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Nigeria’s GT Holding plans $750 million capital increase

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Nigerian banking group, Guaranty Trust Holding Plc, wants to raise up to $750 million in capital and will ask its shareholders for permission to do so next month. It will join other banks in increasing their capital to meet new goals.

The Central Bank of Nigeria set minimum capital standards for banks last month. This is meant to make the country’s financial system stronger and give lenders a bigger chance to help the economy grow.

According to Guaranty Trust Holding Plc, Guaranty Trust Bank is one of the best banks in Nigeria. The company said on Friday that it would seek shareholders for permission to raise the money at a meeting on May 9. In the last few weeks, competitors Access Holdings and FBN Holdings have both said they want to raise money. To meet the new level set by the central bank, more than 20 banks in Nigeria will need to get more capital within two years.

A statement from the CBN in March said that commercial banks with foreign licenses must now have a minimum capital base of N500 billion.

The recapitalization is a big boost that will help these banks compete in the world market for money. Regional banks must have at least N50 billion in capital, while national banks with permission must have at least N200 billion.

The apex bank said that lenders need more buffers to help Nigeria’s economic growth goals, especially since the local naira has lost a lot of value since June of last year.

Credit rating agency Fitch said on Wednesday that over the next two years, Nigerian banks will likely issue a lot more shares of stock and merge with other banks, since some small or medium-sized lenders may have trouble getting cash.

Nigeria’s banking system has been through several crises, with the worst ones happening in 2008 and 2009. The number of banks dropped from about 90 in 2005 to 24 by 2006 and to 20 commercial banks by the end of 2011. This was because of a program of recapitalization and consolidation.

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Nigeria: Court insists Binance executive can face trial on behalf of firm

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In an ongoing tax evasion case, a Nigerian court decided on Friday that Binance executive, Tigran Gambaryan, may go to trial on the cryptocurrency exchange’s behalf.

Binance and executives Gambaryan, a U.S. citizen and head of financial crimes compliance, and British-Kenyan national Nadeem Anjarwalla, a regional manager for Africa, face four counts of tax evasion. They are also accused of participating in specialized financial transactions without a license and laundering more than $35 million in another case.

All of them have entered not-guilty pleas on the allegations of money laundering. Following the court hearing on Friday, Binance’s attorney chose not to comment. The attorney for Gambaryan was similarly silent.

“We are deeply disappointed that Tigran Gambaryan, who has no decision-making power in the company, continues to be detained,” a Binance spokesperson said in a statement on Friday after the court hearing.

“These charges against him are completely meritless. He should be freed while discussions continue between Binance and Nigerian government officials.”

Gambaryan is still being held while Anjarwalla left the nation in March. The office of Nigeria’s security adviser has declared that it is collaborating with Interpol to pursue Anjarwalla’s detention.

After its executives were imprisoned as part of a crackdown on cryptocurrencies in February after being invited to the African nation for talks with officials, the CEO of Binance has warned Nigeria of establishing a dangerous precedent.

Nigeria’s Federal Inland Revenue Service (FIRS) has announced that Gambaryan may face prosecution on behalf of the exchange; Binance has not been accused in the tax evasion case.

According to prior statements from Gambaryan’s attorney, Gambaryan was “neither a director, partner, nor company secretary” and did not have any formal authorization from Binance to take on the accusations on the firm’s behalf.

Judge Emeka Nwite decided on Friday that Gambaryan, who is Binance’s chief financial compliance officer and was lawfully designated to represent the company in a meeting in Nigeria, should be served with the charges against Binance.

On Wednesday, Gambaryan is scheduled to appear in court and enter a plea on Binance’s behalf. On Friday, Gambaryan’s request for bail in the money laundering case was turned down. As the nation struggled with ongoing dollar shortages, cryptocurrency websites became the go-to venues for trading the Nigerian naira. Nigeria has blamed Binance for its currency problems.

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Nigerian govt denies reports it plans to borrow pension fund for infrastructure

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The Nigerian government has denied reports that it plans to borrow the N20tn pension fund to finance infrastructural projects.

In a statement made in Abuja, Wale Edun, the Minister of Finance and Coordinating Minister of the Economy, stated that the government would abide by the laws and guidelines in place pertaining to the pension fund.

Following a two-day Federal Executive Council meeting at the Presidential Villa on Tuesday, the minister reportedly informed reporters that the government would present a plan to use local funds, including the fund, to finance infrastructure development.

Edunstated that the government does not intend to exceed these legal boundaries, emphasising that the government was committed to protecting workers’ pensions.

“It has come to my notice that stories are making the round that the Federal Government plans to illegally access the hard-earned savings and pension contributions of workers. Nothing could be farther from the truth.

“The pension industry, like most the financial industries, is highly regulated. There are rules. There are limitations about what pension money can be invested in and what it cannot be invested in.

“The Federal Government has no intention whatsoever to go beyond those limitations and go outside those bounds which are there to safeguard the pensions of workers.

“What was announced to the Federal Executive Council was that there was an ongoing initiative drawing in all the major stakeholders in the long-term saving industry, those that handle funds that are available over a long period to see how, within the regulations and the laws; these funds could be used maximally to drive investment in key growth areas,” Edun clarified.

The plan to spend the pension fund was reported and was widely criticised. The Trade Union Congress of Nigeria and the Nigeria Labour Congress had earlier on Thursday urged the government to abstain from making any changes to the pension fund.

They stated, “Nigerian workers have entrusted their hard-earned savings for retirement security, not as a means for government projects. It is imperative to halt any further plans to tap into these funds, especially given the lack of transparency and accountability in past government borrowing practices.”

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