COST HEADLINES WEEKLY REVIEW

7th To 13th December 2015

09 December 2015
VANGUARD
NSE loses N103bn in market capitalisation to profit taking

The market capitalization of the Nigerian Stock Exchange (NSE) lost N103 billion on Tuesday to reverse the gains of the last three days due to profit taking. The News Agency of Nigeria (NAN) reports that the market capitalization, which opened at N9.569 trillion, dropped N103 billion or 1.08 per cent to close at N9.466 trillion. Similarly, the All-Share Index lost 300.86 points or 1.08 per cent to close at 27,533.03 against 27,833.89 achieved on Monday. Market analysts attributed the development to profit taking embarked by investors to take advantage of the gains recorded in the last three trading days. Read More



09 December 2015
PUNCH
Nigeria spent N6.9tn on subsidy in five years – W’Bank

Nigeria spent about $35bn (N6.9bn) in the last five years to subsidise petroleum products, the World Bank has said this In its ‘Nigeria Economic Report No. 3’, which was released in Abuja on Tuesday, the bank said fuel subsidy incapacitated the country’s ability to save for the rainy day occasioned by falling crude oil prices in the international market. On gas, the report stated that despite serious disruptions in supply in the first half of the year, the country flared more gas than the one used in generating electricity, adding that much more gas was sold to foreign consumers despite the huge demand and inadequate supply at home. According to the report presented by the World Bank Lead Economist in Nigeria, Mr. John Litwack, annual spending on fuel subsidy accounts for roughly one-fourth of all federal budgetary spending, adding that the spending was significantly greater than the entire executed federal capital budget as well as the combined spending on education and public health. The report stated, “The weak enforcement of administrative prices further reduces the benefits of fuel subsidies to Nigerian households. There are other important costs as well. Uncertainty about the fuel subsidy has strongly discouraged investment in domestic refining. Read More



09 December 2015
THISDAY
FBN Grows Income to N10 Billion in Three Years

FBN Insurance said it has in the past three years successfully raised its Gross Written Premium from below N 2 billion to N10 billion in 2015. Managing Director of the company, Val Ojumah who disclosed this at a media briefing in Lagos as part of activities to mark the company's fifth anniversary celebration, said in 2012, Gross Written Premium of the company stood below N2 billion, while operating profit was within N200 million. He said in N2014, Gross Written Premium of the Life business rose to N7.3 billion, while the operating profit stood at N 1 billion. The firm’s return on equity also rose by 24 per cent. The company said this year, it is maintaining the same returns on equity, while its Gross Premium forecast is N10 billion for 2015.According to the MD, the company aims at giving good returns on equity as well grow grass written premium. “We are second in the industry in terms of efficiency, our operating cost, income ratio is one of the best in the industry, hovering around 22 to 25 per cent, while others in the industry is around 76 per cent", he said. Read More



09 December 2015
VANGUARD
FG to re-introduce toll gates —Fashola

Minister of Power, Works and Housing, Mr Babatunde Fashola, disclosed yesterday, that the Federal Government will reintroduce toll gates where revenue generated can be channelled towards sustaining and maintaining quality federal roads. He promised that money generated from the toll gates will be properly accounted for and judiciously put to use. Fashola, in his maiden press conference at the Ministry of Works in Abuja, also said the former Ministry of Works owes 206 contractors over N2 trillion for which only N13 billion was released to the Ministry out of the N18.132 billion it budgeted for. In his words He said “Maintenance would be our watchword. We are setting up a robust maintenance regime to keep our highways in good shape. This shows that tolling is necessary to support government funding. So, it will not be too much if we ask every road user to pay a little to augment government funding for road maintenance. Read More



10 December 2015
THIDAY
Again, NCC Justifies N1.04trn Fine on MTN

The Nigerian Communications Commission (NCC) has justified its decision to impose N1.04 trillion fine on MTN Nigeria over its failure to deactivate unregistered SIM on its network, insisting that it made the penalty huge to deter other operators from flouting the law. Although the NCC has reduced the fine from N1.04 trillion to N780 billion, based on 25 over cent discount, and has equally given MTN two weeks to respond, it is still not certain whether MTN would jump at it and pay as expected by NCC. The Director, Public Affairs of NCC, Mr. Tony Ojobo, told THISDAY that the commission was shocked that the MTN kept up to 5.2 million unregistered and improperly registered SIM cards on its network, knowing fully well that each defaulting SIM card, attracts N200,000."It was a difficult decision to take, but we had to act the way we acted because we are regulator that is setting the pace of telecoms regulation for other regions and we must be seen as upright in our dealings always. Read More



10 December 2015
PUNCH
Subsidy: FG okays N407bn payment to marketers

The Federal Government on Wednesday finally approved the payment of N407.07bn as fuel subsidy to oil marketers. The payment was confirmed by the Minister of Finance, Mrs. Kemi Adeosun, through a statement signed by the Director of Press, Ministry of Finance, Mr. Marshal Gundu. The minister said in the statement that the approval was given following a directive by President Muhammadu Buhari that the amount be paid immediately to the oil marketers in order to end the lingering fuel scarcity in the country. The statement read in part, “The Minister of Finance, Mrs. Kemi Adeosun, has confirmed the payment of N407, 076,805,386.30 for subsidy claims to oil marketers so as to end the lingering fuel situation. Read More



10 December 2015
PUNCH
Banks record N11.98bn fraud in six months —CBN

The banking sector recorded 5,917 cases of fraud involving the sum of N11.98bn in the first half of this year, statistics obtained from the Central Bank of Nigeria have indicated this. The report stated that the 5,917 cases of fraud represented a decrease by 333 when compared to the 6,250 cases recorded at the end of December 2014.However, the report stated that the incidence of fraud recorded a decline, while its monetary value rose by N2.98bn from N9bn in December 2014 to N11.98bn in June this year. It stated, “Key operational risks reported were incidents of fraud and forgeries, disruption of banking activities during the fuel crisis, slow implementation of the unique identifiers’ scheme and insecurity in some parts of the country. “Cases of fraud and forgeries decreased to 5,917 at end-June 2015 from 6,250 at end-December 2014. However, the amount involved increased to N11.98bn at end-June 2015 from the N9bn recorded in the second half of 2014.” Read More