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Central Bank of Nigeria Annual Report and Statement of Accounts for the Year Ended 31st December 2006
No full textThis Report reviews the operations of the Central Bank of Nigeria (CBN) and macroeconomic developments during the fiscal year 2006 and appraises the major economic policy outcomes during the period. The Bank reported a stable foreign exchange market in 2006, with an average effective official exchange rate of N 128.65 per U.S dollar, an increase of 2.6% over 2005. The stock of external reserves, valued at US$12.30 billion, was 49.6% higher than in 2005, driven by high crude oil prices and lower debt-service burden. The reserves were equivalent to 28.4 months of import cover, exceeding the 6 months requirement under the convergence criteria of the WAMZ. The banking industry\u27s soundness was assessed using the CAMEL rating, with 0 banks being sound, 12 being satisfactory, and 3 being marginal. The credit portfolio of banks improved as the ratio of non-performing loans to total credit declined to 8.7% from 9.3% in 2005. The financial system at end-2006 comprised the CBN, the Nigeria Deposit Insurance Corporation (NDIC), the Securities and Exchange Commission (SEC), the National Insurance Commission (NAICOM), the National Pension Commission (NPC), 25 deposit money banks, 750 community banks, I l2 finance companies, 322 Bureaux-de-Change, one stock exchange, one commodity exchange, 9 primary mortgage institutions, five development finance institutions, 103 insurance companies, seven microfinance banks, and 581 registered insurance brokers. Investment under the Small and Medium Enterprises Equity Investment Scheme (SMEEIS) increased by 41.4% to N 17.04 billion, with 52.8% of total investment going to the services sector
A pro-poor framework for enhancing micro-savings in Nigeria.
No full textNigerians generally do not seem to have what is usually referred to as “the saving culture”. This assertion may not entirely be true as it based on information from the formal banking system without recourse to the savings activities at the informal sector of the economy. It is a fact that the informal sector of the economy is large with unrecorded transactions. Consequently, this paper attempts to examine the fundamental issues in saving and thereafter design a formal savings habit of the populace, especially the low-income group. The framework is designed to mobilise micro-savings, hitherto kept with thrift collectors and roll it over gradually till old age. The paper is divided into six sections. Following the introduction, section two expounds theoretical issues in savings and presents all relevant theories on savings. Section three describes the experience of other jurisdictions in encouraging and mobilising micro savings. The study concludes that: the informal sector of the economy consists mainly of low-income group who desire to save for different reasons. These could include saving to finance a specific project, to ensure smoothened consumption, or to guarantee quality welfare at old age. Most of these individuals, however, make only very short-term informal savings either with deposit/thrift collectors or through rotational savings. This is basically due to low transaction cost and the pressure which ensures deposit discipline
Proof of concept fund approach to small and medium enterprise franchising and marketing research findings.
No full textOver the past 20 to 25 years small scale enterprises have exploded in the informal sector of the Nigeria\u27s businesses. The informal sector study (CBN, NISEK 2000) showed that over 25,000 small scale enterprises were in existence in the agro industrial production sector of the economy during the year 2000. This paper proffers a model of funding called Proof of Concept Fund as a bridging credit facility to research institutes and small scale industrialist who would want to patent/franchise budding research findings to commercialization. The study reveals that there are substantial empirical studies of countries that have used the Proof of Concept Fund approach to invoke the research findings from the laboratory to the level of franchising and patenting for the market. It had been used to leverage on bringing higher levels of control on production and product differentiations
Investments and risk management under the new pension scheme
No full textThe Pension Reform Act 2004 ( the Act ), a compul sory contributory pension scheme ( the scheme \u27 or CPS ) has been established for all the categories of workers in the Federal public service, Federal Capital Territory , and in the private sector ( \u27applicable sectors\u27). This paper attempt to discuss and examine the issues of investment and risk management that are essential to the success of the new Scheme, and highlight some of the benefits and limitations of the contributory pension scheme and its investment and risk management framework. The study concluded that, the new CPS, it is also pertinent to mention the need for developing a social security system that will cater for the unemployed, self employed, and other categories of persons whose lives may not feel the impact of this new Scheme. This should be the next challenge for the Government
Cost of Funds Determination by Banks in Nigeria
No full textThe article examined the cost of funds as a determining factors in the pricing of a loanable funds that has an influence on day-to-day running of the banks especially in the extension of credit to customer. It highlights how cost of fund was inversely computed by banks instead of the normal method. The finding revealed that high cost of funds is driven by scarcity of loanable funds in the banking system
Foreign direct investment and technology transfer to Nigerian manufacturing firms: evidence from empirical data.
No full textThe paper investigates the vertical effects of FDI on Nigeria manufacturing firms. Specifically, the paper asks, do Nigerian manufacturing firms benefits from FDI? As an investigation into the vertical effects of FDI , the paper attempts to establish whether manufacturing firms in Nigeria that receives FDI benefit from technology flows which comes along with foreign capital. The paper employs data from the World Bank Nigerian manufacturing survey, 2001
Are immigrants remittance flows a source of capital for development?: a review
No full textThe paper seeks to develop a remittance model that would indicate if immigrant remittances were a source of capital flows for development
Special remark at the 2006 Executive Seminar on Capital account liberalization: issues, problems, and prospect
No full textThe special remark was given by Mr Mordi, C.N.O. the then Ag. Director of Research and Statistics Department at the 2006 Executive Seminar
Economics of exchange rate management
No full textExchange rate policy plays an important role in national economic development management. If well managed, it could facilitate the achievement of macroeconomic objectives of rapid economic growth, low rate of inflation, high employment generation, buoyant balance of payment condition, and progressive income distribution. Of all economic policies, it is the most suitable policy for ensuring internal and external balances. This paper examine the economics of exchange rate management; the conceptual issues in exchange rate management in view of attaining the macroeconomic objectives for rapid economic growth and development. One of the critical issues in the management of foreign exchange is to know the main determinants of exchange rate management in the country. Many factors come to mind on this issue. In addition to 43 pressure from international financial institutions that often exert pressure on developing countries to adopt sound macroeconomic policies, external shocks also impose some serious constraints on monetary authorities. Critical among these external shocks are deteriorating terms of trade and change in international interest rates. For the current exchange rate policy to be sustainable there is need for proactive programme of economic diversification. The economy should be moved away from depending solely on oil oriented-foreign earnings to non-oil. The current diversification index with an annual average of about 1.3 is abysmally low when compared with countries such as Algeria (5.5), Egypt (about 20 in recent times), Morocco (36) and Tunisia (28)
Recent reforms in the Nigerian banking industry: Issues and challenges.
No full textThe banking industry around the world has witnessed remarkable changes in recent decades, given t h e i n c r e a s i n g w a v e o f globalization, structural and technological changes, and integration of financial markets. As McKinnon and Shaw (1973) observed in their seminar work on the key roles of banks as propel lands of growth and development in developing economies, a feeble banking system is repressive, distortionary and dis-connect the intermediation process thereby precipitating macroeconomic instability. The paper reviews the various reforms in Nigerian banking industry since 1986 particularly the complementary policies and outcomes of the recent reforms in the industry as well as the issues and challenges. The paper concludes that ,the new agenda in the Nigerian banking industry has identified the building blocks for an effective and efficient financial system that will meet international best practice. The various initiatives (the 13-point agenda) that are required to realize this vision constitute the building blocks. It needs to be recognized, however, that the realization of the vision involves the cooperation of all the stakeholders in the industry. While the foundations are being laid and plans are in place to pursue the agenda to a successful end, the future is by no means secure. It is only with the combined efforts of all that the probability of achieving a virile banking sector in which depositors can have confidence in, will be realised