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Police arrest governorship aspirant’s supporters

Police arrest governorship aspirant’s supporters

Police in Uyo, Akwa
Ibom State, yesterday, arrested scores of youth who had staged a march
in support of a governorship aspirant accused recently by the state
government of murder.

Truckloads of
security personnel disrupted a protest organised by the youth group and
sealed off the campaign office of James Akpanudoedehe, a former
minister of the Federal Capital Territory, who now seeks the state
governorship seat, arresting at least 30 of the men in the process.

The state police
commissioner, Walter Rugbere, told journalists the men will be charged
to court Wednesday for failing to secure permission for the procession,
and constituting “public nuisance.”

Mr. Akpanudoedehe
was arrested last week after the state government accused him of having
a role in the murder of a prominent politician who was gunned down in
the state a forthnight ago.

His arrest heightened tension in a state already fraught with rampant cases of kidnapping, murders, and overall insecurity.

The opposition
blamed the state governor, Godswill Akpabio, of running a highhanded
administration that brooks no dissent. But the state government had
always disputed this.

“By laying the
blame for Inyang’s murder on the opposition, even ahead of police
investigation, the state government is employing scare tactics and
wants to be the judge in its own case,” said Mr. Akpanudoedehe, days
after Paul Inyang, top PDP official, was shot dead while worshiping in
church.

Mr. Akpanudoedehe,
former minister, who is now seeking to become the state’s next
governor, said the administration’s policies have become more
intimidating, as more persons announced their decision to challenge the
re-election of the incumbent governor, Mr. Akpabio.

Inciting messages

The police said
yesterday’s arrest was to maintain peace that was threatened by
“inciting messages” displayed on the placards of the protesters, and
the harassment of motorists.

But reports from
witnesses said the protest by Mr. Akpanudoedehe’s supporters was
peaceful, and did not engage in forceful behavior such as harassment of
motorists, as claimed by the police.

The youths
reportedly converged as early as 6 a.m, marched through some of the
major streets in the capital city, including Oron Road, Ikot Ekpene
Road, Iboko Street, NEPA Line, and Abak Road.

They were later
stopped by a detachment of over 100 policemen deployed from the Police
Headquarters, Ikot Akpan Abia, who arrived in two separate batches.

While one batch
reportedly pursued the demonstrators along the streets as they were
making their way back to the former minister’s campaign office, the
other batch was stationed outside the office.

The police admitted they shot several canisters of tear gas to help disperse the youth.

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Bank shareholders are not smiling yet

Bank
shareholders are not smiling
yet

Nearly a year after
the bank reforms initiated by the Central Bank, some banks shareholders
are still lamenting, saying they are yet to reap the benefits of their
investments.

The share prices of
bank stocks at the Nigerian Stock Exchange (NSE) have depreciated in
the past 10 months, leaving most investors broke.

Some investors
believe the journey ahead for the banking sector will not be any rosy,
while others are of the view that the recent progress being made on the
establishment of the Asset Management Company of Nigerian (AMCON) will
soon ease the ‘survival struggle’ in the industry.

Bola Oke, a finance
analyst at Wealth Zone Limited, an investment firm, said the current
banks performance show that they are bouncing back to profitability.
“Havoc has been done in these banks. The present bank managers are just
turnaround managers, though we hear some of them have started spending
unnecessarily.”

However, Ms. Oke
said banks’ inability to declare good dividends and bonuses is not
making investors happy. “We (shareholders) cannot be happy since our
expectations were not met, even after the bank reforms. But we just
have to give the banks some time to get their foot back on the ground,”
she said.

Looking forward

Egbo Amaechi, an
executive member of the Shareholders Association of Nigeria, said all
indicators show that the banking sector is still struggling to recover.

“So far, progress
has been made. Remember that this time last year, financial results of
banks, like Oceanic and Intercontinental, that were overdue could not
be presented at the floor of the Nigerian Stock Exchange. Today, banks
are posting results, even when they are not encouraging,” Mr. Amaechi
said.

He said the success of the Asset Management Company will further boost the future performance of the banking sector.

Insolvency

Last week, Oceanic
Bank International, one of the rescued banks re-presented its financial
results to the NSE. The bank, however, could not meet the bonus of one
for 10 earlier promised its shareholders.

Ndi
Okereke-Onyiuke, the director general of the NSE, said the bonus cannot
be paid to the investors because “the bank is technically insolvent,”
adding that “there was no money in the bank’s reserve and there was no
money in the shareholders fund.”

After recording
loss after tax of N234.692 billion for the 15 months ended 31 December,
2008, and loss after tax of N89.007 billion for the year ended 31
December 2009, Oceanic Bank, for the first quarter ended 31 March
posted a profit after tax of N1.676 billion.

More results

In a related
development, Spring Bank and Afribank also posted profits after tax in
their first quarter results, after recording huge losses in their
previous financial results.

Spring Bank audited
result for the eight months ended 31 December 2009 shows a loss after
tax of N24.164 billion, compared with N10.228 billion during the 12
months period ended April 2009. However, the bank unaudited result for
the first quarter ended 31st March 2010 shows profit after tax of
N613.41 million, compared with loss after tax of N1.754 billion in 2008.

Afribank Nigeria audited result for the nine months ended 31
December 2009 shows loss after tax of N230.140 billion, compared with
N158.473 billion during the 12 months period ended March 2009. The bank
unaudited result for the first quarter ended 31 March 2010, shows
profit after tax of N1.919 billion, compared with loss after tax of
N230.140 billion during the nine months ended December 2009.

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‘Corporate bond market needs reforms’

‘Corporate bond market needs reforms’

The Central Bank said on Monday that reforms were necessary to improve the state of Nigeria’s corporate debt market.

Sanusi Lamido
Sanusi, the Central Bank Governor, said this in Switzerland yesterday,
adding that further reforms, including pensions and insurance, were
needed to enliven the corporate debt market.

“At the moment a
good corporate will be able to price its bonds at 200-300 basis points
above the risk-free (government bond),” a Reuters report quoted Mr.
Sanusi as saying. “The next challenge for us obviously is not so much
the demand side but the supply side, to ensure that the subscription is
not coming from bank liabilities but is coming from actual
institutional investors.”

Mr. Sanusi said
there has to be progress on the insurance reforms, pension reforms, and
progress on other capital market reforms to attract institutional
investors, so that it is actual real, long-term money that is going
into the subscription, and not savings and current accounts.

Reducing taxes

The government has
already agreed to waivers to reduce the taxes on interest income on
bonds, which had required corporates to issue with very high yields and
therefore limited bonds’ attractiveness.

“I think at the
moment most of the corporates are waiting for other macroeconomic
reforms,” Mr Sanusi said, explaining that it did not make sense to
raise money for a power project until the right regulatory framework
was in place. He added that bad loans are an issue, which is why “we
have got a number of distressed banks in Nigeria, while the asset
management company, which is coming into place soon, is likely to take
care of a substantial part of the bad loan problem”. The importance of
a strong and viable domestic bond market as an alternative source of
finance in emerging economies has been critically affirmed by the
global financial crisis playing a crucial role in bridging the funding
gaps that resulted from the near total freeze in global credit flows as
borrowers in less developed economies were forced to look to domestic
markets in order to meet their medium to long term capital needs.

Experts say the
development of the domestic bond market is one key ingredient required
to strengthen Nigeria’s financial system and limit its vulnerability to
external fiscal shocks in the future.

Addressing infrastructure gaps

However, the
Nigerian bond market is yet to develop an electronic trading platform
on the Nigerian Stock Exchange to facilitate bond trading in the
secondary market.

Ike Chioke,
managing director, Afrinvest, a finance research and analysis firm,
said for the Nigerian bond market to fully take its position and
attract more participants, there should be a framework for adopting
international best practice primarily in bond trading platforms and
settlements and a robust banking sector operating on sound market
principles.

“The introduction of corporate bond issuances (and sustained
liquidity) will alert many investors to the strategic advantage of
corporate bonds, and opportunities for diversification presented by the
move away from sovereign debt” he said.

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Soft landing for Unity, Wema Banks

Soft landing for Unity, Wema Banks

Reprieve
may have come the way of Unity Bank and Wema Bank, following the
decision of the Central Bank to extend the deadline for their
recapitalisation.

The
banking industry regulator in September 2009 gave both banks until June
30 to recapitalise. However, when it became increasingly difficult for
both banks to meet the deadline, the Central Bank extended it.

Mohammed
Abdullahi, the Central Bank head of corporate affairs, confirmed this.
“The truth of the matter is that we are extending the deadline for
them.”

But
a statement posted on the Central Bank website last night, ostensibly
after enquiries by a NEXT reporter, said that 30 September is the new
deadline for the two banks. “We wish to inform the general public that
due to unanticipated three months extension in timeline for setting up
Asset Management Corporation of Nigeria (AMCON), the Central Bank of
Nigeria has granted a three months extension for the two banks to
recapitalise.”

Banks’ strategies

Both
banks decided to adopt different strategies to meet the target date.
Wema Bank opted to raise N49 billion from both local and foreign
investors, as well as rely on the proposed Asset Management Company
(AMCON) to raise additional N10 billion. Unity Bank, on the other hand,
hopes to meet its recapitalisation target from existing shareholders
through a rights issue. The issue, which opened on 4 June was expected
to close by 13 July, well after the deadline set by the Central Bank.
The rights issue was intended to raise about N23.9 billion.

Some
stockbrokers who spoke under anonymity, said the bank may have adopted
direct marketing to execute the sale of the rights offer. According to
the managing director of one of them, “Not many of my clients have
Unity Bank shares, and so far I have not received any request to buy.
Don’t forget that the primary market is still very fragile and people
do not have confidence in banking stocks right now. So, accessing funds
from the primary market may not be easy for the bank at this time.”

He
said the bank may have done its campaign to its high networth
shareholders who may be willing to retain their stake in the bank.

Current realities

Tunde
Olofintila, head of corporate affairs, Wema Bank, said the former
deadline was no longer feasible. Mr. Olofintila said the bank had
mapped out its recapitalisation plans and was in touch with the Central
Bank on the progress made. He said Wema Bank plans to raise equity from
the Bank of Industry (BoI) and the Asset Management Corporation of
Nigeria, expected to take off in the next few weeks.

“We have laid out all these plans and we reached an agreement with the CBN. The 30 June deadline may no longer stand.”

In
addition, he said the bank is applying for a regional licence instead
of its current licence, which allows it to operate across the country.
On the implication of this, he said some of its branches will have to
go. “Yes, just a few of our branches will have to go. Maybe 16 or 17
out of 154 branches,” he said. Efforts to get official comments from
Crispin Uduobuk, head, media relations of Unity Bank, did not yield any
result as he did not pick his calls.

Both
banks were accused by the Central Bank of not meeting the N25 billion
minimum capital, which deadline ended on 31 December, 2005.

Also,
during the stress test conducted by the Central Bank last year, both
banks were found to have failed the liquidity criteria, capital
adequacy ratio, and corporate governance, and yet did not sack the
management of the two banks as it did for the other seven banks which
did not meet these criteria.

In
addition, both banks were not up to date with publishing their
quarterly and full year result, in clear violation of Central Bank
rules.

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Lawmakers halt another aviation contract

Lawmakers halt another aviation contract

The House of
Representatives has ordered the immediate stoppage of another federal
aviation contract over allegations of over-bidding and breach of
procurement regulations.

The House Public
Procurement committee yesterday directed the Ministry of Aviation to
suspend a €17 million (N3.0 Billion) contract for the installation of
Aeronautical Information System (AIS) in airports, after lawmakers
questioned officials over the poor handling of the transaction. “I wish
to state here that the Minister of Aviation and the Director General of
the Nigerian Airspace Management Agency (NAMA) should suspend all
actions on the contract until they appear before us to clarify the
issues being raised by the contractor,” announced Yusuf Tuggar, the
house committee chairman on Monday.

Members accused the
officials of the aviation ministry, Nigerian Airspace Management
Agency, and the Bureau of Public Procurement, of flouting basic rules
and granting the contract to a company that tendered at the highest
cost for the execution of the project.

Inflated

The Minister of
Aviation, Fidelia Njeze, is expected to explain the ministry’s decision
in awarding the deal to a company that bid almost twice what was quoted
by another company.

Basic federal
public procurement rules state that contracts be awarded to companies
with lower quotations, except in special cases and even then clearance
for the award is supposed to be obtained.

In the AIS contract, Mocom/Skynet won the bid despite bidding €17.9 million, against the €9.5 million, bid by Avsatel GMBH.

The job is to set
up an AIS detection system-surveillance equipment in all airports
across the country. Further details and terms of the contract were not
made available, but the House committee chairman, said the contract
will be suspended pending the outcome of the investigation.

Contract flaws

This is the third
time in four months that a committee in the House of Representatives
has reported major flaws in a contract awarded for a major project in
the country.

A contract for the
construction of a new runway for the Abuja airport, was earlier
suspended by the House over allegations of over-costing. Lawmakers also
ordered inquiry into the costing of the expansion project of the Abuja
airport expressways.

In all three cases,
the lawmakers faulted the Bureau of Public Procurement for failing to
detect the over rated amounts, and approving the contract for execution.

For the AIS contract, the bureau spokesperson, NNebolisa Odizie,
said the decision was taken because of an “inadequate” technical and
financial evaluation submitted by Avsatel. He said the bureau abided
“strictly” by the advice of expert consultants in awarding the contract.

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Group sets agenda for Jega

Group sets agenda for Jega

Foremost democracy
monitoring group, the Transition Monitoring Group (TMG) has asked the
new chairman of the Independent National Electoral Commission (INEC),
Attahiru Jega, to flush out all officers of the commission who worked
with his predecessor, Maurice Iwu in order to ensure credible elections
are held next year.

The group also
asked Mr Jega to commence the review of the voters’ register,
especially with a view to removing names of none existent people from
the from the document. TMG, which hailed the appointment of the new
chairman and the subsequent confirmation, said in a statement signed by
its national coordinator, Mashood Erubami, and publicity secretary,
Auwal Rasfanjani, on Monday, that the country is dangerously transiting
towards the 2011 elections, adding that it is appropriate for him to
take definite steps so that future elections will not fail.

The group said the
removal of those that worked with Mr Iwu and the review of the voters’
register have become necessary if the nation is to hold a credible
election. “In the first instance, most of the people that worked with
Prof. Maurice Iwu are by the current imperatives for fair elections
unnecessary land mines that must be removed from the path of
progressive advancement of the election administration umpire,” stated
the group. “Secondly, the fundamental review of the current fraudulent
and non- transparent and verifiable collated Voters Register is a
desirable step that must be swiftly taken as a good measure to divest
the register of its content of Ghosts and foreign names which have
undermined the register from being an essential ingredient for
conducting free and fair elections.”

Meeting the expectations of the electorate

TMG also advised Mr
Jega to ensure that the foundation of the country’s electoral system is
rooted in the constitution and related electoral laws. This way,
according to the group, the expectations of Nigeria electorate in 2011
will not be doomed. The group also urged the new INEC boss to make
inclusiveness, transparency and accountability, the prerequisites for
peaceful, participative and credible elections in Nigeria. “To this
extent, INEC must be seen to be properly constituted by non partisan
elements from the society and must not be seen to be demonstrating
allegiance to head of state, the ruling party, or show it has political
allies, so as to build confidence in the electorate and build
confidence of the people in the elections it will conduct.

The attitude
of winners take all by any political party, using extraneous means that
are foreign to the electoral laws must not be permitted at anytime, so
as not to worsen the current ethnic tensions and religious bigotry in
the country,” the TMG said.
Reactions to Mr. Jega‘s selection as the umpire for the 2011 general
elections has been mostly positive, but fears have been expressed about
his ability to do the job if systemic problems are not addressed.

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Reps to pass 2010 supplementary budget today

Reps to pass 2010 supplementary budget today

The Speaker of the
House of Representatives, Dimeji Bankole, on Monday, disclosed that the
country’s lower chambers of the National Assembly will today (Tuesday)
pass the 2010 supplementary budget.

Mr. Bankole, while
fielding questions from aviation correspondents at the presidential
wing of the Murtala Mohammed Airport (MMA), Lagos, disclosed that the
House is operating with the executive arm of government to ensure that
the budget is passed in order to move the country forward.

“As far as the 2010
budget is concerned, we are working with the executive arm of
government to make sure that tomorrow, in the House of Representatives,
we pass it (the supplementary budget),” he said.

It would be
recalled that early this month, President Goodluck Jonathan, while
presenting a supplementary budget of N638.8 billion to the National
Assembly, asked the legislators to re-examine the economic structure of
the 2010 budget, and to revise downwards the budget from N4.48 trillion.

According to Mr.
Jonathan, the development is not unconnected with the drop in crude oil
revenue, as he noted that the implications may have adverse connotation
on the country’s financial level.

“I wish to bring to
your attention, certain challenges posed by the serious shortfall in
the projected revenue and the adverse implications it poses for
financing the level of aggregate expenditure appropriated,” he said.

“Specifically,
recent revenue developments indicate significant shortfalls in both oil
and non-oil revenue, which may well continue for the rest of the fiscal
year, with adverse implications for the financing of the budget,” he
said.

Effect of oil revenue drop

Admitting that
there is significant drop in the country’s oil revenue, Mr. Bankole
disclosed that the designated team in the National Assembly, together
with the Ministry of Finance, will see to the effect of the shortfall.

“I’m sure there is
a reduction, but those things would be worked out between the
appropriation committee of the National Assembly and the Finance
Ministry,” he said.

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Group calls for sanctions against ExxonMobil

Group calls for sanctions against ExxonMobil

Oilwatch Africa, an
environmental group, has described ExxonMobil’s poor reaction to calls
on it to mend its ruptured oil pipeline in some communities in Akwa
Ibom State, as worrisome. The group asked the Nigerian government to
immediately impose appropriate sanctions on the oil multinational.

Multiple spills
from a ruptured pipeline laid by Exxon Mobil in 1968 had gone unchecked
for over three weeks, impacting several communities in Ibeno local
government area, spreading to 15 other communities in Esit Eket and
Eket LGAs of Akwa Ibom State.

The current spill
is coming barely two weeks after over 100,000 barrels of crude oil was
spewed into the ecosystem from the same facility.

Like ExxonMobil, like BP

Oilwatch Africa, in
a statement issued in Port Harcourt, said that ExxonMobil’s action is a
clear indication of their disdain not only for the ecosystem, but also
for the livelihoods of communities that have been impacted by the
spills.

The group lamented
that Nigeria leaks as much oil as the current spill in the Gulf of
Mexico every year, and that in over five decades of oil exploitation
over 7000 separate oil spill events have occurred in the country.

It urged the
Nigerian government to immediately set in motion open and transparent
process to compel Exxon Mobil to take immediate action to contain and
curtail the spread of the spill, restore the ecosystem, and compensate
communities whose livelihoods have been impacted upon.

Government’s romance with oil companies

“It is still a
puzzle that the Nigerian government is still entangled in an unholy
wedlock with the oil industry. By now, we expect the Nigerian
government to take a cue from the US government’s response to the Gulf
of Mexico incident by instituting criminal charges against individuals
and businesses that have destroyed local livelihoods and compel them to
pay for what it would cost to restore the ecosystem,” said Nnimmo
Bassey, International Steering Committee member of Oilwatch
International.

Mr. Bassey
described as “disturbing” the fact that it took vigorous protests of
communities for the oil company to grudgingly accept responsibility for
the spill, make a pledge to clamp the leaking oil pipeline, and to make
available relief materials to affected communities.

“It is even more
disheartening that in addressing this ecological disaster, our own
government decided to hide behind closed doors and allowed itself to
take the unprecedented step of barring the press from being part of the
resolution of an issue which affects us all.” Mr. Bassey said that it
is appropriate to remind the Nigerian government about the steps taken
by the U.S government as the spill in the Gulf of Mexico evolved,
especially the mobilisation of over 20,000 people and 1,300 vessels to
join in the efforts to stop the oil from reaching ecologically
sensitive wetlands and to participate in the immediate process of
remediation of the ecosystem.

“Will the mouthpieces of the oil industry in our government claim
ignorance of US government insistence that BP sucks its spill and
pledge $20 billion as an initial step to deal with the immediate,
medium term, and long term impact of the spill? For true and lasting
peace in the Niger Delta, the Nigerian government must actively pursue
an economic diversification agenda that reduces dependence on oil as a
single major revenue earner, because present global realities is a
world moving towards non-fossil based development,” Mr. Bassey said.

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Labour calls London summit a ‘national disgrace’

Labour calls London summit a ‘national disgrace’

The Nigeria Labour
Congress yesterday added to the criticism against the Federal
Government’s proposed golden jubilee conference in the United Kingdom,
describing it as a“ national disgrace.”

The NLC president,
Abdulwahed Omar, said, in a press statement yesterday, the move
represents a higher degree of “irrationality” than the N10 billion
allegedly set aside for the Independence celebrations.

“While we had
earlier condemned the over N10 billion budget for the celebration, we
are convinced that the London Summit planned by the federal government
is more irrational and totally unnecessary given the huge state
resources that would be used to host it,” the statement said.

“Perhaps other than
to display our linkage to our colonial heritage, we believe that it is
highly illogical for our leaders to take a ceremony of our golden
jubilee independence anniversary to the capital of the country that
forcefully imposed itself on us for well over a century of exploitation
and oppression.”

The two-day
conference, said to be part of Nigeria’s 50th anniversary celebration,
is to be held in London on June 28 and June 29, 2010.

Unconfirmed reports
say Mr. Jonathan is to attend the event with 18 governors and 12
ministers. The ruling People’s Democratic Party new chairman,
Okweselize Nwodo, is also expected to be at the event.

Opposition parties reacted angrily to the news on Sunday, saying it is another waste of public funds.

A senior official
in Mr. Jonathan’s government had denied media reports that the
administration is providing the N10 billion budget for the events
expected to climax on October 1, 2010.

The Minister of
Information, Dora Akunyili, denied that Mr. Jonathan raised the budget
of the celebration from N62 million earmarked by the late President
Umaru Yar’Adua, to N10 billion. She explained that the amount
originated from a committee set up by Mr. Yar’Adua himself.

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America to help Nigeria tackle cyber crime

America to help Nigeria tackle cyber crime

Cyber crime and scam mails have done a
lot of damage to Nigeria’s image. Therefore, the Nigeria Communications
Commission, NCC, is partnering with the government of the United States
to take steps towards improving Nigeria’s monitoring and investigations
skills, so as to minimise the impact of such cyber misuse. The
partnership is also expected to address network and data insecurity.

Bashir Gwandu, the acting executive
vice chairman of the NCC, said this after a meeting held last week with
Perry Ball, the Counsellor for Economic Affairs of the United State
Embassy.

Mr. Gwandu said that many fraud cases
have been committed using scam mails, which emanate from unknown
persons and disguised sources claiming to be from Nigerian institutions
such as Central Bank of Nigeria, Nigerian National Petroleum
Corporation (NNPC), and some other top commercial banks.

“This has significantly damaged
Nigeria’s image abroad and we can’t allow it to continue,” Mr. Gwandu
said, adding that the FBI and other US top security agencies have
leading expertise in tracing the origins of computer viruses, scam
mails, and in identifying the physical locations of servers used to
host terrorists’ web sites.

“This wealth of experience, if acquired
by Nigerians, will go a long way in reducing the impact of cyber crime
committed in the name of Nigerians.”

Not made in Nigeria

According to Mr. Gwandu, “many of the
scam mails purporting to be from Nigerians originate from sources
outside Nigeria, and are often hatched thousands of miles away but the
scammers usually claim to be Nigerians.”

One of the key challenges associated
with this type of crime is the fact that Internet Service Providers
(ISPs) obtain their Internet Protocol Number blocks from outside
Africa, and in most cases, from Europe and North America, which makes
it cumbersome to use basic techniques of tracing the origin of the
mails and the viruses due to the fact that the ISPs are located outside
Nigeria’s jurisdiction, Mr. Gwandu explained.

There might, therefore, be a need to
mandate Nigerian Internet Service Providers to acquire IP Numbers from
Afrinic – an organisation that assigns IP Blocks in Africa, he said.

The partnership with the Americans, Mr.
Gwandu said, is an attempt to deal with the problems and combat the
challenges these crimes pose.

America’s offer

In his remarks, the head of the US
delegation, Mr. Ball, offered to give assistance to the Nigerian
government in the form of training and capacity building so that the
country becomes equipped to tackle the challenge.

He said the meeting with the NCC has been exceptionally productive
and they will do everything possible to assist Nigeria very soon.

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