CBN Moves To Regulate Non-interest Securities


The Central Bank of Nigeria (CBN) has moved to regulate the operation of investments in Islamic non-interest securities, with the introduction of protection charges on Non-Interest asset backed securities in the country.

The expectation is that the measure will help to guarantee confidence in the non-interest securities market.

In a circular that we as issued by the central bank, the decision to regulate the market was triggered by the increasing investments in Islamic securities like Sukuk. The CBN’s non-interest asset backed securities (CNI-ABS) tagged the charges as Wakalah, a protection, delegation, or authorization measure by the apex bank.

The circular that was signed by CBN’s director, financial markets department,  Angela Ejembi reads, “The increased investments in Sukuk issued by multilateral organisations and the rising participation of non-interest financial institutions at the CBN windows has made it mandatory that the CNI-ABS to be operationalised.”

Wakalah an Islamic finance tool that denotes an agency contract, where one party appoints another to conduct a defined legal action on his behalf, for a specified fee or commission.

From the 2021 if the contents of the draft framework appeals to individuals or institutions interested in the CBN Non-Interest Asset Backed Securities (CNI-ABS), the CBN plans to charge: 10.00 per cent of the underlying return for 1 to 30 days investment; 7.50 per cent for 31 to 90 days; 5.00 per cent for 91 to 180 days; and 2.50 per cent for 181 to 365 days.

Ejembi stated that “the Central Bank of Nigeria developed the CBN Non-Interest Asset Backed Securities (CNI-ABS) to deepen the Nigerian financial markets, increase financial inclusion and provide a liquidity management instrument that is compliant with the principles of non-interest finance in Nigeria.”

The CBN is now asking for “observations and comments” on the exposure draft of the framework for the operationalisation of the Central Bank of Nigeria Non-Interest Asset Backed Securities. These observations and comments are expected to be with the CBN on Friday, 8th January, 2021.

The structure of the CBN non-interest asset backed securities (CNI-ABS) include: Full or partial conversion (into local currency) of the value of CBN investments in Islamic Development Bank (IsDB) and/or International Islamic Liquidity Management Corporation (IILM) sukuk, or any other sukuk from multilateral organisations where Nigeria is a member.

Other structures of the CNI-ABS are: Securitisation of the value of CBN investment based on the maturity profile of the underlying security which shall serve as the issue account, for auction purposes; auction of the securitised assets to eligible institutions; transfer allotment of auction amount to eligible institutions based on their subscription; and transfer of earnings received related to the securitised assets to eligible institutions based on their holdings, less all amounts outstanding. This shall be net of applicable charges as may be approved from time to time.

Others are: the assets shall meet the condition of tradability in sharia; the investor shall enter into a unilateral binding undertaking to sell the nominal to the CBN at maturity; upon exercise of unilateral binding undertaking, the asset becomes exclusively owned by the CBN who reserves the right to hold or reissue it to the market.

The draft framework also stated that “the bid applications shall not carry any rate. All successful bids shall be satisfied at a rate of return corresponding to the earnings on the underlying security. The rate of return shall be based on tenor and amount invested, and shall be subject to applicable (Wakala) charges/fees.

A single exchange rate will apply (based on Wa’d) for issuing, maturity and return of each issue relative to the underlying asset and will be determined at the beginning of each auction.

Another interesting thing investors have been asked to assess is the settlement terms. According to the CBN, “settlement shall be on a T+0 basis. Auction shall take place on any approved business day, while cash settlement and securities allotment shall take place on the next business day.”

On the settlement day, the CBN is expected to: debit the operating accounts of all successful institutions at the auction; credit CBN designated account with the value; debit CNI-ABS issue account and credit the institution’s securities account. The CBN shall be the depository of the securities.

The CNI-ABS will have the following features: It shall be a tradable instrument; its rate shall be determined by the returns on the underlying asset; its maturity shall be on any day of the week and shall be matched with the coupon payment date of the underlying asset; it shall qualify as a liquid asset for the eligible institution’s assets.

Based on the new regulatory instrument, returns received during the period but before maturity of an issue shall be held in trust in an account that does not yield any interest to the CBN; where an issue matures before receipt of coupon by the CBN, the Bank shall pay the accrued return as advance/loan at zero interest rate in anticipation of expected return.



How to manage gestational diabetes —Expert

Obstetrics/gynaecology resident, Dr. ’Kemi Windapo, who is also the President, Association of Resident Doctors, Federal Medical Centre, Ebute-Metta, speaks to TOBI AWORINDE about gestational diabetes

What is gestational diabetes?

In simple terms, gestational diabetes is any degree of high blood glucose (sugar) that is first diagnosed during pregnancy and usually disappears following delivery. It affects how the cells in the body use glucose and it can lead to significant complications in both the mother and the baby. Therefore, it needs to be detected early and managed appropriately.

What causes gestational diabetes?

Gestational diabetes results from a combination of factors, including a woman’s inability to produce enough insulin (the hormone that reduces blood glucose levels) to compensate for the increased nutritional demands of pregnancy as well as high levels of some hormones produced by the placenta during pregnancy; these are known as the diabetogenic hormones of pregnancy. They make it more difficult for the body to process glucose efficiently, thus, resulting in high blood glucose levels.

How is gestational diabetes diagnosed?

Women with risk factors for gestational diabetes or women with symptoms such as increased thirst, increased urination, weight loss and tiredness, which are suggestive of high glucose levels, are sent for an oral glucose tolerance test. This involves testing for the fasting blood sugar, following which a 75g glucose load is ingested. The blood glucose values an hour and two hours after the glucose load is ingested are tested. If any of the values are higher than expected, a diagnosis of gestational diabetes can then be made.

How common is gestational diabetes?

Gestational diabetes varies from region to region and also depends on the criteria used for its diagnosis. The prevalence is therefore broad. Worldwide, it affects about one to 45 in every 100 pregnant women. A large study done in Africa suggested that gestational diabetes affects 13 in every 100 pregnant women.

Can a woman be treated for gestational diabetes during pregnancy?

Yes. Treatment is actually necessary in order to prevent the complications associated with gestational diabetes in both the mother and the baby. Treatment depends on the severity of the condition and the presence or absence of complications.

Is there any medication needed for treatment?

Yes. Oral anti-diabetic medications, like Metformin, may be employed in the management of gestational diabetes. Insulin therapy may also be necessary. These have been found to be safe with no adverse effects on the growing foetus.

Should a woman with gestational diabetes change her diet?

Dietary modification is usually the first line of action in the management of gestational diabetes. Frequent small meals high in fibre and low in calories are recommended. Emphasis should be on meals with lots of vegetables and fruits.

Will gestational diabetes affect the delivery of the baby?

Barring any contraindications, a vaginal delivery can be conducted. The presence of gestational diabetes increases the chances of shoulder dystocia, a condition where there is difficult delivery of the baby’s shoulder following the delivery of the baby’s head, which occurs as a result of abnormal accumulation of fat in the baby’s shoulders. This condition can lead to an injury to the baby such as an injury to the nerves controlling the upper limbs or even death, if not immediately identified and resolved. It can also result in severe tears in the vagina and perineum of the mother. Caesarean delivery is reserved for conditions where vaginal delivery is not advisable, such as when gestational diabetes exists with other medical conditions in pregnancy or if the baby is suspected to be bigger than usual.

If a woman has gestational diabetes, will the condition disappear after she is delivered of the baby?

In actual gestational diabetes, it usually resolves following delivery because there is a withdrawal of the diabetogenic hormones, which are produced by the placenta. The actual diagnosis of gestational diabetes can only be made six weeks after delivery because, at this time, a repeat OGTT done is expected to be normal. If the OGTT done at this time is positive, there is a possibility that the diabetes predated the pregnancy (pre-gestational).

It is, however, important to note that because gestational diabetes increases the risk of developing overt diabetes in future, routine yearly testing for diabetes is recommended.

What are the risk factors?

Risk factors for gestational diabetes include previous history of gestational diabetes or pre-diabetes, first-degree relative with diabetes mellitus, history of a big baby (weighing more than 4kg); history of a malformed baby, history of an unexplained stillbirth, being overweight and obese (over 90kg), pre-pregnancy history of Polycystic Ovarian Syndrome, women who are of African descent; and lack of physical activity.

How can one reduce the risk of having gestational diabetes?

When it comes to preventing gestational diabetes, there are no guarantees. One can, however, reduce the risk of having gestational diabetes by ensuring a healthy lifestyle prior to conception. Consume a high-fibre and low-calorie diet; lots of vegetables and fruits are highly recommended. Portion control is a very important factor to consider. Exercising before and during pregnancy may help prevent gestational diabetes. Exercising for 30 minutes per day, at least five times a week, is recommended. Exercising can include a brisk walk, yoga, cycling, swimming and so on. Starting pregnancy at a healthy weight can also help reduce the risk. Changes to diet and taking up routine exercise can help one lose extra weight beforehand. It is also important to undergo preconception care and counselling with a qualified medical practitioner so that occult pre-existing conditions and risk factors can be identified and mitigated prior to attempting conception.

What other conditions can a woman with gestational diabetes develop?

Women with gestational diabetes are at increased risk of developing high blood pressure and preeclampsia – high blood pressure associated with significant amount of protein in the urine – which can threaten the lives of both the mother and the baby. Women with gestational diabetes are also at an increased risk of having a delivery by caesarean section, especially if the baby grows bigger than usual. There is an increased likelihood of developing gestational diabetes in subsequent pregnancies and in future, about 20 out of 100 women who had gestational diabetes will develop frank Type 2 diabetes within five years of delivery.

Does gestational diabetes have any effect on the baby?

Gestational diabetes can have effects on the baby both during pregnancy and after delivery. During pregnancy, it increases the risk of the baby growing bigger than usual –  macrosomia – which can lead to complications at birth and also increase the need for delivery by caesarean section. It also increases the risk of the baby being born before term. Babies born early to mothers with gestational diabetes have an increased risk of having breathing problems at birth which is known as Respiratory Distress Syndrome. In untreated or poorly managed gestational diabetes, there is a risk of having a baby with major abnormalities or birth defects. Though uncommon, there can be a sudden unexplained stillbirth, which is a catastrophic complication. Later in life, children of women who have gestational diabetes will have a higher chance of developing obesity and Type 2 diabetes.

Will the baby of a woman with gestational diabetes be born with diabetes?

No. Quite paradoxically, the baby will be born with an increased risk of low glucose levels (hypoglycaemia) shortly after birth due to a withdrawal from the maternal environment of high glucose and the adaptive high insulin levels in the baby. This hypoglycemia may present as seizures in severe cases. It is, therefore, important to routinely monitor blood glucose levels in infants of diabetic mothers. Frequent feeding and sometimes, intravenous administration of glucose can help to return the baby’s glucose levels to normal.

Can a woman with gestational diabetes breastfeed her baby?

Yes. Breastfeeding is not contraindicated in gestational diabetes.

What are the financial implications of managing gestational diabetes?

The financial implications will usually depend on the management modality. Some women with gestational diabetes can be managed with a simple dietary modification while some others will require oral anti-diabetic medication or insulin therapy and in some cases both oral anti-diabetic medication and insulin therapy may be necessary. Metformin is the commonest oral anti-diabetic medication in use and costs about N300 for a sachet of 10 tablets and can cost more depending on the brand. A vial of insulin on the other hand costs about N3,000 and can also vary in price, depending on the brand. We also have to note that self-monitoring of blood glucose levels is an important aspect in the management of gestational diabetes. A home self-monitoring kit can cost between N8,000 and N15,000 also depending on the brand. The cost of consulting with a maternal medicine consultant, endocrinologist, dietician, diabetic nurses and so on will have to be put into consideration as the care required in the management of gestational diabetes is multidisciplinary.


World Bank: Pandemic to push over 115 million people into extreme poverty

A report by the World Bank has noted that over the past 12 months, the Covid-19 pandemic has harmed the poor and vulnerable the most, and it is threatening to push millions more into poverty.

This year, the World Bank said, after decades of steady progress in reducing the number of people living on less than $1.90/day, COVID-19 will usher in the first reversal in the fight against extreme poverty in a generation.

The report said the latest analysis warns that COVID-19 has pushed an additional 88 million people into extreme poverty this year – and that figure is just a baseline.

“In a worst-case scenario, the figure could be as high as 115 million. The World Bank Group forecasts that the largest share of the ‘new poor will be in South Asia, with Sub-Saharan Africa close behind. According to the latest Poverty and Shared Prosperity report, ‘many of the new poor are likely to be engaged in informal services, construction, and manufacturing – the sectors in which economic activity is most affected by lockdowns and other mobility restrictions,’” the Bretton Woods Institution said.

Those restrictions – enacted to control the spread of the virus, and thus alleviate pressure on strained and vulnerable health systems – have had an enormous impact on economic growth.

The June edition of the Global Economic Prospects, put it plainly: “COVID-19 has triggered a global crisis like no other – a global health crisis that, in addition to an enormous human toll, is leading to the deepest global recession since the Second World War.”

It forecast that the global economy as well as per capita incomes would shrink this year – pushing millions into extreme poverty.



SIM registration: Nigerian government waives NIN retrieval fee

The Nigerian Communications Commission and the National Identity Management Commission have been ordered to remove the fee imposed on subscribers for National Identification Number retrieval requests.

NIMC USSD service to retrieve NIN usually attract N20 fee which will be deducted from the phone credit balance after dialing *346*

However, a statement from the office of The Minister of Communications and Digital Economy, Isa Pantami, stated that the fee was cancelled to make linking phone lines to NIN easier.

The statement titled, ‘Pantami Orders Cancellation Of NIN Retrieval Charge Across All Networks’, partly read, “The Minister’s directive which takes immediate effect, is an intervention aimed at making the process easier and affordable.

“In a letter conveying the implementation of the directive, the Executive Vice Chairman NCC and the Director-General of NIMC informed Dr Pantami that the relevant authorities had met with, and negotiated a waiver with the Mobile Network Operators in that regard.

“By this waiver, all Nigerians, subscribers, and applicants can access the service using the *346# code for their NIN retrieval at no charge for the duration of the NIN/SIM Card integration exercise.”

The Nigerian Communications Commission (NCC) had given telecommunications operators in the country two weeks to block all SIM cards that are not registered with the National Identity Numbers (NIN).

Failure to do so will lead to phone lines being blocked or disconnected by the 31st of December 2020.


How to retrieve your National Identification Number – NIMC

The National Identity Management Commission has published a practical way of retrieving one’s National Identification Number (NIN) via a USSD code.

The Nigerian Communications Commission earlier issued a two-week ultimatum to telecommunication operators to block all SIM cards that are not registered with the National Identity Numbers, as earlier reported by DAILY EPISODE.

Following the recent directive, the National Identity Management Commission (NIMC) urged the general public to beware of fraudsters and scammers who are on the prowl to swindle unsuspecting people. To avoid this, NIMC urged the public not to click on any unverifiable link requesting for NIN.

What you should know

In lieu of the recent NCC directive, the National Identity Management Commission has urged the public and citizens who are already enrolled in the NIMC scheme but have lost their NIN to dial *346# to retrieve the NIN. The USSD code is available on MTN, Airtel, Glo and 9mobile.

  • For those people whose SIM card used for the registration of NIN have been reallocated, NIMC urged such people to visit their telecom registration centres to have their NIN merged with their current SIM card.
  • For name modification, individuals are urged to visit NIMC office and pay the sum of N500 via Remitta. Further breakdown showed that for those adding or changing a new name, newspaper publication and court affidavit are required, while those with misspelt name require no newspaper publication.
  • Those who are yet to enrol are advised to visit or click HERE and visit the nearest enrolment centre to complete the registration.