Bank Reforms Boost Nigeria’s Efforts to Mitigate Impact of Financial Crisis
19/11/2008
"The Government of Nigeria will continue with its efforts to consolidate its financial and banking sector reforms in order to cushion the effects of the current global financial meltdown on the Nigerian economy," the Chargé d’affaires of the Nigerian Embassy in Tunisia, Abdel Kader Musa, has said.
Mr. Kader made the revelation while addressing the recent Conference of African Ministers of Finance and Central Bank Governors on the Global Financial Crisis in Tunis, Tunisia, where he represented his country’s ministry of finance and central Bank. The chargé d’affaires said the government had injected nearly 1. 7 trillion Naira (NGR 183.325 = 1US$) into the system and had taken relevant regulatory and supervisory actions whose scope extends to non-bank financing institutions. Pension funds, insurance and macro-finance institutions in Nigeria have been regulated, Mr. Musa emphasized.
While the international community struggles to come to grips with the analytical tools to understand the full dimension of the financial crisis, Mr. Musa explained that the Nigerian government had already intensified its efforts towards economic diversification and efficient utilization of domestic resources, under its 7-Point Framework Agenda. The country’s government has further increased allocations to support infrastructure development, especially in the energy sector.
The Nigerian government’s quick response to the crisis becomes more significant in the light of the country’s position in the ECOWAS sub-region, he said, concluding that "Nigeria will do everything possible to enhance its efforts to foster strong regional integration as a means of mitigating the financial crisis".
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Monday, January 4, 2010
Banks and sovereign-wealth funds
The smart and the not-so-smart
YOUR phone rings at 3am. It’s a senior American banker sounding desperate. An unidentified heavy-breather—the treasury secretary?—is also on the line. It’s the opportunity of a lifetime, the banker swears: the chance to buy a multibillion-dollar stake in a big Wall Street firm. By the way, he adds breezily, any chance of an answer right away?
Most sovereign-wealth funds (SWFs) got an invitation of this sort between November 2007 and January 2008. Within a few weeks some $40 billion was poured into distressed Western lenders, among them Citigroup, UBS, Morgan Stanley and Merrill Lynch. Now SWFs are selling out. This month the Kuwait Investment Authority, the oldest SWF, sold a $4 billion stake in Citigroup, claiming a $1.1 billion profit. In September one of Singapore’s two investment vehicles, GIC, sold part of its stake in Citi, realising a $1.6 billion profit.
Click here to find out more!
Were SWFs right to buy? They piled in far too soon. It took another year for share prices to hit bottom; despite this year’s rally, they are still below the levels when SWFs invested, typically using convertible stock. Plenty made mistakes: Temasek, Singapore’s other state fund, sold out of Bank of America early this year, probably at a loss. Nor should the near misses be forgotten. In mid-2007 China Development Bank (strictly speaking a firm, not a fund) and Temasek offered to buy $13 billion of Barclays’ shares, at about twice today’s price, if its bid for ABN AMRO succeeded.
The winners fall into two camps. Some waited until prices had fallen further before buying. Qatar’s investment fund and prominent individuals in Qatar and Abu Dhabi participated in Barclays’ capital raisings in June and October last year and have made money. Others negotiated well. Kuwait and GIC invested in Citigroup in January 2008 but the fine print protected them from share-price falls. The Abu Dhabi Investment Authority, by contrast, invested $7.5 billion in Citi in November 2007 in less secure convertible instruments. It is likely to end up nursing a large loss.
The banking crisis was a baptism of fire. Most SWFs are still keen on strategic investments but only in healthy firms where there is a clearer national interest. About two-thirds of their deals in this quarter have been in natural resources. Gay Huey Evans of Barclays Capital reckons this trend will continue.
YOUR phone rings at 3am. It’s a senior American banker sounding desperate. An unidentified heavy-breather—the treasury secretary?—is also on the line. It’s the opportunity of a lifetime, the banker swears: the chance to buy a multibillion-dollar stake in a big Wall Street firm. By the way, he adds breezily, any chance of an answer right away?
Most sovereign-wealth funds (SWFs) got an invitation of this sort between November 2007 and January 2008. Within a few weeks some $40 billion was poured into distressed Western lenders, among them Citigroup, UBS, Morgan Stanley and Merrill Lynch. Now SWFs are selling out. This month the Kuwait Investment Authority, the oldest SWF, sold a $4 billion stake in Citigroup, claiming a $1.1 billion profit. In September one of Singapore’s two investment vehicles, GIC, sold part of its stake in Citi, realising a $1.6 billion profit.
Click here to find out more!
Were SWFs right to buy? They piled in far too soon. It took another year for share prices to hit bottom; despite this year’s rally, they are still below the levels when SWFs invested, typically using convertible stock. Plenty made mistakes: Temasek, Singapore’s other state fund, sold out of Bank of America early this year, probably at a loss. Nor should the near misses be forgotten. In mid-2007 China Development Bank (strictly speaking a firm, not a fund) and Temasek offered to buy $13 billion of Barclays’ shares, at about twice today’s price, if its bid for ABN AMRO succeeded.
The winners fall into two camps. Some waited until prices had fallen further before buying. Qatar’s investment fund and prominent individuals in Qatar and Abu Dhabi participated in Barclays’ capital raisings in June and October last year and have made money. Others negotiated well. Kuwait and GIC invested in Citigroup in January 2008 but the fine print protected them from share-price falls. The Abu Dhabi Investment Authority, by contrast, invested $7.5 billion in Citi in November 2007 in less secure convertible instruments. It is likely to end up nursing a large loss.
The banking crisis was a baptism of fire. Most SWFs are still keen on strategic investments but only in healthy firms where there is a clearer national interest. About two-thirds of their deals in this quarter have been in natural resources. Gay Huey Evans of Barclays Capital reckons this trend will continue.
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