to propose a suspension of their foreign debt repayments worth $501m due to severe foreign exchange volatility.
The request, though rejected by FAAC, was part of their efforts to mitigate the heightened debt service burdens, which state officials claimed has significantly hampered their ability to service existing debts.
Experts say the high debt servicing costs leave little room for investment in infrastructure, education, healthcare, and other key areas vital for economic growth and social welfare.
Meanwhile, an analysis of the budget implementation report showed that Akwa-Ibom, Borno, Cross Rivers, Edo, Katsina, and Niger spent between 60 and 80 per cent of their internally generated revenue to repay owed debts.
Also, states as Abia, Anambra, Bayelsa, Delta, Ebonyi, Ekiti, Jigawa, Enugu, Kebbi, Kwara, Ondo, Osun Zamfara, and Oyo disbursed between 13 and 58 per cent of their revenue for debt servicing
While the amount spent on debt servicing for nine states including Adamawa, Bauchi, Gombe, Imo, Kano, Kogi, Plateau, Taraba, and Yobe exceeded their revenue within the period.
Data for Benue, Nasarawa, Ogun, Rivers, Sokoto, and Kaduna states were not available when this report was filed. Only Lagos State recorded an impressive IGR of N603.71bn while it paid N201.49bn as debt charges.
A state-by-state breakdown indicated that Abia State under the leadership of Governor Alex Otti spent N4.83bn on servicing its debt, while it earned N15.6bn as revenue, representing a ratio of 31 per cent.
Adamawa spent N14.48bn on its debt but earned N5.75bn, recording a deficit of minus 252 per cent, Akwa-Ibom state spent N20.78bn on its servicing but got N31.74bn IGR indicating 65.4 per cent ratio.
Anambra serviced its debt with N4.8bn but got N18.61bn IGR at a ratio of 25.9 per cent. Bauchi got a debt service ratio of minus 42.9 per cent after it earned N3.92bn but spent N16.8bn on servicing. Bayelsa spent N17.84bn on servicing but earned N46.98bn as revenue, indicating a servicing ratio of 38 per cent.
Further analysis of the report indicated Borno spent N7.25bn on debt charges and earned N12.04bn, representing a ratio of 60.2 per cent, Cross Rivers had a debt service ratio of 60.7 per cent after it spent N12.05bn on loans and got N19.86bn IGR.
Delta State’s burden was 58.2 per cent after it spent N39.08bn on reducing its debt and earned N67.05bn within the review period. Ebonyi had a 48.6 per cent debt ratio due to its N5.05bn spending on debt and N10.39bn revenue collection. Edo State under the leadership of Governor Godwin Obaseki spent N22.66bn on servicing and collected N34.44bn as revenue, indicating a debt ratio of 65.8 per cent.
Ekiti had a debt service ratio of 47.9 per cent after it spent N7.85bn on loans and got N16.39bn IGR. Enugu spent N3.49bn on its debt but earned N16.39bn, indicating a 20.6 per cent ratio. Gombe spent N13.07bn on its debt but earned N9.6bn, recording a deficit of minus 136 per cent. Imo State also recorded a deficit of minus 1.10 per cent after it spent N10.68bn on servicing but got N9.69bn as revenue.
Also, Jigawa State spent N1.89bn on servicing while it earned N4.55bn as revenue, representing a ratio of 41.6 per cent. Kano recorded a deficit of minus 244.4 per cent due to N60.02bn expense on debt but collected N24.57bn as revenue.
Katsina had a 77.4 per cent debt ratio due to its N8.14bn spending on debt and N10.51bn revenue collection. Kebbi spent N1.99bn on its loan servicing while it earned N4.79bn as revenue, representing a ratio of 41.6 per cent. Kwara State recorded the lowest debt-to-revenue ratio of 13.9 per cent, and spent N4.87bn on debt charges but collected N35.1bn as revenue.
Kogi spent N12.79bn on servicing and collected N12.75bn as revenue, indicating a debt ratio of minus 1.06 per cent. Niger State recorded a debt ratio of 80.7 per cent due to debt charges of N11.88bn and revenue collection of N14.73bn.
Ondo State recorded a debt to revenue of 52.4 per cent, Osun (43.2 per cent), Oyo (57.2 per cent). Plateau State recorded the highest debt-to-revenue ratio of minus 550.76 per cent, spending N61.23bn on debt charges but collected N11.11bn as revenue. Taraba and Yobe states recorded a deficit of minus 283.5 per cent and 1.16 per cent respectively.
Experts have, however, attributed the significant increase in debt servicing cost partly to the devaluation of the naira, which drove up the cost of servicing foreign debt obligations as the nation grapples with the forex liquidity crisis and exchange rate volatility.
The Director/CEO of the Centre for Promotion of Private Enterprise, Dr Muda Yusuf, speaking in an exclusive interview on Sunday, stated that the significant debt servicing cost was adversely impacted by the depreciation of the naira, which caused a decline in its value relative to other currencies.
He noted that the enormous debt burden inherited by the current administration is also straining state finances and impacting its ability to meet major obligations.
Mr Muda said, “The point is that these states inherited a huge burden of debts. The figure mentioned may sound outrageous but is not much when calculated in dollar terms. Multilateral debts are also tied to infrastructural projects and developmental purposes. Borrowing is not in itself bad if it is used for developmental purposes but the burden of debt must not suffocate the state finances and affect its ability to fulfill major obligations.
“Also, those debts are foreign and once the naira depreciates, it affects the level of debt. As they struggle to service it, the level is still going up because of the exchange rate depreciation. With the depreciation of the currency, the burden of servicing those loans has become extremely very heavy. The exchange rate factor is a major challenge in the debt burden of many states.”
Government spending has come under increased scrutiny in recent times, particularly in light of the country’s worsening economic challenges.
At different fora, financial experts have also raised concerns about states’ spending on recurrent expenditure, highlighting the need to embrace financial innovations.
A professor of Economics at Babcock University, Segun Ajibola, stated that the enduring problem of high governance expenses had persisted at the state level, with inadequate oversight and accountability resulting in minimal economic benefits for grassroots citizens.
Ajibola, a former president of the Chartered Institute of Bankers, lamented that state assemblies had also abandoned their oversight duties, leaving the state governors to operate with no iota of transparency and accountability.
He said, “The first issue is the perennial complaint about the high cost of governance in Nigeria and at all levels. When you look at these issues, attention is often concentrated on the Federal Government, so the searchlight is always more on the central government. Most often, nobody cares about what is happening in the states and local government, and that is where the problem is.
“There are so many institutional frameworks in place to look at what is happening at the federal level but who cares about the states? The cost of governance in relative terms is even much higher in states than the federal and that is why you hardly feel the impact of governance in most states.
“Only a few states can boost a significant presence in the lives of their people in our states. The state assemblies are expected to conduct oversight functions on the activities of the executives in their respective states, but in reality, how many states are doing that, leaving the executives to be all in all incurring high costs.”
Meanwhile, 20 state governments borrowed a total sum of N446.29bn collectively to address their budget deficits and to cover various expenses, including essential services, infrastructure projects, and operational costs.
Our correspondent’s findings also revealed that the majority of these loans were sourced from multilateral and international creditors, contrary to the Federal Government’s emphasis on borrowing from the domestic market.
Further analysis showed that Cross Rivers State was among the states that got the highest loan of N121.22bn between January and June. It was followed by Oyo State with N55.36bn loans. Third on the list is Kogi State with loans worth N41.22bn.
Katsina State also obtained loans worth N34.09bn from creditors within the quarter.
Other states including Niger got N34.03bn, Gombe (N32.38bn), Ondo (N20,82bn), Borno (N20.7bn), Bauchi (N19.28bn), Taraba (N20.23bn), Yobe (N10.17bn), Kwara (N10.06bn), Ekiti (N7.94bn), Ebonyi (N6.43bn), Kano (N6.15bn), Abia (N3.37bn), Enugu (N1.39bn).
The states with the least borrowing include Edo (N633.73m), Osun (N250m), and Plateau state with N530.86m loan.
The federation account allocation committee (FAAC) says the three tiers of government shared a total of N1.203 trillion in August 2024 from a gross total of N2.278 trillion.
According to a statement on Tuesday by Mohammed Manga, director of information and public relations at ministry of finance, FAAC announced the allocation at its September meeting chaired by Wale Edun, minister of finance.
The amount shared dropped by N155 billion compared to the N1.35 trillion allocated in July.
“From the stated amount inclusive of gross statutory revenue, value added tax (VAT), electronic money transfer levy (EMTL) and exchange difference (ED), the federal government received N374.925 billion, the states received N422.861 billion, the local government councils got N306.533 billion, while the oil producing states received N99.474 billion as derivation, (13% of mineral revenue),” Manga said.
“The sum of N81.975 billion was given for the cost of collection, while N992.617 billion was allocated for transfers intervention and refunds.”
Manga said the communique issued by the FAAC shows that the gross revenue from VAT for August was N573.341 billion, representing a decrease of N51.988 billion from the N625.329 billion distributed in July.
He said from that amount, the sum of N22.934 billion was allocated for the cost of collection and the sum of N16.512 billion was given for transfers, intervention and refunds while the remaining N533.895 billion was shared among the three tiers of government.
The director said the federal government received N80.084 billion, the states got N266.948 billion, and local government councils were allocated N186.863 billion.
“Accordingly, the gross statutory revenue of N1.221 trillion received for the month was lower than the sum of N1.387 received in the previous month by N165.994,” Manga said.
“From the stated amount, the sum of N58.415 billion was allocated for the cost of collection and a total sum of N976.105 billion for transfers, intervention and refunds.
“The remaining balance of N186.636 billion was distributed as follows to the three tiers of government: federal government got the sum of N71.624 billion, states received N36.329 billion, the sum of N28.008 billion was allocated to LGCs and N50.675 billion was given to derivation revenue (13% mineral producing states).
“Also, the sum of N15.643 billion from electronic money transfer levy (EMTL) was distributed to the three (3) tiers of government as follows: the federal government received N2.252 billion, states got N7.509 billion, local government councils received N5.256 billion, while N0.626 billion was allocated for cost of collection.”
He said the communique also showed that N468.245 billion from the exchange difference was shared, with the federal government receiving N220.964 billion, the states receiving N112.076 billion, local governments N86.406 billion and N48.799 billion going to the oil-producing states as derivation (13 percent of mineral revenue).
Manga said the communique also reported decreases in revenue from companies income tax (CIT), VAT, import and excise duties, EMTL, petroleum profit tax (PPT), oil and gas royalty and customs external tariff (CET) levies.
“According to the communique, the total revenue distributable for the current month of August 2024, was drawn from statutory Revenue of N186.636 Billion, Value Added Tax (VAT) of N533.636 Billion, N15.017 Billion from Electronic Money Transfer Levy (EMTL) and N468.245 Billion from Exchange Difference, bringing the total distributable amount for the month to N1.203 Trillion,” he said.
“The balance in the Excess Crude Account (ECA) as at September 2024 stands at $473.754.57.”
‘NIGERIA’S ECONOMY IS ON RIGHT PATH’
Speaking at the meeting, Edun appreciated members of the FAAC for their continued support and contributions, urging them to do more.
He also thanked revenue-generating agencies for their hard work in ensuring smooth operations for all levels of government.
The minister assured that Nigeria’s economy is on the right path, adding that the country has a president whose actions are in line with the rule of law.
“He is making sure that whatever the country is going through is a stringent economic conditions aimed at repositioning the economy for the benefit and future of our country,” Edun said.
“The policies are for the good of the nation. It is for our own good, we have to go through turbulent situation before the economy will stabilise for good.”
Edun said the economic challenges are not unique to Nigeria but are being experienced globally, adding that “we have to play our own role and fasten our belts”.