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‘Nigeria’s economic recovery poised to build momentum in Q2’

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Market optimism over the recovery of Africa’s largest economy has increased steadily throughout the first trading quarter of 2018.

The combination of appreciating oil prices, foreign exchange stability and easing inflationary pressure has boosted confidence in Nigeria’s economy. With the nation’s GDP hitting 0.82% in 2017 and predicted to register a positive trajectory amid strengthening domestic demand, the outlook continues to look highly encouraging.

The improving macroeconomic conditions and ongoing efforts to diversify away from oil reliance are likely to attract foreign investors, further fueling economic growth.

It is fair to suggest that Nigeria’s stabilizing fundamentals may encourage the Central Bank of Nigeria to cut interest rates sooner than anticipated. With oil prices appreciating, domestic production improving and foreign exchange reserves rising to $46 billion, most of the ingredients are in place for the CBN to act.

There is a strong suspicion that inflationary pressures need to ease further into the realm of single digits before the central bank loosens its monetary policy. An interest rate cut has the ability to stimulate the current recovery because it encourages consumer borrowing and businesses to increase investments.

While an interest rate cut in April may be slightly premature, the CBN could surprise markets near at the end of Q3 if inflation continues to decline.

Although domestic economic conditions continue to improve, investors must not overlook external risks that may impact Nigeria’s current recovery. Oil price volatility remains a key risk for Nigeria despite the nation’s ongoing efforts to diversifying to other sustainable sources of growth. With oil accounting for roughly 90 percent of exports and 80 percent of public revenues, a sharp depreciation in prices could easily spell trouble for Nigeria.

While WTI crude has followed a positive trajectory in recent months amid expectations of demand increasing and optimism over OPEC’s production cuts, the upside may face headwinds. It must be kept in mind that soaring production from US Shale remains a threat to higher oil prices and is likely to result in a selloff medium to longer term. While Nigeria could continue enjoying the benefits of oil trading around $64, the clock is ticking as oversupply remains a market theme.

In addition to oil prices, attention should also be focused towards the Dollar’s performance and US rate hike expectations. Higher US interest rates have the ability to trigger capital outflows from emerging markets and weaken EM currencies with the Naira falling into the category.

While the Naira may be slightly bruised by capital flight in the event of higher US interest rates, Nigeria’s rising foreign exchange reserves and rising oil prices could cushion the impact.

The Naira witnessed stability against the Dollar in March with prices trading around N360 on the parallel markets and N304 on the official market. While the local currency’s appreciation may be attributed to intervention by the CBN, the improving sentiment towards Nigeria has also played a leading role.

The ongoing trade drama between the United States and China is unlikely to have a direct impact on Nigeria’s economy. Indirectly, the uncertainty and anxiety over a potential global trade war could spark risk aversion consequently impacting emerging markets like Nigeria. A scenario where foreign investors remain guarded and maintain a safe distance from risk, could weigh on Nigeria in the recovery stages.

As we enter the second quarter of 2018, much focus will be directed towards domestic monetary policy, inflation and external risks that could impact Nigeria’s positive momentum. Easing inflationary pressures remain one of the most encouraging aspects for Nigeria as consumer prices hit $14.33 in February. Not only will falling inflation boost the rate of return for savers and increase disposable income in Nigeria, it creates an opportunity for the CBN to cut interest rates- ultimately stimulating economic growth.

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John Abayomi denies ownership of Instablog9ja, threatens to sue Linda Ikeji

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John Abayomi, Online Editor for Punch newspapers, has threatened a lawsuit against the publisher of Linda Ikeji blog, Linda Ikeji, for publishing false and malicious story about him.Abayomi through his lawyer, Falana and Falana’s Chambers claimed that the publication with the headline, ‘LIB Exclusive: Meet the owner of Instablog9ja-John Abayomi’ has put his life and that of his family in danger.

In the letter delivered to the blogger on Friday, Ikeji was asked to tender an unreserved apology within forty-eight hours or risk legal action.

Linda in the said publication had claimed that ‘the owner of instablog9ja is John Abayomi, a former online editor of Vanguard news and current online editor of Punch’.

However, Falana said the statement is untrue and unfounded, but only calculated to lower Abayomi’s esteem and damage his reputation and professional career.

“Your publication has put him in the harm’s way, thereby endangering his life and the lives of his family members. It has also attracted a lot of negative reactions from members of the public including celebrities who has been eager to know the face behind the blunt and sarcastic blog because of the method of reportage”.

“Your mendacious publication was clearly actuated by malice in that it was deliberately done to portray our client as an imposter, a fraudster and a blackmailer”

“In the light of the foregoing, we have our client’s firm instructions to demand an unqualified apology together with a retraction of the libelous publication in the edition of your blog (Linda Ikeji blog) in addition to having the retraction published on Instagram.

“However, if you fail or refuse to accede to our client’s demands within 48 hours of the receipt of this letter, we shall have no option than to initiate civil proceedings against you at the Lagos State High Court without further recourse to you,” reads the letter which was signed by Chukwuma Onwuemene (ESQ.).

A reliable source has also rubbished reports that Abayomi was summoned to a meeting by his employers, Punch Newspapers, over Linda Ikeji’s publication.

“It is totally untrue. There was no such meeting. John is a top-notch professional and everybody close to him, including his employers, are aware that Linda Ikeji’s publication was completely untrue,” the source said.

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Diamond Bank wins Women’s Market Champions Awards

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Nigeria’s leading retail bank, Diamond Bank Plc has been awarded the prestigious Women’s Market Champion honours by the Global Banking Alliance for Women. This year’s Women’s Market Champions reflect the global nature of the Global Banking Alliance for Women’s work hailing from diverse markets and regions.

According to Vanessa Van Landingha, Manager, Branding and Communications Strategy, Global Banking Alliance for Women (GBA), Diamond Bank was selected as one of the 2018 awardees for its outstanding impact on Women development and providing them with holistic solutions that meet their needs.

“The awarded institutions are true champions of women, working to unleash the economic potential of the female economy,” GBA Chief Executive Inez Murray said. “Their engagement with the GBA network is essential to the work we are doing to economically empower women worldwide and contributes to the Women’s Market success of the entire membership.” Landingha said.

Commenting on the award, Karimot Tukur, Head Consumer Banking said; “This award lends credence to the work that Diamond Bank has been doing over the years to advance the cause of women especially in the SME and Financial Inclusion space. Our Diamond Woman proposition is designed specifically for women, by women and dedicated to the economic empowerment of women.”

Diamond Bank Plc is one of Nigeria’s leading commercial bank providing enhanced customer experience through innovation and technology. Regarded as a supporter of Small and Medium-Scale Enterprises through SME lending, capacity building, business seminars and workshops.

Recently, the Bank recorded a landmark funds disbursement of over N1 billion to small business owners under the cash flow-based SME lending scheme in partnership with the Women’s World Banking (WWB), and this has earned the leading financial institution ranked among the top five SME-focused banks in Nigeria in the 2018 KPMG Customer Service Survey.

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FCMB partners WSBI to boost financial inclusion, savings in Nigeria

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First City Monument Bank (FCMB) is set to substantially increase its support to agribusiness, its value chain and growth of the Nigerian economy after signing a Memorandum of Understanding with the World Savings and Retail Banking Institute (WSBI). The memorandum outlines a framework to deepen agency banking, financial inclusion and savings culture in the informal and agribusiness sectors. As part of the terms of the partnership, in addition to the stated areas of support, WSBI will provide technical oversight supervision on a regular basis to ensure the achievement of mutually agreed goals set by both institutions.

According to the memorandum, the project involves FCMB rolling out an integrated savings account – named ‘Kampe Account’ – to offer financial services under phase one of its plan to 150,000 unbanked and under-banked farmers across five states through agricultural agents operating under the bank’s agency banking proposition. The first set of states to benefit in this first phase are Kaduna, Kano, Nasarawa, Ogun and Oyo. The plan is to reach 2 million farmers across the entire nation by year 2023.

In addition to the financial support to farmers, FCMB plans to deploy its state-of-the art technology and mobile banking solutions to drive the project mainly in the rural and sub-urban farm settlements where most farmers are based. The bank will also organize capacity-building programmes for farmers aimed at facilitating their understanding of the sector and promote innovative ideas that would make the sector attractive, ultimately facilitating job creation that would in turn, impact on productivity and income.

Commenting on the grant from WSBI and the initiative, FCMB’s Managing Director and Chief Executive, Mr. Adam Nuru noted the development will revolutionize agribusiness – one of the various empowerment strategies adopted by the bank that is appreciated by stakeholders within and outside Nigeria.

Adam Nuru said: “Partnering with WSBI and harnessing the business model we have developed to drive it, under our Kampe Account, is built on a sustainable approach which ensures farmers can gain better access to finance and other resources needed to help them build successful businesses.”

Nigerian smallholder farmers have been at a disadvantage due to several factors including land fragmentation, inadequate farming equipment, broken value chains, poor access to finance and inadequate cash flow. Over the years, they have suffered from lack of essential services such as access to good markets to create low economies of scale, challenges in the promotion of agricultural productivity, hurdles in their bid to achieve increase in food security to improve rural livelihoods for engendering systematic growth out of poverty. FCMB and WSBI are optimistic that these challenges will be addressed.

Mr. Nuru added: “Farmers who benefit from this effort can and should make the best use of the opportunity. FCMB will continue to partner with WSBI to create opportunities that would ensure the realization of the personal and business needs of customers.”

WSBI Managing Director Chris De Noose concluded: “The Kampe Savings Project is yet another example of the innovative ways rural communities can flourish through mobile savings and beyond. Expanding banking access and agricultural services through the provision of mobile services to the farming community, which increasingly includes more women, can help knock out any doubt about the payoff that farming can bring.”

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MTN To Offer Nigerians Mobile Banking Services In 2019

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MTN Group will apply for a mobile banking license in Nigeria and launch a service there next year, its CEO said on Tuesday, further embedding the South African telecoms company in its biggest but increasingly problematic market.

“We will be applying for a payment service banking license in Nigeria in the next month or so, and if all goes according to plan, we will also be launching Mobile Money in Nigeria probably around Q2 of 2019,” Rob Shuter told a telecoms conference in Cape Town.

MTN, Africa’s biggest telecoms company, has faced challenges in Nigeria where it has been ordered by the central bank to return $8.1 billion which the bank said was illegally sent abroad, and in a separate case has been slapped with a $2 billion tax bill in Nigeria. It is in talks with the central bank about the $8 billion fund transfer.

The success of mobile money over in East Africa, pioneered by Kenya’s Safaricom, has convinced investors and the industry that financial services is the next growth area for telecoms to offset falling prices for basic services.

Shuter, who has led MTN since last year, also said the company would relaunch mobile money services in South Africa, two years after canning the service. The company has also bought a music streaming business Simfy, which Shuter said was “Africa’s leading music streaming business.”

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