28032019 - NATIONAL ASSEMBLY LEADERSHIP:All clear for Lawan; fresh crisis brews over Gbaja

8—Vanguard, THURSDAY, MARCH 28, 2019
CONFERENCE:
From left,
Representative of
Director of National
Mathematical Centre,
NMC, Prof. Peter
Onumanyi; Chairman
of Mathematical
Analysis and
Optimization
Research, Prof.
Johnson Olaleru and
Chairman of National
Mathematical Centre
(NMC), Governing
Council, Prof. Buba
Bajoga, during the
6th international
conference on
mathematical analysis
and optimization in
Abuja. Photo: NAN.
Analysts dismiss MPR cut as hasty,
with zero impact on lending
By Babajide
Komolafe
FINANCIAL analysts
have described the
decision by the Central Bank
of Nigeria, CBN, to reduce
the Monetary Policy Rate,
MPR, to 13.5 per cent as a
hasty decision with zero
impact on boosting lending
to businesses.
Contrary to analysts’
projections, CBN on Tuesday,
at the end of its two day bimonthly
Monetary Policy
Committee, MPC, reduced
the Monetary Policy Rate,
MPR, from 14 per cent to 13.5
percent, citing the need to
signal a new direction
towards improved growth.
Analysts, however, opined
that the 50 basis points
reduction in the MPR will
have little or no effect in
boosting lending to the
private sector.
Citing the looming risk to
inflation and the fragile state
of the nation’s economy,
analysts at Vetiva Capital
Management Limited,
described the CBN’s decision
as ‘hasty own goal,’ which
would not lead to increased
lending to the private sector
as envisaged by the CBN.
They said: “The decision
was touted as a key measure
to stimulate the economy by
reducing the cost of
borrowing. Whilst the
decision will have an
immediate impact on
borrowing rates already
benchmarked to the MPR, we
are sceptical of a significant
pass-through to the real
sector as bank lending rates
are notoriously sticky going
down.
"Also, the decision
seemingly ignores the
looming risks to inflation —
an expected increase in
liquidity from the frontloading
of a late 2019 budget, an
increasingly likely review of
the multi-year tariff order,
MYTO, which has an impact
on electricity prices, and most
importantly a looming 67
percent increase in national
minimum wage —all of
which are likely to push
inflation north for the rest of
the year.
“Taking a view from recent
history, where the MPC cut
rates by 200 basis points in
2015, before subsequently
reversing course within the
space of a year, a rate HIKE
might not be far off the cards,
especially given the expected
rise in inflation and the
current fragile state of the
economy.
“Overall, whilst the cut in
the rate is a signal from the
MPC of a stronger progrowth
focus, we believe this
decision is ultimately an own
goal as the rate cut will do
little to stimulate the economy
and has the added
disadvantage of distracting
from its primary objective –
price stability.”
Also commenting, analysts
at Lagos-based Afrinvest Plc
said: “We are not distracted
to believe an easing cycle has
begun; rather, we think policy
stance remains intact
considering global interest
rate development and the
desperation to sustain and
retain flows.
“The CBN can always
resort to Open Market
Operations, OMO, to
achieve the objective of
attracting and retaining
capital flows."
Analysts at Lagos-based
Cowry Assets Management
FGN bonds record N140bn
over-subscription
By Emma Ujah,
Abuja Bureau Chief
A
B U J A —
INVESTORS’
appetite for the Federal
Government Bonds have
continued to rise with the
March Auction, conducted
yesterday, recording a
N140 billion oversubscription.
At the exercise, which
was conducted by Debt
Management Office,
DMO, N100 billion bonds
were offered, but investors
staked over N240.6 billion.
The over-subscription of
the FGN bonds at the
monthly auctions had been
consistent since the
beginning of the 2019 fiscal
year.
A statement by DMO,
yesterday, said it offered
three instruments at the
auction for three, seven and
10-year tenors and
subscriptions for the three
instruments were in excess
of N148bn for competitive
bids.
“Non-competitive bids
valued at N92.6bn were
also received, taking the
total subscriptions across
the 3 tenors to over
N240.6bn,” it said.
The trend of investors’
preference for the longer
tenured instrument
continued, with the 10-year
bond significantly
oversubscribed with a bidto-cover
ratio above five.
Allotments were made to
successful bidders at the
2019 budget: Lawmakers, ministers, others
review N8.827trn budget estimates
By Emman
Ovuakporie
A BUJA—CRITICAL
stakeholders, such as
National Economic Team,
leadership of National
Assembly and a cross
section of the general
public, yesterday,
converged on Abuja to
deliberate on N8.827 trillion
budget estimates for 2019
fiscal year.
Speaker of the House of
Representatives, Mr
Yakubu Dogara, on his
part, noted that the public
hearing was aimed at
ensuring active
participation of the
Nigerian public.
Limited gave a similar
opinion. They said: “The
MPC’s decision to cut the
policy rate by 0.50 percent
was engendered by the
feeling of sustainability in the
level of stability of Nigeria’s
macroeconomic indices
which were expected to drive
growth going forward and
the signal by US Fed to leave
Fed rate unchanged in 2019
which was expected to
redirect foreign inflows into
emerging and developing
economies like Nigeria.
"We do not expect
significant growth in credit to
private businesses given the
inelastic nature of the
relationship between credit to
private sector and reduction
in MPR.”
rates of 13.5 percent for the
five-year, 13.5 percent for
the seven-year and
13.5percent for the 10-year
bonds, which are
considerably lower than the
allotment rates for the
February 2019 Auction.
The total amount allotted
to both competitive and
non-competitive bids for the
three instruments,
according to the DMO, was
N121.95 billion.
Dogara challenged
ministers to strive towards
achieving 70 per cent
implementation level
against the current 45
percent implementation
level, which he noted was
what is obtainable now.
He noted that the
president has the
constitutional power to
initiate budget proposal,
while the National
Assembly has the power of
appropriation.
He lamented that despite
the late submission of the
budget proposal over the
years, the executive has
continued to blame the
Legislature for late passage
FAAC shares N619.857bn to
FG, others for February
By Emmanuel
Elebeke
ABUJA—AT the end of
its monthly meeting,
yesterday, the Federation
Accounts Allocation
Committee, FAAC, shared
N619.857billion to the three
tiers of government as
revenue generated for the
month of February 2019, but
shared in March 2019.
Acting Accountant
General of the Federation,
AGF, Mohammed Usman ,
who briefed newsmen at the
end of the FAAC meeting in
Abuja, said the amount was
lesser that N505.246 billion
shared in January, which he
attributed to the persistent
shut down of oil
installations within the
month under review.
The AGF also disclosed
that the balance in the
Excess Crude Account,
ECA, currently stands at
$183m, which is less than
$249 billion recorded in the
previous month by $66
of the budget.
He said: “We are all aware
of the importance of a wellformulated
budget for
effective service delivery by
government. Indeed, the
budget represents the main
bond between the
government and the people.
“Today’s exercise forms a
very important segment in
the making of the
Appropriation Act by the
National Assembly. This
interactive session is in line
with the constitutional
responsibilities and
Legislative Agenda of the
National Assembly which is
aimed at making the budget
process more inclusive and
transparent."
million.
A communiqué at the
end of the meeting
indicates that from the
N619.857 billion, the
Federal Government
received N2223.157bn, the
states received
N113.188bn, Local
Government Councils
received N187.263 bn.
The oil producing states
received N45bn as 13 per
cent derivation revenue
and the Revenue
Generating Agencies
received N9.725 billion as
cost of revenue collection.
Meanwhile, for the
February 2019, the gross
revenue of N478.434 bn
was received in the month
of February 2019. This is
lower than the N505.246 bn
received in the previous
month by N26.812bn.
The gross revenue from
Value Added Tax, VAT, was
N96.389bn as against
N104.468bn distributed in
the previous month,
resulting in a decrease of
N8.079 billion.
Dokpesi narrates ordeal
in Immigration custody
By Dirisu
Yakubu
A BUJA—MEDIA
mogul and founding
chairman of African
Independent Television,
AIT, Chief Raymond
Dokpesi, has blamed the
President Muhammadu
Buhari-led administration
for his ordeal in the hands
of the nation’s security
agencies.
Dokpesi who was,
yesterday, invited for
questioning by Nigeria
Immigration Service, NIS,
disclosed this to newsmen
after spending about three
hours at the NIS
headquarters in Abuja.
According to him,
“definitely, if I had brought
my passport today, they
would have impounded it,
that is what it is. There are
no two ways about it, but
the passport is with the
court. But even if they
decide to do so, like I said,
the passport is a property
of the Federal Republic of
Nigeria, so they can
request for it.
“I just returned from a
medical trip overseas on
March 22, 2019 when I
was arrested for between
50 to 55 minutes at the
airport. I was told that they
had instructions from above
to arrest me on my return
but after a few phone calls
and contacts, the
Immigration officer at the
airport told me that he had
instructions from above
that I could leave and he
gave me back my passport
and told me that I should
go, that they would reach
me subsequently.
“On Monday, I received
new information and in
line with the normal
process, I returned my
passport to the Federal
High Court since I
travelled under a judicial
approval or permission. So
I returned the passport and
gave notice that I might go
for a medical check up so
that they will ensure that
the operation was
successful and that all the
organs and everything are
properly healed. "
Dokpesi who was
interrogated for two and a
half hours at the
Comptroller General’s
Investigation Department
and allowed to go home
about 3:10p.m., said he had
a feeling he would be
invited again.