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Banks count on biometric machines to help reduce fraud

Banks count on biometric machines to help reduce fraud

The recently-introduced biometric Automated Teller Machines
(ATM) will help banks and customers check fraud complaints in the banking
industry, analysts have said. First Bank of Nigeria Plc introduced biometric
ATMs into the country.

The group managing director and chief executive officer of the
bank, Bisi Onasanya, speaking during the introduction, had said the ATMs were
purchased to protect the data resources of its customers.

The biometric ATM solution is available to the bank’s existing
cardholders who may wish to add biometric authentication as part of their
transaction approval process on First Bank ATMs in addition to PIN selection,
while new cardholders will be issued cards with only the biometric
authentication functionality.

Under the biometric system, cardholders are identified by their
fingerprints, making it almost impossible for any other person to use it in
case the card is lost or stolen. Victor Ndukauba, a finance and research
analyst at Afrinvest, an investment advisory and research firm said: “It will
help in terms of security. It will reduce the exposure to and tendency of
fraud, as regards the use of ATMs. It will have an impact because it would mean
fewer complaints from users.”

A random sampling of other banks showed that they are working on
improving their ATM security systems. At Oceanic Bank, a source who did not
wish to be quoted because he was not authorised to speak to the media, said
that while the bank may not have introduced the biometric ATMs to its
customers, they were willing to upgrade their technology for the convenience
and safety of their customers.

“Everything that would reduce the cases of fraud in all its
ramifications is what every bank is working towards,” he said, adding that
banks try to upgrade their existing technology as soon as new ones are
introduced into the market.

“We have upgraded to the chip and pin” a source at Spring Bank
said. “We are yet to introduce the biometric ATM but we make sure we upgrade
our technology for the security of our customers’ funds.”

A long way

Mario Yanez and Annuar Gomez of the University of Miami, School
of Business Administration in a paper titled ‘ATM and biometrics, a
socio-technical business model’, said that parallel to the development of the
industry, different modes of fraud have made it necessary to reinforce the
levels of security utilized in ATMs.

According to them, “Biometric technology is based on the
scientific fact that there are certain characteristics of living forms that are
unique and not repetitive for each individual; these characteristics represent
the only technically viable alternative to positively identify a person witout
the use of other forms of identification more susceptible to fraudulent
behaviour.”

Biometric identification is utilized to verify a person’s
identity by measuring digitally certain human characteristics and comparing
those measurements with those that have been stored in a template for that same
person.

According to them, banks, other financial institutions and
retailers could increase the volume and reduce their ATM unit transaction
costs; increase their revenues and expand their potential customer base using
the biometrics ATMs.

Biometrics is also increasingly included in a wide range of
verification applications in e-commerce, financial electronic transactions and
other financial transactions.

Banks are responsible

Ariyo Kosoko, the spokesperson of Interswitch Limited, an
electronic transaction switching and payment processing company, said that
banks are responsible for upgrading their ATMs.

“It is the banks, and not the connecting companies, that are
responsible for upgrading the technology of their Automated Teller Machines,”
he said. “We just help the banks in their connectivity and make sure cards can
work on machines. We provide interconnectivity. Upgrading the ATM technology is
really left at the discretion of the individual banks. Ours is to make sure
that notwithstanding any type of ATM technology, operated by the banks,
outdated or modern we provide the adequate interconnectivity.”

History of ATM fraud

For years, the banking industry has been fighting the battle of
fraudsters swindling customers through ATMs. Before the enforcement of the chip
and pin cards last year, the banking system was awash with complaints of the
“mysterious” disappearance of funds from customers’ accounts, as statistics
showed that at least 30 million dangerous ‘magnetic stripe’ ATM cards were
carried about by innocent citizens.

Experts said these toxic ATM cards were highly prone to fraud,
as they could easily be cloned once fraudsters got hold of certain information.
The criminals would swipe the band of magnetic material on the card, which
contains vital data, past a card reader or reading head. Although the rate of
reported ATM fraud has reduced over the months, experts say biometric ATMs
would guarantee more safety for customers’ funds.

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Nigerian Stock Exchange unprepared for merger

Nigerian Stock Exchange unprepared for merger

As stock exchanges around the world merge to expand their
operations, financial analysts say the Nigerian Stock Exchange (NSE) is not
“ripe” for that kind of business. The New York Stock Exchange (NYSE), Euronext
and Germany’s Deutsche Bourse on February 15 reached an agreement to combine
business. If successful, the $10 billion deal will form the biggest exchange
operator in the world.

Also, the London Stock Exchange had on February 9 announced a
$6.9 billion bid to take over Toronto Stock Exchange operator TMX Group. The
move will create a combined group that will be jointly headquartered in London
and Toronto. The two companies are waiting for a review by the Canadian
government to finalise the process. However, Opeyemi Agbaje, an economic
analyst and chief executive officer of Resources and Trust Company Limited, a
business advisory firm, said,

“The Nigerian Stock Exchange (NSE) is a monopoly so the issue of
mergers may not be so relevant to us now,” adding that the global merger trend
“may be driven by profit and scale considerations since many global Exchanges
are now business ventures with profit objectives.” But Virginus Agada, a
stockbroker at Eurocomm Securities Limited, a stockbroking firm, disagreed that
the NSE is a monopoly market.

According to him, “The
issue of merger with another stock exchange cannot be thought of in our market
now. Is it not when you’re healthy that you begin to look for somebody to stay
with you? Our market is not that healthy and therefore it’s not ready for
merger talks now, but we may get there in the future.” He said although there
are benefits to enjoy in mergers such as economies of scale and chains of
ideas, “but I don’t think that should bother us now in this country. Right now
we’re trying to gain confidence from investors.”

He added that “no matter how large investors are willing to come
to the market; if you don’t have enough facility to support them they won’t get
quality benefits.” Mr. Agada, whose firm is one of the affected stock broking
firms yet to meet the NSE’s N70 million capital base requirement for
stockbrokerages, said, “If you want to merge, you should talk about things
other Exchanges can learn from you. We (NSE) have not even shown good examples
within the West Africa region and Africa at large let alone talking of the
developed worlds.”

Detola Olukorede, an equity analyst at Investment Option, a fund
management firm, said, “The NSE is not ripe yet for merger like it’s happening
around the world now.” He said this is because the nation’s bourse is still
“underdeveloped in terms of infrastructure and operation.”

Wave of mergers

The merger of the New York Stock Exchange (NYSE) Euronext and
Germany’s Deutsche Bourse is structured as a combination of Deutsche Bourse and
NYSE Euronext under a newly created Dutch holding company, which is expected to
be listed in Frankfurt, New York and Paris. According to the agreement, when
the merger is completed, Deutsche Bourse stakeholders are set to control a 60
percent stake, with NYSE Euronext investors commanding 40 per cent of the
combined mega-firm’s equity, on a fully diluted basis. The deal is, however,
expected to be closed at the end of 2011. After that, the merged group will
boast more than $20 trillion in annual trading volume and operations in several
European countries and the United States.

A similar case also happened in Asia. Singapore Exchange Limited and ASX
Limited, operator of the Australian Securities Exchange, announced their $8.3
billion merger proposal on October 25, 2010. The merger is expected to create
the fifth largest Exchange operator in the world. Meanwhile, reports say the
two companies released a revised proposal on February 15 in a bid to boost the
deal’s chances of getting regulatory approval in Australia.

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Foreign investors maintain interest in Nigerian capital market

Foreign investors maintain interest in Nigerian capital market

Still smarting from their losses in the wake of the stock market
crash in 2008, many local investors are yet to regain confidence in the
Nigerian capital market. As a result, foreign investors now account for a
larger share of transactions on the Nigerian Stock Exchange (NSE).

Interim administrator of the NSE, Emmanuel Ikhazobor, who
confirmed this, said the major challenge facing the Nigerian capital market
regulators was to build confidence and put in place systems that would enhance
efficiency and transparency.

He was speaking yesterday at the annual capital market
conference organised by Business Day Newspaper with the theme, ‘Can Nigeria
Lead Again?’

“It is true. As at yesterday (Wednesday), foreign investors
accounted for 68 per cent of the volume and value of market transactions.
Confidence has not grown among local investors, who are interested in taking
profit; while the foreign investors are taking longer position in the market,”
Mr. Ikhazobor said.

Total market capitalisation, which peaked at about N12.6
trillion in March 2008, shed about 70 per cent in value as investors moved to
alternative windows. The market has, however, been on the recovery, rising by
about 18 per cent in January from the previous month’s figures.

Increase trading hours

Mr. Ikhazobor said as part of efforts to improve liquidity, the
NSE extended the trading period by two hours from 9.30am to 2.30pm in order to
attract more foreign participation. He said the extension resulted in the
increase in volume, value, and the number of deals in the market.

He further disclosed that the extension, which became effective
December 6 last year, was to be reviewed in less than six months.

“From the result we have achieved, we may not wait for six
months. We may need to increase the trading hours again in order to increase
trade on our market,” he said.

Mr. Ikhazobor also said the regulators were looking at removing
the five per cent cap on share price: “We are looking at scenarios. If we
discover that it will increase liquidity, we will tamper with that also.”

Director general of the Securities and Exchange Commission
(SEC), Arunma Oteh, said there was need for more institutional investors to
play in the market: “Traditionally, our market has been retail driven. What
will enhance liquidity in the market is if there are more institutional
investors.”

She said rather than investing directly, retail investors should
be encouraged to pool their funds together under registered investment scheme
for fund managers to invest on their behalf.

Increase investor
confidence

Ms. Oteh said as part of plans to increase investor confidence
in the market, it was putting in place effective regulation and good corporate
governance code.

“A world class market is one that engenders investor confidence,
has breadth and depth in terms of product offering, is characterised by market
integrity, a strong and transparent disclosure and accountability regime,
fosters good corporate governance, and is fair and robust, and efficient market
place,” Ms. Oteh said.

On his part, managing director of the Asset Management
Corporation of Nigeria (AMCON), Mr. Mustapha Chike-Obi, said the challenge was
to get investors back to the market and create more products to deepen the
market.

“I think we must have securities lending to encourage investors
to express themselves. Luckily, AMCON is going to end up with a large portfolio
of securities which we pledge to hold for two years at the minimum. I want to
tell you, if you want to borrow AMCON’s portfolio of shares, you have those
already. That will be a start,” Mr. Chike-Obi said.

He said operators need to rise up to the challenge of creating products that
would suit the investment needs of Nigerians.

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Senator’s absence stalls anti-money laundering bill

Senator’s absence stalls anti-money laundering bill

The continued
absence of Ibrahim Ida, Chairman Senate committee on Defence and Army
has stalled the passing of the Anti Money Laundering bill.

Mr. Ida represents
Katsina Central constituency in the Senate and heads an ad hoc
committee that was mandated by the Senate in July last year to
recalibrate the bill which the senator thought too harsh at the time.

Mr. Ida has since
the beginning of the week been absent each time the bill came up for
hearing. Traditionally, the Senate does not legislate on bills if the
author is not present in the plenary because the author has the
responsibility of defending the spirit and letters of the bill as well
as offer clarifications to fellow lawmakers on any ambiguous part of
the bill.

The anti-money
laundering bill is a complementary legislation to the anti-terrorism
bill which was passed by the Senate last week. Both the anti-money
laundering and anti-terrorism bills are based on recommendations of the
Financial Action Task Force (FATF), established by the G7 Summit held
in Paris in 1989. The anti-money laundering bill will replace the 2004
version of the same bill which is said to lack the relevant provisions
that will make it fully compliant with the recommendation of FATF.
Passage of the anti-money laundering bill will mark Nigeria’s full
compliance with the international requirements for combating terrorism
recommended by FATF.

President Goodluck
Jonathan, for the third time in 11 months, written the lawmakers early
last week to expedite legislation on the Anti-terrorism and Money
Laundering Bills. Following the President’s repeated appeals to the
lawmakers, the Senate hurriedly passed the anti-terrorism bill on
Thursday last week, with enthusiasm to pass the complementary
anti-money laundering bill this week. However, each time it was
presented for hearing, Mr. Ida, the author of the bill was absent.

When contacted,
Mr. Ida rejected calls and did not reply text messages sent to his
official mobile line. The bill is not new to this kind of treatment at
the upper chamber . In July 2010, a deliberation on the bill was called
off after a slow-moving debate and adoption of the individual clauses
in the bill due to the absence of the initial author of the bill, Sola
Akinyede (PDP Ekiti state).

Although the
senators complained of the complex provisions of the bill which they
said could only be explained by the author, the senators also showed
apathy towards the bill. It was thereafter committed to the Mr. Ida
headed ad hoc committee for further calibration but it never came back
for hearing till the president’s last letter of reminder. Deadline for
the passage of the bill has since expired on June 30.

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Airspace agency commences satellite navigation

Airspace agency commences satellite navigation

The Nigerian
Airspace Management Agency (NAMA) on Wednesday said that it has
commenced the migration from the current terrestrial operations to
satellite-based navigation to enhance safety across the nation’s
airspace.

According to the
agency, arrangements have been concluded for the takeoff of the project
in March, and the International Air Transport Association (IATA) has
been contracted to carry out the job which is to cost the organisation
₦360 million. “There are ample opportunities for airlines to fly in and
out of the airport with flexibility. It is going to be economical for
them as they will burn less fuel, make quicker turn and talk less with
the Air Traffic Controllers,” said Supo Atobatele, General Manager,
Public Affairs, NAMA at the agency’s headquarters in Lagos.

The satellite
navigation system configures a country’s airspace with the Global
Navigation Satellite System (GNSS), which is carried out through the
World Geodetic System 84 (WGS84) survey. Its completion will augment
flight operations, making it easier and safer for pilots to navigate
through the airspace. Funds spent in the acquisition of aviation fuel
will be reduced to a “large extent” when the satellite navigation
system is in place, and the difficulty experienced by airlines and air
traffic controllers in the positioning of aircraft in motion and on the
runway will be adequately corrected, according to the airspace agency.

Mr. Atobatele said
that the federal government will bear the cost of the project, adding
that the International Air Transport Association has carried out survey
of the 22 airports controlled by the Federal Airports Authority of
Nigeria (FAAN) including two others owned by the Akwa Ibom and Gombe
State governments. The NAMA spokesperson noted that at the moment the
project commenced at four major international airports in the country,
Murtala Muhammed Airport, Lagos; Nnamdi Azikiwe Airport, Abuja; Port
Harcourt Airport, Rivers; and Aminu Kano Airport, Kano.

“With this
movement, we’ve gone digital and the issue of obsolete equipment is no
longer there. The GNSS is a modern trend in air navigation spatial
coordinate of terrestrial points, which was established by the ICAO
(International Civil Aviation Organization) and it’s the acceptable
international terrestrial reference framework known as WGS84,” he said.

Mr. Atobatele
disclosed that some foreign carriers have been picked for the test
flights of the new system and that the ICAO had set a deadline of 2016
for all member countries to migrate to the new regime, adding that the
agency looks forward to completing the project by 2012. “When fully put
into use, pilots in flight will depend more on the satellite to
navigate to the airport covered by the survey and depend less on land
aids.

NAMA had trained its personnel, airline technical staff, naval
officers and air force personnel for efficient handling of the
equipment.”

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Nigerian prisons to see improvement

Nigerian prisons to see improvement

Prisoners across
the country will soon begin to benefit from better training and
infrastructure, the comptroller-general of prisons, Ogunsola Ogundipe,
has said. Mr. Ogundipe who was represented by the deputy comptroller of
prisons (finance), Salawu Momodu, said the prison service has started a
restoration programme which will ensure that inmates are no longer
housed in substandard buildings. He made the statement in Abuja on
Tuesday at the fifth International World Conference on Human Rights,
Criminal Justice and Prison Reform, hosted by the Citizens United for
the Rehabilitation of Errants. Mr. Ogundipe said that the training of
inmates to prepare them to adapt to the real world after their jail
terms would form part of the restoration programme.

“We are building
new prisons and upgrading old ones in a bid to develop prison
infrastructure, to ensure that inmates are kept in humane places. We
are also carrying out manpower development,” he said.

Mr. Ogundipe also said that the problem of prison congestion was
because of the large number of people awaiting trial. He said that the
prisons were designed for convicts and not those awaiting trial. Mr.
Ogundipe promised that the reforms taking place in the prison service
would ensure that the problem was tackled soon. He said that with
increased funding, the prisons would do better, arguing that the
colonial structures in the country should be updated. The former chief
justice of the federation, Muhammed Uwais, who also spoke at the event,
said the process of reforming the judicial prison system in Nigeria was
ongoing. He said that although Nigeria was still lagging behind
compared to other countries in the world, “we will catch up with them”.

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Work commences on Benin-Abraka road project

Work commences on Benin-Abraka road project

The Federal Government on Wednesday in Benin
flagged off the first phase of the Benin-Abraka road reconstruction
project with a call on host communities in the area to cooperate with
the contracting firm, Reynolds Construction Company (RCC).

The 30km road project was part of the contracts
approved for the 2010 budget, with the sum of N9.75 billion allocated
for the project which will be supervised by the Ministry of Niger Delta
Affairs.

Minister of Niger Delta Affairs, Godsday Orubebe
who performed the flagging off ceremony un-behalf of President Goodluck
Jonathan, said the road construction will be completed within three
years. He assured the people that the construction company handling the
project will do an excellent job.

On his part, the Minister of State
for Works, Chris Ogiemwonyi, disclosed that the federal government road
project will cut across Edo and Delta States, adding that the first
phase cuts across three local government areas of Orhiomwon,
Ikpoba-Okha and Oredo in Edo State.

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We inherited the aides, presidency insists

We inherited the aides, presidency insists

The Presidency
yesterday reiterated its claim that Goodluck Jonathan inherited most of
his aides from his predecessor, late Umaru Yar’adua who also took over
some of them from the administration of Olusegun Obasanjo.

The spokesperson
to the president, Ima Niboro said there was need to condemn “the
willful distortion of the list of appointees.” He said, “If you go
through the list you will know that some of them were already there and
only relocated to fill vacancies at the president’s wing,” he said.

A NEXT report had stated that the Presidency has an army of 133 aides who get paid about N780 million every year.

The report also
said Mr. Jonathan, after being sworn in as president last May,
following the death of Mr Yar’Adua, not only retained almost all the
special aides appointed by his late boss, but also appointed 57 new
ones.

Mr Niboro, in his
second response on the issue, said most of the new appointments were
made to fill in vacant positions at the office of the President and
Vice President, when the president vacated his office as vice president
to the office of the President.

“You don’t come
into office and fire everyone. Here we are complaining about
institutional memory and someone somewhere believes the president
should fire everybody,” he said. “Having said that, I think it is quite
silly to claim that I told a lie, when the evidence that I am correct
stares you in the face. I maintain that apart from the normal positions
the president filled in the presidency, a large number were inherited.
The president has created only a handful of key positions, like the
special advisers on power, policy monitoring, SSA on Diaspora Affairs,
the Coordinator of Anti Terrorism, and a couple of others that were
found to be needed for the times.

“Indeed I can tell
you that the president has not even exhausted the Special Adviser
positions approved for him by the National Assembly,” he said.

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Party confirms Ribadu/Adeola ticket

Party confirms Ribadu/Adeola ticket

The KOWA party on Thursday, said that it
had formally confirmed the nomination of Mr. Fola Adeola as the running
mate of Mallam Nuhu Ribadu, the Action Congress of Nigeria (ACN)
presidential candidate for the April poll. The new running mate is a
party member of KOWA, the party in a statement in Lagos said the
approval was sequel to the National Executive Committee and Board of
Trustees (BOT) meeting held on Monday, February 21, 2011, in Abuja.

The statement was signed by Mrs Oluremi
Sonaiya, the Public Relations Officer of the KOWA Party. It was
reported that Mr. Ribadu had earlier submitted to the Independent
National Electoral Commission (INEC), the name of a US-based Nigerian,
Dr Stanley Ugochukwu as his running mate for the April poll. This
changed after much deliberations within the leadership of the ACN and
finally on February 21, Mr Fola Adeola, former Managing Director and
Chief Executive Officer of Guaranty Trust Bank PLC, was picked for the
post .

KOWA’s statement declared that the
party’s release of Adeola and his acceptance to serve was without
prejudice to their commitment to the ideals and vision of KOWA party.
‘‘At the NEC meeting in Abuja, the party leadership declared Mr Adeola’s
selection as a critical move necessitated by the enormity of the task
of rescuing Nigeria from its current desperate state,” it said. ‘‘KOWA
will promote the Ribadu/Adeola ticket on ACN platform to institute the
good governance and present a viable alternative for Nigerians come
April 2011,” it stressed.

NAN

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‘Choice of army chief is on merit’

‘Choice of army chief is on merit’

President Goodluck
Jonathan yesterday said his appointment of the Chief of Army Staff,
Azubuike Ihejirika, a Lieutenant General, was hinged on merit and his
resolve not to discriminate against any ethnic group in the country but
to ensure equal opportunities for all.

He stated this
during a courtesy call on members of the Abia State traditional rulers
council led by its chairman, His Majesty, Eze John Akaniru, in Aba,
where the PDP campaign train touched yesterday.

Mr. Jonathan said
he chose Mr. Ihejirika after much submissions and analysis and
conviction of his brilliance and competence amongst his contemporaries,
to buttress his administration’s policy of equal opportunities for all
Nigerians.

“He is a brilliant
and competent officer and when people thank me for his appointment I
say no, because we are re-creating a Nigeria where no one or ethnic
group suffers discrimination of any kind. I did not know him, I did not
know he was from Abia State, but I did my analysis and I was told he
was the best and I decided that being the best he has to take the job,”
the president said.

Mr. Jonathan also
reassured the people of his government’s commitment to eradicate
kidnapping and to also tackle security issues in the South East region
and the entire nation.

“We are working day
and night and we are going to employ all modern technological methods
to halt the trend of insecurity across the country, particularly in the
South East,” he said.

Mr. Jonathan, who
at the ceremony was conferred with the title of ‘Omezuri Abia’ (meaning
the one that has built Abia) by the Abia traditional rulers, thanked
the traditional rulers and their counterparts across the South East for
the honour bestowed on him and his wife, Patience, and also for their
overwhelming support for him and his running mate during the PDP
primaries.

He called for their
continued support in the forthcoming elections where he is standing as
the presidential aspirant of the Peoples Democratic Party.

Earlier, Eze
Akaniru commended President Jonathan for appointing prominent Igbo sons
and daughters into key positions in the country, and for restoring
security of lives and property in the South East particularly Abia, “at
a time when we almost lost hope security-wise.”

“Your campaign is a campaign of hope for all Nigerians and we are
praying for your success. Rest assured that no single vote from Abia
State will go to any other political party or aspirant apart from you
and the PDP,” the traditional ruler said.

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