TrustBond Mortgage Bank Plc has said that failure by the National Assembly to pass the foreclosure law has contributed to the unprecedented housing deficit in the country.
The Chief Executive Officer of the bank, Adeniyi Akinlusi, while addressing shareholders at bank’s 7th yearly general meeting in Lagos on Monday, posited that the non-existence of an effective foreclosure mechanism in Nigeria is constituting a disincentive to housing investors.
Foreclosure law is a legal mechanism , which allows the lender to take possession and sell the secured property (foreclosure” or “repossession) to pay off the loan in the event that the borrower defaults on the loan or otherwise fails to abide by its terms.
According to him, the National Assembly must expedite action on the passage of the law affecting the legal and regulatory framework of the Mortgage sector; especially related to foreclosure to motivate the mortgage bank increase their loan portfolio.
‘The major challenge is the issue of foreclosure. There is no effective foreclosure mechanism put in place, if you go to court, it would take donkey years.
And at such, if mortgage banks find out that people who default are not paying their loans they can not sell their houses, they are not motivated to increase their loan portfolio or give more people loans because the ones you have, you are having more problems with it.
“The foreclosure law needed to be passes by the state and National Assembly so that we can have more petressed the need for each state to come up with an effective law that will make foreclosure easy in the state to attract the needed funding and capital from the mortgage bank.
“The major stakeholder, Nigeria Mortgage Refinance Company (NMRC), in collaboration with the Federal Mortgage Bank and Central Bank of Nigeria, are going round the states to tell the states to pass their own law. Each state can simplify the law by coming up with an effective law that will make foreclosure easy in the state.
“Once you have a state that pass this, it would attract funding and capital from the mortgage bank because you can use it as an example. There are one or two states that have passed it and we are engaging with some other states so that once you have good examples in this regard, more funding will go to people in those states and they can own their houses.”
He explained that the bank recorded gross earnings of N1.1 billion, an increase of 35 per cent over N844.8 million achieved in the corresponding period of 2014. Profit after taxation stood at N90.8 million, representing 429 per cent rise, when compared to loss position of N27.6 million in 2014.
He added that the bank would continue to focus on consolidating its capacity to access long-term funds from NMRC and other sources to grow the business.
At a time in Nigeria when the economic growth depends largely on private enterprise, the place of the informal sector in the economy can hardly be over-emphasised. This is why, like the rejected stone, the informal sector as a component of the economy has become the head of the corner for economic growth.
All in a jiffy, both the housing sector and the mortgage system have woken from sleep and discovered that this sector could be leveraged upon for growth. The pension fund is also in this league, though in relation to both mortgage and housing.
There is an on-going debate on the possibility of including the informal sector with its estimated N81.048 trillion annual income in a new housing fund that could be created and added to the existing Pension Commission’s (PenCom) multi-fund structure with the aim of narrowing down housing affordability gap.
This however has to happen alongside lowering of mortgage interest rate to single digit of 8- 9 percent, down from the current 22 – 25 percent commercial rate which operators charge on mortgage loans. The argument flows on the assumption that the inclusion of the informal sector operators who constitute 67.54 million of Nigeria’s 81.15 million workforce in the contributory pension scheme will lead to increased housing affordability.
In the same vein, as economic activities continue to shrink leading to loss of jobs, salary cuts and significant drop in personal income, most of the primary mortgage banks (PMBs), which are struggling with hash operating environment and rising non-performing loans (NPL), are looking to the informal sector to sustain their operations and also stimulate growth in that sector.
Low capital base coupled with the prevailing economic conditions have so impacted the operations of these banks that a good number of them are unable to meet their contractual and statutory obligations to their clients and regulators respectively.
The Nigeria Deposit Insurance Commission (NDIC), one of the regulators of the sector, was quoted as saying that the inability of as many as 15 PMBs to pay their insurance premium as at December 2016 was an unfortunate situation that put the customers at risk. “The loans and advances extended by these PMBs declined significantly by 31.87 percent to N168.96 billion in 2015”, the commission added, pointing out that 14 out of 42 PMBs failed to render returns to it while unpaid premium from nine PMBs amounted to N238.30 million the same year.
The Central Bank of Nigeria (CBN) says that notwithstanding PMBs’ improved performance in the past couple of years, their loans and advances, deposit liabilities and other liabilities decreased by 6.85 percent, 5.25 per cent and 5.89 per cent to N154.46 billion, N115.77 billion and N68.06 billion, respectively, at end-December 2016 from N165.83 billion, N122.18 billion and N72.32 billion at end-June 2016.
But the operators are not resting on their oars. They are building blocks and putting measures in place to engender growth of this fledgling sector in order to increase access and affordability, and by extension, enlarge the clan of homeowners in the country.
Unbundling of mortgage origination process, further reduction in loan origination period, introduction of computerised land titling registration, land title insurance, introduction of uniform underwriting standards (UUS) for informal sector, enactment of foreclosure law, and wider public awareness for the sector are part of the push by the operators for the growth of the sector.
Mortgage is a sub-sector of the economy and the operators are saying that since the larger economy is not doing well and the mortgage sector is not insulated from what is happening in the larger economy, what is happening to them is not unexpected.
“We know what happened to oil price and the foreign exchange market. These have affected everything in the economy. In the case of oil, both the volume and the price went down. All these affected consumer purchasing power. Don’t forget that the balance sheet of the mortgage banks were not strong abnitio”, said, Ayodele Olowookere, CEO, Omoluabi Mortgage Bank Plc.
He stressed that the problems of the mortgage banks revolve around their small capital base and so there isn’t much they can do. “For all the money that I have, unless I raise additional capital, I don’t think I can do 1,000 mortgages. To do mortgages, you need long term funds and that is the only way you can do long term mortgages”, he said.
Udo Okonjo, vice chair/CEO, Fine and Country West Africa, agrees, emphasizing that the real core factor responsible for the slow growth in this sector is that the banks and the mortgage institutions don’t have long term funds; all they have are short term deposits. “The underlying fundamental for mortgage growth is that we have to have saving culture and large financial base because mortgages are long term funds. In an ideal world, you will be talking about 20-25 years mortgages at very low interest rate”, Okonjo added.
Technically speaking, Nigeria has no mortgage system and Okonjo reasons that the country doesn’t really have a real estate sector. “What we are doing is just scratching the surface. If we really want to create wealth through real estate which is one of the major ways the developed world creates wealth, then we have to develop and grow the mortgage sector”, she emphasised.
But the operators are not deterred. “We are here to stay and grow this sector”, Olowookere assures, revealing, “at Moluabi, we are looking at the best way to do things, especially in credit management and evaluation. We are looking at the informal sector. People in this sector are not collecting salaries, but earn huge and regular income. So, we are finding creative ways of bringing them into the net. We are also looking at new ways to raise capital by bringing in more shareholders”.
He said, “The operators in the market know better than to press the panic button, because the fundamentals of the economy are still strong and what is happening in the capital market is normal.
“The Nigerian economy responds to politics like many economies and anyone who knows how the affairs of the world are run will expect these as some of the people taking profit are preparing to fund the election.”
He said the efforts of the present administration so far had driven the country out of decades of poor economic decisions.
“Our key sectors have improved steadily irrespective of the fact that we are living on 40-50 years infrastructure and we have not stopped yet, even as population has grown in manifold,” Fashola said.
Bola Ahmed Tinubu, former Lagos state governor and now national leader of the All Progressive Congress APC stands tall among Nigerian leaders who have the ability to identify talents and deploy them appropriately while leaving them with ample discretion to achieve a lot.
He, it was, who gave to Lagos state, wonderful governors, Babatunde Raji Fashola and Akinwunmi Ambode. It can thus be argued that Tinubu has turned Lagos into a moving train that no one, including himself, can stop anymore. Should other Nigerian leaders put pettiness behind and pick the best hands for the job, development would come to many areas of the country.
Today, this column takes a look at the posture of one of the train drivers, Raji Fashola, a Lagos boy whose capacity for unending excellent service is worth projecting for public enlightenment. One of the things I often recall about Fashola concerns his reaction to my fierce criticism of his deportation from Lagos in 2013 of some fellow Nigerians to their states of origin. Many other critics were similarly angry with the governor on the subject but he surprised us all when he swiftly reversed the policy with a public apology. Indeed, as Governor of Lagos state, he impacted much on people such that a few of his political party members who had toyed with the idea of obstructing his reelection easily gave up the thought leaving him to spend his constitutionally allowed 8-year rule.
Thereafter, the prospect of his moving into a higher level as Minister was fiercely opposed. It looked like an insider media fight following the appearance on the state government’s website of allegations that Fashola had spent N78.3m on his personal website; and incredible sums to construct two boreholes at the Lagos House. When asked to comment on the development, Fashola made a poetic declaration that “when you wrestle with a pig, the pig gets happy and you get dirty. For those who still wish to remain in the mud, they should look in the mirror. For those who wish to throw mud at me, they should look at their own hands. As for me, I have moved on.” In earnest, Fashola has moved on. He did not only become a Minister but one with 3 heavy portfolios of ‘Power, Works and Housing.’ As one of Nigeria’ few leaders whose eyes are on the verdict of history, Fashola has been busy here and there, making great strides and leaving his name in gold. This month alone, the Minister was personally at project sites in several states in his bid to develop the nation. On May 08, he was in Kebbi, where Governor, Atiku Bagudu, confirmed that “most of the local governments in his State are getting 18 to 20 hours of power supply, from Kaduna DisCo.”
A week later the Minister was in Yola, Adamawa state to boost the morale of his operatives with what he called the road map for incremental power. On the occasion, he officially announced the completion of Azura Power Plant. Four days later, that is, May 19, Fashola was in Anambra state to verify the workability of a funding mechanism evolved by the Federal Government to fund infrastructure projects that would make the country globally competitive. Speaking to stakeholders in the state, the Minister argued that because of the mechanism known as the modified tax credit policy, the Sukuk Intervention Fund and the Presidential Infrastructural Fund, nothing would stop the completion of the second Niger Bridge. His visit was in fulfilment of the one he made to Governor Willie Obiano in February last year that he would constantly inspect the project until its completion. Two days later, Fashola left Anambra and headed for Lagos to flag off the rehabilitation of the Ikorodu-Sagamu Road to boost agriculture and the state’s economy. While there, he got the assurance of the people that they would support the project notwithstanding the inconveniences they would undergo during its execution. What makes Fashola’s performance worthy of note is that he is one of the exceedingly few office holders of our nation that do not sacrifice development for politics.
This same month when he was busy at his duty posts and projects, many of his colleagues were busy sponsoring parallel party congresses in several states and over-heating the polity. To mention but a few, there were parallel congresses in Ebonyi state, featuring Dr Ogbonnaya Onu, Minister of Science and Technology and his group versus the one led by Senator Julius Uchar. In Oyo state, Minster of Communication, Adebayo Shittu held one different from that of Governor Abiola Ajimobi. In Rivers state, Rotimi Amaechi Minister of Transportation had one different from the group led by Senator Magnus Abe. In Enugu state, the group to which Foreign Affairs Minister, Godfrey Onyeama belongs organized one different from that of the group led by Group Capt Joe Oji former Military Governor of Gombe state. In Kwara state, Lai Mohammed, Minister of Information and Culture and his group operated differently from the group loyal to Dr Bukola Saraki, Senate President. In Cross River state, it was a battle between the group of the Minister of the Niger Delta Affairs, Usani Uguru Usani and the National Vice Chairman, South, Ntufam Hilliard Eta.
Those of them who abandoned their offices to get involved in the intrigues of parallel congresses at the expense of governance betrayed the confidence of the nation. Of course some of them who are clearly political neophytes in their localities only wanted to show to their national leaders that they are heavyweights at home spending more time than makes sense identifying enemies of the president/governor whom they have to fight against to prove their own loyalty to their principals. In the process, politics is all that is happening in our clime, no development. In fact, when candidates get voted into office, they spend all the period meant for societal development plotting for reelection; and when they are in their last allowable term, they start to plot the emergence of their anointed successors. Here, we have two pleas; the first one is for our president to have more faith in those who perform effectively in office instead of loafers who wear loyalty badges. The second is for the media to stop purchased awards to full time politicians; they should rather publicize the Fasholas who draw a line by seeing political office as service. This would help many more people to join the league of patriots committed to national development.
The Managing Director, International Housing and Construction Show Limited, Mr Festus Adebayo, has called for the strenghtening of a conducive environment and strong political will of the Federal Government to make affordable housing a reality to the mases.
Adebayo who is also the organiser of Abuja International Housing Show,said this while speaking in an interview with newsmen in Abuja on Saturday.
He said the annual Abuja International housing show was usually put in place to help government get the political will by ensuring easy access to mortgage and also providing conducive and affordable housing in Nigeria.
He further stated that the show was looking up to a time when state governments would see housing as a tool for economic development and also source of employment.
“ Our principle in Abuja international housing show is that we keep talking, we keep doing advocacy, we keep reminding government what they need to do, untill when the government hear.
“It is when the government hear and they implement what we have said, then will the political will which we have being looking for will arrive.”
He, however, commended the efforts of the present administration and authorities in the Federal Ministry of Power, Works and Housing and as well state governments who have contributed and supported the course of the show.
Speaking further, Adebayo pin pointed some of the achievements and successes of the housing show among which are the sponsoring a bill for housing at the national assembly and embarking on advocacy from state to state on the need to put housing at the fore-front.
He added that in the past 10 years, the show had provided an avenue for stakeholders to come together and brainstorm on ways of making housing affordable which according to him had yielded very many results.
“I can tell you, Abuja international housing show has put housing in the front burner in the last ten years.
“We also have other platform like the radio, television and other social media we have been using to remind the government of what needed to be done to make housing better”, he added.
Adebayo further stated that some states have adopted the idea of having a ministry of housing for effective development control mechanism of housing projects.
According to him, there are states that no longer see charging of fees on building approval as a way of making money.
He said this was an effort of the advocacy of the abuja international housing show.
He, therefore, said the 12th edition of the show which would commence between July 16th to July 19th would address lingering challenges in the sector to give housing projects a face lift.
Housing News reports that the Abuja international housing show is a stakeholders platform where stakeholders meet annually to exchange ideas, proffer solutions and updates on latest trends in housing.
It is also a platform where leaders find a lasting solutions to housing shortage in Nigeria.
Mr Festus Adebayo, CEO, International Housing and Construction Show Ltd., says the annual Abuja International Housing Show (AIHS) seeks to complement the Federal Government’s efforts in providing affordable houses to Nigerians.
Adebayo, the CEO of International Housing and Construction Show Ltd., said this in an interview with Newsmen in Abuja on Friday.
The 12th edition of the programme scheduled to hold from July 16 to July 19, would feature experts in the housing sector to address the demands of housing deficit in the country.
Adebayo noted that there was a need to look at the sources of financing construction of housing to make life meaningful for Nigerians.
He said that the theme of the 12th edition is: “ Everyone Deserves a Home” would critically examine ways in which stakeholders would interact to ensure every Nigerians own a home.
Adebayo said that in the past 11 years, the platform had carved for itself an international reputation in the course of finding lasting solutions to shortages of housing in Nigeria.
“Abuja International Housing Show has become a platform where those thinking of how to have a home have their dreams actualised.
“ It has also become a credible platform where people network, promote their businesses and make housing available at affordable rates.
“Abuja International housing show has been doing all these with the support of its partners drawn from the Federal Ministry of Power, Works and Housing, Federal Mortgage Bank, professional bodies among others,“ he said.
He said that all these were aimed at complementing the Federal Government’s efforts in providing affordable housing.
Adebayo added that the 12th edition of the programme would leverage on the gains of previous editions by focusing more on the growth of the housing sector. He noted that that the issues of affordability of houses, interest rate, access to land, green housing and local building materials would be discussed to give Nigerians access to own their houses.
He called on the Federal Government to do more in the area of housing affordability and availability.
Adebayo further urged the government to take a clue from the governments of India, Singapore and Malaysia on how they were able to address their housing challenges.
He said that would help to improve on better ways to get it right in the provision of housing to the Nigerians.
To improve knowledge in its practice and bridge professional gap, the Lagos State chapter of the Nigerian Institution of Estate Surveyors and Valuers (NIESV), has established a resource centre and an e-library.
The facility, located in the Ikeja Office of the Institution, is part of the initiative being put in place by the state executives, which aims to bring international standard to the profession locally.
NIESV Chairman, Lagos branch, Mr. Olurogba Orimolade, explained that the resource centre will ensure that training, which hitherto are not undertaken in the country, take place on a weekly and monthly basis in specialised areas.
“The resource centre will help us bring in people to teach us those technologies; the advantage is that nobody will have the need to go abroad for those skills. We are not only concerned about our fees, but also building capacity of our members. Foreign companies in Nigeria are using new technologies and that alone is disqualifying project managers meant to be supervising certain jobs,” he explained.
Conducting journalists around the 11-seater classroom resource centre, Orimolade said it is designed to have the most current equipment and devices for organised master classes/training workshops. The main vision for the centre, he said, is to focus on training in key areas in the real estate industry, especially in the estate surveying and valuation profession.
“This resource centre will be one of the tools that should help improve the professional skill set of our members and the public at large, through the various trainings and master classes which will be taking place there. The e-library has been created in a similar fashion. The plan is to have computer systems with unlimited Internet access for members mainly for the purpose of research,” he explained.
The centre and e-library are part of the showcase during the 2018 Estate Surveyors and Valuers’ Week, which commenced last Sunday and will end tomorrow. The key highlight of the week included the inauguration of the remodelled branch secretariat by the President of NIESV, Roland Abonta, among others.
On the protracted Land Use Charge, Orimalade said the branch will submit its report to the Lagos state government. The report, he revealed, is expected to advise the government on areas to improve upon, among others.
“We have asked the government to look at the process from the angle that people want to pay tax but there should be clarity. The government has a right to come up with tax but the argument is if it is fair,” he said.
The Federal Government on Tuesday said that the National Housing Programme was designed with ‘Ramps’ for mobility and interactions in consideration of people living with disabilities.
The Minister of State II for Power, Works and Housing, Alhaji Suleiman Zarma, made this known during an inspection of the ongoing construction of the NHP in Ado-Ekiti.
Zarma, in the company of some ministry’s officials, was on an assessment tour of the Federal Government’s roads and housing projects in the south-west geo-political zone.
NHP is designed nationwide to suit different categories of people, especially people living with disabilities through provision of Ramps to ease their movement in the buildings.
However, in the course of the inspection in Ado-Ekiti, the minister said that people living with disabilities should not be restricted to the ground floors only, as designed in the site, and should be allowed to interact freely.
He said: “In the world, people living with disabilities are integrated without being segregated. So there is no point to say that you have them only on the ground floor that is another phase of segregation.
“They should be able to go to all the floors and to all the levels of the building; they should be accommodated to carry out their activities.”
Zarma, a surveyor, urged the officials in charge of the NHP in the state to make sure that the designs were suitable for the disabled in the next phase of the NHP in the state.
According to him, the staircases will be strips or ramps that will cater for their movement.
He said: “They should not segregate the people with disabilities by restricting them to the ground floor; they should be allowed to go up and interact.’’
The NHP Team Leader in the state, Segun Dosu, noted that due to initial set back caused by relocation challenge, the 70 housing units being constructed began late but was nearing completion.
The architect assured the minister that the design for the second phase of the programme, which would commence soon, would go beyond the ground floor and extent to others to accommodate the people living with disabilities.
He said that all the contractors were mobilised and reported to the site except one that was handling two number blocks of three bedrooms, who was yet to report for site handing over.
According to him, the contractor has been served with warning letter to do so with a view to commencing the process of determining his contract.
Dosu said: “The water infrastructure contract is already at 80 per cent completion with the drilling of four boreholes, installation of ground and overhead tanks and construction of water treatment plant.
“The road infrastructure contract progress include completion of site survey, setting out of roads, cutting and bending of re-enforcement are ongoing with a view to commence concrete works on the drainage.
“External electrification progress includes the completion of erection of poles and construction of housing for transformer sub-stations while cable line installation is ongoing.”
THE Minister for Works, Power and Housing, Mr. Babatunde Fashola, last weekend inspected Federal Government’s on-going projects in the South-East geopolitical zone, starting from Abia, Imo, Enugu, Ebonyi to Anambra states.
Arriving the Enugu border with Abia State, after his departure from Imo State, the Minister rode through one flank of the Enugu-Port Harcourt Expressway, stopping at the CGC asphalt plant located at Awgu. On arrival in Enugu State, Fashola expressed disappointment on the garbage he saw along the way at Okigwe (Imo State) and Lokpanta (Abia State) points. He immediately called on the affected state governments to clear the markets, refuse and so much rubbish that have taken over the spots. It was at Awgu that the Minister plied the ongoing road construction up to Enugu-Port Harcourt road after the contractor said he hopes to achieve 15 per cent completion by December, whereas 23km asphalting has been done.
Both the Minister and the Federal Controller of Works in Enugu State, Engr. Femi Oyekanmi expressed reservations and disappointment on the part of the contractor for slow pace of work. From there, the team passed through Nenwe-Oduma-Uburu, Ebonyi State road construction where work has gone on to very commendable extent. After a courtesy call on Governor Dave Umahi, the minister inspected the Ezzamgbo Federal Housing project, where he made remarks against state governments embarking on constructions of federal highways without permission from Abuja. Fashola emphatically told state governors that the Federal Government will not pay for any work they execute on federal roads if permissions were not properly obtained before the execution. He emphatically said that state governments should stop further execution of such projects until the Federal Government clears outstanding debts to states on such jobs. He also inspected the Enugu-Onitsha Expressway, where he noted that the very dilapidated 15 kilometers Abakpa junction-9th Mile section will be re-awarded since the former contractor absconded from the job. He however, commended the contractor working from 9th Mile to Ezeagu section of the road.
Unknown to electricity consumers in Enugu State and environs, the New Haven transmission sub-station has been upgraded to accommodate additional 70 megawatts to boost power supply from the sub-station. After inspecting the installations, Fashola said: “It’s a transmission sub-station taking power from the grid at 132 KV, that’s a lot of voltage, stepping it down to 33 from where they now provide service to the Discos. TCN, the owner of this substation, is the transporter of power, wheeling it from where it is generated to a Disco such as the Enugu Disco that serves the Eastern part of Nigeria, essentially.
“So Enugu Disco takes the power at 33 and takes it down to 11and finally to 415 volts where it comes to your home, that’s when the power is safe. Now, what they do is that they use feeders to send the power to different parts of their distribution franchise, to different communities, towns and locations. “Now apart from adding more power, about 70 megawatts, if you know that one megawatt can power roughly 200 homes, if you multiply 200 by 70, you will see the number of people that will be served here when the additional 70 megawatts is switched on in a few weeks. What is being awaited is the fire protection system in the transformers. “What we have done here is that we have two new transformers of 60 MVA each; that means an additional 120 MVA to the existing 60 MVA, that is 180 MVA and it increases the total power intake addition by 70 megawatts which makes it over 190 megawatts for this Disco. What that means is that those industrial complexes can now be fed through a new feeder instead of clustering the old feeder. So there are four new feeders dedicated by the Disco, because they are the ones that know their customers, so they are the ones to decide who will receive it but we know they have nominated two people, one is the industrial cluster and the other one is for Ugwogo and another one for Independence Layout.”
At the Ugwogo-Nike site of the ongoing 2016 National Housing programme, Fashola expressed disappointment with both the contractors and supervisors for the poor quality jobs on the estate that includes 1, 2 and 3-bedroom bungalows that cumulatively amount to 23 unit blocks, most nearing completion. The minister at the end of the inspection noted that the Federal Government will not accept poor quality jobs. “If we pay you money, mix the cement properly, that is the ethical side of construction. You don’t know who will live there, it maybe you, it maybe your relation and we want to build houses that are safe for people to live in. So don’t cheat on the cement because we have paid you for it,” said Fashola. He later moved on to Anambra State where he further inspected the remaining portion of Enugu-Onitsha road under reconstruction, among other federal projects sited in the state.
It is now less than two years to the deadline for achieving the Financial System Strategy (FSS 2020) and the bill is yet to be passed into law. Passage of the bill will ratify much of the work that have been done and accord it legal backing. It would also provide platform for further engagements even after the expiration of the deadline.
Nigeria has, after 10 years of establishing the FSS2020, achieved 50 percent out of the 80 percent target of the financial inclusion. FSS 2020 was born out of a prediction by Goldman Sach that Nigeria’s economy would be among the top 20 economies of the world by 2020.
Goldman Sachs believes that only two countries in Africa will overtake Italy in GDP size by 2015 and that is Nigeria and Egypt. In his presentation on Nigeria’s Financial System Strategy 2020 Plan “Our Dream”, Chukwuma Soludo, former governor of CBN, on June 18, 2007, said, for Nigeria to achieve this feat and its aim of being part of the 20 largest economies by 2020, she must maintain an annual average growth rate of 12.4 percent over the next 15 years.
Nigeria’s GDP grew by 1.92 per cent year on year in fourth quarter of 2017 compared to 1.4 per cent in third quarter of 2017, according to the National Bureau of Statistics (NBS).
In 2007, the CBN launched the FSS2020 aimed at calibrating the financial system as a means of ensuring economic growth and development with the view of growing the Nigerian economy to become one of the 20 largest economies in the world by 2020.
FSS 200 aims to develop and transform Nigeria’s financial sector into a growth catalyst and engineer Nigeria’s evolution into an international financial centre. The strategy was designed to strengthen and deepen the domestic markets, enhance integration with the external financial markets; and promote sustainable economic development.
Passing the FSS 2000 bill is important for Nigeria as it is focused on making Nigeria a financial hub of Africa just like London is the financial hub of Europe.
Non-passage of the bill impacts negatively on the Federal Government’s target of achieving 80 percent financial inclusion by 2020. A survey on access to financial service by Enhancing Financial Innovation and Access, revealed that Nigeria was still at 41.6 per cent exclusion rate as at 2016, three years to the 2020 target.
Interestingly, the Nigerian Senate on May 15, 2018 passed the Companies and Allied Matters Act (CAMA), is seen as the biggest business reform bill in Nigeria in over 28 years.
Some other bills passed by the Senate the passage of the collateral securities into law, passage of 15 other major economic Bills passed to law, rand review of about 50 existing extant laws.
Segun Ajibola, President/Chairman of Council, Chartered Institute of Bankers of Nigeria (CBN), who is presently pushing for the passage of FSS 2020 bill acknowledged that these bills passed into law by the 8th Senate have in no small measure enhanced the recovery and resilience of Nigeria’s economy.
However, there are other related bills that are critical to the implementation of FSS 2020. These include the Nigeria International Financial Centre Bill, Financial Consumer Protection Bill, and the Electronic Transactions Bill.
The FSS 2020 bill as noted by Seye Awojobi, Registrar/CEO, CIBN, was passed by the 7th Senate but assent was not granted by President Muhammadu Buhari.
Recognising the importance of the FSS2020 Bills, Bukola Saraki, Senate president said FSS2020 must be brought to the front burner in view of its strategic work that is important to the financial system and economic growth of Nigeria.
The Senate President also indicated that in respect of the pending Bills there will be need to set up a small joint technical committee that will prioritize the Bills for quick passage. “The Chairman of the Committee on Banking will be on hand to facilitate a working collaboration on the critical Bills with the delegation, particularly FSS2020 High Level Legal Working Group and the FSS2020 Secretariat,” Saraki said.
The stakeholders involved in the implementation of the FSS 2020 include the Federal Ministry of Finance, National Assembly; Securities and Exchange Commission (SEC); Nigerian Deposit Insurance Corporation (NDIC); National Insurance Commission (NAICOM); National Pension Commission (PENCOM); Federal Inland Revenue Service (FIRS); Nigeria Insurers Association (NIA); Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA) and Manufacturers Association of Nigeria (MAN).
Others are Debt Management Office (DMO); Nigerian Stock Exchange (NSE); Deposit Money Banks (DMBs); Federal Mortgage Bank of Nigeria (FMBN); Bank of Industry (BOI); Nigeria Export Import Bank (NEXIM); Bank of Agriculture (BOA) and Development Partners, while the key implementing institutions are CBN, NDIC, SEC, NAICOM, PENCOM, DMO, NSE, Federal Mortgage Bank of Nigeria (FMBN), FIRS, the Small and Medium Enterprises Development Agency of Nigeria and Financial Reporting Council.