CBN Assures Public On Financial System Stability, Safety Of Funds
~2.5 mins read
CBN assures public on financial system stability, safety of funds
The Central Bank of Nigeria, CBN yesterday assured the public of its commitment to the stability of the financial system and safety of depositors’ funds.
Meanwhile, the Chartered Institute of Banking of Nigeria, CIBN and Body of Banks Chief Executive Officers, have expressed concern over the persistent social media criticisms targeted at Nigerian banks, stressing that such attacks not only undermines the hard-earned reputation of these institutions but also seeks to unfairly manipulate targeted banks.
Expressing the position of the CBN in a statement titled, “CBN Reaffirms Commitment to Financial System Stability, Safety of Depositors’ Funds, Director, Corporate Communication Department, Hakama Sidi Ali said: “The Central Bank of Nigeria (CBN) wishes to reassure the public of its unwavering commitment to ensuring the stability and reliability of the Nigerian financial system. The CBN recognises the crucial role that confidence plays in banking operations and wants to affirm that all deposits in Nigerian banks are secure. “The CBN actively ensures that banks adhere to established regulations and best practices to maintain the integrity of our financial system.
Regular stress testing is conducted to identify potential vulnerabilities, helping to ensure that our financial institutions are resilient. In addition, the CBN has implemented Early Warning Systems that proactively detect and address emerging risks, allowing us to provide timely solutions to any foreseen issues.
The Bank’s approach to Risk-Based Supervision ensures that it focuses its regulatory efforts on institutions that may pose the highest risk to the financial system. This targeted strategy allows it to maintain a robust oversight mechanism while promoting the overall health of the banking sector. Furthermore, the CBN has established Memoranda of Understanding with the various countries where Nigerian banks’ subsidiaries are located.
This collaboration enhances regulatory coordination and ensures that our banks operate within a safe and sound framework in accordance with banking regulations, both domestically and internationally.
“The CBN remains dedicated to fostering a secure banking environment where depositors can be fully confident in the safety of their funds. It will continue to monitor and adapt strategies to safeguard the financial interests of all Nigerians and stakeholders in our financial system.”
Also, the CIBN and Body of Banks Chief Executive Officers, in a statement expressing concern over spate of social media attacks on banks, said: “It is essential to highlight the significance and contributions of the banking sector, which remains one of the most regulated and integral parts of Nigeria’s economy. The Nigerian banking industry is governed by rigorous regulations issued by the Central Bank of Nigeria (CBN), its primary regulator, and other direct and indirect regulatory bodies. A large number of these banks are publicly listed and adhere to the highest standards of transparency and compliance, as required by domestic and international investors and regulatory agencies.
“If any individual or group has concerns or grievances regarding the operations of any bank, they are encouraged to direct such issues to the appropriate regulatory authorities. These bodies are equipped to address concerns impartially and professionally, ensuring that all matters are resolved through the proper channels.
“Resorting to social media attacks, blackmail, or smear campaigns not only undermines the hard-earned reputation of these institutions but also seeks to unfairly manipulate targeted banks. We urge individuals engaged in such actions to desist and consider the facts before making accusations.
“The regulatory agencies are well-positioned to handle concerns with diligence and professionalism. We remain committed to delivering the highest standard of banking services, guided by the regulations that govern our industry.”
The Supreme Court Has Scheduled A Hearing For October 22 Regarding A Lawsuit From At Least 16 State Governments
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The Supreme Court has scheduled a hearing for October 22 regarding a lawsuit from at least 16 state governments that questions the legality of the laws that created the Economic and Financial Crimes Commission (EFCC) and two other entities. A panel of seven justices, headed by Justice Uwani Abba-Aji, set the date after the states were allowed to join as co-plaintiffs and permission was granted to consolidate the case, which was initially brought by the Kogi Government through its Attorney General.The states involved in the lawsuit SC/CV/178/2023 include Ondo, Edo, Oyo, Ogun, Nassarawa, Kebbi, Katsina, Sokoto, Jigawa, Enugu, Benue, Anambra, Plateau, Cross River, and Niger. These 16 states assert that the constitution is the highest law, and any legislation that contradicts it is invalid. The plaintiffs contend that the Supreme Court, in the case of Dr. Joseph Nwobike vs. Federal Republic of Nigeria, ruled that a UN Convention against corruption was incorporated into the EFCC Establishment Act. They argue that when this law was enacted in 2004, the requirements of Section 12 of the 1999 Constitution, as amended, were not adhered to. They maintain that for a convention to be integrated into Nigerian law, compliance with Section 12 is essential. According to them, this constitutional provision requires the majority of the state Houses of Assembly to agree to adopt the convention before the EFCC Act and similar laws can be passed, which they claim was not done.
In their current lawsuit, the states argue—supported by the Supreme Court's ruling in a previously referenced case—that the law in question cannot be enforced on states that did not consent to it, as per the Nigerian constitution. Therefore, they contend that any institution established under this law should be deemed illegal. When the case was heard on Tuesday, the attorneys representing the states presented their arguments. While most of them requested to be added as co-plaintiffs, two states sought a motion to consolidate the case.
Kogi AG's attorney, Abdulwahab Mohammed, SAN, informed the court that several states have expressed interest in joining the case as co-plaintiffs, while others are seeking to consolidate their claims. "It is up to this esteemed court to guide us on how to proceed, my lord. Out of approximately 15 states, around 13 wish to join as co-plaintiffs, while only two are interested in consolidation. To simplify the court's task, those wanting to be co-plaintiffs should be allowed to join and adhere to the existing processes, while those seeking consolidation should be instructed to file their requests within seven days," Mohammed stated. Following the lawyers' arguments, Justice Abba-Aji granted their requests.
She postponed the case until October 22 for a hearing. The Attorney General of Kogi State has filed a lawsuit, numbered SC/CV/178/2023, against the Attorney General of the Federation (AGF) as the sole defendant. In the initial summons submitted by a legal team led by Prof. Musa Yakubu, SAN, the state presented six questions for consideration and requested nine forms of relief. The Kogi government is seeking a declaration stating that the federal government, through the Nigerian Financial Intelligence Unit (NFIU), does not have the authority to issue any directives, guidelines, advisories, or any other instruments regarding the administration and management of state funds. Additionally, the government is requesting a declaration that the EFCC, NFIU, or any federal agency cannot investigate, request documents, summon, or arrest anyone in relation to offenses concerning the administration and management of state funds.
Why Nvidia Stock Rose Again Tuesday, Nearing Record High
~1.4 mins read
Nvidia (NVDA) stock rose on Tuesday after Foxconn, the world’s largest contract electronics manufacturer, touted strong demand for artificial intelligence servers.
Executives at Foxconn—officially named Hon Hai Precision Industry—said Tuesday at the company's annual tech day they were constructing in Mexico the world’s largest facility for assembling AI servers to house Nvidia’s GB200 chips, part of its Blackwell AI architecture.
Young Liu, chair of Foxconn, said in an interview with Bloomberg Television that the company is aiming to produce 20,000 GB200 NVL72 servers at the factory in 2025. HSBC analysts have estimated the price of one GB200 NVL72 server is about $3 million.
Demand for Nvidia’s Blackwell system is “awfully huge,” said Benjamin Ting, Foxconn’s senior vice president of cloud enterprise solutions, at the company’s tech day. Liu told Bloomberg demand was “crazy,” echoing comments from Nvidia CEO Jensen Huang last week.
Nvidia stock climbed more than 4% Tuesday, extending gains from yesterday when the company overtook Microsoft (MSFT) as America’s second-most valuable company.
The stock, which closed just under $133 on Tuesday, is approaching its record closing high of $135.57, which was set on June 18. Nvidia's all-time intraday high, set on June 20, is $140.76.
Nvidia shares have more than doubled this year after rebounding from a summer slump amid reports that a design flaw would delay the rollout of the Blackwell system. Those reports coincided with a sell-off of big tech stocks as earnings disappointed and Wall Street questioned the wisdom of massive AI spending.
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Japa: People Should Prioritize Love For Their Country Over Financial Gain — Sen. Akpabio
~1.1 mins read
Senate President Godswill Akpabio says Nigerians should place their love for the country above financial gain.
Akpabio spoke on the floor of the senate on Tuesday. The senate president said the country would be better if citizens who are skilled in various fields stayed back. “The country is losing its expertise. If they acquired those expertise and returned to Nigeria, it would have been better,” he said while commenting on a motion seeking to address mass immigration of Nigerians.
“I also think the conditions of service are quite responsible. I believe people should place love for their country above financial gains. That is why many of us choose to remain here.” Akpabio said the massive migration of Nigerians has adversely impacted the country’s health sector.
“The brain drain is a big problem, not just in the educational sector, particularly in the health sector – it is affecting us a lot. The greatest professionals in medicine in the USA, from what I read, some people say we have almost 22,000 health workers in there (US) who are Nigerians and they are doing extremely well. I have seen that from different reports.In the educational sector, the disadvantages are too numerous because some of the departments do not have even up to 50 per cent staff strength.So what then are you teaching our children? It’s like a computer, garbage in and garbage out.”
The senate president said the national assembly would continue to do its best to better the lives of teachers so that they could stay back and impact future generations.
401 (k) Investors Flocked To Bond And Money Market Funds In September
~1.9 mins read
Investors shifted their retirement portfolios out of stocks and into bonds in September, opting for more conservative investments over riskier ones.
Bond funds, money market funds and stable value funds saw combined inflows of $341 million, with bond funds getting the largest share at roughly 45%, an analysis of trading in 401 (k) accounts by Alight, a retirement record keeper, found. In contrast, large U.S. equity funds, company stocks and target date funds, saw about $281 million flow out.
As 401 (k) investors sought safer investments, the average asset allocation in equities decreased from 72.9% in August to 72.2% in September.
In terms of overall trading volume, September, was a light trading month, but on 18 out of the 20 of trading days, investors put money into fixed-income funds.
"The light 401 (k) trading activity in September suggests that investors were taking a cautious approach to their retirement investments," said Rob Austin, Head of Thought Leadership at Alight, adding that, "the low trading volume that significantly favored fixed income funds indicates that traders were focused on rebalancing their portfolios."
With the Federal Reserve broadly expected to cut rates in September, many investors began rethinking their portfolios to accommodate lower yields on everything from short-term Treasurys and money market funds to high-yield savings accounts, and any stock market volatility that could follow.
Stocks had their worst start to September in 70 years after some disappointing earnings from large tech companies in July and concerns about a recession. That was enough to make many investors, especially millennials, more risk-averse.
As you get closer to retiring, it may feel safer skewing your portfolio towards fixed-income securities and away from stocks. However, the combination of factors mentioned above makes planning for retirement challenging in the current environment.
If you're a few years away from retirement, equities may not be a bad place to be, according to some experts, but you can also lean on some longer maturity bonds that are typically less sensitive to the rate cuts and still face less risk. They also suggest limiting the amount of cash and cash equivalents, like money market funds, investors have on hand to less than 12 month's worth of expenses.
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