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Banks record ₦1.5tr non-performing loans in 2018

Analyst links incidence to macroeconomic headwindsFollowing the adoption of IFRS 9, about 10.9 per cent of the loan book in the banking industry, representing ₦1.5trillion are in Stage 3 (impaired), as at December 2018, according to the recently released banking industry report by Agusto & Co.

The figure represents 15 per cent increase in non-performing loans (NPLs), when compared to the N1.3 trillion posted in the industry in 2017.Already, Federal Government’s bad debts company, Asset Management Corporation of Nigeria (AMCON), has already warned that it will no longer buy such debts, even as it is still struggling to recover outstanding N5trillion unpaid banks loans before its wind-down by 2023.

Debts in Stage 3 are loans with objective evidence of impairment at the reporting date. In the previous period, Stage 3 loans can be assumed to be ‘individually impaired or non-performing loans (NPLs). They also comprise credit-impaired loans, including all loans that are 90 days’ overdue.

Also, debts in this category are where the financial asset is credit impaired. This is effectively the point at which there has been an incurred loss event under the IAS 39 model.
Specifically, in 2017 non-performing loans was ₦1.3trillion, this accounted for 9.5 per cent of the loan book. The 15 per cent increase in Stage 3 loans in 2018 compared to 2017 is evidence of the deterioration of the loan assets recognised by Nigerian banks.

According to the report, the increase in NPL is largely due to the fact that most companies are yet to recover from the economic recession particularly the impact of the foreign exchange rate crises. This is also a reflection of the weak domestic operating conditions, and sluggish economic growth witnessed in the past few years.

The IFRS9 talks about how loan provisions are accounted for in an annual report whether performing or non-performing.Furthermore, the report said the industry’s Stage 2 loans and advances as at December 2018 were ₦2.9 trillion, representing 22 per cent of gross loans.

“In prior periods, Stage 2 loans can be assumed to be ‘past due but not impaired’, and it amounted to ₦793 billion in 2017.  Although Stage 2 loans do not have objective evidence of credit loss, these loans should be monitored closely to ensure that it does not deteriorate to Stage 3.

“If after 90 days, there is no longer evidence of a significant increase in credit risk, such loans could be transferred back to Stage 1. Comforting, however, the banking Industry has provided for 87.35 per cent of the industry’s non-performing loans.”

The report also revealed that the banking industry’s total loans declined by 2.8 per cent, largely due to the repayment by some customers and the cautious approach by banks towards extending further loans due to weak macro-economic climate.

“In the near term, Agusto & Co expects a reduction in NPL ratio, but this will not be significant. We also expect that there will be no significant growth in the Industry’s loan book, as banks will continue to be risk-averse in the face of harsh operating terrain.”

Speaking on the implication of the rising banks’ NPLs, the Managing Director, GTI Asset Management and Trust Limited, Amos Aladere, said this will impact negatively on lenders’ capacity to declare huge profits.  Given the rate of rise, he said the Central Bank of Nigeria (CBN), may issue a directive soon compelling banks to clean up their loan books, which would put pressure on them to make more provisioning that will ultimately impact on their profitability, as they gradually write off the loans.

Source: Guardian Ng

Nigeria counts losses as delay in ministerial appointments hits investors

There are signs of growing discomfort among investors over the delay in Nigerian President Muhammadu Buhari’s appointment of cabinet ministers and it is taking a toll on businesses and the economy.

More than a month after Buhari was sworn in for a second four-year term in the month of May, local and foreign investors are in the dark over who heads which ministry, particularly key positions like finance as well as industry, trade and investment.

Being a developing country with a history of policy inconsistencies and a public sector that is larger than life, foreign investors typically interface with high-level government officials – a category ministers fall under – to set an investment in motion. This way, they hope to get some assurance over the safety of their investment dollars.

The uncertainty over the identity of Nigeria’s next batch of ministers has led some foreign direct investors to hold off on potential big-ticket deals while portfolio investors are beginning to redirect cash to other countries that are ready for business, two chief executive officers of leading financial houses told BusinessDay.

According to them, some foreign government agencies and Development Finance Institutions (DFIs) are also staying away or not engaging because there are no ministers.

“There are people who are currently negotiating to invest in the country but they are waiting to see those that would be appointed to engage with them,” one of the CEOs whose investment firm manages over a thousand foreign clients said.

“Whenever we engage with investors, they are curious about knowing who the new minister of finance and who the new minister of trade and investment would be,” another CEO confirmed

A six-month delay in the appointment of ministers during Buhari’s first term formed part of the recipe for an economic recession in 2016 after it contributed to a steep decline in foreign investment.

Total foreign investment into the country nearly halved to $5.1 billion in 2016 from $9.6 billion in 2015, and was down 75 percent from $20.8 billion in 2014, according to NBS data.

Many Nigerians and international observers had expected President Buhari to hit the ground running in his second term.

“There is nothing to suggest that we have learnt the lessons of 2015,” an independent economist who consults for one of Nigeria’s state governments said on condition of anonymity.

“It adds like an extra 50 basis points on the country’s risk premium,” the economist said.

Yields on Nigeria’s benchmark 10-year Federal Government bond have ticked upwards, albeit by a mere 4 basis points to 14.39 percent as at July 2, from 14.35 percent at the end of May.

Traders say yields have reacted more to the movement in oil prices and the stability in the naira than the delay in ministerial appointments.

The performance of Nigeria’s publicly-quoted companies has been woeful. Stocks are down an average of 6.5 percent since the beginning of 2019. Blue chips from Dangote Cement to Guaranty Trust Bank have been hit by negative investor sentiment no thanks to the perceived lack of urgency in the implementation of reforms needed to boost economic growth.

“These delays are becoming the norm in Nigeria and it shows how unserious we are as a nation,” a former public official told BusinessDay.

The delay slows down the pace of critical reforms since action typically comes from the ministerial pool, not civil servants who want things to remain as they are to extract rent.

“That gives the impression that we are not keen on implementing the reforms that will open up the economy,” the former government official added.

At 2 percent, the economy is growing at a rate below that of the population (2.6 percent). It means per-capita GDP is on the decline which the IMF expects will last eight years if Nigeria continues to hold off on critical reforms in power and the oil sector.

Some sources, however, told BusinessDay that President Buhari is set to release a list of nominees to the Senate.

They blamed the delay on the inability of the Senate to constitute its principal officers, especially the election of the Senate Leader whose responsibility it is to announce such requests from the President.

BusinessDay findings show the President had on Monday invited the two senior special assistants in charge National Assembly Matters, Ita Enang (Senate) and Umar Yakubu (House of Representatives) to a closed door meeting.

The meeting, BusinessDay gathered, was summoned ahead of Tuesday’s resumption of the National Assembly for full legislative business.

Although the list is ready, our correspondent at the Presidential Villa was told, the President has kept the names of nominees as a top secret.

For President Buhari, forming a cabinet might not hold much weight for the economy going by a statement he made in an interview with a French TV station France 24 in 2015, where he argued that “ministers are noise makers”.

However, if examples from other countries are anything to copy from, it took South Africa’s President Cyril Ramaphosa only 96 hours from the day he was sworn in to appoint a cabinet.

Immediately the 66-year old president announced the naming of the ministerial cabinet, it sent a signal of his readiness to hit the ground running. The South African rand reacted positively, gaining some 0.5 percent against the dollar, after an initial loss of 1 percent prior to the announcement.


Restructuring DisCos is first step in fixing a broken power sector

In their current situation, no investor will pay $1 for any of Nigeria’s 11 electricity distribution companies (DisCos). In fact, any serious investor would have to be paid to take them but even then, they probably would still not be attractive. Not with a balance sheet where contingent liabilities far exceed assets.

This situation has led to calls for a radical restructuring of DisCos who are now technically bankrupt, and maintain a semblance of existence only on account of government subsidies. This restructuring will require all stakeholders taking a haircut on their asset, instituting corporate governance and restoring best practice.

It starts with understanding that a loss of N713bn since privatisation has negative consequences for the sector and poses systemic risk to the economy as a whole and agreeing to return the sector to a sound commercial template. Furthermore, the Federal Government with a 40 percent stake in the DisCos that continues to bail out the sector needs to start taking requisite action to check the excesses of the investors.

The option is to either restructure or continue digging a hole in the form of subsidies which will eventually trigger a shutdown of the entire decrepit system.

The DisCos reported a combined loss of N446.85bn in 2017 which is 64 percent higher than the previous year. Their total combined operating cost of N655.16 billion in the same period outstripped cumulative sales of N563.10 billion. Interest expense surged by 129.51 percent to N155.64 billion, indicating a balance sheet that’s unsustainable.

Restructuring the DisCos’ balance sheet will entail writing off at least half of their over N2 trillion exposure to the Nigerian Bulk Electricity Trading Company (NBET) and the Central Bank of Nigeria (CBN). The Federal government through NBET can convert the rest to convertible long-term debt. This will give the balance sheet a new lease of life to present to new investors.

But the DisCos do not get a free pass. The CBN and other commercial banks of which the core investors have exposure of over N500 billion will treat the debt like any other commercial debt.

Banks can choose to convert their debt to stakes in the DisCos but the core investors will also be given the right to buy at the same share price. DisCos’ current shareholding will be diluted and in exchange for government’s acquisition of their debt, a special agency can be created to professionally represent the stake of all investors including the government.

Analysts say tariff must represent the true cost of production but tariffs higher than N45-50 per Kw/hr may derail the plan. Embedded generation plants with gas as feedstock are offering industries tariff around N40 and N50 per kWH/hr and solar energy tariff are now lower than 10 cents. Higher tariff will shift the market to cheaper alternatives.

The DisCos have consistently said that a lack of cost-reflective tariff is the key reason for their losses. This is worsened by electricity theft and debt by government ministries and departments.

“Electricity pricing must be reflective and NERC must step up action to check electricity theft,” said Ayodele Oni, energy lawyer and founder of Bloomfield law firm.

Oni also said that NERC must also enforce obligations in DisCos’ performance contracts and should maintain independence from the executive arm of government.

DisCos have to also raise collections as market information from NBET indicates that they currently only collect 30 percent of market invoice from customers.

Restructuring the DisCos will make way for new investors who will inject fresh capital into the business. A sound management should be put in place to run the transition to new investors.

Chuks Nwani, energy lawyer and vice president of consultancy firm, PowerHouse International, proposes that the Federal Government create a debt instrument to cover half of DisCos’ tariff


Within the period, pressure on the DisCos’ balance sheet will ease off while they are compelled to make investments to improve their network, cut down on aggregate technical, collections and commercial losses (ATC&C) and if power distribution improves, they can then begin to recover through higher tariffs and at the same time repaying their debt.

“This is a better option instead of continuing to allow the Central Bank to continually provide intervention funding,” Nwani said.

Nwani said that within the five-year period, NBET will monitor investment plans the DisCos will submit while the Transmission Company of Nigeria (TCN) will also implement an improvement plan. NERC will monitor these plans for compliance while enforcing compliance with performance contracts.

However, Nigeria’s 11 DisCos distribute a paltry 4,000 MW, a capacity too little for efficient pricing to make the sector viable. Generation companies (GenCos) are burdened with so much debt that asking them to bring the total installed capacity of over 12,000MW on stream will require massive investments. Worse still, the TCN cannot effectively wheel half of the capacity without the grid collapsing.

Analysts say NERC should implement the DisCo franchising regulation which allows third-party investors to provide electricity within a franchise area earlier ceded to DisCos.

Other regulations, including the mini-grid which opens up investments into the off-grid sector, must be promoted as well as the eligible customer declaration, which allows GenCos to sell power directly to big consumers of power.


nigeria as the poorest country

Why my policies, programmes, projects are unpopular, by Buhari

Promises formidable cabinet to deliver mandate
President Muhammadu Buhari yesterday declared that his decision to move against very powerful individuals remains unpopular and challenging. He explained that most of his administration’s policies and programmes were also being rejected by only those whose interest has been affected.

The president, who spoke when he received the Buhari Media Organisation (BMO) led by its chairman, Omoniyi Akinsiju, at the State House, Abuja, assured his visitors that he would put together a formidable team to deliver his Next Level mandate to Nigerians.
Exactly 34 days since his inauguration on May 29 for a second term in office, Buhari is yet to appoint a cabinet. It is unclear if it will take the president as long as the period it took him in 2015 to constitute the Federal Executive Council (FEC).

There are already criticisms and concerns from stakeholders and citizens who fear the economic dangers the delay portends for the country. The Nigerian leader said: “It is not an easy job to sell the administration’s services, as we are doing unpopular things and facing powerful individuals and taking on vested interests who are accustomed to the corrupt era.

“But we must do things the right way. If we promised change, then we must deliver it. This is regardless of whose interest is touched. There must be a manifest departure from the old order.“We are making significant progress and this is evident. Despite attempts by enemies to twist and bend facts, most Nigerians know the truth.”

Buhari, in 2015, attributed his failure to expeditiously constitute his cabinet to his quest to assemble a capable team that would galvanise the administration’s programmes. He had also said he also needed to restructure the ministries to effect his party’s mantra of change in government processes and operations.

The president, who said he was aware of the anxiety and impatience exercised by Nigerians, said those feelings were unfounded, as he intended to do things “methodically and properly.”

The nation’s first citizen again assured the citizenry of his resolve to leave Nigeria better the raging security challenges notwithstanding.

Also in the delegation is Tunde Thompson, who was imprisoned under the draconian Decree 4 of 1983 by his then military administration.

The leader of the team, Akinsiju, had stated: “The organisation regularly commissions the writing and publishing of newspaper opinion articles and press statements to elucidate and amplify government programmes and clarify socio-economic and political issues being undertaken by the administration.”

Source: Guardian

Capital importation into Nigeria hits $8.4 billion, rose by 216% in Q1 2019

The total value of capital importation into Nigeria in the first quarter of 2019 was estimated at a whopping $8.48 billion. This is revealed in the latest capital importation data released by the National Bureau of Statistics (NBS). 

According to the NBS data, the $8.48 billion capital importation in the first quarter represents an increase of 216.03% compared to Q4 2018 (quarter-on-quarter). Also, capital importation year-on-year into Nigeria rose by 34.61% when compared to the first quarter of 2018.

Capital Importation by type: Basically, Nigeria’s capital importation is categorized into three investment types, and these include Foreign direct investment, Portfolio investment and other investment.

The Portfolio Investment in Nigeria is made up of three items which include Equity, Bonds and Money Market instruments. During the period under review, the largest amount of capital importation by type was received through Portfolio investment, which accounted for 84.21% ($7,145.98 ) of total capital importation.

  • Money Market instruments account for 82% total portfolio investments, amounting to $5.92 billion, representing a 376.9% rise within the quarter.
  • Equity ranks second with $656.19 million or 9%, recording a 110% growth within the quarter.
  • Bonds received the lowest portfolio investment with $565.6 million or 7% of total capital. However, in terms of growth, portfolio investment into bonds rose by 173% within the quarter.

Othe Investment is broken-down into four categories which include Trade credits, Loans, Currency deposits and Other claims. However, the bureau only provided data for loans and currency deposits. In the first quarter of 2019, other investments recorded the second biggest capital importation, accounting for 12.91%  or $1.09 billion of total capital importation.

  • Loans investment was estimated at $752.2 million, rose by 2.62% within the quarter.
  • Other claims within the quarter stood at $343.8 million, indicating a 2,025% growth when compared to

Foreign Direct Investment investments in Nigeria has just two components and this includes Equity and other capital. Specifically, FDI accounted for the least of total capital importation in the first quarter with $243.36 million or 2.86% of total capital imported in 2019.

  • Equity FDI inflow in the first quarter was estimated at $242.67 million, rose by 39.97%. Equity constitutes almost 100% of the entire FDI.
  • Other Capital stood at $700,000, less than 1% of the FDI inflow.

Capital Importation by Sector: Further analysis of the capital importation shows that five of the fifteen sectors recorded a decline in capital importation. Sectors with positive growth include Banking, Financing, Production / Manufacturing, Servicing, Agriculture, Electrical, I.T Services and Consultancy. On the other hand, five sectors recorded negative growth within the quarter, the sectors include Shares, Telecomms, Oil and Gas, Construction, Brewing, Drilling and Marketing.

  • Nigerian banking sector received the biggest share of capital importation in the first quarter with $2.85 billion or 33.6% of the total capital. Also, capital importation into the banking sector grew by 141.45% within the quarter.
  • Despite negative growth in capital importation of shares, the sector record the second biggest capital inflow, with $2.40 billion or 28.32% of total capital importation.
  • Three other sectors that made the top five sectors with the biggest share of capital importation include Financing ($2.13 billion) production and manufacturing ($418 million) and Servicing ($409 million).

Capital Importation by origin: The United Kingdom emerged as the top source of capital investment in Nigeria in Q1 2019 with $4.53.22 billion. This accounted for 53.40% of the total capital inflow in Q1 2019.

Also, by the destination of Investment, Lagos state emerged as the top destination of capital investment in Nigeria in Q1 2019 with $4,773.26 million. This accounted for 56.25% of the total capital inflow in Q1 2019.

By Bank, Stanbic IBTC Bank Plc emerged at the top of capital investment in Nigeria in Q1 2019 with $3,606.09 million. This accounted for 42.50% of the total capital inflow in Q1 2019.

Nigeria’s economy is gathering growth momentum: With over 216.03% increase in the value of capital importation into the economy, it suggests Nigeria’s economy is gathering the much need momentum for sustained growth in the second half of 2019. This is a good boost for the Central Bank’s aim to achieving double-digit growth by 2020.

Basically, capital importation refers to the movement of capital into Nigeria in the form of investments in assets, bonds, shares and so on. FDI is an investment in form of a controlling ownership in a business in one country by an entity based in another country while FPI is the entry of funds into a country where foreigners deposit money in a country’s bank or make purchases in the country’s stock and bond markets, sometimes for speculative purposes.

Analysts have stressed that capital inflows into Nigeria’s economy will improve after the general election. It is evident that portfolio investment accounts for the biggest share of capital importation, this could be largely attributed to the attractive yields in the fixed income market.

Source: Nairametrics

AHCN 2019 Workshop Addresses Rental and Low Income Housing in Nigeria

The Association of Housing Corporations of Nigeria (AHCN) have held a 2-day National Workshop on Pragmatic Approach to Addressing Rental and Low Income Housing Availability and Affordability in Nigeria.

The workshop which was also the 99th Council Meeting of AHCN took place in Calabar from Tuesday 25th to Thursday 27th 2019.

Participants at the workshop bemoan the increasing housing shortage and affordability crisis without corresponding actions to match the demand and calls for urgent collaboration among stakeholders with pragmatic strategies that will directly address the housing and employment needs of the people.

The workshop identifies mass rental housing as untapped viable option of sustaining housing corporations and call on all state governments to support their state housing agencies in driving rental housing across Nigeria.

The workshop notes and commends the establishment and impact of Family Homes Funds and its efforts to make affordable housing available to low income earners through funding development, mortgage and rent to own scheme. A call was made to all State Governments to support their state housing corporations and make lands available to ensure the success of the family Homes Funds programs.

In a communique signed by AHCN President, Muhammed Baba Adamu and Secretary General, Mr. Olusola Martins, the workshop recognizes the inherent opportunities in business partnerships and calls for effective partnership models and synergies between Family Homes Funds and the Federal Mortgage Bank of Nigeria, FMBN to enhance development funding and wholesale mortgage lending and origination to reduce housing shortfall in Nigeria.

The workshop commends the recent FMBN review of the off-takers guarantee which makes it acceptable and bankable in favour of housing corporations to enable them access construction loans from commercial banks and calls on all state governments to support their housing corporations to take advantage of these opportunities for mass housing projects.

Housing cooperatives were also identified by the workshop as viable option to enhance housing availability and affordability as well as mobilizing resources and off-takers in tackling funding mechanism challenge; and therefore call for collaboration of housing cooperatives with housing agencies in addressing rental and low income housing shortage in Nigeria.

The workshop identifies the challenge and lack of adoption of foreclosure laws to safeguard investors as one of the impediments to attraction of housing finance to the housing sector and calls on governments to speed up the adoption of legal framework for judicial enforcement of mortgages and foreclosure legislations to boost investors’ confidence and streamline bureaucracies in the Nigeria’s mortgage market.

The workshop calls on all housing agencies to embrace modern technology and digital solution for development and management of real estates and rental housing and to adopt highly skilled labour for development.

The workshop resolved to address the issue of non-availability of data base for off-takers on real estate and mortgage information management which constituted major challenge to the development of mortgage system in Nigeria. The Association resolves to sustain a pilot scheme of Home Ownership Off-takers Affordability Survey Data base which commenced first quarter of 2018 with a creation of a verifiable working database of about 1,000 workers per selected state with her partner Value Chain Project Consultants, to pre-qualify them for their actual housing needs and mortgages to acquire same in all the states of the federation. The meeting therefore reiterates its call on the Federal Government and the CBN to provide revolving housing fund and inject a minimum of N500 billion loans as intervention funds into the real estate sector at a single digit to develop the housing sector.

The workshop also reiterates its commitment to Public Private Partnership (PPP) and calls on government to take appropriate steps to address, strengthen and embrace emerging partnership options for effective housing delivery of decent and affordable mass housing so as to promote effectiveness and profitability of housing agencies.

The forum observes the drop in commitment by governments towards the National Housing Fund contributions and implored them to sustain the contribution to make funds available for housing development.

The workshop calls on the FMBN to make the loans process more applicant friendly by removing all bureaucratic hurdles and demonstrate a verifiable and transparent trends of benefits to NHF contributors nationwide in order to win back the confidence of states that have withdrawn.

The meeting notes the availability of local building materials and calls on governments and all Nigerians to embrace the use of local building materials as appropriate alternative for addressing availability and affordable housing in Nigeria. With the availability of Hydraform and NBRRI technologies, state governments are encouraged to set up pilot scheme of local building materials plants in all the states of the federation to encourage development and acceptance of local building materials in Nigeria.

The meeting notes and commends various research works and development of Nigerian Building and Road Research Institute (NBRRI) over the years which culminated in the discovery and development of Interlocking Cement Stabilize Earthly Blocks (ICESEBs) and production of pozzolana cements a partial replacement of Portland Cement which are procured from locally sourced, readily available raw material with cementing properties serving as partial replacement for conventional cement with a completely built pilot plants in both NBRRI premises, Ota in Ogun State and at Bokkos in Plateau State; and call on government to embrace NBRRI technologies to set an example for its acceptance by Nigerians.

The forum notes and commends the involvement of NBRRI in investigation of building collapse cases in Nigeria and posits that such involvement will promote quality delivery of housing as it will assist to determine the causes of collapse and proffer solutions to generate data bank for building collapses in the country

By Ojonugwa Felix Ugboja

Family Homes Funds Making Affordable Housing a Reality for Nigerians

Following a successful partnership between Family Homes Funds and Delta state, Vice President of Nigeria, Prof Yemi Osinbajo will in few days be commissioning 650 units affordable housing estate in Asaba, Delta state for low income earners. This and many more projects are ongoing efforts by Family Homes Funds to make affordable housing a reality for Nigerians.

Family Homes Funds is a pivotal force in driving affordable housing objectives in Nigeria since its establishment. The Federal Government housing initiative intended to support the development of up to 500,000 Homes targeted at people on low income over the next 5 years has designed innovative schemes that is helping to deliver affordable housing in Nigerian and increase the housing options in the market.

With its many social housing rental funds like Help To Own, Rent To Own among others, the impact of Family Homes Funds is already being felt by Nigerians after a take-off that hasn’t been more than 12 months.

According to the Managing Director of Family Homes Funds (FHF), Mr Femi Adewole, the most transformative thing they can do is to introduce a formal rental system into the market.

The Fund has launched a social housing rental housing fund to provide affordable housing opportunities for Nigerians on very low and medium income. The cost of monthly rentals doesn’t exceed 40% of household income and beneficiaries will have an option to buy at any time they are able to do so.

Many Nigerians on low income are unable to buy a home either because they do not have sufficient savings for a deposit or are currently unable to meet requirements for a mortgage. The Family Homes Funds’ Rental Housing Fund gives Nigerians on low income a first step on the housing ladder. Eligible beneficiaries are able to lease a decent home for a monthly cost not exceeding 40% of their household income and an option to buy the home anytime.

The Fund complements existing mortgage financing facilities by providing targeted assistance to people on low income through a Home Loans Assistance Fund – Help to Buy as part of the Governments’ Social Intervention Programme. The assistance is in form of a deferred loan for up to 40% of the cost of their home with no payments for the first 5 years.

Due to cost and low income, most Nigerians cannot own a home and are most times forced to live in slums with poor housing conditions and poor security.

This assistance from Family Homes Funds is unique because no payments will be made until the 6th year, where monthly payments will start repaying both interest and capital. To assist the purchaser, the amount paid starts low and increases each year in gradual steps (average 6.5% per annum) in order for the HTB loan to be fully repaid by year 20, the same year as the mortgage is expected to be fully repaid.

To qualify, households should have earnings between N600k to N1.2m per annum and the new home costs less than N7.5m. An exception is made in Abuja, Lagos, Port Harcourt and Kano where the cost of a new home can be as high as N9m. Households benefiting from Loan Assistance must not already own a suitable home and need to include one income earner who is under 35 years of age and does not have to be one of the people applying for the scheme or the loan but must available to help with repayments.

In addition, this July, the Vice President of Nigeria, Prof Yemi Osinbajo will commission an estate in Asaba financed by Family Homes Funds in partnership with Delta state government. The affordable estate is made up of 650 housing units for low income earners.

The affordable housing project consists of one, two and three bedroom bungalows with all necessary facilities for home functionality. The estate has adequate access to water supply, power, security and good road network.

Built with high quality and sustainable materials, the houses are structured in ways that give each owner and his or her family a decent living space and some sense of privacy.

According to the MD, Femi Adewole, the estate is built in a fast developing and serene area with a lot of greenery. It represents the Funds’ vision to not only build houses, but to build ones that are healthy to live in and affordable for the owners.

More initiatives are also ongoing in the six geopolitical zones of the country with some either completed or at near completion stages. In Borno for example, the Fund is developing 4,700 housing project for civil servants and Internally Displaced Persons (IDPs).

According to Femi Adewole, 1700 of the 4700 homes are targeted at civil servants, mostly middle and low income civil servants, while 3000 is being built for IDPs whom have been displaced by Boko Haram insurgency in the northeast.

‘’They are small houses built in the outline areas, not necessarily in Maiduguri, but those villages that had been ravaged by the insurgents. The state has already produced quite a number but what most people are not aware of is the hundreds of thousands of Nigerians who have been displaced by Boko Haram who are still living in temporary refugee camps for 3 to 5 years. So the government has a programme of returning them back to their villages which have been liberated. The idea is that we will be joining the government efforts to finance those homes,’’ he said.

Several Family Homes projects are currently going on in states like Kaduna, Nasarawa, Delta, Ogun, Kano etc. The major excitement for most Nigerians is the affordability of these projects which had previously been difficult for low income earners. This has definitely been a new dawn and efforts should be sustained in order to reduce Nigeria’s burdensome housing deficit.

By Ojonugbwa Felix Ugboja


As always, the Abuja International Housing Show offers amazingly awesome opportunities for the most discerning companies across the built industry value chain.

Here are 10 awesome tips to enhance your exposure and sales as an exhibiting brand at the 13th Abuja International Housing Show slated for the 23rd – 26th July, 2019.

1. Prepare Early: Preparing early is key to a most successful outing as an exhibitor in any event, much less one as noteworthy as the Abuja International Housing Show. This enables brands avoid issues such as poor logistics, unavailable props, late stand setup etc which may lead to loss of critical audiences at the most strategic moments.

2. Be Unique: Contrary to popular belief, it really doesn’t matter where you are positioned at a big show like the AIHS, what is important is how uniquely positioned you are. Are you armed with the most fascinating props that catches the attention of attendees no matter the distance? With very attractive and attention grabbing signage, you are sure to attract all classes of prospective audiences to your exhibition stand.

3. Be Marketing Ready: Being marketing ready means many things in business. For the AIHS, all of your marketing collaterals should be not just available but available in excess to avoid shortage as its a long four day event. From brochures, flyers and complementary cards, to handy proposals to facilitate business agreements and seal deals on the spot, being marketing ready is a sure fire way to boost sales at the event.

4. Come with Branded Souvenirs: Having branded Souvenirs to gift visitors that come to your exhibition stand is necessary to put your corporate image in front of the built industry consumers all year round. This includes pens, notepads, desk pads, wrist bands, mugs, T-shirts, decorative mini product samples etc. These items allow attendees think about your brand for as long as possible even if they didn’t buy or place an order on the spot, ingraining it in their consciousness until the perfect moment for a perfect sale. And of course, don’t forget that everyone loves gifts.

4. Flag Off on Social: Don’t wait until the AIHS begins before you flag off on social. With nicely designed publicity banners, posts and the right hashtags, flag off your next exhibition stop on social media with the right copy messages and hashtags to inform existing and potential customers about your stand and the benefits of dropping by at the 13th Abuja International Housing Show. The promoted discounts may tick off a long time prospect who may be ready to swoop down and pick up a deal.

5. Deals: A myriad of deals should be on display at your stand and let attendees know you are here for business. These deals can feature competitions, discounts and promotions that prospects can’t resist because they know it’s a no brainer to scoop it or miss out on it until the coming year.

6. Light Nibbles: Having light snacks, sweets and juices at your stand is an incentive to draw audiences, be they the high and mighty or emerging middle class to middle class, everyone is game as people tend to be quick to catch bites especially if they have had an early day. The buzz it may create, draw participants to know more about your service offerings.

7. Bring your Smiling Faces: The saying, ‘You’re never fully dressed without a smile’ is still true. Putting on a welcoming outlook can do wonders for your business. Hence, letting all your exhibiting teammates know this is essential for success. Informing them that the smile must never fade from their faces will keep them on high alert and attracting everyone to your corporate stand.


8. Speak to Prospects: Don’t wait for attendees to speak to you, the moment you see them milling around your stand, say hello and speak to them about your offerings. Without taking time out to think of who you are talking to, speak to them. A driver may be sent on an errand by his boss to get building materials and he will remember the company that treated him like a king even when he didn’t look like one. In essence, speak to all by treating all attendees equally.

9. Look the Part: Dress the way you wish to be addressed is another important saying. While you may not favour an entirely corporate look, sell your brand in the best way possible, establishing brand colours, image, logos and playoffs in the most dramatic ways. You need to look like you are at the AIHS show to sell, which is what you are coming to do anyway.

10. Be Creative, Bring Social On: Tweet those pictures, use insta stories, chat with Snapchat, use Facebook live videos, share your best thoughts about the program on LinkedIn. It’s a show, so become the show by showing the world what your brand is up to. This will continue to establish you as a formidable brand, increasing your success potential beyond the show with prospective audiences.

With these 10 awesome tips, it’s time to belt up for an exhilarating ride at the 2019 outing of the Abuja International Housing Show.

By Felix Ojonugwa Ugboja

Banks to tighten criteria on corporate loans—CBN

TheCentral Bank of Nigeria, CBN, has said banks will tighten criteria for corporate loans in the third quarter of the year. The apex bank said the criteria include more collateral, stronger loan covenants and higher fees/commissions for corporate loans. CBN disclosed this in its Credit Condition Survey, CCS, report for the second quarter. Governor, Central Bank of Nigeria (CBN), Mr Godwin Emefiele The report also indicated that though there was a decline in the availability of corporate loans  in the second quarter of the year, banks intend to reverse this trend in the third quarter. Banks to jerk up lending rate for corporates in Q1’19(Opens in a new browser tab) The report stated:

“The overall availability of credit to the corporate sector decreased in the second quarter, but was expected to increase in third. “This was driven by favourable economic conditions, changing sector-specific risks, changing appetite for risk, market share objectives and changing liquidity positions.

“Lenders reported that the prevailing commercial property prices positively influenced credit availability of the commercial real estate sector in the current quarter.

“Lenders expect the prevailing commercial property prices to positively influence secured lending to public non-financial corpora-tions in the current quarter.” “Availability of credit increased for all business sizes in Q2 2019.

Lenders expect the same trend in the next quarter. Spreads between bank rates and MPR on approved new loan applications narrowed for all business, except for small business, in Q2 2019, but were expected to widen for all business sizes in Q3 2019. “The proportion of loan applications approved for all business sizes increased in the current quarter, and are expected to further increase in Q3 2019.

“Lenders required stronger loan covenants from all firm sized businesses in the current quarter. Similarly, they reported that they would require stronger loan covenants for all firm sized businesses except for small business, which they plan to leave unchanged, in the next quarter “For the current quarter, fees/commissions on approved new loan applications fell for all firm sized businesses except for large PNFCs, while for Q3 2019 lenders expect fees/commissions on approved new loan applications to rise for all firm sized businesses except for large PNFCs.

“More collateral requirements were demanded from all firm sizes on approved new loan application in Q2 2019, except for large PNFCs. However, lenders will demand for more collateral from all firm sizes in the next quarter.”

Source: Vanguard

Just in: Fire guts Bayelsa Radio

The Bayelsa State-owned radio station, Bayelsa Radio, has been gutted by fire.

It was gathered that the fire destroyed a critical section of the station, which is located along Azikoro Road, Yenagoa, the state capital.

A source said though no life was lost, the inferno inflicted monumental damage on the station razing the whole studio.

Details shortly….

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