CENTRAL BANK OF NIGERIA
ECONOMIC REPORT FOR THE FIRST
HALF OF 2014


Central Bank of Nigeria
Corporate Head Office
33 Tafawa Balewa Way
Central Business District
P. M. B. 0187
Garki Abuja
Website: www.cbn.gov.ng

Tel:
+234(0)946238707

+234(0)946238762


© 2014 Central Bank of Nigeria

ISSN 1597 - 2976


iii


Vision

“By 2015, be THE MODEL CENTRAL BANK delivering
PRICE and FINANCIAL SYSTEM STABILITY and promoting
SUSTAINABLE ECONOMIC DEVELOPMENT”.


Mission

To be proactive in providing a stable framework for the
economic development of Nigeria, through the
effective, efficient and transparent implementation of
monetary and exchange rate policy, and
management of the financial sector.


iv


THE CENTRAL BANK OF NIGERIA


Established by the Central Bank of Nigeria (CBN) Act of 1958,
the Principal objects of the Bank as contained in the new CBN
Act, 2007 are to:
ensure monetary and price stability
issue legal tender currency in Nigeria
maintain
external
reserves
to
safeguard
the
international value of the legal tender currency
promote a sound financial system in Nigeria
act as banker and provide economic and financial
advice to the Federal Government of Nigeria


v
MEMBERS OF THE BOARD OF DIRECTORS OF THE BANK
AS AT JUNE 30, 2014

1.
Godwin I. Emefiele

-
Governor (Chairman)
2.
Adebayo A. Adelabu
-
Deputy Governor (Corporate Services)
3.
Sarah O. Alade (Mrs), OON
-
Deputy Governor (Economic Policy)
4.
Kingsley C. Moghalu, OON
-
Deputy Governor (Financial System Stability)
5.
Suleiman A. Barau, OON
-
Deputy Governor (Operations)
6.
Anastasia M. Daniel-Nwobia -
Director (Permanent Secretary, Federal Ministry of
Finance)
7.
Jonah O. Otunla -
Director (Accountant General of the Federation)
8.
Muhammad M. Kafarati
-
Director
9.
Collins C. Chikeluba

-
Director
10.
Anthony A. Adaba

-
Director
11.
Stephen O. Oronsaye, CFR
-
Director
12.
Ayuli Jemide

-
Director


Yunusa M. Sanusi

-
Secretary to the Board


MEMBERS OF THE COMMITTEE OF GOVERNORS OF
THE BANK AS AT JUNE 30, 2014

1.
Godwin I. Emefiele

-
Governor (Chairman)
2.
Adebayo A. Adelabu
-
Deputy Governor (Corporate Services)
3.
Sarah O. Alade (Mrs), OON
-
Deputy Governor (Economic Policy)
4.
Kingsley C. Moghalu, OON
-
Deputy Governor (Financial System stability)
5.
Suleiman A. Barau, OON
-
Deputy Governor (Operations)


Yunusa M. Sanusi

-
Secretary


vi
TABLE OF CONTENTS


PAGE
Summary

xiv


1.0
INTRODUCTION


2.0 OPERATIONS OF THE CENTRAL BANK OF NIGERIA ..
..
..

2.1 Liquidity Management


2.2 Monetary Policy Committee (MPC) Decisions
..
..
..

2.3
Developments in the Payments system


2.3.1 Retail Payments System


2.3.1.1 Cheques


2.3.1.2 Electronic Payments..


2.3.1.2.1 ATM Transactions ..
..
..
..

2.3.1.2.2 Web Transactions. ..
..
..
..

2.3.1.2.3 Point of Sale (PoS) Transactions ..
..

2.3.1.2.4 Mobile Payments ..
..
..
..

2.3.2 Wholesale Payments System..


2.3.2.1 Real Time Gross Settlement (RTGS) System
..

2.3.2.2 Nigeria Interbank Settlement System Instant
Payment (NIP)


2.3.2.3 Nigeria Interbank Settlement System Electronic
Fund Transfer (NEFT) ..


2.3.3 Currency Operations


2.3.3.1 The Issue of Legal Tender ..
..
..
..

2.3.3.2 Currency in Circulation (CIC)
..
..
..

2.4
Financial Sector Surveillance


2.4.1 Banking Supervision


2.4.2 Routine/Target Examination


2.4.3 Routine/Special Foreign Exchange Examinations ..
..

2.4.4 Banking Sector Soundness ..


2.4.5 Compliance with the Code of Corporate
Governance for Banks in Nigeria ..
..
..
..

2.4.6 Financial Literacy and Consumer Protection
..
..

2.4.7 Fraud and Forgeries..


2.4.8 Cross Border Activities


2.4.9 Examination of Other Financial Institutions..
..
..

2.4.10 Anti-money Laundering/Combating of Financing Terrorism
/Offsite Risk-Based Supervision (RBS) Assessment Matrix

2.5
Foreign Exchange Market and Management
..
..
..

2.5.1 Spot Segment of the Market..


2.5.2 Forwards Segment of the Market ..
..
..
..

2.5.3 Exchange Rate Movements


2.5.3.1 Spot Exchange Rates


2.5.4 Foreign Exchange Flows


2.5.5 Sectoral Utilisation of Foreign Exchange ..
..
..

2.5.6 Foreign Exchange Receipts by Top Hundred Exporters ..

2.5.7 Nominal Effective Exchange Rate (NEER) and Real
Effective Exchange Rate (REER) Indices ..
..
..

vii
2.6
Development Finance Operations


2.6.1 Agricultural Credit Guarantee Scheme
Fund (ACGSF)


2.6.2 Interest Drawback Programme


2.6.3 The Trust Fund Model (TFM) ..


2.6.4 Entrepreneurship Development Centres (EDCs)..
..

2.6.5 N200 Billion Commercial Agricultural Credit Scheme (CACS) 38

2.6.6 N200 Billion Restructuring and Refinancing Facility (RRF)

2.6.7 N200 Billion SME Credit Guarantee Scheme (SMECGS)..

2.6.8 N300 Billion Power and Airline Intervention Fund (PAIF)
Initiative ..


2.6.9 Nigeria Incentive-Based Risk Sharing System for
Agricultural Lending (NIRSAL) ..


2.6.10 Financial Inclusion ..


ECONOMIC REPORT


3.0
GLOBAL ECONOMIC DEVELOPMENTS ..


3.1
Global Output


3.2
Global Commodity Prices ..


3.3
Global Inflation..


3.4
International Financial Markets


3.5
World Economic Outlook for the Rest of 2013
..
..
..

4.0
DEVELOPMENTS IN THE DOMESTIC ECONOMY
..
..
..

4.1
Monetary and Credit Developments


4.1.1 Reserve Money


4.1.2 Broad Money (M2) ..


4.1.3 Narrow Money (M1) ..


4.1.4 Quasi Money (QM) ..


4.1.5 Currency-in-Circulation and Deposits at the CBN ..
..

4.1.6 Currency Outside Bank (COB)


4.1.7 Drivers of Growth in Monetary Supply
..
..
..

4.1.7.1 Net Foreign Assets (NFA) ..
..
..
..

4.1.7.2 Net Domestic Assets (NDA) ..
..
..
..

4.1.7.2.1Net Domestic Credit (NDC) ..
..
..

4.1.7.2.1.1 Credit to the Government (Cg)

4.1.7.2.1.2 Credit to the Private Sector (Cp)

4.1.7.2.2 Other Assets (Net) of the Banking System

4.1.8 Sectoral Distribution of Credit..


4.1.9 Maturity Structure of DMBs’ Outstanding
Loans and Advances, and Deposit Liabilities..
..
..

4.1.10 Market Structure of the Banking Industry ..
..
..

4.1.11 Consumer Credit


4.1.12 Weighted Effective Average Cost of Funds (WEACF)
For Banks..


4.1.13 Money Market Developments..


4.1.13.1 Money Market Assets Outstanding..
..
..

4.1.13.2 Primary Market..


4.1.13.3 Open Market Operations (OMO)..
..
..

viii
4.1.13.4 OMO Auctions


4.1.13.5 The Two-Way Quote Trading in NTBs..
..
..

4.1.13.6 Repurchase Transactions..
..
..
..

4.1.13.7 Central Bank of Nigeria (CBN) Standing Facilities..

4.1.13.7.1 Standing Lending Facility (SLF). ..
..

4.1.13.7.2 Standing Deposit Facility (SDF). ..
..

4.1.13.8 Inter-Bank Funds Market ..
..
..
..

4.1.14 Interest Rates Developments..


4.1.14.1 Money Market Rates..


4.1.14.1.1 Deposit Rates..


4.1.14.1.2 Lending Rates.. ..


4.1.15 Yield on Fixed Income Securities ..
..
..
..

4.1.16 Institutional Savings ..


4.1.17 Other Financial Institutions ..


4.1.17.1 Development Finance Institutions..
..
..

4.1.17.2 Microfinance Banks (MFBs)..
..
..
..

4.1.17.3 Discount Houses


4.1.17.4 Finance Companies (FCs)..
..
..
..

4.1.17.5 Primary Mortgage Banks (PMBs) ..
..
..

4.1.17.6 Bureaux-de-Change (BDCs)..
..
..
..

4.1.17.7 Asset Management Corporation of Nigeria
(AMCON).. ..


4.1.17.8 Nigerian Mortgage Refinancing Company (NMRC) 73
4.1.18 Capital Market Developments..


4.1.18.1 Institutional Developments..
..
..
..

4.1.18.2 The Nigerian Stock Exchange(NSE)..
..
..

4.1.18.3 New Issues Market ..


4.1.18.4 The Secondary Market.. ..
..
..
..

4.1.18.5 All-Share Index and Aggregate Market
Capitalisation


4.2 Fiscal Operations

4.2.1 Federation Account Operations.. ..
..
..
..

4.2.1.1 Revenue Distribution for First Half, 2014
..
..

4.2.1.1.1 Federation Account Distribution ..
..

4.2.1.1.2 VAT Pool Account..

..
..

4.2.2 Federal Government Finances..


4.2.2.1 Federal Government Fiscal Balance
..
..

4.2.2.2 Federal Government Retained Revenue ..
..

4.2.2.3 Total Expenditure of the Federal Government ..

4.2.3 State Governments’ Finances


4.2.4 Local Governments’ Finances


4.2.5 Public Debt ..


4.2.5.1 Consolidated Government Debt ..
..
..

4.2.5.2 Domestic Debt..


4.2.5.3 External Debt..


4.2.5.4 Consolidated Debt Service Payments.. ..
..

4.3 Real Sector Developments ..


4.3.1 Agriculture.. ..


4.3.1.1 Agricultural Policies and Institutional Support.. ..

4.3.1.2 Agricultural Production and Prices..
..
..

4.3.2 Industry..


ix
4.3.2.1 Industrial Policy and Institutional Support ..
..

4.3.2.2 Industrial Production..


4.3.2.3 Manufacturing..


4.3.3 Crude Oil


4.3.3.1 Crude Oil Production and Demand
..
..

4.3.3.2 Crude Oil Prices..


4.3.4 Gas


4.3.5 Petroleum Products ..


4.3.6 Solid Minerals ..


4.3.7 Electricity Generation ..


4.3.8 Electricity Consumption..


4.3.9 Industrial Financing..


4.3.9.1 NEXIM ..


4.3.10 Telecommunications ..


4.3.11 Consumer Prices


4.3.11.1 Headline Inflation ..


4.3.11.2 Core Inflation..


4.3.11.3 Food Inflation..


4.3.11.4 Urban and Rural Consumer Price Indices and

Inflation Rates ..


4.3.12 Health


4.3.13 Education


4.3.14 Housing and Urban Development ..
..
..
..

4.3.15 Aviation Services


4.3.15.1 Aviation Policy and Airport Development
..

4.3.15.2 Domestic Operations


4.3.15.2 International Operations ..
..
..
..

4.3.16 Maritime Services ..


4.3.17 Railway Services


4.4
External Sector Developments


4.4.1 Current Account


4.4.1.1 Trade ..


4.4.1.2 Services ..


4.4.1.3 Income ..


4.4.1.4 Current Transfers..


4.4.2 Capital and Financial Accounts ..
..
..
..

4.4.2.1 Foreign Direct Investment ..
..
..
..

4.4.2.2 Portfolio Investment ..


4.4.3 Capital Importation by Sector and Capital Outflow
..

4.4.4 Reserve Assets and Months of Import Cover
..
..

4.4.5 External Assets of Financial Institutions ..
..
..
..

5.0
INTERNATIONAL ECONOMIC RELATIONS

5.1
Regional Institutions ..


5.1.1 Presidential Taskforce Meeting on ECOWAS Monetary

Cooperation Programme ..


5.1.2 West African Monetary Zone (WAMZ)
..
..
..

5.1.3 West African Institute for Financial and Economic
Management (WAIFEM)


5.1.4 West African Monetary Agency (WAMA) ..
..
..

5.1.5 African Union Summit


x
5.1.6 Association of African Central Banks (AACB).. ..
..

5.1.7 African Development Bank (AfDB)..
..
..
..

5.1.8 African Union (AU)and Economic Commission for Africa (ECA)
Conference of Ministers of Finance, Planning and Economic
Development


5.2 Multilateral Economic and Financial Institutions.. ..
..
..

5.2.1 G20 Finance Ministers and Central Bank Governors..
..

5.2.2 Intergovernmental Group of Twenty Four (G24)..
..

5.2.3 World Economic Forum on Africa (WEFA)
..
..

5.2.4 The World Bank/ IMF Spring Meetings
..
..
..

5.2.5 The Institute of International Finance (IIF) ..
..
..

5.2.6 International Commodity Organisation ..
..
..

6.0
OUTLOOK FOR THE SECOND HALF OF 2014 ..
..
..
..

TABLES
Selected Macroeconomic Indicators


Monetary Policy Benchmarks and Outcomes
..
..
..

Structure of the CIC ..


Nominal and the Real Effective Exchange Rate Indices
..

Analysis of CACS Financed Projects by Value Chain
..
..

Indices of Selected International Stock Markets ..
..
..

Exchange Rate of Selected Countries


Sources and Uses of Reserve Money


Growth in Monetary Aggregates ..


Credit to the Core Private Sector ..


Maturity Structure of DMBs Assets and Liabilities..
..
..

11 Weighted Effective Average Cost of DMBs Funds (WEACF) ..

Composition as Percentage of EACF..


Bid-Cover Ratios of Selected Securities


Money Market Rates..


DMBs Deposit and Lending Rates. ..


Open Market Operations (OMO) Sessions
..
..
..

Treasury Bills: Issues and Subscription


Monetary and Credit Developments..


Value of Money Market Assets..


Selected Interest Rates


Federation Account Operations ..


Summary of Federal Government Finances..
..
..
..

Functional Classification of Federal Government Recurrent and

Capital Expenditure..


Summary of Statutory & VAT Revenue Allocation to
State Governments..


Allocation to Local Governments from the Federation
and VAT Pools Accounts


Domestic Debt of the Federal Government
..
..
..

Domestic Debt Service Payments to the Federal Government
by Instruments


External Debt Outstanding ..


External Debt Service Payments.. ..


Consolidated Debt Outstanding ..


xi

Gross Domestic Product at 2010 Constant Basic Prices ..
..

Gross Domestic Product at Current Basic Prices ..
..
..

Selected Real Sector Indicators.. ..


Composite Consumer Price Index ..


Urban and Rural Consumer Price Index ..
..
..
..

Balance of Payments Analytic Presentation (US$)..
..
..

Balance of Payments Analytic Presentation (Naira)
..
..

Foreign Exchange Flows Through the Economy..
..
..

Nigeria’s Gross External Reserves.. ..


Nigeria’s Foreign Exchange Cross Rates.. ..
..
..
..

Monthly Average Exchange Rate Movement.. ..
..
..

Demand and Supply of Foreign Exchange
..
..
..

Sectoral Utilization of Foreign Exchange ..
..
..
..

Total External Assets of Financial Institutions..
..
..
..

CHARTS

Volume of Cheques Cleared..


Value of Cheques Cleared..


Classification of Electronic Payments by Volume
..
..

Classification of Electronic Payments by Value ..
..
..

Volume of Electronic Payments


Value of Electronic Payments


Volume of ATM Transactions


Value of ATM Transactions..


Volume of Web Transactions


Value of Web Transactions ..


Volume of POS Transactions


Value of POS Transactions ..


Volume of Mobile Transactions


Value of Mobile Transactions


Volume of RTGS Transactions


Value of RTGS Transactions ..


Volume of NIP Transactions ..


Value of NIP Transactions ..


Volume of NEFT Transactions


Value of NEFT Transactions ..


Credit Risk Management System (CRMS) Statistics..
..
..

Demand, Supply and Net Demand of Foreign Exchange
Spot Market ..


Exchange Rate Movements..


rDAS/Bureau-de-Change Foreign Exchange (N/US$) Premium..

Foreign Exchange Disbursements Through the CBN..
..
..

Foreign Exchange Transactions Through the CBN..
..
..

Sectoral Utilization of Foreign Exchange (Visibles)..
..
..

Sectoral Utilization of Foreign Exchange (Invisibles)..
..
..

Nominal (NEER) and Real Effective Exchange Rate (REER) .. ..


Indices..


Sectoral Distribution of ACGSF Loans (By Purpose)..
..
..

Analysis of CACS Financed Projects by Value Chain
..
..

NIRSAL Credit Risk Guarantee (CRG) Issued..
..
..
..

xii

Performance of the Naira against Major Currencies
..
..

Performance of the Naira against Regional Currencies
..

35 (a)
Reserve Money and its Components: Sources ..
..
..

35 (b)
Reserve Money and its Components: Uses
..
..
..

Ratio of Currency Outside Bank to Money Supply
..
..

Growth in Money Supply.. ..


Distribution of Net Domestic Credit..


Sectoral Distribution of Banks Credit


Maturity Structure of Deposit Money Banks Loans and Advances

Maturity Structure of Banks Deposits ..


Distribution of Private Sector Credit..


43 (a)
Market Structure of the Banking Industry ..
..
..
..

43 (b)
Market Structure of the Banking Industry (Concentration Ratio
of Largest Firm)


Consumer Credit of DMBs ..


Trends in Weighted Effective Average Cost of Banks Funds.. ..

Money Market Assets Outstanding..


Nigerian Treasury Bills Outstanding ..


Distribution of FGN Bonds.. ..


Money Market Rates..


Government Bonds Average Yield Curve
..
..
..

Volume and Value of Transactions at the NSE.. ..
..
..

Market Capitalization and NSE Value Index..
..
..
..

Structure of Gross Federation Revenue.. ..
..
..
..

Composition of Oil Revenue..


Composition of Non-Oil Revenue..


Federally-Collected Revenue Distribution..
..
..
..

Distribution to the tiers of Government.. ..
..
..
..

Federal Government Fiscal Balance..


Composition of Federal Government Retained Revenue..
..

Composition of Federal Government Expenditure..
..
..

Economic Classification of Federal Government Recurrent
Expenditure..


Composition of Total Allocation to State Governments ..
..

Composition of Statutory Allocation to Local Governments .. ..

Composition of Federal Government Consolidated Debt
..

Breakdown of External Debt Stock


Breakdown of Extenal Debt Service Payments ..
..
..

GDP Growth Rate.. ..


Industrial Production Index..


Average Manufacturing Capacity Utilisation
..
..
..

Crude Oil Production and Exports..


Average Spot Prices of Selected Crudes ..
..
..
..

Gas Production and Utilization..


Distribution of Petroleum Products..


Sectoral Disbursement of NEXIM Loans


Total Active Lines and Tele-density..


Consumer Price Indices..


Inflation Rate ..


Urban and Rural Consumer Price Indices..
..
..
..

Exports, Imports and Trade Balance..


xiii

Non-Oil Exports by Products..


Non-Oil Imports by Sectors..


Share of Services Out Payments.. ..


Private Home Remittances..


Net FDI and Portfolio Investment Flows.. ..
..
..
..

Capital Importation by Sector..


Capital Outflows and Outward Transfers ..
..
..
..

Stock of External Reserves and Months of Import Cover..
..

Nigeria’s Total External Assets..


xiv

SUMMARY
POLICY FRAMEWORK
The Central Bank of Nigeria’s (CBN) primary mandate remains
monetary and price stability. To achieve the mandate, the Bank in the
first half of 2014, pursued a monetary policy strategy using a
combination of approaches. Thus, the Bank employed the open
market operations (OMO), complemented by reserve requirement
(RR), discount window operations and primary market transactions as
well as interventions in the foreign exchange market. The monetary
policy rate (MPR) was retained as the major signal of the Bank’s policy
stance and the anchor for short-term interest rates. The Bank undertook
supervisory and surveillance activities through regular review of banks’
returns, spot checks, on-site and off-site monitoring, and special
investigations, among others, to ensure a sound financial system
stability.
CBN OPERATIONS:
Developmental
Initiatives
The Bank sustained the implementation of its various developmental
initiatives such as; the N200 billion Restructuring and Refinancing Facility
(RRF), the N200 billion SME Credit Guarantee Scheme Fund (SMECGS),
and the N300 billion Power and Airline Intervention Fund (PAIF). Others
included the Agricultural Credit Guarantee Scheme (ACGS), the
Commercial Agricultural Credit Scheme (CACS), Entrepreneurship
Development Centres and the Nigeria Incentive-Based Risk Sharing
System for Agricultural Lending (NIRSAL).

Liquidity
Management
Open market operations was sustained as the main tool for liquidity
management. Other quantity based instruments used alongside the
OMO were the reserve requirements, discount window operations and
standing facilities. Also, primary market transactions in government
securities and interventions in the foreign exchange market under the
retail Dutch Auction System (rDAS) were employed.
Payments
&
Clearing System
To enhance the National Payments System, the CBN introduced Bank
Verification Number (BVN) to address the challenge of absence of a
unique identifier in the Nigerian banking industry. The BVN would
enhance the effectiveness of the “Know Your Customer” (KYC)
principle, with its associated benefits, including reduction of fraud and


xv
credit risk; and growth of credit and related products. Other activities
included: Sensitisation campaigns on the cash-less policy initiative in
preparation for its take-off in the remaining 30 states of the Federation;
Revision of the guidelines for e-card issuance and usage in Nigeria; and
Implementation of industry e-reference portal to enhance processing
of customers’ accounts references.


Financial Sector
Surveillance


As part of its supervisory and surveillance activities, the Bank conducted
the quarterly review of foreign exchange activities of twenty (20) banks
to ascertain their compliance with extant foreign exchange laws and
regulations.
Institutions
where
infractions
were
identified
were
appropriately
sanctioned.
In
addition,
Anti-Money
Laundering/
Combating the Financing of Terrorism (AML/CFT) spot check on thirteen
(13) banks was carried out and five (5) banks were sanctioned for
contravening various laws and regulations. The Bank also undertook an
on-site examination of one foreign subsidiary of a domestic bank as
part of its oversight of cross-border activities.
The banking sector remained sound at end-June 2014. The industry
non-performing loans (NPL) ratio stood at 3.50 per cent, down from 3.65
per cent at end-June 2013, following improvement in the risk
management practices of banks. The industry liquidity ratio stood at
42.66 per cent at end-June 2014, higher than the threshold of 30.0 per
cent.
The implementation of the 2010 banking reform initiatives continued
during the review period. One bank was issued with a commercial
banking licence with international authorization, while another
obtained HoldCo and commercial banking licences with international
authorization. In addition, a discount house was granted approval-inprinciple (AIP) to convert to a merchant bank, while a foreign bank was
granted final approval to establish a representative office in Nigeria.
Also, a parallel-run of the Basel II alongside Basel I minimum capital
adequacy computation commenced during the first half of 2014, with
banks required to also render their returns on Basel II format on monthly
basis. In addition, the submissions of DMBs’ Internal Capital Adequacy
Assessment Process (ICAAP) documents to the Bank commenced in
the review period.
The Bank issued a revised Code of Corporate Governance for Banks


xvi
and Discount Houses to align its provisions with current realities and
global
best
practices;
eliminate
ambiguities
and
strengthen
governance practices in the institutions. To ensure full implementation,
banks and discount houses were required to render quarterly returns to
the CBN. A compliance examination and spot check on banks was
carried out to ascertain compliance with the consumer complaints
management
guidelines.
The
exercise
revealed
remarkable
improvement in most banks. However, defaulting banks were directed
to make appropriate refunds and ensure strict compliance henceforth.
The Bank also conducted consumer financial literacy sensitization and
awareness programmes in Enugu and Ibadan in the review period.


Foreign Exchange
Management
The Retail Dutch Auction System (rDAS) was retained as the
mechanism for managing foreign exchange by the Bank. The
exchange rate of the naira vis-à-vis the US dollar was relatively stable
at the official window due to interventions by the Bank which
moderated demand pressure. The average exchange rate of the
naira to the US dollar at the rDAS, interbank and BDC segments were
N157.29/US$, N162.55/US$ and N169.49/US$, respectively, in the first half
of 2014. Foreign exchange inflow through the economy increased by
5.9 and 2.4 per cent to US$75.64 billion above the respective levels in
the first and second halves of 2013. Total foreign exchange outflow
through the economy increased by 52.7 and 18.3 per cent to US$29.09
billion, over the levels at end-June and end-December 2013,
respectively. Overall, the net foreign exchange inflow through the
economy stood at US$46.55 billion, compared with US$52.32 billion and
US$49.27 billion in the corresponding period and preceding half year,
respectively.

THE FINANCIAL
SECTOR


The CBN maintained a tight monetary policy stance in the first half of
2014, keeping the monetary policy rate at 12.0 per cent throughout the
period. Consequently, major monetary aggregates were significantly
below their indicative benchmarks. Reserve money, at N4, 723.1 billion,
was 15.0 per cent below its level at end-December 2013. Broad money
supply (M2) grew by 1.7 per cent relative to the level at end-December
2013, compared with the growth of 0.7 per cent at the end of the
corresponding period of 2013. At this rate, M2 growth was lower than
the provisional indicative target of 14.5 per cent for fiscal 2014. Both


xvii


currency-in-circulation and currency outside bank declined at the end
of the review period.
Aggregate credit to the domestic economy grew marginally as a result
of the slow growth in claims on the private sector and the decline in net
claims on the Federal Government. Net domestic credit (NDC), grew
by 0.9 per cent to N15,173.6 billion at the end of the first half of 2014,
compared with the growth of 3.6 per cent at the end of the
corresponding period of 2013. Net claims on government fell by 21.9
per cent at the end of the first half of 2014, compared with 3.6 per cent
at the end of the corresponding half of 2013. The Federal Government,
as in the preceding half-year, however, remained a net lender to the
banking system. Credit to the private sector grew by 2.8 per cent at the
end of the first half of 2014, compared with 3.6 per cent at the end of
the first half of 2013.
Money market rates were relatively stable in the first half of 2014. The
weighted average prime and maximum lending rates stood at 16.7
and 25.8 per cent, respectively. The spread between the average term
deposit and maximum lending rates narrowed by 0.75 percentage
points to 16.92 percentage points. With the year-on-year inflation rate
at 8.2 per cent in June 2014, most deposit rates were negative in real
term.
Aggregate financial savings rose by 5.0 per cent to N9,511.0 billion in
the first half of 2014, compared with N9,224.4 billion and N9,085.6 billion
at end-December 2013 and the corresponding period of 2013,
respectively. DMBs remained the dominant depository institutions in the
financial system, accounting for 90.0 per cent of the total financial
savings, compared with 95.2 per cent in the preceding half year while
other savings institutions accounted for the balance.
The All-Share Index (ASI) and aggregate market capitalization rose by
2.8 and 0.1 per cent to close at 42,482.48 and N19.09 trillion,
respectively, compared with 41,329.19 and N19.08 trillion at endDecember 2013.


Provisional gross federally-collected revenue in the first half of 2014
stood at N5,109.04 billion or 12.1 per cent of GDP. This was below the
proportionate budget estimate by 6.0 per cent, but was above the


xviii


THE
GOVERNMENT
SECTOR
level in the corresponding period of 2013 by 6.3 per cent. The shortfall in
federally-collected revenue relative to the budget estimate was as a
result of the decline in non-oil revenue. Further analysis indicated that
oil revenue constituted 70.5 per cent of total revenue, while non-oil
revenue accounted for the balance.
At N1,771.27 billion or 4.2 per cent of GDP, the estimated Federal
Government’s retained revenue was lower than both the proportionate
budget estimate and the level in the corresponding period of 2013 by
17.0 and 9.6 per cent, respectively. The decline in retained revenue
relative to the proportionate budget estimate was attributed, largely,
to the drop in both FGN independent revenue and its share from the
Federation Account.
The estimated aggregate expenditure of the Federal Government in
the first half of 2014 was N2,096.37 billion or 5.0 per cent of GDP. This fell
by 19.9 and 11.8 per cent below the budget estimate and the level in
the corresponding period of 2013, respectively. The decline in total
expenditure relative to the proportionate budget estimate reflected,
largely, the delay in capital releases induced by the late passage of
the 2014 Appropriation Bill. The fiscal operations of the Federal
Government in the first half of 2014 resulted in overall deficit of N325.11
billion or 0.8 per cent of GDP, as against the proportionate budget
estimate and corresponding period of 2013 deficit of N482.10 billion
and N415.40 billion, respectively. The deficit was financed, mainly, from
domestic sources, particularly through the issuance of FGN Bonds and
loans from special account (Development of Natural Resources
Account).
The stock of Federal Government consolidated debt at end-June 2014
was N8,881.40 billion or 10.5 per cent of GDP This represented an
increase of 4.6 per cent over the level at end-December 2013. Of the
total debt stock, domestic debt accounted for N7,421.40 billion or 83.6
per cent, while the external debt amounted to N1,460.30 billion
(US$9.38 billion) or 16.4 per cent of the total.


Provisional Data from the National Bureau of Statistics (NBS) showed
that the gross domestic product (GDP), at 2010 constant basic prices,
rose by 6.4 per cent in the first half of 2014, compared with 4.9 per cent


xix

THE REAL
SECTOR


in the first half of 2013. The growth reflected, largely, the performance
of the non-oil sector, which grew by 7.4 per cent. Agriculture and
industry recorded growth of 4.6 and 5.9 per cent, respectively. Similarly,
construction, services and trade recorded respective growth of 14.0,
7.2 and 5.7 per cent in the first half of 2014.
Nigeria’s average daily crude oil production stood at 1.91 mbd or
345.71 million barrels (mb), representing a decline of 4.0 per cent below
the level of 1.99 mbd or 360.19 mb attained in the corresponding half
of 2013. The average spot price of Nigeria’s reference crude, the Bonny
Light (37o API) increased by 0.9 per cent to US$111.29 per barrel above
its level in the first half of 2013.
The general price level maintained an upward trend in the first half of
2014. The all-items composite Consumer Price Index (CPI) stood at
158.6 (November 2009=100) at end-June 2014, compared with 146.6
and 152.3 at end-June 2013 and end-December 2013, respectively.
The year-on-year headline inflation fluctuated in the first half of 2014
and stood at 8.2 per cent at end-June 2014, representing an increase
of 0.2 percentage point over the level at end-December 2013. The 12month moving average inflation rate declined to 8.0 per cent at endJune 2014, from 10.4 and 8.5 per cent at end-June and end-December
2013, respectively.


EXTERNAL
SECTOR
Provisional data showed that the external sector was under pressure
reflected in the depletion of the external reserves and huge short-term
capital reversal in the first half of 2014. Despite this development, the
current account recorded a surplus equivalent to 2.26 per cent of gross
domestic product (GDP), occasioned by robust trade balance and
increased home remittances. The capital and financial account also
registered a higher net foreign assets position, representing 0.6 per cent
of GDP in the first half of 2014, compared with 0.5 per cent of GDP in
the first half of 2013. External reserves, at US$37.33 billion, declined by
12.9 per cent from the level at end-December 2013 and could support
8.0 months of import cover (goods only). External debt increased from
US$6.92 billion and US$8.82 billion at end-June and end-December
2013, respectively, to US$9.38 billion.
Global output expansion was modest, but unbalanced across
economies. Policy uncertainties and structural rigidities continued to


impede overall demand. In the advanced economies, growth was
gradually gaining traction after a lull due to the harsh weather
conditions and weak domestic demand, resulting in huge inventory
accumulation. In the emerging market economies, growth remained
sluggish, affected by policy uncertainties, structural rigidities and
protracted weakness in external demand, which weighed negatively
on domestic demand. The financial markets were susceptible to
uncertainties
around
interest
rates
normalisation
in
advanced
economies. In sub-Saharan Africa, growth remained strong, supported
by commodity-related factors. Nigeria posted reasonable growth
despite domestic challenges. In the Middle East and North Africa
(MENA), growth was constrained by difficult socio-political and security
concerns. Global inflation generally remained subdued, lower than
historical averages, following continued negative output gaps in the
advanced economies, weaker domestic demand in many emerging
markets, and falling commodity prices, particularly energy.


OUTLOOK
FOR THE REST
OF 2014
Despite the unfavourable global economic environment, Nigeria’s
output growth for the second half of 2014 was expected to remain
resilient amidst disruptions of agricultural activity on account of
insecurity. Firmed-up domestic demand would continue to drive the
services and manufacturing sectors, while the strengthening of growth
in advanced economies would bolster external demand. Although
there are signs of domestic inflationary pressures, pass-through effect of
foreign prices on domestic inflation was expected to be dampened as
global inflation expectations have remained well anchored. In
addition, proactive monetary policy measures would stem the liquidity
surfeit from accommodative fiscal policy anticipated in the second half
of the year. Consequently, domestic inflation would remain reasonably
contained within the Bank’s target band of 6.0 – 9.0 per cent.
The outlook for the external sector for the rest of 2014 remained
promising, given the sustained high international crude oil price and
stable domestic economic conditions. The fiscal outlook is, however,
mixed. Despite the sustained increase in international oil prices above
the FGN budget benchmark price of US$77.5/barrel, the reduction in US
demand for Nigeria’s crude due to the discovery of shale oil might
adversely affect total revenue. However, it was expected that the


xxi
recovery in some emerging markets might boost the demand for
Nigeria’s Brent and, thereby, dampen the effect of the lower crude oil
demand from the US on federation revenue and accretion to the
excess crude account. It was also expected that capital expenditure
implementation would intensify in the second half of the year along
with upsurge in recurrent expenditure due to the financial outlay for the
2015 election activities.


Indicator
Jun-10 1/
Jun-11 1/
Jun-12 1/
Jun-13 1/
Jun-14 2/
Domestic Output and Prices
GDP* at Current Mkt Prices (N' billion)
25,931.88

29,915.91

34,643.40

38,671.86

42,339.35
GDP* at Current Mkt Prices (US$' billion)
172.84

195.26

219.75

245.84

269.17

GDP* per Capita (N)
163,194.62

182,429.20

204,707.10

224,614.39

242,181.32

GDP* per Capita (US$)
1,087.70

1,190.71

1,298.50

1,427.90

1,539.67

Real GDP* Growth (Growth Rate %)
6.62

3.79

4.94

6.38

Oil Sector
17.31

(9.19)

(13.77)

(1.23)

Non-oil Sector
4.68

6.43

8.18

7.44

Sectoral Classification of GDP* (Growth Rate %)
Agriculture
2.58

6.36

2.52

4.55

Industry
16.14

(0.96)

(0.85)

5.90

Construction
3.82

24.17

13.96

13.99

Trade
6.78

1.61

5.91

5.71

Services
3.27

4.90

8.82

7.21

Oil Production (mbd)

Manufacturing Capacity Utilisation (%) 1/

Inflation Rate (%) (Year-over-Year)

Inflation Rate (%) (12-month moving average)

Core Inflation Rate (%) (Year-over-Year) 3/

Core Inflation Rate (%) (12-month moving average) 3/

Federal Government Finance (% of GDP*)
Retained Revenue

Total Expenditure

Recurrent Expenditure

Of which: Interest Payments

Foreign

Domestic

Capital Expenditure and Net Lending

Transfers

Current Balance (Deficit(-)/Surplus(+))

Primary Balance (Deficit(-)/Surplus(+))

Overall Fiscal Balance (Deficit(-)/Surplus(+))

Financing

Foreign

Domestic

Banking System

Non-bank Public

Others

Selected Macroeconomic and Social Indicators


xxiii
Indicator
Jun-10 1/
Jun-11 1/
Jun-12 1/
Jun-13 1/
Jun-14 2/
Consolidated Government Debt Stock

External

Domestic

Money and Credit ( Growth Rate %)
Reserve Money

Narrow Money (M1)

Broad Money (M2)

Net Foreign Assets

Net Domestic Assets

Net Domestic Credit

Net Credit to Government

Credit to Private Sector

Money Multiplier for M2

Income Velocity of M2

Interest Rates (% per annum)
Monetary Policy Rate (MPR) 4/

Repurchase Rate
Reverse Repurchase Rate
Treasury Bill Rate
91-day


9.98

Inter-bank Call Rate

Deposit Rates
Savings Rate

3-months Fixed

6-months Fixed

12-months Fixed

Prime Lending Rate

Maximum Lending Rate

External Sector
Current Account Balance (% of GDP*)

Goods Account

Services and Income Account

Current Transfers

Capital and Financial Account Balance (% of GDP*)

Overall Balance (% of GDP*)

External Reserves (US $ million)
37,468.44

31,890.91

35,412.50

44,957.00

37330.03
Number of Months of Import Equivalent

Debt Service Due (% of Exports of Goods and Services)
Average Crude Oil Price (US$/barrel)

Average AFEM/DAS Rate (N/$1.00)

End of Period AFEM/DAS Rate (N/$1.00)

Average Bureau de Change Exchange Rate (N/$)

End of Period Bureau de Change Exchange Rate (N/$)

Capital Market
All Share Value Index (1984=100)


Value of Stocks Traded (Billion Naira)


Aggregate Market Capitalization (Trillion Naira)


Social Indicators
Population (million)


Population Growth Rate (%)


Life Expectancy at Birth (Years)
NA
NA
NA
NA
NA
Adult Literacy Rate (%)
NA
NA
NA
NA
NA
Incidence of Poverty 5/
NA
NA
NA
NA
NA
*Figures and computations for are from/based on newly rebased GDP figures, comprising 44 activity sectors.
NA indicates not available
3/ Core Inflation is measured as the rate of change of all-item Consumer Price Index (CPI) less farm produce.
4/ MPR replaced MRR with effect from December 11, 2006.
5/ The incidence of poverty in Nigeria was projected to increase from 65.6 per cent in 1996 to 70.0 per cent in 2000.
However, the result of a Nigeria Living Standard Survey of 2003/2004 from NBS (former FOS),
1/ Revised
2/ Provisional
Selected Macroeconomic and Social Indicators (Cont...)
showed that the incidence of poverty declined to 54.4 per cent in 2003/2004.

CENTRAL BANK OF NIGERIA
REPORT FOR THE FIRST HALF OF 2014

1.0
Introduction
The focus of monetary policy in the first half of 2014 remained the sustenance
of monetary and price stability. Consequently, the framework for monetary
management remained an eclectic approach, involving a combination of
interest rate and monetary aggregate, with the monetary policy Rate (MPR)
serving as the anchor for short-term interest rates. To address liquidity surfeit
in the banking system, the Bank strengthened and sustained its tight
monetary policy measures in the first half of 2014 to achieve the objectives of
monetary policy consistent with the real gross domestic product growth
target of 7.02 per cent for fiscal 2014. The strengthening of the policy stance
was intended to stem the likely inflationary pressures from the huge injection
from the 2014 Federal Government budget of N4.96 trillion, which resulted in
a sizeable deficit of N325.11 billion in the review half year. In addition, liquidity
injections into the banking system from AMCOM operations, matured
securities, and monthly statutory revenue releases exerted pressure on the
foreign exchange market, thus warranting the sustenance of a tight
monetary policy stance to stabilize the naira. As in previous periods, the main
instrument of monetary management was open market operations (OMO)
complemented by discount window operations, reserve requirements,
primary market transactions and interventions in the foreign exchange.
The major monetary policy benchmarks for 2014 and the provisional
outcome as at the end of the first half are shown below:

Table 1
Monetary Policy Benchmarks and Outcomes
(Growth in % except otherwise stated)
Key Variables

June, 2014

Bench
mark
Outcome
Bench
mark
Outcome
Bench
mark
Outcome
Bench
mark
Outcome
Broad Money Growth
(M2)

Narrow Money
Growth (M1)


Base Money
(Reserve) Growth

Aggregate credit to
the domestic
economy
Growth (Net)

Credit to
Government
Growth (Net)


Credit to the private
sector Growth

Inflation rate

Real GDP Growth

*Monetary aggregates annualized as at June, 2013; **2nd Quarter growth rate; ***June 2013 inflation rate.

2.0 OPERATIONS OF THE CENTRAL BANK OF NIGERIA
2.1
Liquidity Management
The Bank maintained a tight monetary policy stance during the first half of
2014, focused at achieving the objectives of monetary and price stability.
Accordingly, the Bank employed a range of instruments to manage the
liquidity arising from fiscal injections into the banking system and its effects on
the general price level. The measures included: retention of the MPR at 12.0
per cent with a symmetric corridor of +/-200 basis points; LR at 30.0 per cent;
a band of +/- 3.0 per cent; mid-point of the exchange rate at N155/US$ and
increase in the CRR on public sector deposits from 50.0 to 75.0 per cent, and
private sector deposits from 12.0 to 15.0 per cent. Consequently, reserve
money, which stood at N5, 558.92 billion at end- December 2013, contracted
by 15.0 per cent to N4, 723.07 billion at end-June 2014. This was, however,
N383.80 billion or 7.5 per cent above the second quarter indicative
benchmark of N5,106.87 billion.

Open market operations (OMO) remained the Bank’s primary tool of liquidity
management. This was complemented by reserve requirements, discount
window operations, standing facilities, and CBN bills. Also, the Bank
intervened in the foreign exchange market under the retail Dutch Auction
System (rDAS) (spot, forwards, BDCs), at the inter-bank segments. In addition,
primary market transactions in government securities continued to be
deployed in monetary management.
2.2
Monetary Policy Committee (MPC) Decisions
The Monetary Policy Committee (MPC) held three (3) regular meetings in the
first half of 2014, specifically in January, March and May. A summary of the
key decisions of the Committee are presented hereunder:
Date of Meeting
Type of Meeting
Decisions
January 20 - 21, 2014
Regular

Retained MPR at 12.0 per cent with interest rate
corridor of +/- 200 basis points

Retained Liquidity Ratio at 30.0 per cent

Increased public sector CRR from 50.0 to 75.0 per
cent

Retained private sector CRR at 12.0 per cent

Took immediate steps to redress the supply-demand
imbalance in the BDC segment while maintaining
focus on anti-money laundering (AML) activities.
March 24 – 25, 2014
Regular

Retained MPR at 12.0 per cent with interest rate
corridor of +/- 200 basis points

Increased CRR on private sector deposits by 300 basis
points to 15.0 per cent.
May 19 – 20, 2014
Regular

Retained MPR at 12.0 per cent with interest rate
corridor of +/- 200 basis points

Retained public sector CRR at 75.0 per cent and
private sector CRR at 15.0 per cent

2.3
Developments in the Payments System
To further improve the National Payments System, the Bank carried out the
following activities:
Introduced Bank Verification Number (BVN) to address the challenge of
absence of a unique identifier in the Nigerian banking industry. The BVN
would enhance the effectiveness of the “Know Your Customer” (KYC)
principle, with its associated benefits in the reduction of fraud and credit
risk; and growth of credit and related products;
Sensitisation campaigns on the cash-less policy initiative in preparation for
its take-off in the remaining 30 states of the Federation;
Revision of the guidelines for e-card issuance and usage in Nigeria; and
Implementation of industry e-reference portal to enhance processing of
customers’ accounts references.
Box 1: Bank Verification Number
The CBN in collaboration with the Bankers’ Committee, introduced the Bank Verification
Number (BVN) with biometric solution, as a unique identifier for all bank customers and is
aimed at revolutionizing the payments system in the country. The BVN authentication is
targeted at addressing absence of a unique identifier in the banking industry; check
cybercrime, ATM and other related financial frauds; and avoid losses of customers’ funds
through compromise of Personal Identification Numbers (PIN) and identity theft. The BVN
would also ensure accountability, enhance credit supply as borrowers’ identity is easily
tractable, and encourage financial inclusion.
The BVN enables one person to have a single identity within the financial system irrespective
of the number of accounts within multiple banks and the enrolment process would be done
only once.
The enrolment of bank customers for BVN would commence in the second half of 2014 with
end-December as the deadline. Thereafter, customers would no longer be able to operate
their bank accounts without the BVN.

2.3.1 Retail Payments System
2.3.1.1 Cheques
In the first half of 2014, the volume and value of cheques cleared decreased
by 13.5 and 8.9 per cent to 7,144,340 and N3,710.7 billion, respectively, from
8,257,330 and N4,073.2 billion in the second half of 2013. The development
was attributed to the steady rise in the use of e-payment channels.
Figure 1
Volume of Cheques Cleared
(Million)

First Half 2013
Second Half 2013
First Half 2014
Million


Figure 2
Value of Cheques Cleared
(N’ Billion)

First Half 2013
Second Half 2013
First Half 2014
N'Billion

2.3.1.2
Electronic Payments
The volume and value of electronic payments rose by 13.0 and 10.2 per cent
to 199,324,309 and N1,944.6 billion, respectively, in the first half of 2014, from
176,446,592 and N1,764.0 billion in the second half of 2013. A breakdown of
e-payment channels indicated that ATM remained the most patronised,
accounting for 88.1 per cent, followed by mobile payments and PoS
terminal, with 6.3 and 4.5 per cent, respectively. The web (internet) was the

least patronised, accounting for 1.1 per cent of the total. In terms of value,
ATM accounted for 84.5 per cent; mobile payments, 7.2 per cent; PoS, 7.1
per cent; and the web (Internet), 1.2 per cent.

Figure 3
Classification of Electronic Payments by Volume
(First Half 2014)
ATM
88.1%
PoS
4.5%
Web
(Internet)
1.1%
Mobile
6.3%

Figure 4
Classification of Electronic Payments by Value
(First Half 2014)
ATM
84.5%
PoS
7.1%
Web (Internet)
1.2%
Mobile
7.2%

Figure 5
Volume of Electronic Payments
(Million)

First Half 2013
Second Half 2013
First Half 2014
Million


Figure 6
Value of Electronic Payments
(N’Billion)

First Half 2013
Second Half 2013
First Half 2014
N' Billion


2.3.1.2.1 ATM Transactions
The number of ATMs deployed stood at 14,764 at end-June 2014,
representing 15.8 per cent increase above 12,755 at end-December 2013.
ATM transactions increased in both volume and value by 10.6 and 6.1 per
cent to 175,506,932 and N1,636.4 billion in the first half of 2014, from
158,629,927 and N1,542.6 billion in the second half of 2013, respectively.

Figure 7
Volume of ATM Transactions
(Million)

First Half 2013
Second Half 2013
First Half 2014
Million


Figure 8
Value of ATM Transactions
(N’ Billion)

First Half 2013
Second Half 2013
First Half 2014
N' Billion

2.3.1.2.2 Web Transactions
The volume and value of web (internet) transactions in the first half of 2014
increased by 24.5 and 15.6 per cent to 2,230,353 and N30.7 billion, from
1,791,988 and N26.6 billion in the second half of 2013, respectively. The
development was as a result of increased awareness and acceptance of
this mode of payment.

Figure 9
Volume of Web Transactions
(Million)

First Half 2013
Second Half 2013
First Half 2014
Million


Figure 10
Value of Web Transactions
(N’Billion)

First Half 2013
Second Half 2013
First Half 2014
N'Billion


2.3.1.2.3 Point of Sale (PoS) Transactions
The number of PoS terminals deployed increased slightly by 1.4 per cent to
121,886 at end-June 2014 from 120,191 at end-December 2013. PoS
transactions increased in both volume and value by 44.8 and 32.7 per cent
to 8,971,501 and N137.7 billion in the first half of 2014, from 6,194,467 and
N103.8 billion in the second half of 2013, respectively. The development was
attributed to increased public awareness and usage of the channel.

Figure 11
Volume of PoS Transactions
(Million)

First Half 2013
Second Half 2013
First Harf 2014
Million


Figure 12
Value of PoS Transactions
(N’Billion)

First Half 2013
Second Half 2013
First Half 2014
N'Billion

2.3.1.2.4 Mobile Payments
The volume of mobile payments increased by 27.9 per cent to 12,575,523 in
the first half of 2014 over the level in the second half of 2013. Also, the value
rose by 53.5 per cent to N139.7 billion above the level in the preceding
period. The increase was due to the effect of the sensitisation on the use of
mobile payments as alternative and easier mode of payment.

Figure 13
Volume of Mobile Transactions
(Million)

First Half 2013
Second Half 2013
First Half 2014
Million

Figure 14
Value of Mobile Transactions
(N’ Billion)

First Half 2013
Second Half 2013
First Half 2014
N'Billion


2.3.2 Wholesale Payments System
2.3.2.1 Real Time Gross Settlement (RTGS) System
The volume and value of inter-bank transfers through the Real-Time Gross
Settlement (RTGS) system increased by 61.0 and 37.8 per cent to 323,414 and
N78,011.7 billion, respectively, at end-June 2014, from 200,918 and N56,610.7
billion in the second half of 2013. This indicated enhanced efficiency in the
system following the upgrade of the RTGS in December 2013.

Figure 15
Volume of RTGS Transactions
(Million)


First Half 2013
Second Half 2013
First Half 2014


Figure 16
Value of RTGS Transactions
(N’ Billion)

First Half 2012
Second Half 2012
First Half 2013
N'Billion


2.3.2.2
Nigeria Interbank Settlement System Instant Payment (NIP)
The volume and value of NIP transactions rose by 50.5 and 37.1 per cent, to
16,839,648 and N9,137.8 billion, respectively, in the first half of 2014, from
11,186,930 and N6,666.2 billion in the second half of 2013. The increased
patronage was attributed to users’ preference for instant settlement.

Figure 17
Volume of NIP Transactions
(Million)

First Half 2013
Second Half 2013
First Half 2014
Million

Figure 18
Value of NIP Transactions
(N’Billion)

First Half 2013
Second Half 2013
First Half 2014
N'Billion


2.3.2.3 Nigeria Interbank Settlement System Electronic Fund Transfer
(NEFT)
In the review period, the volume and value of NEFT transactions decreased
by 11.5 and 2.8 per cent to 14,260,732 and N7,356.9 billion, from 16,115,171
and N7,569.2 billion, respectively, in the second half of 2013. The decline was
attributed to users’ preference for NIP and RTGS platforms which were realtime online.

Figure 19
Volume of NEFT Transactions
(Million)

First Half 2013
Second Half 2013
First Half 2014
Million


Figure 20
Value of NEFT Transactions
(N’Billion)


2.3.3 CURRENCY OPERATIONS
2.3.3.1 The Issue of Legal Tender
The Bank approved an indent of 1,760.1 million, 29.6 per cent lower than the
2,501.72 ordered in 2013. This was expected to meet the currency needs of
the economy in 2014. The entire indent of 1,760.1 million pieces of banknotes
was ordered from the Nigerian Security Printing and Minting (NSPM) Plc, 5.5
per cent below the 1,861.7 pieces for 2013.

In the first half of 2014, NSPM Plc delivered 229.8 million pieces or 13.1 per
cent of the total ordered, compared with 149.2 million pieces or 8.0 per cent
delivered in the corresponding half of 2013. Of the total 620 million pieces of
banknotes awarded to foreign printers in December 2013, 330.8 million
pieces or 53.3 per cent were received, while 8.98 million pieces of goodovers of N100, N20 and N10 notes were from various foreign printers at endJune 2014.
The Bank continued the clean notes policy in the first half of 2014 through the
sorting and withdrawal of old and used banknotes activities, replacing them
with new ones. A total of 150,445 boxes valued at N965.8 billion were
processed, while 144,313 boxes valued at N4,054.9 million were audited. Thus,
the number of boxes processed and audited increased by 50.3 and 53.7 per
cent, respectively, over the levels in the corresponding half of 2013.
Furthermore, 147,987 boxes of unfit notes, valued at N608.4 billion, consisting
of various denominations, were withdrawn and destroyed in the first half of
2014, compared with 25,913 boxes, valued at N329.3 billion in the first half of
2013.
To ensure the successful implementation of the Nigerian Cash Holding
Scheme, the Bank finalized arrangements to commence engagement with
stakeholders, including DMBs, NIBSS, cash-in-transit (CIT) and sorting
companies. The exercise was to revalidate the implementation model and
elicit stakeholders’ commitment to the project. Also, as part of the
implementation plan, the procedures for custody of CBN cash with thirdparty companies were being reviewed. Upon completion, the Scheme
would reduce the cost of cash management; improve on demand planning
and supply forecasting; and enhance efficiency in processing and
distribution on shared services through an integrated cash management
platform.
2.3.3.2 Currency-in-Circulation (CIC)
Currency-in-circulation (CIC) at end-June 2014 stood at N1,497.14 billion,
representing an increase of 5.0 per cent over the level at end-June 2013.

Specifically, there were 4,914.3 billion pieces of banknotes and 1,998.7 pieces
of coins worth N1,495.90 billion and N1.24 billion, respectively. This showed an
increase in the value of banknotes and coins in circulation by 5.0 and 0.2 per
cent over the levels in the corresponding first half of 2013. The growth in CIC
reflected the dominance of cash in the economy and increase in economic
activities consistent with its historical trend.
The N5, N10, N20 and N50 banknotes accounted for 55.2 per cent of the
number of banknotes in circulation and represented 3.7 per cent of the
value of banknotes in circulation. At end-June 2014, the N200 and N20
banknotes in circulation fell by 48.9 and 5.3 per cent, respectively, while the
N1000, N500, N100, N50, N10 and N5 denominations rose by 10.5, 3.0, 4.9,
19.3, 32.1 and 13.6 per cent, respectively, over the levels in the first half of
2013.
Table 2
Structure of the CIC
Volume
Value
Volume
Value
Volume
Value
Volume
Value
Volume
Value
(million)
(N billion)
(million)
(N billion)
(million)
(N billion)
(million)
(N billion)
(million)
(N billion)
N2

N 1

50k

25k

10k

1k

Sub Total

Notes
N1000

N500

N200

N100

N50

N20

N10

N5

Sub-Total

Total

Table 2 :Currency Structure, 2010 - June 2014
Jun-14
Jun-13

Coins

Source: CBN

2.4 Financial Sector Surveillance
2.4.1 Banking Supervision
During the review period, the CBN intensified its supervisory and surveillance
activities on the banking sector with the overall objective of promoting the
health of the financial institutions. To this end, the Bank adopted various
approaches, including regular review of banks’ periodic returns, spot checks,
on-site monitoring and special investigations.
The Bank concluded an on-site examination of a foreign subsidiary of a bank
as part of its oversight of cross-border activities. In addition, AML/CFT spot
check on thirteen (13) banks was carried out to ascertain their compliance
with the extant laws and regulations. Sequel to the exercise, five (5) banks
were sanctioned for contravening various AML/CFT laws and regulations.
The CBN continued its effort to enhance capacity and information sharing
among supervisors during the review period. The Bank hosted officials of the
Bank of Tanzania on a study tour on regulation and supervision of
development finance institutions. It also hosted officials of the Bank of
Uganda to discuss avenues for enhancing oversight of cross-border
operations of banking groups. Furthermore, the CBN hosted the inaugural
meeting of the College of Supervisors on the United Bank for Africa Group in
Abuja, Nigeria. The College of Supervisors for the West African Monetary Zone
(CSWAMZ) also held two (2) meetings in January and April in The Gambia
and Ghana, respectively, to review supervisory practices and health of the
financial institutions in the sub-region.
The CBN, in collaboration with Enhancing Financial Innovation and Access
(EFInA), a non-governmental organization; and the Islamic Finance Council,
UK, organized a 4-day capacity building programme for Nigerian sharia
scholars. The objective of the programme was to develop skills of Sharia
scholars on conventional banking and finance practices and of Islamic
finance. In addition, the CBN participated in several other meetings of the
International Islamic Liquidity Management Corporation (IILM) and the
Islamic Financial Services Board (IFSB). The meetings resolved to develop

guidance notes to the adoption of Basel III liquidity standards and the revised
core-principles for Islamic finance regulation, among others.
The implementation of the 2010 banking reform initiatives continued during
the review period. Access Bank Plc was issued with a commercial banking
licence with international authorization, while First Bank Plc obtained HoldCo
and commercial banking licences with international authorization. In
addition, Associated Discount House was granted approval-in-principle (AIP)
to convert to a merchant bank. Also, Union Bank of Switzerland AG (UBS AG)
was granted final approval to establish a representative office in Nigeria. In
the other financial institutions sub-sector, 18 and 28 microfinance banks were
granted AIP and final licences, respectively.
The Bank’s Credit Risk Management System (CRMS) continued to provide a
supportive platform for the management of credit risk in the banking industry.
At end-June 2014, the number of registered borrowers in the CRMS database
increased by 21.64 per cent to 115,980, compared with 95,347 at endDecember 2013. The number of borrowers with outstanding facilities rose by
37.59 per cent to 46,027 during the review period compared with 33,452 at
end-December 2013. Similarly, the total number of credits in the database
rose by 58.79 per cent to 72,541 at end-June 2014 compared with 45,682 at
end-December 2013. During the review period, forty-three (43) requests on
customers’ credit records in the CRMS were processed, compared with fiftythree (53) at end-December 2013. The developments were attributed to the
intensified effort on the part of the Bank to ensure compliance with CRMS
guidelines.
The number of private credit bureaux (PCBs) remained at three (3) at endJune 2014, and continued to complement the CRMS in the credit
administration process. The activities of the PCBs were buoyed by increased
patronage by both financial and non-financial institutions during the review
period.

Figure 21
Credit Risk Management System (CRMS) Statistics
(First Half 2014)

End-Dec 2013
End-June 2014
No of Registered Borrowers
No of Borrowers with Outstanding Facilities
No of Credits

The Bank commenced a parallel-run of the Basel II alongside Basel I minimum
capital adequacy computation during the first half of 2014. Consequently,
banks were required to render their returns on Basel II format on a monthly
basis. In addition, the submission of DMBs’ Internal Capital Adequacy
Assessment Process (ICAAP) documents to the Bank commenced in the
review period.
2.4.2 Routine/Target Examination
A joint CBN/NDIC risk assets assessment examination of all banks was
conducted to ascertain the quality of their risk assets and adequacy of loan
loss provisioning for the approval of their 2013 annual accounts. Having met
the required provisioning, the 2013 annual accounts of all the banks were
approved. Also in the review period, twenty-three (23) banks were visited in
order to monitor the implementation of recommendations made in the RBS
Examination Reports as at September 30, 2013. The review showed that over
eighty (80) per cent of the recommendations had been implemented by the
banks, while the rest were at various stages of implementation.
Furthermore, a risk asset assessment of two (2) discount houses was carried
out in the first half of 2014 to verify compliance with CBN guidelines. The
outcome of the exercise led to the sanctioning of one institution for
breaching the extant guidelines. A routine examination of the three (3)

private credit bureaux was also conducted during the period to ascertain
the level of compliance with the guidelines for the sub-sector. The major
observations bordered on issues related to board and management
structure, customer dispute resolution, data exchange agreements, and
internal audit. Supervisory letters were issued to two (2) institutions to
implement the recommendations.
2.4.3 Routine/Special Foreign Exchange Examinations
The Bank conducted the quarterly review of the foreign exchange activities
of twenty (20) banks to ascertain their compliance with extant foreign
exchange laws and regulations. The review covered foreign exchange
operations for the period, October 1, 2013 to March 31, 2014. The major
infractions by banks were: failure to issue certificates of capital importation to
beneficiaries within the stipulated 24 hours of receipt; incomplete
documentation for visible and invisible import trade transactions; rendition of
inaccurate returns; and non-compliance with approved net open position
limits. The CBN obtained responses from banks with respect to the infractions
and imposed appropriate penalties.
A special investigation on the foreign exchange sales by banks to bureauxde-change (BDCs) was carried out between January and May 2014. The
focus of the exercise was to determine the aggregate foreign exchange
purchase of BDCs and ascertain if they operated in accordance with
subsisting foreign exchange rules and guidelines. The investigation revealed
that the BDCs utilised a significant proportion of total foreign exchange
sourced by banks from the official and autonomous markets. The affected
institutions were sanctioned accordingly.
To enhance the skills of on-site Examiners, particularly in the area of the
application of IT Audit tools, a special in-house training on ACL, SQL and
advanced Excel (code named iSight Project) was carried out. Twenty- four
(24) bank examiners were trained. The benefits of the training exercise were
evident in recent foreign exchange examinations with the speedy, detailed
and incisive analysis of spooled banks’ operational backup data.

2.4.4 Banking Sector Soundness
At end-June 2014, the industry non-performing loans (NPL) ratio stood at 3.50
per cent, compared with 3.23 and 3.65 per cent at end-December 2013 and
end-June 2013, respectively. The reduction in the NPL ratio relative to the
corresponding period of 2013 was attributed to the improved risk
management practices of banks. The industry liquidity ratio stood at 42.66
per cent at end-June 2014, compared with 50.6 and 67.8 per cent at endDecember 2013 and end-June 2013, respectively. The decline was attributed
to increase in CRR on both public and private sector deposits in the review
period.
2.4.5 Compliance with the Code of Corporate Governance for Banks in
Nigeria
The Revised Code of Corporate Governance for Banks and Discount Houses
was issued by the CBN to align its provisions with current realities and global
best practice, eliminate ambiguities and strengthen governance practices in
the institutions. To ensure full implementation, banks and discount houses
were required to render quarterly returns to the CBN. Also, as part of
governance structure, non-interest banks (NIBs) were required to submit
applications for approval of products and advertisement materials to the
Financial Regulation Advisory Council of Experts (FRACE) on NIBs.
Consequently, sixteen (16) applications from Jaiz Bank, Sterling Bank and
Stanbic IBTC Bank non-interest banking windows as well as Tijara Micro
Finance Bank (proposed) were approved by the Council in the review
period.
2.4.6 Financial Literacy and Consumer Protection
During the review period, four hundred and twenty eight (428) new
complaints
were
received
on
excess
charges,
frauds,
dishonored
guarantees, unauthorized deductions, card related and other electronic
channels, compared with 759 complaints in the corresponding period of
2013. Overall, a total of 497 complaints, including those outstanding from the
previous periods were resolved, compared with 88 in the corresponding

period of 2013. Total claims against the banks during the period in local and
foreign currencies amounted to N7.38 billion and US$311,359.00, respectively,
compared with N5.73 billion and US $1.05 million at end-June 2013. Total
refunds by banks stood at N3.87 billion and US$176,358, compared with N1.45
billion and US$829.22 at end-June 2013.
To strengthen the consumer complaints management and resolution process
of the Bank, an automated consumer complaints management system was
deployed in ten (10) selected banks for the processing of complaints. Also, a
new circular reviewing the timeline from 14 to 30 days for the resolution of
complaints on excess charges on loans was issued during the review period.
The extension became necessary to address concerns by banks that the
initial resolution time was insufficient.
The Bank conducted a compliance examination and spot check on banks
to ensure compliance with the complaint management guidelines and
ascertain the effectiveness of banks’ complaints management systems
during the review period. The exercise revealed remarkable improvements in
the complaints management system of most of banks. The Bank directed
defaulting banks to make appropriate refunds to affected customers
effective from the date of the revised Guide to Bank Charges (GBC) and
ensure strict compliance henceforth.
The Bank conducted consumer financial literacy sensitization and awareness
programmes in Enugu and Ibadan in the review period. In addition, a
National Baseline Survey was conducted to determine the current levels of
financial literacy in the country. The outcome of the exercise was being
awaited and would serve as a basis for assessing the impact of the various
financial literacy initiatives on the economy.

2.4.7 Fraud and Forgery
The number of reported cases of fraud and forgeries was 5,197, involving
N16.82 billion in the first half of 2014. This was higher than the 2,478 cases,
involving N22.4 billion in the corresponding period of 2013. Of this amount,
the actual loss incurred by banks was N1.72 billion, compared with N3.82
billion in the corresponding period of 2013. The frauds were executed
through diverse means, including fraudulent withdrawals from customers’
account, suppression and conversion of customers’ deposit, theft, illegal
funds transfer, cheque defalcations, and fraudulent ATM withdrawals. In most
cases, these frauds were perpetrated by outsiders, although there were
instances where bank employees were also culpable.
There was a significant decrease in the amount involved and the actual
losses to the banking industry, when compared with the corresponding
period in the previous year. This is the result of increased supervisory oversight,
stronger internal control measures adopted by banks, and improved use of
technology and a more thorough approach towards hiring employees in
highly sensitive areas of banks’ operations.
2.4.8 Cross Border Activities
At end-June 2014, the number of foreign subsidiaries of Nigerian banks stood
at sixty-two (62), compared with sixty-five (65) at end-December 2013.
Similarly, the number of representative offices of Nigerian banks abroad
declined to seven (7) from eight (8) at end-December 2013. The
development was due to Keystone Bank’s divestment of its subsidiaries in
Liberia, Sierra Leone and The Gambia.
At the end of June 2014, the Bank had conducted one (1) on-site
examination of ICB Ghana, a foreign subsidiary of First Bank of Nigeria, and
the report was yet to be issued. The on-site examinations of foreign
subsidiaries of other banks were scheduled to take place in the second half
of the year.

2.4.9 Examination of Other Financial Institutions
During the first half of 2014, on-site examination was conducted on 367
microfinance banks (MFBs), representing 43.0 per cent of the 854 existing
MFBs. The examination report revealed improvement in the practice of
microfinance banking business by operators and higher levels of risk
management practices among the institutions.
Analysis of the reports on examination conducted in the fourth quarter of
2013 was made in the review period. The exercise revealed that the
institutions had varying operational/financial challenges. Consequently,
supervisory letters were issued to the institutions as follows:
Three (3) FCs were adjudged marginal and were required to take
necessary corrective actions to restore their prudential ratios to the
prescribed minimum;
Thirty (30) FCs were adjudged as unsound/insolvent and were directed
to recapitalize to meet within 90 days, the adjusted minimum capital of
N20 million stipulated in the Guidelines and take necessary actions to
meet other prudential requirements; and
Two (2) FCs undergoing restructuring were given 180 days to complete
the restructuring exercise, failing which their licences would be revoked.
Following the setting up of a task force for regular monitoring of foreign
exchange utilization by BDCs, spot-checks were conducted on 68 BDCs
during the review period by the task force. The exercise revealed that most
BDCs were operating in disregard for their operational rules and guidelines. It
also showed other severe regulatory concerns in the operation of BDCs,
including weak and ineffective operational structures with negative
consequences on the conduct of monetary policy. Consequently,
appropriate sanctions were meted to the erring institutions.

Routine examinations were also conducted on the three (3) private credit
bureaux and two (2) discount houses in operation to verify compliance with
extant CBN guidelines.
2.4.10 Anti-Money Laundering/Combating of Financing of Terriorism/Off-Site
Risk Based Supervision (RBS) Assessment Matrix
During the review period, the Bank, with technical assistance from the
International Monetary Fund (IMF), concluded the development of the Offsite Risk Assessment Methodology (ORAM). In order to finalise the framework,
a pilot-test would be conducted on three selected banks, based on their size
(small, medium and large), in the second half of the year. The ORAM when
fully deployed would validate and streamline how the input data (Form 001)
was generated as well as validate the authenticity of the AML/CFT mitigants
put in place by financial institutions.
Also, a letter was issued to all banks and discount houses in the review period
to re-emphasize provisions of an earlier circular on the status and reporting
lines of Chief Compliance Officers of banks and discount houses.
Consequently, all banks and discount houses were directed to ensure the
following:
Chief Compliance Officers (CCOs) in these institutions should have a
minimum grade of General Manager in their institutions;
The CCO should report to the Board of Directors with dotted reporting
lines to the MD/CEO, without interlocking roles; and
The compulsory attendance by the Chief Compliance Officer at the
monthly meetings of the Committee of Chief Compliance Officers of
Banks in Nigeria (CCCOBIN).
The primary intention of these directives was to ensure that the CCOs of
banks and discount houses have sufficient authority to apply the provisions of
the relevant Acts and Circulars on money laundering at all levels of their
institutions.

2.5
Foreign Exchange Market and Management
The Retail Dutch Auction System (rDAS) remained the mechanism for
managing foreign exchange by the Bank within a band of N155/US$ ± 3%.
During the review period, aggregate demand for foreign exchange grew
significantly by 27.4 and 115.3 per cent to US$28.01 billion, above the levels in
the preceding half year and the corresponding period of 2013, respectively.
The total sales of foreign exchange to the market edged-up by 63.0 and 27.2
per cent to US$25.2 billion above the respective levels in the first and second
halves of 2013. The exchange rate of the naira per US dollar at the official
window remained stable, while the Bureau-de-Change (BDC) and interbank
rates depreciated relative to the levels in the first and second halves of 2013.
2.5.1. Spot Segment
A total of fifty (50) auctions were held at the spot segment of the foreign
exchange market, as against forty-seven (47) in the corresponding period of
2013. Aggregate demand for foreign exchange increased to US$28.01 billion
in the period under review, from US$13.01 billion and US$21.99 billion in the
first and second halves of 2013, respectively. The development was due to
dividend repatriation by foreign firms, particularly in the first quarter of the
year. A disaggregation of total demand showed that rDAS-spot amounted
to US$23.91 billion (85.4%), and BDCs, US$3.52 billion (12.6%). On the supply
side, the total foreign exchange sold spot was US$25.17 billion, an increase of
63.0 and 27.2 per cent, over the respective levels in the first and second
halves of 2013. Of total sales, spot rDAS constituted US$17.23 billion (68.4%);
BDCs, US$3.52 billion (14.0%); interbank, US$3.35 billion (13.3%). The balance
was accounted for by matured rDAS forward. There was no swap transaction
in the review period.

Figure 22
Demand, Supply and Net Demand of Foreign Exchange Spot Market
(US$ Million)

Foreign Exchange Demand
Foreign Exchange Supply
Net Foreign Exchange Demand

2.5.2. Forwards Segment
A total of nine (9) auctions were held at the rDAS-forwards segment of the
foreign exchange market for 1-, 2- and 3-month forwards contracts.
Authorised dealers did not patronise the window in the last two months of the
first half of 2014 owing to stable and favourable rates at the spot segment.
The aggregate demand for rDAS-forwards in the review period amounted to
US$0.58 billion, compared with US$0.21billion in the second half of 2013. The
demand for 1-, 2- and 3-month tenors were US$0.30 billion, US$0.22 billion and
US$0.06 billion, representing 51.4, 38.1 and 10.5 per cent of the total,
respectively. The growth in demand at the rDAS-forwards window signified
increased hedging activities within the review period. The Bank sold a
cumulative of US$0.57 billion forwards contracts that comprised 1-month
tenor, US$0.30 billion (53.3%); 2-month tenor, US$0.22 billion (39.3%); and 3month tenor, US$0.04 billion (7.4%). In the first half of 2014, forwards contract
amounting to US$1.08 billion was disbursed at maturity. The performance in
the rDAS-forwards segment showed preference for the 1-month tenor due to
expectation of low exchange rate risk.
2.5.3. Exchange Rate Movements
The exchange rate of the naira vis-à-vis the US dollar was relatively stable at
the official window due to increased intervention by the Bank to stem

demand pressure. However, the rates depreciated at the other segments of
the market.
2.5.3.1. Spot Exchange Rates
The average exchange rate of the naira to the US dollar at the rDAS segment
averaged N157.29/US$ in the first half of 2014. This represented a marginal
appreciation of the naira per US dollar by 0.01 and 0.02 per cent relative to
the levels in the first and second halves of 2013, respectively. However, at the
interbank and BDC segments, the average exchange rate depreciated by
2.7 and 5.8 per cent to N162.55 and N169.49 per US dollar, respectively,
relative to the levels in the first half of 2013. Compared with the second half
of 2013, the naira fell by 1.4 and 2.5 per cent to the US dollar at the interbank
and BDC segments, respectively. Consequently, the premium between the
average rDAS and BDC rates widened from 5.0 per cent in the second half of
2013 to 7.8 per cent and exceeded the international benchmark of 5.0 per
cent. The premium between the average interbank and rDAS rates also
widened to 3.3 per cent from 0.6 and 1.9 per cent in the first half of 2013 and
the preceding half year, respectively.
Figure 23
Exchange Rate Movements
(N/US$)

Jan-13
Feb-13
Mar-13
Apr-13
May-13
June-13
July-13
Aug-13
Sep-13
Oct-13
Nov-13
Dec-13
Jan-14
Feb-14
Mar-14
Apr-14
May-14
Jun-14
N/US$
Interbank
BDC
rDAS/wDAS

Figure 24
rDAS/Bureau-de-Change Foreign Exchange (N/US$) Premium
(Per cent)

Jan-13
Feb-13
Mar-13
Apr-13
May-13
June-13
Jul-13
Aug-13
Sep-13
Oct-13
Nov-13
Dec-13
Jan-14
Feb-14
Mar-14
Apr-14
May-14
Jun-14
Per cent

The end-period exchange rate of the naira against the US dollar depreciated
by 0.02 and 1.9 per cent to N157.29/US$ and N162.95/US$ at the rDAS and
interbank segments, respectively. It, however, appreciated by 2.4 per cent at
the BDC segment to N168.00/US$, relative to the level at end-December
2013. In comparison with the corresponding period of 2013, the naira, at the
rDAS segment, appreciated by 0.01 per cent, but depreciated by 0.2 and 3.6
per cent at the interbank and BDC segments, respectively.
2.5.4. Foreign Exchange Flows
Foreign exchange inflow through the economy grew by 6.0 and 2.4 per cent
to US$75.64 billion over the respective levels in the first and second halves of
2013. Of this, inflow through autonomous sources accounted for 69.7 per
cent of the total, while the balance of 30.3 per cent was through the CBN.
Autonomous inflow rose by 2.2 and 0.4 per cent to US$52.75 billion above the
respective levels in the first and second halves of 2013. A disaggregation of
inflow showed that invisibles accounted for US$48.83 billion; non-oil export
receipts by banks, US$3.65 billion; and external accounts purchases, US$0.27
billion. Invisibles comprised over-the-counter (OTC) purchases (by banks from
oil companies, capital importations, home remittances and other purchases)
and ordinary domiciliary account purchases accounted for US$29.65 billion
and US$19.18 billion of the total, respectively.

Total foreign exchange outflow through the economy increased by 52.7 and
18.3 per cent to US$29.09 billion, over the levels at end-June and endDecember 2013, respectively.
Overall, the net foreign exchange inflow through the economy stood at
US$46.55 billion, compared with US$52.32 billion and US$49.27 billion in the
corresponding period and second half of 2013, respectively.
Foreign exchange inflow through the CBN grew by 15.9 and 7.3 per cent to
US$22.89 billion above the levels in the corresponding and preceding half
year, respectively. This was attributed to enhanced earnings from crude oil
exports occasioned by favourable international crude oil prices. Of the total,
receipts from crude oil sales rose by 10.8 and 16.8 per cent to US$21.03 billion
above the levels in the first and second halves of 2013, respectively. The nonoil component increased by 139.9 per cent to US$1.86 billion, compared with
US$0.78 billion and US$3.31 billion at end-June and end-December 2013,
respectively.
The cumulative foreign exchange outflow through the Bank rose by 51.2 and
21.5 per cent to US$28.50 billion above the levels in the corresponding and
the preceding half year, respectively. The development was attributed,
largely, to the growth in rDAS utilisation by 63.0 and 27.2 per cent to US$25.17
billion relative to the respective levels in the first and second halves of 2013.
A disaggregation of rDAS utilisation showed that sales to rDAS-spot stood at
US$17.23 billion (60.5%); interbank, US$3.34 billion (11.7%); BDCs, US$3.52 billion
(12.3%); and rDAS-forwards, US$1.08 billion (3.8%).
Outflow through other official payments fell by 12.4 per cent to US$2.56 billion
below the level in the first half of 2013. Of this, payments to international
organisations and embassies, US$0.18 billion; parastatals and estacode,
US$0.60 billion; NNPC/joint venture cash (JVC) calls, US$1.56 billion;
contributions/grants, US$0.14 billion and miscellaneous items, US$0.08 billion.
Furthermore, outflow through drawings on letters of credit (L/Cs) and national

priority projects in the review period tapered by 4.6 and 27.6 per cent to
US$0.19 billion and US$0.04 billion, respectively.

Figure 25
Foreign Exchange Disbursements through the CBN
(First Half 2014)
Eurobond Proceed
Transfers
1.2%
Drawings on L/Cs
0.7%
External Debt
Services
0.6%
Interbank
11.7%
Other Official
Payments
9.0%
National Priority
Projects
0.2%
BDCs
12.3%
rDAS-Spot
60.5%
rDAS-Forwards
3.8%

External debt service rose by 25.0 and 18.7 per cent to US$0.18 billion above
the respective levels in the preceding and corresponding periods of 2013.
The Bank also transferred Eurobond proceeds of US$0.35 billion to the Debt
Management Office (DMO) during the review period.
The total foreign exchange transactions through the Bank resulted in a net
outflow of US$5.61 billion in the review period, compared with a net inflow of
US$0.89 billion in the first half of 2013 and a net outflow of US$2.14 billion in the
preceding half year.
Figure 26
Foreign Exchange Transactions through the CBN


1st Half 2013
2nd Half 2013
1st Half 2014
US$ billion
Inflow
Outflow
Netflow

2.5.5. Sectoral Utilisation of Foreign Exchange
Aggregate foreign exchange utilisation in the first half of 2014 increased by
16.3 and 22.1 per cent to US$32.91 billion, over the levels at end-June and
end-December 2013, respectively. A disaggregation showed that import
(visible) rose by 14.5 and 15.0 per cent to US$16.63 billion, compared with the
respective levels in the preceding period and corresponding period of 2013.
Under this category, foreign exchange utilisation for oil sector imports,
manufactured
products
and
agricultural
sector,
which
respectively
accounted for 15.7, 8.5 and 0.7 per cent of the total, rose by 16.6, 29.6 and
53.6 per cent to US$5.16 billion, US$2.78 billion and US$0.24 billion above the
respective levels in the corresponding period of 2013. The amount of foreign
exchange utilised for the importation in the industrial, transport and minerals
sub-sectors also increased by 15.4, 24.6 and 9.5 per cent to US$4.66 billion,
US$0.94 billion and US$0.18 billion, respectively. However, foreign exchange
utilisation for food products fell by 3.9 per cent to US$2.66 billion from the level
in the first half of 2013, and accounted for 8.1 per cent of total utilisation.
Total utilisation of foreign exchange for invisible (services) increased by 30.4
and 18.1 per cent to US$16.27 billion, compared with the levels in the
corresponding period and second half of 2013, respectively. This was driven,
largely, by the financial services sub-sector, which grew by 15.2 and 22.2 per
cent to US$13.21 billion, over the levels at end-December 2013 and end-June
2013, respectively, and accounted for 40.2 per cent of the total. The sector
was driven largely by banking and other financial services, which was 98.6
per cent of the total. The major components of the latter were asset
management, (US$7.67 billion); payments and money transmission services,
(US$3.17 billion); and lending, (US$1.04 billion). Deposits, guarantees and
commitments, trading on own account, settlement and clearing services for
financial assets, advisory and financial information accounted for the
balance. As a component of financial services, insurance services (life; nonlife; reinsurance and retrocession; and auxiliary services) fell by 41.9 and 37.9
per cent to US$8.66 million.

Payment for business services increased by 161.5 and 110.7 per cent to
US$1.54 billion, over the levels in the corresponding period and preceding
periods in 2013, respectively.
Further analysis of invisibles showed that payments for education, transport,
communication, distribution, construction and engineering, and other
services grew by 34.7, 32.1, 42.4, 173.5, 281.8 and 44.9 per cent to US$0.14
billion, US$0.72 billion, US$0.37 billion, US$0.05 billion, US$0.05 billion and
US$0.17 billion, respectively. These accounted for 0.4, 2.2, 1.1, 0.2, 0.1 and 0.5
per cent of total utilisation, respectively. Foreign exchange payment for
health related and social services, however, fell by 76.1 and 13.7 per cent
below the levels in the corresponding period of 2013 and end-December
2013 to US$0.33 million.

Figure 27
Sectoral Utilisation of Foreign Exchange (Visibles)
(First Half 2014)
Industrial Sector
28.0%
Food Products Sector
16.0%
Manufactured
Products Sector
16.7%
Transport Sector
5.6%
Agricultural Sector
1.5%
Minerals Sector
1.1%
Oil Sector
31.1%

Figure 28
Sectoral Utilisation of Foreign Exchange (Invisibles)
(First Half 2014)
Business Services
9.5%
Communication
Services
2.3%
Educational Services
0.9%
Other Services
1.0%
Financial Services
81.2%
Transport Services
4.4%
Construction and
Related Engineering
Services
0.3%
Distribution Services
0.3%
Tourism and Travel
Related Services
0.1%

2.5.6. Foreign Exchange Receipts by Top Hundred (100) Exporters
Analysis of export receipts by the top 100 exporters in the country during the
first half of 2014 showed that Olam Nigeria Limited retained the first ranking as
the top exporter with proceeds valued at US$178.44 million from the export of
sesame seeds and cocoa beans to Europe, Asia and the United States.
Mamuda Industries Nigeria Limited ranked second with exports valued at
US$89.53 million through the sale of leather to Italy and Hong Kong. Unique
Leather Finishing Limited and Bolawole Enterprises Nigeria Limited were the
third and fourth largest exporters, respectively, with the proceeds amounted
to US$73.24 million and US$55.76 million realised from leather exports to
Europe and cotton and cocoa beans exports to Canada, respectively. Sun
and Sand Industries Africa Limited and British American Tobacco Nigeria
Limited ranked fifth and sixth largest with earnings of US$47.48 million and
US$46.60 million from exports of tin and aluminum alloy to Japan and
tobacco products to Ivory Coast, respectively.
2.5.7 Nominal Effective Exchange Rate (NEER) and Real Effective Exchange
Rate (REER) Indices
The Nominal Effective Exchange Rate (NEER) and the Real Effective
Exchange Rate (REER) indices were computed based on a 13-country

currency basket of Nigeria’s major trading partners. In the review period, the
NEER index fell by 0.07 percentage point, compared with the level at endDecember 2013, while it rose by 0.44 percentage point over the level at endJune 2013. The movement in the index reflected the stability of the exchange
rate and the marginal appreciation recorded at the official window during
the review period.
The REER index fell by 12.22 and 13.93 per cent, compared with the level at
end-December and end-June 2013. This reflected the fall in inflation in the
reporting period relative to the level in the corresponding period of 2013.
Figure 29
Nominal Effective Exchange Rate (NEER) and Real Effective Exchange Rate
(REER)

Jan-13
Feb-13
Mar-13
Apr-13
May-13
Jun-13
Jul-13
Aug-13
Sep-13
Oct-13
Nov-13
Dec-13
Jan-14
Feb-14
Mar-14
Apr-14
May-14
Jun-14
Nominal Effective Exchange Rate
Real Effective Exchange Rate

Table 3
Nominal and the Real Effective Exchange Rate indices
(November 2009=100)

Nominal Effective
Exchange Rate
Real Effective
Exchange Rate
Jan
99.05
77.84
Feb
98.12
77.08
Mar
97.16
76.10
Apr
97.88
76.34
May
96.56
75.02
Jun
95.78
74.15
Jul
95.83
74.00
Aug
94.50
72.96
Sep
96.08
73.71
Oct
96.85
73.79
Nov
96.14
72.74
Dec
96.34
72.34

Jan
94.96
60.43
Feb
95.87
60.96
Mar
96.24
61.05
Apr
96.42
61.05
May
96.29
60.07
Jun
96.27
60.22

2.6
Development Finance Operations
2.6.1 Agricultural Credit Guarantee Scheme Fund (ACGSF)
During the first half of 2014, the volume and value of guaranteed loans under
the ACGSF increased by 56.6 and 65.2 per cent to 35,413 and N5.93 billion,
respectively, over the levels in the corresponding period of 2013. Of the total
volume of loans guaranteed by purpose, food crops accounted for 24, 223
(68.0%); livestock, 3,660 (10.0%); fisheries, 1,397 (4.0%); cash crops, 1,925
(5.0%); mixed farming, 3,593 (10.0%); and others, 915 (3.0%).
Also, of the total value of loans guaranteed by category, individuals
accounted for N5.65 billion, (95.3%); informal groups, N0.12 billion (2.0%);
cooperatives, N0.056 billion (1.0%); and companies, N0.10 billion (1.7%).
From inception of the Scheme in 1978 to end-June 2014, the cumulative
number of loans guaranteed was 894,954, valued at N77.40 billion. A total of

454 claims valued at N92.75 million was settled during the review period,
bringing the total claims settled from inception to 14,691 valued at N546.93
million.
Figure 30
Sectoral Distribution of ACGSF Loans (By Purpose)
(First Half 2014)
Food Crop
68.0%
Mixed Farming
10.0%
Livestock
10.0%
Fisheries
4.0%
Cash Crops
5.0%
Others
3.0%

2.6.2 Interest Drawback Programme (IDP)
The number and value of IDP claims settled in the first half of 2014 fell by 37.4
and 14.8 per cent, to 13,097 and N171.20 million from the levels of 20,907 and
N201.1 million, respectively, in the corresponding period of 2013. This brought
the cumulative number and value of IDP claims settled from inception to
246,426 and N1.94 billion, respectively.
2.6.3 The Trust Fund Model (TFM)
During the first half of 2014, no new Memorandum of Understanding (MoU)
was signed. Thus, from inception in 2002 to date, the number of MoUs stood
at 58, consisting of state governments, multinational agencies, local
government councils (LGCs), non-governmental organisations (NGOs) and
individuals with pledged sum of N5.56 billion.
2.6.4 Entrepreneurship Development Centres (EDCs)
Three (3) new EDCs in Maiduguri (for North East), Makurdi (for North Central)
and Calabar (for South South), respectively, trained 937; 1,120; and 1,044
entrepreneurs, totalling 3,101, above the target of 3,000 for the first half of
2014. Of the trained entrepreneurs, 1,872 (60.4%) were males, while 1,229

(39.6%) were females. In addition, 904 accessed credit from banks for startups/ expansion of businesses, while 2,703 new jobs were created.
2.6.5 N200 Billion Commercial Agriculture Credit Scheme (CACS)
In the review period, the sum of N8.18 billion was released to eight (8) banks
for on-lending to eleven (11) privately-sponsored projects, one (1) state
government and four (4) enhancements for private projects. Analysis of the
number of projects financed showed that processing accounted for 36.4 per
cent, while production and marketing accounted for 54.5 and 9.1 per cent,
respectively.
Table 4
Analysis of CACS Financed Privately-Sponsored Projects by Value Chain
(First Half 2014)
Category

Number of
Projects
Per cent
Value
{N’ billion }
Per cent
Production

54.5
1.055
38.0
Processing

36.4
1.197
43.0
Marketing

9.1
0.550
19.0
Total

100.0
2.802
100.0

Analysis by value indicated that processing accounted for N1.20 billion
(43.0%); production, N1.06 billion, (38.0%); and marketing, N0.56 billion
(19.0%).
At end-June 2014, N234.29 billion was disbursed to 307 projects, compared
with N119.37 billion disbursed to 273 projects in the corresponding period in
2013. The sum of N40.34 billion was repaid by banks in respect of seventy-six
(76) projects in the review period.

Figure 31
Analysis of CACS Financed Privately-Sponsored Projects by Value Chain
(First Half 2014)

Production
54.5%
Processing
36.4%
Marketing
9.1%

2.6.6 N200 Billion Restructuring and Refinancing Facility (RRF)
In the first half of 2014, N17.8 billion was released to the Bank of Industry (BOI)
for disbursement, as against the corresponding period of 2013 when no fund
was released. Thus, the cumulative amount disbursed from inception to date
amounted to N305.2 billion for 600 projects, while cumulative repayments
under the SME RRF stood at N80.9 billion in the first half of 2014.
2.6.7 N200 Billion SME Credit Guarantee Scheme (SMECGS)
Under the Scheme, four (4) applications valued at N155.23 million were
guaranteed during the first half of 2014, compared with eight (8) applications
valued at N279.2 million in the corresponding period of 2013. The total
number of projects guaranteed from inception to date was 76 valued at
N3.37 billion, while N1.80 billion for 29 projects had been fully repaid.
2.6.8 N300 Billion Power and Airline Intervention Fund (PAIF) Initiative
In the first half of 2014, N0.51 billion was released to the BOI for one (1) airline
project, compared with five (5) projects valued at N39.6 billion in the
corresponding period of 2013. The number and value of projects funded from
inception stood at 51 and N233.16 billion, comprising 15 airline and 36 power
projects, valued at N117.43 billion and N115.73 billion, respectively. The 36
power projects had a potential generating capacity of 847.4MW, out of
which 440.1 had been added to the National Grid. Also, the Fund’s 7%

concessionary interest rate with the 10 – 15 years long tenor had created a
stabilising effect on the capital structure of the refinanced airline projects,
thereby, making them more viable. It has saved the projects about 12% of
the cost of capital if they borrowed at the average market rate (19%). Since
inception, in 2010, a total of N32.36 billion had been repaid by the
beneficiaries.
2.6.9 Nigeria Incentive-Based Risk Sharing System for Agricultural Lending

(NIRSAL)
During the period under review, the Nigeria Incentive-Based Risk Sharing
System for Agricultural Lending (NIRSAL) programme continued to improve
on its activities as it issued four (4) credit risk guarantees (CRGs) valued at
N2.06 billion to various counterparties. The programme also obtained CRGs
for twenty- four (24) new growth enhancement support scheme (GES) valued
at N5.66 billion through eight (8) banks under the 2014 NIRSAL GES
Framework.
Figure 32
NIRSAL Credit Risk Guarantees (CRG) Issued
January – June 2014
Crop Production
1.8%
Agro Processing
98.2%

In addition, the sum of N163.83 million was paid to 116 projects as IDB claims
under the GES/NIRSAL Interest Draw Back (IDB), through fifteen (15) banks,
thus, bringing the cumulative IDB payments to N198.90 million.

2.6.10 Financial Inclusion
The Bank’s effort at achieving the objective of raising financial inclusion to
80.0 per cent by 2020 was sustained during the review period. It held
workshops on the National Financial Inclusion Strategy for banks from January
22 – 24, 2014 and for microfinance banks located in Lagos from March 12 -
13, 2014. Following the workshops, it was resolved that the banks should
prepare three years (2014 to 2016) financial inclusion plans for their
organizations, focusing on products, channels and details of the marketing
strategies for realizing them. The microfinance banks were directed to
maintain a close working relationship for information sharing on regulatory
changes that support financial inclusion.
Pursuant to securing the buy-in of external stakeholders in implementing the
Strategy, the Bank held meetings with various relevant financial services
regulators in the review period. The meetings assessed the level of progress
towards promoting financial inclusion by the agencies and how they could
encourage the institutions they regulate to perform their roles better. The
meetings also resolved that there was need for joint effort amongst the
regulators to undertake nationwide sensitization campaigns on financial
inclusion matters while effort should be made to set up financial inclusion
units in the various agencies.
In a related development, the Bank held a meeting with the Bill and Melinda
Gates Foundation to deliberate on efforts at arranging for the 2014 edition of
the Geospatial Mapping of financial access points across the nation on June
6, 2014. In addition, the Bank attended the Financial Inclusion Strategy Peer
Learning workshop in Nadi, Fiji from March 26 - 28, 2014. The programme
shared perspectives on the: methodology involved in developing and
implementing financial inclusion strategies; need to liaise with state
governments across a country to explore the adoption of appropriate social
safety programmes; and need to ensure continuous dialogue with private
sector to enable a hitch-free implementation of a proposed strategy.

ECONOMIC REPORT
3.0
Global Economic Developments
3.1
Global Output
Global output growth was modest in the first half of 2014. According to the
International Monetary Fund (IMF) World Economic Outlook (WEO, July 2014),
global growth was projected at 3.4 per cent, up from 3.2 per cent in 2013.
The key growth drivers were moderating fiscal consolidation and highly
accommodative monetary policy in most advanced economies. Growth in
the review period, however, faced several downside risks including: the
larger-than -expected inventory accumulation in the US at end-2013; a harsh
winter that further dampened exports; weaker domestic demand in China,;
growing geopolitical tensions in Eastern Europe; and slower growth in other
emerging market economies.
In the advanced economies, output growth strengthened to 1.8 from 1.3 per
cent in 2013, despite the deceleration witnessed in the US in the first half of
2014. Growth in the euro area strengthened to 1.1 per cent, but with uneven
growth prospects across the region, reflecting continuing financial
fragmentation, weakened private and public sectors’ balance sheets, and
high unemployment rates in some countries. Japan recorded a stronger than
expected performance in the first half of 2014, which may decelerate
subsequently, owing to the planned unwinding of fiscal stimulus.
In emerging market and developing economies, growth was projected to
decelerate to 4.6 per cent in 2014 from 4.7 per cent in 2013, due mainly to;
weak external and domestic demand, tighter financial conditions, and
dampness in business and consumer confidence.
Developing economies continued to show signs of vulnerabilities largely on
account of: weak export performance; softer external demand from sluggish
growth in the advanced economies; and moderating foreign direct
investment, leading to a decline in foreign exchange inflows and the risk of a
build-up of external and public debts.

Growth in sub-Saharan Africa remained strong, supported by commodityrelated factors and substantial depreciation of some currencies in the region.
Leading economies in the region, including Nigeria, posted reasonable
growth rates, despite struggling with domestic challenges of insurgency,
electricity and labour conflicts.
In the Middle East and North Africa (MENA), growth was projected to rise
moderately to about 3.1 per cent from 2.5 per cent in 2013, driven largely by
the oil-exporting economies, where high public spending contributed to
increased non-oil activity. Many of the region’s oil-importing countries
continued to grapple with difficult sociopolitical and security concerns,
which undoubtedly, weighed on confidence and economic activity.
3.2
Global Commodity Prices
Developments in the global commodity markets were mixed. Some
commodity prices broadly remained flat, while others softened. The
development was attributed mainly to the slowdown in emerging markets,
especially, China, the increased crude oil supplies from the U.S., the build-up
of base metals, the rising grain supplies, and the uncertainties in global
economic outlook. With increase in supplies outpacing tepid demand in
most commodity markets, the IMF commodity price indices declined. Some
commodity prices, however, firmed-up following signs of strengthening
global activity, though with increased price volatility. Gold gained 10.0 per
cent in the first half of the year, as the escalating violence in Iraq and tension
between Ukraine and Russia boosted demand for hedging assets.
3.3
Global Inflation
Global inflation generally remained subdued in the review period following
continued negative output gaps in the advanced economies, weaker
domestic demand in most emerging markets, and falling commodity prices.
Global inflation was projected at 2.7 per cent in 2014, representing an
increase of about 40 basis points relative to the estimate for 2013. In the
advanced economies, inflation was below target and with long-term
inflation expectation at about 1.5 per cent, the projected return to target

would be gradual. In emerging market and developing economies, inflation
declined to 5.2 per cent from 6.0 per cent on the backdrop of weak
commodity prices and sustained tight monetary policy.
Headline inflation in the OECD area picked up slightly in the first quarter of
2014 following a decrease in the last quarter of 2013. The upward trend
continued to the beginning of the second quarter, with OECD headline
consumer price inflation at 2.1 per cent in May and June, 2014, up from 2.0
per cent year–on-year in April 2014.
Developments in Eurozone inflation were mixed. There were concerns that
the Eurozone could fall into deflation, raising fears that consumers might
spend even less as they would expect prices to fall in future months. Figures
from Eurostat indicated that in June 2014, the highest annual inflation rates
were in the United Kingdom (1.9%), Austria (1.7%) and Luxembourg (1.2%).
However, negative annual rates were observed in Bulgaria (-1.8%), Greece (-
1.5%), Portugal (-0.2%), Hungary and Slovakia (both -0.1%). Thus, in June 2014,
annual inflation rates fell in ten member states, remained stable in four, and
rose in fourteen.
3.4
International Financial Markets
Developments in the international financial markets during the first half of
2014 were affected by uncertainties surrounding geopolitical tensions and
the tapering of the quantitative easing measures of the US Fed. In the
advanced economies, especially the US, monetary conditions continued to
remain largely supportive, than in the euro area and Japan. Policy rates
remained around the zero lower bound, and were expected to rise from
2015, particularly in the US, where some signs of recovery were beginning to
emerge. Credit to the private sector in the euro area continued to decline,
indicating weak demand. Despite the tapering of the Fed’s QE since May
2013, long term interest rates were still lower than what would have prevailed
if the term premium were to reverse to pre-crisis levels. Consequently,
financial conditions remained broadly accommodating, leading to rallies in
equities market and low bond risk spreads. Markets continued to expect

prolonged period of low interest rates and supportive monetary policy in the
euro area and Japan.
In emerging markets, financial and monetary conditions tightened in
response to more difficult external financial environment since the tapering
of the Fed’s QE. With the re-pricing of emerging market assets and risks,
bond rates and spreads increased. Accordingly, gross capital inflow
declined, as exchange rates depreciated. Generally, the cost of capital in
emerging markets increased, thereby dampening investment and growth.
Monetary authorities around the world largely sustained their policy rates in
the review period, with a few exceptions. Ghana and Brazil raised their
policy rates from 16.0 and 10.5 per cent to 18.0 and 11.0 per cent,
respectively, to tame mounting inflationary concerns. Russia lowered her
policy rate by 100 basis points to 7.5 per cent to address growth concerns,
stemming from weak domestic demand and economic sanctions. The ECB
lowered
her
key
policy
rate
to
provide
additional
monetary
accommodation to support lending to the real economy.
The performance of international stock markets was positive during the
review period, with the indices for the developed and some emerging
markets rising. In the U.S., increase in stock prices was due largely to
improved corporate deals and faster-than-expected rise in industrial output.
Also, growth in the Asian and European stock markets was as a result of
surge in Purchasing Managers’ Indices, although at a slower pace in the
euro area.
In Africa, the Nigerian, South African and Egyptian stock market indices rose
by 2.8, 10.1 and 20.3 per cent, respectively, while the Kenyan index declined
by 0.9 per cent. In Nigeria, the rise in share prices was attributed to improved
performance of quoted blue chip.
The exchange rate of the naira relative to other major international
currencies indicated that the naira depreciated against the pound sterling,
Japanese yen and Swiss Franc by 3.0, 3.4 and 0.6 per cent, respectively, at

end-June 2014. It, however, appreciated against the Euro by 0.85 per cent.
At the regional level, the naira depreciated by 0.3 and 0.1 per cent against
the WAUA and CFA franc, respectively, in the same period.


Figure 33
Performance of the Naira against Major Currencies

USD
GBP
EUR
JPY


Figure 34
Performance of the Naira against Regional Currencies

N/CFA
N/WAUA
WAUA
CFA

Table 5
Indices of Selected International Stock Markets
(Dec 31, 2013 – Jun 30, 2014)

At the international foreign exchange market, most currencies depreciated
against the US dollar during the period under review. Among African
currencies, the Nigerian naira remained stable while the South African,
Egyptian, Kenyan, and Ghanaian currencies depreciated.
Country
Index
31-Dec-13
31-Mar-14
30-Jun-14
YTD
% Change
Mar 31, 2014 -
Jun 30, 2014 %
Change
AFRICA
Nigeria
ASI

South Africa
JSE African AS

Kenya
Nairobi NSE 20

Egypt
EGX CSE 30

Ghana
GSE All Share

NORTH AMERICA
US
S&P 500

Canada
S&P/TSX Composite

Mexico
Mexico Bolsa (IPC)

SOUTH AMERICA
Brazil
Bovespa Stock

Argentina
Merval

Colombia
IGBC General
13,071.27
13,827.01
NA
NA
NA
EUROPE
UK
FTSE 100

France
CAC 40

Germany
DAX

Russia
MICEX

ASIA
Japan
NIKKEI 225

China
Shanghai SE A

India
BSE Sensex

Source: Bloomberg

Table 6
Exchange Rates of Selected Countries
(Value in Currency Units to US$)


Currency
31-Dec-13
30-Apr-14
30-Jun-14
Apr -June %
App/Dep
YTD %
App/Dep
AFRICA
Nigeria
Naira

South Africa
Rand

Kenya
Shilling

Egypt
Pound

Ghana
Cedi

NORTH
AMERICA
Canada
Dollar

Mexico
Peso

SOUTH
AMERICA
Brazil
Real

Argentina
Peso

Colombia
Peso

EUROPE
UK
Pound

Euro Area
Euro

Russia
Ruble

ASIA
Japan
Yen

China
Yuan

India
Rupee

Source: bloomberg
MTM= Month to Month
YTD = Year to Date

3.5
World Economic Outlook for the Rest of 2014
The strengthening of global growth towards the end of the first half of 2014
would be sustained for the rest of the year, as leading indicators were
positive in key advanced economies and China. The IMF projects a rise in
global growth to 3.4 per cent for the rest of the year. The US was expected to
grow by 1.7 per cent at year end. The euro area would emerge from
recession to grow by 1.1 per cent. Japan would expand by 1.6 per cent; as
China and the emerging markets (including China) were projected to grow
by 7.4 and 4.6 per cent at year end, respectively.
The outlook for global inflation would remain reasonably contained,
particularly in advanced economies, against the backdrop of moderate
commodity prices and weak demand. In most advanced economies,
headline inflation was below their central bank’s targets, inflation
expectation, as reported in survey data and financial market indicators over
the medium term, has remained well anchored.
With the European Central Bank lowering its policy rate in June, capital flows
to emerging markets was likely to recover, raising the prospects of currency
appreciation pressures in these economies. With these developments, stock
markets were likely to sustain their positive performance globally.
4.0 DEVELOPMENTS IN THE DOMESTIC ECONOMY
4.1 Monetary and Credit Developments
The CBN maintained a restrictive monetary policy stance in the first half of
2014, keeping the monetary policy rate at 12.0 per cent throughout the
period. Consequently, the growth of major monetary aggregates fell
significantly below their indicative benchmarks. Reserve money, broad and
narrow money supply declined relative to their indicative benchmarks for the
period and their respective levels at the end of the corresponding period of
2013. Both currency-in-circulation and currency outside bank declined at the
end of the review period. Aggregate credit to the domestic economy grew
marginally as a result of the moderate growth in claims on the private sector
and the decline in net claims on the Federal Government. Similarly, growth in

consumer credit slowed in tandem with credit to the private sector.
4.1.1 Reserve Money
Reserve money, at N4,723.1 billion, fell by 15.0 per cent at end-June 2014
below its level at end-December 2013, compared with the decline of 12.6
per cent at the end of the corresponding period of 2013. The development
relative to the level at end-December 2013 reflected the respective decline
of 10.1 and 33.1 per cent in net foreign and net domestic assets of the CBN.
The corresponding decline in the uses of reserve money was attributed to the
fall in both bank reserves and currency-in-circulation by 14.7 and 15.7 per
cent, respectively.
Table 7
Sources and Uses of Reserve Money
Jun 11
Dec '11
Jun 12
Dec 12
Jun-13
Dec 13
Jun-14
Foreing assets (net)
4,922,626.64

5,823,794.26

6,025,336.84

7,393,557.68

7,561,183.53

6,898,546.52

6,200,004.89

Foreign Assets
5,004,384.4

5,829,819.7

6,025,436.9

7,395,331.5

7,614,112.5

7,034,368.8

6,580,954.2

Long-term Foreign Liabilities
0.0

-

-

311.5

311.5

311.5

311.5

Short-term foreign Liabilities
81,757.7

6,025.5

100.0

1,462.2

52,617.4

135,510.7

380,637.8

Net credit to Government
(2,733,579.8)

(3,514,447.1)

(3,723,009.9)

(3,574,376.4)

(3,519,920.5)

(2,101,616.1)

(2,730,498.8)

Claims on Government
798,851.0

680,601.7

738,017.8

733,354.5

451,404.9

746,938.3

640,782.7

Fed. Government Deposits
3,532,430.8

4,195,048.7

4,461,027.8

4,307,730.9

3,971,325.4

2,848,554.4

3,371,281.5

Net credit to Private Sector
229,755.4

3,963,550.1

4,045,673.7

3,661,512.3

4,223,762.4

4,520,790.0

4,395,507.2

Claims on private sector
726,392.5

4,569,146.0

4,652,650.4

4,708,311.8

4,703,313.2

4,917,493.1

4,684,233.8

Private sector deposits
496,637.1

605,595.9

606,976.7

1,046,799.6

479,550.8

396,703.1

288,726.6

Net claims on DMBS
564,905.6

(744,210.9)

(1,014,301.3)

(1,583,300.3)

(3,380,269.2)

(2,437,707.6)

(2,488,066.9)

Claims on DMBS
748,162.9

793,049.0

1,110,570.2

1,052,556.0

915,469.7

1,259,320.3

772,362.4

CBN Securities
183,257.3

1,537,259.9

2,124,871.5

2,635,856.3

4,295,738.9

3,697,027.9

3,260,429.4

Other Assets Net
(918,651.5)

(2,744,621.0)

(2,821,724.0)

(2,192,909.7)

(1,648,603.4)

(1,321,090.2)

(653,874.6)

Other Assets
3,469,322.3

4,878,098.4

6,031,460.4

6,790,896.4

7,182,339.6

1,914,118.5

1,506,392.0

Other liabilities
4,387,973.8

7,622,719.3

8,853,184.4

8,983,806.1

8,830,943.0

3,235,208.7

2,160,266.6

RESERVE MONEY
2,065,056.3

2,784,065.4

2,511,975.3

3,704,483.6

3,236,152.9

5,558,922.6

4,723,071.7

Currency in Circulation
1,353,982.6

1,566,046.4

1,363,730.7

1,631,717.2

1,425,507.8

1,776,813.2

1,497,142.1

Banks' Deposit with CBN
711,073.7

1,218,019.0

1,148,244.6

2,072,766.4

1,810,645.1

3,782,109.5

3,225,929.6

Figure 35 (a)
Reserve Money and its Components: Sources
(N’ Billion)

Dec-10
Jun-11
Dec-11
Jun-12
Dec-12
Jun-13
Dec-13
Jun - 14
N'billion
NFA
NDA
OAN
RM


Figure 35 (b)
Reserve Money and its Components: Uses
(N’ Billion)

4.1.2 Broad Money (M2)
Growth of money supply was modest in the first half of 2014. Broad money
supply (M2) grew by 1.7 per cent relative to the level at end-December 2013,
compared with 0.7 per cent at the end of the corresponding period of 2013.
At this level, M2 growth was lower than the provisional indicative target of
14.5 per cent for fiscal 2014. The modest growth in money supply reflected
the decline in net foreign assets and other assets (net) of the banking system,
which effects suppressed the impact of the 0.9 per cent growth in net
domestic credit.

4.1.3 Narrow Money (M1)
Narrow money (M1) fell by 6.1 per cent to N6,587.3 billion at end-June 2014,
compared with the decline of 6.5 per cent at the end of the corresponding
half of 2013. The development was due to the respective decline of 19.7 and
2.5 per cent in its currency and demand deposit components. The decline in
currency outside bank reflected the growing confidence in e-payments in
the economy following the success of the cash-less policy of the Bank.
4.1.4 Quasi Money (QM)
Quasi-money grew by 7.9 per cent to N9, 341.1 billion at the end of the
review period, compared with 7.3 per cent recorded at the end of the
corresponding half of 2013. The growth in quasi money was attributed to the
rise in savings and time deposits, particularly the 19.8 per cent growth in
foreign currency deposits with banks.
4.1.5 Currency-in–Circulation (CIC) and Deposits at the CBN
Currency-in-circulation fell by 15.7 per cent to N1,497.1 billion and constituted
31.7 per cent of the uses of reserve money at the end of the first half of 2014,
compared with the decline of 12.6 per cent at the end of the corresponding
period of 2013. Similarly, banks’ deposit with the CBN fell by 14.7 per cent,
compared with 12.6 per cent at the end of the corresponding period of 2013.
4.1.6 Currency Outside Bank (COB)
Currency outside bank fell by 19.7 per cent in the first half of 2014, compared
with the decline of 13.3 per cent at the end of the corresponding half of
2013. At that level, COB constituted 7.3 per cent of M2 and 17.6 per cent of
M1, which were 0.1 and 1.4 percentage points above their respective levels
in the corresponding period of 2013. The development reflected increased
confidence in the use of e-payments in the economy.

Figure 36
Ratio of Currency Outside Bank to Money Supply

9-Dec
10-Jun
10-Dec
11-Jun
11-Dec
12-Jun
12-Dec
13-Jun
Dec 13
14-Jun
Ratio
COB/M2
COB/M1
Figure 37
Growth in Money Supply
(Per cent)
(10)
(5)
-

Jun-10
Dec 10
Jun 11
Dec 11
Jun 12
Dec 12
Jun 13
Dec 13
Jun 14
M2
M1
Per cent

4.1.7. Drivers of Growth in Money Supply
4.1.7.1. Net Foreign Assets (NFA)
Foreign assets (net) of the banking system declined at the end of the review
period. Relative to the level at end-December 2013, NFA fell by 9.6 per cent
to N7,693.3 billion, as against the growth of 1.3 per cent at the end of the
corresponding half of 2013. The development reflected the respective
decline of 10.1 and 7.5 per cent in CBN and banks’ net foreign assets
holdings. As a percentage of M2, NFA constituted 48.3 per cent, compared
with 58.8 per cent at the end of the corresponding period of 2013.

4.1.7.2 Net Domestic Assets (NDA)
Net domestic assets grew by 15.1 per cent to N8,235.1 billion, in contrast to
the decline of 0.2 per cent at the end of the first half of 2013. The
development was attributed to the respective increase of 0.9 and 12.0 per
cent in domestic credit (net) and other assets (net) of the banking system.
4.1.7.2.1 Net Domestic Credit (NDC)
Net domestic credit grew by 0.9 per cent to N15,173.6 billion at the end of
the first half of 2014, compared with the growth of 3.6 per cent at the end of
the corresponding period of 2013. The development reflected, wholly, the
increase in claims on the private sector as net claims on Federal Government
fell at the end of the review period.
4.1.7.2.1.1 Credit to the Government (Cg)
Net claims on government fell by 21.9 per cent at the end of the first half of
2014, compared with the 3.6 per cent decline at the end of the
corresponding half of 2013. This reflected the decline in banking system’s
holding of government securities such as treasury bills and FGN Bonds, which
fell by 16.2 and 24.8 per cent, respectively, from their levels at endDecember 2013. The Federal Government, as in the preceding half-year,
remained a net lender to the banking system.
4.1.7.2.1.2 Credit to the Private Sector (Cp)
Credit to the private sector grew by 2.8 per cent at the end of the first half of
2014, compared with 3.6 per cent recorded at the end of first half of 2013.
The development reflected, wholly, the 3.2 per cent increase in claims on the
core private sector as claims on states and local government declined by 5.9
per cent.
4.1.7.2.2
Other Assets (net) (OAN)
Other Assets (net) of the banking system grew at the end of first half of 2014.
Relative to the level at end-December 2013, OAN grew by 12.0 per cent, as
against the decline of 7.4 per cent recorded at the end of the corresponding
period of 2013. The development relative to the level at end-December 2013

was attributed to the increase in unclassified assets of both the CBN and
banks during the review period.
Table 8
Growth in Monetary Aggregates
(Per cent)


June ‘12
Dec ‘12
June ‘13
Dec ‘13
June ‘14
Net Foreign Asset (NFA)

Net Domestic Credit

Credit to Federal Government (Cg)

Credit to Private Sector(Cp)

Quasi Money (QM)

Narrow Money (M1)

Broad Money (M2)

Other Assets (net) (OAN)


Figure 38
Distribution of Net Domestic Credit
(N’ Billion)

Jun 11
June 12
June 13
June 14
N Billion
Claims on Federal Government (Net)
Claims on Private Sector

4.1.8 Sectoral Distribution of Credit
Of the total outstanding credit to the core private sector, N4,083.8 billion was
given to the priority sectors, which comprised agriculture, solid minerals,
exports and manufacturing sub-sectors. This accounted for 37.9 per cent of
the total, compared with 37.2 per cent in the corresponding half of 2013. The
less
preferred
sectors
(real
estate,
public
utilities,
transport
and
communications, finance and insurance and government) accounted for

43.1 per cent of the total, while the unclassified sectors accounted for the
balance.
Table 9
Credit to the Core Private Sector:
(Percentage Share)

Share in Outstanding (per cent)


Jun 12
Dec 12
Jun 13

Dec 13

Jun 14
1. Preferred Sectors

Agriculture

Solid Minerals

Exports

Manufacturing

2. Less Preferred Sectors

Real Estate

Public Utilities

Transport and Communications

Finance & Insurance

Government

Import & Dom. Trade (General Comm.)

3. Unclassified

Total (1+2+3)

Figure 39
Sectoral Distribution of Banks’ Credit
(Per cent)

H1 2012
H2 2012
H1 2013
H2 2013
H1 2014
Per cent
Priority
Less Preferred
Unclassified

4.1.9 Maturity Structure of DMBs’ Outstanding Loans and Advances, and
Deposit Liabilities
The credit market remained dominated by short-term maturities in the first
half of 2014. Outstanding credit maturing within one year accounted for 56.6
per cent, compared with 56.0 per cent at the end of the second half of 2013.
The proportion of the medium-term (≥1yr and < 3yrs) and long-term (3yrs and
above) maturities stood at 16.8 and 26.6 per cent, compared with 19.8 and
24.2 per cent, respectively, at the end of the first half of 2013. Similarly,
deposits below one year constituted 95.6 per cent of the total, of which 72.7
per cent had maturity of less than 30 days. Long-term deposits constituted 1.1
per cent and exceeded the 0.003 per cent recorded at the end of the first
half of 2013. As in the preceding period, the near-absence of long-term
deposits continued to constrain the ability of banks to create long-tenored
risk assets crucial for economic development and transformation.
Figure 40
Maturity Structure of Deposit Money Banks (DMBs) Loans and Advances

Figure 41
Maturity Structure of Banks Deposits

H1 10
H2 10
H1 11
H2 11
H1 12
H2 12
H1 13
H2 13
H1 14
Per cent
Per cent
Short term
Medium-term - (Above 1 year and Below 3 Years) rhs
Long-Term (3 Years and Above) rhs

Jun 12
Dec 12
Jun 13
Dec 13
Jun 14
Per cent
Short term
Medium term
Long term

Table 10
Maturity Structure of Banks Assets and Liabilities
Assets (Loans and Advances)
Jun 12
Dec 12
Jun 13
Dec 13
Jun 14
Tenor


0-30 days

31-90 days

91-181 days

181-365 days

Short term

Medium Term (Above 1yr and
below 3yrs)

Long-Term (3 Years and Above)

Liabilities


0-30 days

31-90 days

91-181 days

181-365 days

Short term

Medium Term (Above 1yr and
below 3yrs)

Long-Term (3 Years and Above)

Total

Figure 42
Distribution of Private Sector Credit
(End-June 2014)
Credit to core
private sector
95.7%
Credit to State
and Local
Government
4.3%
4.1.10 Market Structure of the Banking Industry
The banking industry remained oligopolistic in the first half of 2014. Available
data showed that the average market share of assets and deposits of the
five largest banks (concentration ratio, CR5) stood at 51.5 and 52.9 per cent,
respectively, compared with 51.0 and 52.7 per cent at the end of the first half
of 2013. The market share of the largest bank with respect to assets and
deposits, stood at 13.7 and 14.8 per cent, respectively, at the end of the
review period, compared with 13.6 and 15.2 per cent at the end of the

corresponding half of 2013. However, the banking sector remained
competitive in both deposits and assets as revealed by the respective
Herfindahl-Hirschman Index (HHI) of 789.2 and 752.1 on a scale of 1000,
compared with 797.4 and 748.6, respectively, in the corresponding period of
2013.
Figure 43a
Market Structure of the Banking Industry

HY1 09
Hy2 09
Hy 110
Hy2 10
Hy1 12
Hy2 12
Hy2 12
Hy1 12 Hy 1 13 Hy 2 13 Hy1 14
HHI
CR 5
CR(Deposits)
CR( Assets)
HHI (Deposits) rhs
HHI (Assets) rhs

Figure 43b
Market Structure of the Banking Industry: Concentration Ratio of Largest Firm

HY1 09
Hy2 09
Hy 110
Hy2 10
Hy1 12
Hy2 12
Hy2 12
Hy1 12
Hy 1 13
Hy 2 13
Hy1 14
CR
CR( Largest-Deposits)
CR (Largets-Assets)

4.1.11 Consumer Credit
Consumer credit grew by 3.5 per cent to N809.78 billion in the first half of
2014, compared with 0.8 per cent recorded at the end of the corresponding
period of 2013. At that level, consumer credit constituted 5.0 per cent of total
outstanding credit to the core private sector, up from 4.2 per cent at endDecember 2013.
Figure 44
Consumer Credit of DMBs
(N’ Billion)

H1 2011
H2 2011
H1 2012
H2 2012
H1 2013
H2 2013
H1 2014
Pe r cent
N Billion
Claims on the core provate sector
Consumer Credit
Growth over preceding December (%) rhs
Ratio of claims on core private sector (%) rhs

4.1.12 Weighted Effective Average Cost of Funds (WEACF) for Banks
The weighted effective average cost of funds for banks stood at 12.0 per
cent (without overhead costs) in the first half of 2014, the same as in the
corresponding period of 2013. The computed WEACF without overheads
stood at 5.1 per cent, compared with 5.9 per cent in the first half of 2013.
Table 11
Weighted Effective Average Cost of DMBs Funds (WEACF) (Per cent)

H2 10
H1 11
H2 11
H1 12
H2 12
H1 13
H2 13
H1 14
Interest expense

Deposit Insurance
premium

Overheads

Salaries and Wages

Others

EACF with overheads

EACF without
overheads


In terms of contribution to WEACF, interest expense contributed 37.3 per
cent, while overheads and insurance premium contributed 57.8 and 4.9 per
cent, respectively. Consequently, interest expense and overheads remained
the main drivers of banks cost of funds.

Table 12
Composition as Percentage of WEACF

HY1 11
HY2 11
HY1 12
HY2 12
HY1 13
HY2 13
HY1 14
Interest expense (2)

Deposit insurance premium (3)

Overhead cost (4)


Figure 45
Trends in Weighted Effective Average Cost of Banks Funds

1st half 2012
2nd half 2012
1st half 2013
2nd half 2013
1st half 2014
Per cent
EACOF ( with over heads)
EACOF (without over heads)

4.1.13 Money Market Developments
In the first half of 2014, activities in the money market were influenced by the
liquidity flow in the banking system. The redemption of AMCON bonds in
December 2013, repayment of matured CBN bills and FGN Bonds, payment
of Joint Venture Cash (JVC) calls to oil partners, as well as the periodic
statutory revenue allocation (SRA) boosted the level of liquidity in the system.
In addition, the attractive yields on fixed income securities and the
comparative edge in interest rates arising from sustained tight monetary
policy attracted foreign direct investment and bolstered liquidity. Patronage
for the CBN’s Standing Deposit Facility (SDF) remained high, while that for the

Standing Lending Facility (SLF) was minimal. Open market operations were
complemented with the upward review of CRR on both private and public
sector deposits, which resulted in the withdrawal of N806.75 billion during the
review period. Consequently, money market rates were relatively stable
during the review period.
The Monetary Policy Committee (MPC) at its three (3) meetings in the review
period retained the Monetary Policy Rate (MPR) at 12.00 per cent with the
symmetric corridor of ± 200 basis points. The liquidity ratio and net open
position (NOP) limit were also retained at 30.00 and 1.00 per cent,
respectively. The Bank increased the cash reserve requirement (CRR) on
public sector deposits from 50.0 per cent to 75.0 per cent, in the first half of
2014, while CRR on private sector deposits was raised to 15.0 per cent from
12.0 per cent within the review period.
4.1.13.1 Money Market Assets Outstanding
Provisional data indicated that money market assets outstanding at the end
of the first half of 2014 stood at N7,195.99 billion, showing increase of 4.9 and
9.6 per cent above the levels at end-December 2013 and the corresponding
half year, respectively. The development relative to the preceding half year
reflected, mainly, the increase of N147.8 billion (8.4%) and N154.32 billion
(10.2%) in FGN Bonds and Nigerian Treasury Bills outstanding, respectively.
Figure 46
Money Market Assets Outstanding
(End-June 2014)
NTBs
38.04%
FGN Bond
60.75%
Commercial Paper
0.15%
Bankers Acceptance
0.35%
Certificate of
Depsosits
0.71%

A breakdown of the money market assets outstanding at the end of the first
half of 2014 showed that 60.75 per cent of the assets were held in FGN Bond,
while 38.04, 0.35, 0.71 and 0.15 per cent were NTBs, Bankers Acceptance,
Certificate of Deposits and Commercial Paper, respectively.
4.1.13.2 Primary Market
At the Nigerian Treasury Bills auction, N399.05 billion worth of 91-day bills was
offered and sold with bid rates ranging from 9.20 to 14.0 per cent, and stop
rates ranging from 9.2 to 11.6 per cent. At the 182- and 364-day auction, bills
worth N567.82 billion and N1,262.84 billion were offered and sold at the rates
of 9.5 to 12.8 per cent and 9.5 to13.0 per cent, respectively. Total subscription
stood at N5,607.36 billion, compared with N4,268.72 billion in the
corresponding half year of 2013. The huge subscription in the review period
was attributed to the growing demand for government securities owing to
attractive yields.
Table 13
Bid-Cover Ratios of Selected Securities
TENOR (DAY)
91-day
182-day
364-day
TOTAL (Nbn)
OFFER AMOUNT (Nbn)

TOTAL SUBSCRIPTION (Nbn)

ALLOTMENT (Nbn)

BID COVER RATIO
1.65
2.41
2.84

BID RANGE
9.20-11.62
9.45-12.75
9.54-12.99


The bid-cover ratios for the various tenors were 1.7, 2.4 and 2.8 for the 91, 182-
and 364-day, respectively. The high (above 2.0) bid-to-cover ratio for 182-
and 364-day tenors indicated investors’ preference for longer maturities.
Thus, total NTBs outstanding at end-June 2014 stood at N2,735.87 billion,
showing an increase of 10.2 per cent over the N2,483.29 billion at the end of
the first half of 2013.

Figure 47
Nigerian Treasury Bills Outstanding
(N’ Billion)

1st Half 2010
1st Half 2011
1st Half 2012
1st Half 2013
1st Half 2014
N' Billion

During the review period, the CBN, in collaboration with the Debt
Management Office, issued a new tranche of the 10-year FGN Bond, while 3,
10- and 20-year tranches were reopened. The term to maturity of the bonds
ranged from 2 years 2 months to 16 years 5 months. Total value of FGN Bonds
offered was N460.10 billion, while public subscription and sale stood at
N1,161.50 billion and N465.00 billion, respectively. The increased demand for
the securities was attributed to the high level of liquidity in the banking
system, investors’ preference for risk-free long-term instruments, and
attractive coupons. A total of N380.0 billion matured FGN Bond was repaid,
culminating to an injection of N85.0 billion into the banking system.

Figure 48
Distribution of FGN Bonds
(End-June 2014, per cent)
Banks and Discount
Houses
46.0%
Others
54.0%

Thus, the total value of bonds outstanding at end-June 2014 stood at
N4,369.84 billion, compared with N4,032.90 billion at end-June 2013,
representing an increase of N336.94 billion or 8.4 per cent.
4.1.13.3 Open Market Operations (OMO)
In line with the monetary policy stance of the Bank to rein in inflation and
maintain rates at target levels, open market operations continued to be
employed for liquidity management in the first half of 2014.
4.1.13.4 OMO Auctions
OMO auctions were conducted during the first half of the year to deepen
the secondary market, boost tradable securities and to mop-up excess
liquidity in the banking system. Direct OMO auctions were conducted
seventy-one (71) times to mop-up excess liquidity using CBN bills ranging from
39 to 147 days. Total subscription amounted to N5,454.46 billion, while total
CBN bills sold were N4,484.94 billion. The bid rates ranged from 9.95 to 13.4
per cent. The upward review of CRR on both public and private sector
deposit resulted in the withdrawal of N806.8 billion during the review period.
In the corresponding period of 2013, the amount sold was N7,099.5 billion,
while total subscription was N11,532.8 billion. The sum of N181.4 billion was
expended in the conduct of OMO, compared with N360.4 billion in the
corresponding half of 2013. CBN bills valued at N5,065.6 billion matured and
were repaid in the review period, translating to a net injection of N580.7
billion in the first half of 2014.
4.1.13.5
The Two-Way Quote Trading in NTBs
The two-way quote trading platform remained inactive in the review period,
same as in the corresponding half year of 2013.
4.1.13.6
Repurchase Transactions
There was no request for repurchase transactions in the review period as in
the corresponding half year of 2013.

4.1.13.7
Central Bank of Nigeria (CBN) Standing Facilities
In the first half of 2014, the Bank continued to provide standing facilities to
deposit money banks and discount houses to enable them meet their shortterm liquidity needs and surpluses. The rates for SDF and SLF remained at 10.0
per cent and 14.0 per cent, respectively, throughout the review period as the
anchor rate (Monetary Policy Rate) remained at 12.0 per cent.
4.1.13.7.1 Standing Lending Facility (SLF)
On request, Standing Lending Facility were availed to banks and discount
houses that were in need to offset their negative closing balances at the end
of each business day. The total request for the SLF granted in the first half of
2014 was N3,487.9 billion, out of which N1,641.7 billion was the automated
conversion of Intra-day Facility to overnight repo. The daily average request
was N29.7 billion in 94 working days, while the interest earned amounted to
N196.51 million. In comparison with the corresponding period of 2013, the
total SLF demanded stood at N5,341.5 billion, depicting a daily average of
N43.6 billion. The development in the review period could be attributed to
the inflow from matured FGN Bonds and NTBs.
4.1.13.7.2 Standing Deposit Facility (SDF)
Strong patronage at the SDF window reflected the liquidity surfeit in the
system. The daily average deposit at the SDF window in the first half of 2014
was N376.1billion, compared with N142.3 billion in the corresponding period
of 2013. The average interest paid on SDF in the review period stood at N0.15
billion, compared with N57.70 million in the corresponding period of 2013.
4.1.13.8 Inter-Bank Funds Market
The value of Inter-bank transactions stood at N3,646.3 billion, down from
N13,192.9 billion in the first half of 2013. The unsecured call and tenored
segments amounted to N87.5 billion, compared with N4,548.7 billion in the
first half of 2013. At the Open-Buy-Back (OBB) segment, the value of
transactions declined to N3,558.8 billion, from N8,643.9 billion in the first half of
2013. The lower level of transactions at the unsecured segment was
attributed, largely, to the launching of new real time gross settlement (RTGS)

and Scripless Security Settlement System (S4), both of which facilitated the
transfer of securities and settlement.
4.1.14 Interest Rate Developments
Money market rates were relatively stable in the first half of 2014. Short-term
rates in all the segments of the money market were lower than the levels in
the corresponding period of 2013. The monthly weighted average inter-bank
and OBB rates ranged from 10.00 to 10.63 per cent and 10.38 to 12.25 per
cent, respectively. Weighted average inter-bank rate in the first half of 2014
stood at 10.46 per cent, down from 11.52 per cent in the corresponding half
of 2013. The OBB average rate declined to 10.93 per cent from 11.27 per cent
in the corresponding period of 2013.

Table 14
Money Market Rates
(Per cent)
WEIGHTED AVERAGE
Month
MPR
Call
Rate
OBB
NIBOR 7days
NIBOR 30days
Jan-14

Feb-14

Mar-14

Apr-14

May-14

Jun-14

Average 2014
First Half

Average 2013
First Half


The weighted average of the Nigeria Inter-bank Offered Rate (NIBOR) for the
7- and 30-day tenors were 11.40 and 12.01 per cent, respectively, compared
with the 12.01 and 12.42 per cent recorded in the corresponding half of 2013.

Figure 49
Money Market Rates
(per cent)

Jun'12
Jun'13
14-Jan
14-Feb
14-Mar
14-Apr
14-May
14-Jun
Per cent
MPR
Call Rate
OBB

4.1.14.1 Money Market Rates
4.1.14.1.1 Deposit Rates
Deposit rates rose in the first half of 2014. Average term deposit rate rose by
1.7 percentage points to 8.6 per cent above the level in the corresponding
half of 2013. All other rates on deposits of various maturities rose from a range
of 4.90 – 8.10 per cent in the first half of 2013 to a range of 4.80 – 8.99 per
cent in the review period. The developments in interest rates were attributed
to the tight monetary policy stance of the Bank. With the year-on-year inflation
rate at 8.2 per cent in June 2014, most deposit rates were negative in real term.
4.1.14.1.2 Lending Rates
In the first half of 2014, the weighted average prime and maximum lending
rates rose by 0.1 and 1.0 percentage points to 16.72 and 25.52 per cent,
respectively, above the rates in the corresponding period of 2013.
Consequently, the spread between the average term deposits and
maximum lending rates narrowed to 16.92 from 17.67 percentage points.

Table 15
DMBs Deposits and Lending Rates
(Per cent)
Month
Savings
Average
Term
Deposit
Prime
Lending
Maximum
Lending
Jan-14

Feb-14

Mar-14

Apr-14

May-14

Jun-14

Average 2014 H1

Average 2013 H1


4.1.15 Yields on Fixed Income Securities
Yields on fixed income securities were generally higher in the first half of 2014
than in the corresponding period of the preceding year. Yields were more
volatile at the shorter end than the medium and the long-term segments of
the curve.
Figure 50
Government Bonds Average Yield Curve
(Per cent)


The yield curve remained normal with the average spread (the difference
between the longest and shortest maturities) at 0.3 percentage point from
1.4 percentage point in the corresponding period of the preceding year. The

development during the review period could be attributed to the overall
market stability. It might also be signaling investors’ optimism about the
medium to long-term expectation of economic activities.
4.1.16 Institutional Savings
Aggregate financial savings rose by 5.0 per cent to N9,511.0 billion in the first
half of 2014, compared with N9,224.4 billion and N9,085.6 billion at endDecember 2013 and the corresponding period of 2013, respectively. DMBs
remained the dominant depository institutions in the financial system,
accounting for 90.0 per cent of the total financial savings, compared with
95.2 per cent in the preceding half year. Other savings institutions, namely
PMBs, life insurance companies, pension fund custodians, the Nigerian Social
Insurance Trust Fund (NSITF), and microfinance banks (MFBs) accounted for
the balance.
4.1.17 Other Financial Institutions
4.1.17.1 Development Finance Institutions
Provisional data indicated that total assets of the six (6) Development Finance
Institutions (DFIs) namely: Bank of Agriculture (BOA); Bank of Industry (BOI);
Federal Mortgage Bank of Nigeria (FMBN); Nigerian Export-Import Bank
(NEXIM);
The Infrastructure
Bank
(TIB);
and
the
National Economic
Reconstruction Fund (NERFUND) declined by 2.0 per cent to N575.10 billion at
end-June 2014, from N586.7 billion at end-December 2013. Similarly, the
aggregate net loans and advances declined by 3.5 per cent to N345.60
billion, from N358.20 billion at end-December 2013. The decline relative to the
preceding half year was attributed to the deterioration in the financial
performance of NERFUND. A disaggregation of the asset base of the
institutions indicated that BOI, FMBN, BOA, NEXIM, TIB and NERFUND
accounted for 51.5, 24.5, 9.1, 9.0, 5.3 and 0.6 per cent, respectively, of the
total.

4.1.17.2 Microfinance Banks (MFBs)
Total assets/liabilities of the reporting microfinance banks (MFBs) stood at
N280.80 billion at the end of the first half of 2014, representing an increase of
3.6 per cent over the level at end- December 2013. Similarly, the paid-up
share capital, shareholders’ funds and net loans/advances increased by 7.7,
16.2 and 0.4 per cent to N72.60 billion, N84.80 billion and N129.50 billion,
respectively, over the levels at end-December 2013. Aggregate reserves also
rose to N12.10 billion at the end of the review period, compared with N5.6
billion at end-December 2013. The developments were due, mainly, to
increased capitalisation, which resulted in significant improvement in the
operational performance of the institutions. Investible funds available to the
sub-sector during the review period amounted to N39.30 billion. The funds
were sourced mainly, from a reduction in other assets (N13.40 billion) and
increase in deposit liabilities (N8.5 billion), accumulated reserves (N6.50
billion) and paid-up capital (N5.20 billion). The funds were utilised, mainly, to
increase bank balances (N14.90 billion), reduce other liabilities (N11.60 billion)
and increase placements with banks (N6.60 billion).
4.1.17.3 Discount Houses
Total assets/liabilities of the two (2) discount houses (DHs) in operation during
the review period increased by 29.4 per cent to N173.20 billion at the end of
the first half of 2014, compared with N133.80 billion and N344.20 billion at
end-December 2013 and the corresponding period of 2013, respectively.
Aggregate funds sourced amounted to N23.40 billion in the first half of 2014,
compared with N11.30 billion and N43.00 billion at end-December 2013 and
the corresponding period of 2013, respectively. The funds were mainly, from
reduction in claims on the Federal Government (N11.80 billion), claims on
banks (N8.90 billion) and increase in other liabilities (N1.20 billion). The funds
were utilized, largely, to reduce borrowings (N9.00 billion), other amount
owed to customers (N7.70 billion) and increased claims on others (N6.10
billion). Discount houses’ investment in Federal Government securities of less
than 91-day maturity, amounted to N63.90 billion in the review period,

representing 50.2 per cent of their total liabilities. This was 9.8 percentage
points below the prescribed minimum level of 60.0 per cent for fiscal 2014.
4.1.17.4 Finance Companies (FCs)
Total assets/liabilities of the 61 reporting finance companies (FCs) declined
by 0. 3 per cent to N102.73 billion at end-June 2014, compared with N103.05
billion at end-December 2013. Similarly, total borrowings decreased by 2.4
per cent to N57.78 billion at end-June 2014, below N59.22 billion recorded at
end-December 2013. However, the paid-up capital increased by 7.6 per
cent to N15.81 billion at end-June 2014, compared with N14.69 billion at endDecember 2013. Aggregate loans/advances and reserves also increased by
8.3 and 20.3 per cent to N50.60 billion and N4.30 billion, respectively,
reflecting improved operational performance of the FCs. Investible funds
available to the institutions during the period amounted to N6.34 billion. The
funds were sourced, mainly, from reductions in placements with banks (N3.24
billion), fixed assets (N0.59 billion), increase in paid-up capital (N1.12 billion)
and reserves (N0.73 billion). The funds were utilized mainly to increase
loans/advances (N3.87 billion) and reduction in borrowings (N1.44 billion).
4.1.17.5 Primary Mortgage Banks (PMBs)
Total assets/liabilities of primary mortgage banks (PMBs) decreased by 14.5
per cent to N413.70 billion at end-June 2014, compared with N484.00 billion
at end-December 2013. The development was attributed to the delisting of
sixteen (16) PMBs that applied for conversion to other categories of OFIs. The
paid-up capital, deposit liabilities and loans/advances also decreased by
14.1, 11.2 and 12.5 per cent to N129.00 billion, N146.30 billion and N137.80
billion, respectively, at end-June 2014. Aggregate reserves, however,
improved from negative N5.70 billion at end-December 2013 to N26.80 billion
at end-June 2014; and shareholders’ funds also increased by 7.7 per cent to
N155.80 billion at the end of the first half of 2014. Investible funds available to
the sub-sector during the review period amounted to N102.70 billion. The
funds were sourced, mainly, from the respective reduction of N43.50 billion
and N19.60 billion in investments and loans/advances, and the N32.40 billion

increase in aggregate reserves. The funds were utilized primarily to reduce
other liabilities (N51.8 billion), paid-up capital (N21.30 billion), and deposit
liabilities (N18.40 billion).
4.1.17.6 Bureaux-De-Change (BDCs)
There were 3,256 licensed BDCs in operation in the first half of 2014,
compared with 2,890 at end-December 2013, indicating a 12.7 per cent
increase. The development reflected the issuance of additional 366 licences
during the first half of 2014.
4.1.17.7 Asset Management Corporation of Nigeria (AMCON)
During the half year, AMCON’s total bond liability to private investors and
deposit money banks, was N866.00 billion, redeemable on October 31, 2014.
The balance of Eligible Bank Assets (EBAs) purchased by the Corporation
stood at N1.61 trillion at end-June 2014, compared with N2.37 trillion and
N2.72 trillion at end-December 2013 and end-June 2013, respectively.
Restructured loans of the Corporation amounted to N428.65 billion at endJune 2014, compared with N374.35 billion at end-December 2013. The
development was an indication that borrowers were finding it difficult to
meet their obligations to the Corporation.
The AMCON continued the process of divestment from Enterprise Bank Ltd
and Mainstreet Bank Ltd. At the end of the first half of 2014, the seven (7)
preferred bidders for Enterprise Bank Ltd were at the point of completing their
due diligence, while qualified parties had been shortlisted for the execution
of Non-Disclosure Agreements in the divestment process from Mainstreet
Bank Ltd. Furthermore, a second public hearing on the proposed
amendment of the AMCON Act 2010 was held on February 17, 2014 by the
Senate.
4.1.17.8 Nigerian Mortgage Refinancing Company (NMRC)
The Nigerian Mortgage Refinance Company (NMRC) was launched by the
President on January 16, 2014. Although the Company was yet to meet the
conditions for grant of final approval by the CBN at end-June 2014, it was

focused at fulfilling the conditions and disbursing its first set of mortgage
refinance loans in the second half of 2014.
4.1.18 Capital Market Developments
4.1.18.1 Institutional Developments
During the first half of 2014, the capital market regulatory authorities
continued to implement various measures towards sustaining investors’
confidence and engendering market efficiency. A major initiative of the
Securities and Exchange Commission (SEC) in the review period was the
inauguration of the pilot Warehouse Receipt Scheme. The Scheme was
expected to provide a centralised market place for commodity producers
and address the persistent problems of limited access to credit by farmers.
The Scheme, when fully operational, would facilitate price discovery, reduce
risk and costs, and improve market efficiency. Also, in the review period, the
Commission introduced electronic filling for the market and, thus,
commenced e-review and e-filling process of transactions through
dedicated e-mail process.
As part of its efforts at sanitizing the market, the SEC successfully concluded
the review of database of capital market operators (CMO), deregistered
dormant CMOs, registered fresh CMOs and implemented a regular database
validation exercise. The Commission also produced a surveillance manual for
the market. Similarly, a capital adequacy assessment exercise of all
registered fund managers was conducted by the SEC. The exercise revealed
that: fifty-three (53) firms had adequate capital; nine (9) inadequate capital;
thirty-one (31) grossly inadequate; while there was no information on thirty-six
(36) fund managers. Also, the Commission conducted a review of nine (9)
banks’ divestment from non-permissible banking businesses in line with the
CBN’s guidelines. Other regulatory activities carried out included: receipt
and resolution of complaints against capital market operators; and off-site
inspection of operations of CMOs, among others.
In line with its policy of continuous monitoring and improvement to sustain the
vibrancy of the market, the Nigerian Stock Exchange Council carried out its

biannual review of the NSE Indices. Having considered mergers, takeovers,
suspension or resumption of trading or any other changes in company
structure, which may have taken place during the period, the Council
reconstituted the stocks that make up the indices, including the NSE-30, NSEBanking, NSE-Consumer Goods, NSE-Oil & Gas, NSE-Industrial, NSE-Lotus
Islamic and NSE-Insurance.
4.1.18.2 The Nigerian Stock Exchange (NSE)
Developments in the Nigerian stock market were mixed in the first half of
2014. In the primary market segment, there were a total of six (6) new issues,
comprising two (2) rights issues and one (1) each of Private Placement,
Global Equity Offering, Special Placement and Corporate Bond. In addition,
the SEC approved applications for thirty eight (38) equity offers, ten (10)
bond issues and twenty five (25) allotments. In the secondary segment of the
market, the aggregate volume and value of securities traded fell by 9.5 and
2.1 per cent to close at 52.8 billion shares valued at N579.30 billion, in 619,318
deals, compared with 58.3 billion shares valued at N591.70 billion, in 764,560
deals recorded in the corresponding period of 2013, respectively. The AllShare Index (ASI) and aggregate market capitalization, however, rose by 2.8
and 0.1 per cent to close at 42,482.48 and N19.09 trillion, respectively,
compared with 41,329.19 and N19.08 trillion at end-December 2013.
4.1.18.3 New Issues Market
The Exchange recorded six (6) new listings, consisting of five (5) equities and
one (1) debt issue in the first half of 2014. The new equity issues comprised
two (2) rights issue, and one (1) each of Private Placement, Special
Placement and Global Equity Offering. One (1) Corporate Bond issue was
also made in the review period. A total of N134.10 billion was raised from all
the new listings, with the bulk, N129.60 billion (96.6 per cent) from equities,
while the debt issuance accounted for the balance of N4.50 billion (3.4 per
cent).

4.1.18.4 The Secondary Market
Available data indicated that transactions on the secondary segment of the
Nigerian Stock market declined in the first half of 2014. Aggregate volume
and value of securities traded fell by 9.5 and 2.1 per cent to close at 52.8
billion shares valued at N579.30 billion, respectively in 619,318 deals,
compared with 58.3 billion shares valued at N591.70 billion, in 764,560 deals
recorded in the corresponding period of 2013, respectively. The equities subsector sustained its dominance in the secondary segment of the market as it
accounted for 99.9 per cent of the aggregate trade transactions, while the
debt market accounted for the balance. Sectoral analysis of the
developments in the market indicated that the financial services sector
(driven largely by activities in the banking sub-sector) remained the most
active on the Exchange with a traded volume of 39.4 billion shares, valued at
N305.80 billion in 335,956 deals, compared with 42.5 billion shares, valued at
N327.70 billion in 446,996 deals in the first half of 2013.
Provisional data on cumulative transactions on the Over-the-Counter (OTC)
bond segment of the market, showed a turnover of 21.08 million units worth
N20.45 billion in 40 deals in the first half of 2014, compared with a turnover of
4.74 billion units worth N5.59 trillion in 27,895 deals in the corresponding period
of 2013.
Figure 51
Volume and Value of Transactions at the NSE

First half 2011
First half 2012
First half 2013
First half 2014
Value in Naira (billion)
Volume in Numer (Billion)
Volume of traded securities (LHS)
Value of securities (RHS)

4.1.18.5 All-Share Index and Aggregate Market Capitalisation
The All-Share Index (ASI) recorded moderate performance relative to the
level at end-December 2013. The NSE ASI rose by 2.8 per cent to 42,482.48 at

the end of the first half of 2014, compared with 41,329.19 at end-December
2013. It indicated a 17.5 per cent increase, compared with the level at the
end of the first half of 2013. Aggregate market capitalisation of all the listed
securities closed at N19.09 trillion, indicating increase of 0.1 and 20.9 per cent
over the levels at end-December 2013 and the corresponding period of
2013, respectively. Listed equities accounted for 73.5 per cent of the
aggregate market capitalization (N14.03 trillion), while the debt component
accounted for the balance of 26.5 per cent (N5.06 trillion). The top twenty
(20) most capitalized companies on the Exchange accounted for 84.5 per
cent (N11.90 trillion) of the total equity capitalization and 62.3 per cent of the
aggregate (equity plus debt) market capitalisation. Six (6) banks,
representing 30.0 per cent, made the list of the top twenty (20) most
capitalized companies and accounted for N2.60 trillion (18.2 per cent) of the
total equity market capitalization, compared with eight (8) banks in the
corresponding period of 2013.
As
a
percentage
of
estimated
nominal
GDP,
aggregate
market
capitalization stood at 45.1 per cent, compared with 40.8 per cent recorded
at end of the first half of 2013.
Figure 52
Market Capitalisation and NSE Value Index


2008:H1
2009:H1
2010:H1
2011:H1
2012:H1
2013:H1
2014:H1
Naira Trillion
Index
NSE Index
Aggregate Market Capitalisation

4.2
FISCAL OPERATIONS
4.2.1 Federation Account Operations
Provisional gross federally-collected revenue in the first half of 2014 stood at
N5,109.03 billion or 12.1 per cent of GDP. This was below the proportionate
budget estimate by 6.0 per cent, but above the level in the corresponding
period of 2013 by 6.3 per cent. The decrease in federally-collected revenue
relative to the proportionate budget estimate was as a result of the decline
in non-oil revenue. Oil revenue constituted 70.5 per cent of total revenue,
while non-oil revenue accounted for the balance.

Figure 53
Structure of Gross Federation Revenue
(First Half 2014, N’ Billion)


Oil Revenue
Non-Oil Revenue

At N3,604.39 billion or 8.5 per cent of GDP, gross oil revenue grew by 0.6 per
cent above the proportionate budget estimate, but was 1.2 per cent below
the level in the first half of 2013. The improvement in oil revenue relative to the
budget estimate was attributed largely to the sustained high price of crude
oil in international market, despite the incessant pipeline vandalism and oil
theft in the Niger Delta region, which constrained crude oil/gas production
and exports during the period.

Figure 54
Composition of Oil Revenue
(First Half 2014)
Crude Oil / Gas
Exports
30.4%
PPT & Royalties
47.5%
Domestic Crude
Oil / Gas Sales
20.8%
Others
1.3%

The sums of N684.05 billion and N440.67 billion were deducted from the gross
oil receipts for Joint Venture Cash Calls; and Excess Crude Oil, Excess
PPT/Royalty Accounts, and “Others”, respectively, leaving a net balance of
N2,479.67 billion that was transferred to the Federation Account.
Gross revenue from non-oil sources, at N1,504.64 billion or 3.6 per cent of
GDP, fell below the proportionate budget estimate by 18.9 per cent, but rose
by 29.9 per cent, compared with the level in the corresponding period of
2013. The fall in non-oil revenue relative to the budget estimate was
attributed mainly to the decline in receipts from customs duties arising from
reduced volume of imports.
Figure 55
Composition of Non-Oil Revenue
(First Half 2014)
Corporate Tax
38.7%
Education Tax
1.3%
Customs & Excise
17.1%
VAT
27.1%
Customs Levies
(Fed. Accountt.)
2.9%
FG Indep. Rev.
9.0%
NITDF
0.1%
Customs Levies
(Non-Fed.
Accountt.)
3.8%

The sum of N217.35 billion was deducted from the non-oil revenue as cost of
collection, leaving a net distributable balance of N1,287.29 billion.
Overall, the federally-collected revenue (net) amounted to N3,766.96 billion.
Of this amount, the sums of N3,118.87 billion (82.8%), N134.01 billion (3.6%),
N391.63 billion (10.4%) and N122.45 billion (3.2%) were transferred to the
Federation Account, FG Independent Revenue, VAT Pool Account and
“Other transfers”1, respectively.
Figure 56
Federally Collected Revenue Distribution
(First Half 2014)
Federation
Account
82.8%
FG Indep. Rev.
3.6%
VAT
10.4%
Other Transfers
3.2%


4.2.1.1
Revenue Distribution for First Half, 2014
Statutory revenue to the three tiers of government and the 13% Derivation
Fund2 from the Federation Account (including SURE-P3 and NNPC Refunds)
and VAT Pool Account was N3,754.26 billion in the first half of 2014. The
amount was below both the proportionate budget estimate and the level in
the first half of 2013 by 10.4 and 15.3 per cent, respectively. A breakdown
showed that the Federation Account amounted to N3,118.87 billion (83.1%);
NNPC Refunds, N30.47 billion (0.8%); SURE-P, N213.29 billion (5.7%) and VAT
Pool Account, N391.63 billion (10.4%).

1Includes Education Tax Fund, Customs Special Levies (Federation and Non-Federation) and National
Information Technology Development Fund.
2 Amount shared among the oil producing states from the total oil revenue.
3Subsidy Re-investment and Empowerment Programme, is the additional revenue to government from
the partial removal of petroleum subsidy.

4.2.1.1.1
Federation Account Distribution
Distribution from the Federation Account to the three tiers of government in
the first half of 2014 was as follows: Federal Government, N1,473.20 billion;
while states and local governments received N747.23 billion and N576.08
billion, respectively. The balance of N322.36 billion was shared as the 13%
Derivation Fund among the oil producing states.
In addition, the Federal Government received N97.75 billion, while states and
local governments as well as the 13% Derivation Fund got N49.58 billion,
N38.23 billion and N27.73 billion, respectively, from the SURE-P. Furthermore,
states and local governments received N14.97 billion and N11.54 billion, while
the 13% Derivation Fund got N3.96 billion from NNPC Refunds.
4.2.1.1.2 VAT Pool Account
The sum of N391.63 billion accrued to the VAT Pool Account in the first half of
2014, representing a decrease of 3.5 per cent below the proportionate
budget estimate for the fiscal year. The distribution among the three tiers of
government was as follows: Federal Government, N58.74 billion; state
governments, N195.82 billion; and local governments, N137.07 billion.
Overall, the total federation revenue distribution for the period fell below the
2014 proportionate budget estimate by 10.4 per cent.
Figure 57
Distributions to the Tiers of Government
(First Half 2014, N’ Billion)


Federal Government
State Governments
Local Governments
13% Derivation Fund

4.2.2 Federal Government Finances
4.2.2.1 Federal Government Fiscal Balance
The fiscal operations of the Federal Government in the first half of 2014
resulted in overall deficit of N325.11 billion or 0.8 per cent of GDP as against
the proportionate budget estimate and corresponding period of 2013 deficit
of N482.10 billion and N415.40 billion, respectively. The deficit was financed
mainly from domestic sources through the issuance of FGN Bonds and loans
from the Special Fund (Development of Natural Resources).
Figure 58
FGN Fiscal Balance
(First Half 2014, N’ Billion)

4.2.2.2 Federal Government Retained Revenue
At N1,771.27 billion or 4.2 per cent of GDP, the estimated retained revenue of
Federal Government was lower than both the proportionate budget
estimate and the level in the corresponding period of 2013 by 17.0 and 9.6
per cent, respectively. The decline in retained revenue, relative to the
proportionate budget estimate, was attributed largely to the drop in the FGN
independent revenue and the share from the Federation Account. Analysis
of the retained revenue revealed that the share from the Federation
Account was N1,473.20 billion (83.2%); VAT Pool Account, N58.75 billion
(3.3%); Federal Government Independent Revenue, N134.01 billion (7.6%);
SURE-P, N97.75 billion (5.5%); and “Others”, N7.56 billion (0.4%).

Figure 59
Composition of Federal Government Retained Revenue
(First Half 2014)
Federation
Account
83.2%
FGN IR
7.6%
VAT
3.3%
SURE-P
5.5%
"Others"
0.4%

4.2.2.3 Total Expenditure of the Federal Government
The estimated aggregate expenditure of the Federal Government in the first
half of 2014 was N2,096.37 billion or 5.0 per cent of GDP. This fell by 19.9 and
11.8 per cent below the proportionate budget estimate and the level in the
corresponding period of 2013, respectively. The decline in total expenditure
relative to the proportionate budget estimate was accounted for, largely by
delay in capital releases induced by the late passage of the 2014
Appropriation Bill. Non-debt expenditure fell below the proportionate budget
estimate by 28.4 per cent and constituted 77.2 per cent of total expenditure.
Total debt service amounted to N477.80 billion, representing 22.8 per cent of
the total.
Figure 60
Composition of Federal Government Expenditure
(First Half 2014)
Recurrent
Expenditure
75.3%
Capital
Expenditure
16.8%
Statutory
Transfers
7.9%

At N1,577.88 billion, recurrent expenditure fell by 8.1 per cent below the
proportionate budget estimate and accounted for 75.3 per cent of the total.
The reduction was due to the decline in outlay on goods and services. As a
percentage of GDP, it contracted to 3.7 per cent, from the 4.4 per cent
recorded in the first half of 2013. A breakdown of the recurrent expenditure
showed that the goods and services component, at N979.27 billion (62.1%) of
the total, fell by 20.2 per cent below the half year budget estimate. This was
largely due to the reduction in overhead cost and pension payments.
Analysis of the goods and services component revealed that personnel cost
and pensions amounted to N827.01 billion (84.5%), while overhead cost was
N152.26 billion (15.5%).
Furthermore, interest payments4 which was 30.3 per cent of the total or 1.1
per cent of GDP, rose to N477.80 billion (34.2%), relative to the proportionate
budget estimate for 2014. Of the amount, the sum of N36.36 billion was
expended on external debt service and N441.44 billion on domestic debt
service. Transfers to the Special Funds (FCT, Stabilization Fund, Development
of Natural Resources and Ecology Funds) and “Others” explained N120.81
billion or 7.6 per cent of the recurrent expenditure.

Figure 61
Economic Classification of FG Recurrent Expenditure, 2014
(First Half 2014)

Provisional data on functional classification of recurrent expenditure showed
that the outlay on administration was N460.13 billion and accounted for 29.2

4This includes interest payments on overdraft.

per cent of the total. When compared with the level in the corresponding
period of 2013, it fell by 26.5 per cent due mainly to the reduction in
allocations to general administration. Also, spending on social and
community services declined by 17.2 per cent and explained 15.8 per cent
of the total. However, “Transfers” rose by 9.4 per cent to N666.52 billion, and
constituting 42.2 per cent of the total. In addition, expenditure on the
economic sector, at N202.19 billion, increased by 13.4 per cent and
accounted for 12.8 per cent of total recurrent expenditure.
Capital expenditure, at N353.15 billion or 0.8 per cent of GDP, was lower than
the proportionate budget estimate by 49.1 per cent, reflecting the slow pace
of capital releases during the period. It also accounted for 16.8 per cent of
the total expenditure. As a proportion of Federal Government revenue,
capital expenditure, at 19.9 per cent was close to the stipulated minimum
target of 20.0 per cent under the WAMZ secondary convergence criteria.
Functional analysis of capital expenditure showed that outlays in the
economic sector represented N90.42 billion or 25.6 per cent of the total,
compared with 44.3 per cent in the preceding period. Public investment in
social and community services accounted for 12.3 per cent, while
administration and transfers were 34.6 and 27.5 per cent of capital outlay,
respectively.
Statutory transfers at N165.34 billion or 0.4 per cent of GDP, was lower than
the proportionate budget estimate by 19.1 per cent and accounted for 7.9
per cent of the total expenditure.
4.2.3 State Government Finances
Aggregate statutory allocations (gross) to state governments from the
Federation Account (SURE-P and NNPC Refunds) and VAT Pool Account
totalled N1,361.64 billion in the first half of 2014. This was 6.4 and 15.9 per cent
below the proportionate budget estimate and the level in the corresponding
period of 2013, respectively. A breakdown showed that allocation from the
Federation Account was N1,101.27 billion (80.9%); NNPC Refunds, N14.97

billion (1.1%); SURE-P, N49.58 billion (3.6%); and VAT Pool Account, N195.82
billion (14.4%).
Figure 62
Composition of Total Allocations to State Governments
(First Half 2014)
Federation Account
80.9%
VAT
14.4%
SURE-P
3.6%
NNPC Refunds
1.1%

The sum of N107.50 billion was deducted as state governments’ contractual
obligations5 from their share of the Federation Account, leaving a net
distributable balance of N993.77 billion. Of the net sum, N354.05 billion was
allocated to the oil-producing states as 13% Derivation Fund and the
balance to the 36 states.
The allocations to the states from the VAT Pool Account, represented an
increase of 7.6 per cent over the level in the first half of 2013, while that of
NNPC Refunds showed a decrease of 33.3 per cent as refunds were
completed in April 2014. Allocation from SURE-P remained at the same level
as in the first half of 2013. Consequently, the net statutory allocation to states
(including 13% Derivation) was 19.2 per cent below the level in the first half of
2013. Further analysis of the state governments’ allocation showed that Akwa
Ibom, Delta and Rivers received 9.7, 7.4, and 7.2 per cent of the total,
respectively. Conversely, Kwara, Ebonyi and Ekiti got the least with
approximately 1.7 per cent each.

5 Includes contribution to external debt service fund, payments for fertilizer, State Agricultural Project, National
Fadama Project and the National Agricultural Technology Support Programme.

4.2.4 Local Government Finances
Aggregate statutory allocation to the 774 local governments from the
Federation Account (including SURE-P and NNPC Refunds) and VAT Pool
Account was N762.92 billion in the first half of 2014, indicating a decline of
13.3 per cent from the level in half year of 2013. A breakdown revealed that
allocation from the Federation Account was N576.08 billion (75.5%); NNPC
Refunds, N11.54 billion (1.5%); SURE-P, N38.23 billion (5.0%) and VAT Pool
Account, N137.07 billion (18.0%). A further breakdown on state basis
indicated that Lagos, Kano and Katsina received 5.7, 5.6 and 4.2 per cent of
the total, respectively, while FCT, Gombe and Bayelsa got the least with 1.6,
1.5 and 1.2 per cent, respectively.
Figure 63
Composition of Statutory Allocations to Local Governments
(First Half 2014)
SURE-P
5.0%
VAT
18.0%
NNPC Refunds
1.5%
Federation Account
75.5%


4.2.5
Public Debt
4.2.5.1
Consolidated Federal Government Debt
The consolidated debt stock of the Federal Government at end-June 2014
was N8,881.40 billion or 10.5 per cent of GDP6. This represented an increase of
4.6 per cent over the level at end-December 2013. Of the total debt stock,
domestic debt accounted for N7421.40 billion or 83.6 per cent, while external
debt amounted to N1,460.30 billion (US$9.38 billion) or 16.4 per cent of the
total.

6 Estimated 2014 GDP.

Figure 64
Composition of Federal Government Consolidated Debt
(First Half 2014)
External Debt
14.0%
Domestic debt
86.0%

4.2.5.2 Domestic Debt
At N7421.40 billion or 8.8 per cent of estimated GDP, the Federal Government
securitised domestic debt at end-June 2014 was above the level at end-
December 2013 by 4.2 per cent. The increase was due to the issuance of
additional FGN Bonds and Nigerian Treasury Bills during the period.
Further analysis showed that the banking system remained the dominant
holder of the Federal Government outstanding domestic debt with N4,694.35
billion or 63.3 per cent, the non-bank public accounted for N2,542.68 billion
or 34.3 per cent and Sinking Fund accounted for the balance of N184.07
billion or 2.4 per cent.
4.2.5.3 External Debt
Total external debt stock (Federal and States, including the Federal Capital
Territory (FCT)) at end-June 2014 was US$9.38 billion or 1.7 per cent of
estimated GDP. This represented an increase of 6.3 per cent above the level
at end-December 2013, reflecting additional multilateral loans of US$0.46
billion. A breakdown by holders indicated that 71.8 per cent was owed to the
multilateral creditors, while the balance of 28.2 per cent was non-Paris Club
Bilateral and Commercial debt.

Figure 65
Breakdown of External Debt Stock
(First Half 2014, US$ Billion)

End-Jun 2010
End-Jun 2011
End-Jun 2012
End-Jun 2013
End-Dec 2013
End-Jun 2014
Multilateral
Others

Further analysis of the external debt stock showed that US$6.36 billion or 67.9
per cent of the total was owed by the Federal Government, while the
balance of US$3.02 billion or 32.1 per cent was by states and the FCT.
4.2.5.4
Total Debt Service Payments
The consolidated debt service payment by the Federal Government at endJune 2014 stood at N467.21 billion or 1.1 per cent of GDP, representing an
increase of 92.2 per cent above the level at end-December 2013. Principal
repayment (amortisation on external debt) accounted for N11.40 billion or
2.4 per cent, while the balance of N455.80 billion or 97.6 per cent was for
interest payments. A further breakdown showed that N28.03 billion (US$178.18
million) or 6.0 per cent of total debt service was expended on external debt,
while the balance of N439.18 billion or 94.0 per cent went to domestic debt.

Figure 66
Breakdown of External Debt Service Payments
(First Half 2014)

End-June 2010End-June 2011 End-June 2012 End-June 2013 End-Dec 2013End-June 2014
Domestic Debt (N' Billion)
External ($US Million)

4.3
REAL SECTOR DEVELOPMENTS
Provisional data from the National Bureau of Statistics (NBS) showed that the
gross domestic product (GDP), at 2010 constant basic prices, rose by 6.4 per
cent in the first half of 2014, relative to 4.9 per cent in the first half of 2013. The
development reflected, largely, the growth in the non-oil sector, which rose
by 7.4 per cent. Conversely, growth in the oil sector fell by 1.2 per cent, due
to the decline in crude oil production, arising from recurrent theft and closure
of oil installations. The agricultural sector recorded a growth rate of 4.6 per
cent, while industry grew by 5.9 per cent. Similarly, construction, services and
trade recorded respective growth rates of 14.0, 7.2 and 5.7 per cent in the
first half of 2014. In terms of relative contribution to GDP, services, industry,
trade, agriculture and construction contributed 2.6, 1.3, 1.0, 0.9 and 0.6 per
cent, respectively.

Figure 67
GDP Growth Rate
(per cent)


1st Half 2013
2nd Half 2013
1st Half 2014
Total GDP
Non-Oil GDP

4.3.1 Agriculture
4.3.1.1 Agricultural Policies and Institutional Support
The Federal Government developed a National Agricultural Resilience
Framework (NARF) to enhance food security and create social stability, in the
first half of 2014. The Framework formed the basis for the national policy on
strategies to reduce Nigeria’s food vulnerability through enhanced
productivity and attainment of environmental resilience. The objectives of
the Framework include:
Strengthening the overall policy/ institutional framework for improved
resilience and adaptation to climate variability and change in the
agricultural sector;

Evaluating and introducing climate risk management and transfer
strategies
in
the
agricultural
sector
planning
and
project
implementation; as well as widespread deployment of same through
communication technologies;
Improving productivity through training of community and grass root
farmers on land and water management strategies, modern farming
practices and using policy instruments such as economic incentives,
regulations and communication;

Reinforcing social safety nets through support systems that reduce
vulnerability and improve livelihood conditions for the vulnerable,
especially women and children;

Improving research capacity in farming systems within the National
Agricultural Research System (NARS) to enable climate friendly
agriculture in Nigeria; and

Revamping extension services, including building new capacity for
evidence-based assessment and management of climate risk.
As part of effort to encourage domestic production and investment in rice
value chain through backward integration, government approved the 2014 –
2017 fiscal policy measure on rice with effect from May 26, 2014. The Policy
was designed to reduce the levy on husked brown, semi-milled and whollymilled rice from 100.0 per cent to 20.0 per cent plus a 10.0 per cent duty rate
for investors. Also, a reduction in levy from 100.0 per cent to 60.0 per cent plus
a 10.0 per cent duty rate was approved for traders of the commodity. The
sustained support of the government for private sector participation in the
rice sub-sector continued to manifest with the completion of the US$900.0
million integrated rice project by Olam Farms Nigeria Limited. The project has
a processing capacity of 210,000 tonnes of rice per annum and a farm size of
10,000 hectares.
Under the Growth Enhancement Scheme (GES) component of the
Agricultural Transformation Agenda (ATA), the number of registered farmers
exceeded the 10 million mark in the review period. The registration of
artisanal fishermen and fishing canoes commenced during the period. The
fisheries sub-sector received a boost with the establishment of fingerlings
production centres in the 36 states of the Federation under the Fish Seed
Development Programme. Furthermore, a deep sea fishing vessel was
acquired by the Federal Government for the exploitation of lantern and drift
fish used for compounding fish meal.

In the crop sub-sector, 966.5 tonnes of certified seeds were produced and
distributed to farmers under the West Africa Agricultural Productivity
Programme (WAAPP – Nigeria), in collaboration with research institutes during
the period. Six staple crop processing zones (SPZ) were established in Kogi,
Niger, Kano, Enugu/ Anambra, Lagos and Rivers states, to process fresh
cassava tubers into starch, sweeteners and sorbitol.
To bridge the financing gap for agribusinesses, government established the
Fund for Agricultural Financing (FAFIN) in collaboration with the German
Development Bank (KFW). The Fund is a private and quasi equity debt fund,
which would deploy US$100.0 million in long-term finance to agribusinesses
and provide equity financing, ranging from US$2.0 million to US$5.0 million to
qualified agribusinesses. The World Bank approved a US$495.3 million credit
for improving farmers’ access to irrigation and drainage services,
strengthening institutional arrangements for integrated water resources
management and improving the delivery of agricultural services in selected
large scale public schemes in Northern Nigeria.
4.3.1.2 Agricultural Production and Prices
Agricultural output recorded modest growth in the first half of 2014. At 271.1
(2010=100), the estimated index of agricultural production increased by 5.5
per cent, compared with the 2.5 per cent growth recorded in the same
period of 2013. The growth in agricultural output, during the review period
was attributed mainly to favourable weather condition and sustained
implementation of various policy measures.
All the sub-sectors of agriculture contributed to its growth in the review
period. The output of crops rose by 5.4 per cent, compared with 1.9 per cent
recorded in the first half of 2013, with staples rising by 5.5 per cent, compared
with 1.9 per cent in the same period. The output of other crops also
increased by 4.3 per cent, compared with 8.4 per cent in the corresponding
period of 2013. The output of livestock, forestry and fishery grew by 5.6, 6.5,

and 8.4 per cent, compared with 6.7, 5.9 and 9.6 per cent, respectively, in
the first half of 2013.
A survey by the CBN indicated that the domestic retail price of selected
agricultural commodities trended upward over the level in the first half of
2013. The price increase ranged from 0.6 per cent for white maize to 30.4 per
cent for cocoa. The price increase, particularly for food commodities, was
attributed largely to distribution constraints arising from the incessant security
challenges in some parts of the country. However, cocoa price rose due to
favourable developments in the world commodity market.
The dollar-based all-commodities price index of Nigeria’s major agricultural
export commodities at the London market increased during the first half of
2014. At 408.9 (1990=100), it rose by 30.7 per cent in contrast to a decrease of
5.5 per cent in the corresponding period of 2013. Five of the six commodities
monitored namely; cotton, palm oil, coffee, cocoa and copra, recorded
price increase of 2.2, 4.4, 29.6, 33.7 and 63.4 per cent, respectively. The
increase in commodity prices was attributed largely to speculative activities
by traders and unfavourable weather conditions, which affected the supply
of the commodities. However, soya bean recorded a price decrease of 3.2
per cent, compared with an increase of 8.3 per cent in the corresponding
period of 2013. This was due to increased supply arising from favourable
weather conditions in key producing countries.
4.3.2 Industry
4.3.2.1 Industrial Policy and Institutional Support
The Federal Government’s effort to ensure steady power supply in the
country received further boost during the period under review. A
Memorandum of Understanding (MoU) was signed with the Democratic
Republic of Congo for the importation of electricity from the Inga Dam
Power Plants, for both local consumption and export to other countries. The
Plants would provide 40,000mw on full exploitation. Also, the World Bank
Group confirmed its support for the power sector reforms by providing Nigeria

with loans and guarantees worth US$1.2 billion to fund electricity projects. The
projects being supported are a 459MW power station (Azura Edo Power
Plant) in Edo State and a 533-MW facility in Akwa Ibom State (Qua Iboe
Power Plant).
To boost skilled manpower in the power sector, the National Power Training
Institute of Nigeria (NAPTIN) signed an MoU with Schneider Electric, for the
training of Nigerian electrical engineers. Schneider would train instructors
who would in-turn train technicians involved in professional electrical wirings.
The Institute is also partnering with the University of Lagos, Lagos; Bayero
University, Kano; Federal University of Technology, Minna and the University of
Science and Technology, Owerri for post-graduate training of engineers in
the sector.
Furthermore, the Federal Government set aside US$300.0 million within the
period as a partial risk guarantee to protect investors in the power sector. The
partial risk guarantee is a risk-sharing mechanism that provides banks with a
partial coverage of risk exposure against loans made for energy efficient
projects. The fund was domiciled with the CBN.
Government also approved the preferred bidders for seven of the ten power
plants owned by the Niger Delta Power Holding Company (NDPHC), under
the National Integrated Power Plants (NIPP). The NIPP assets sale entailed a
divestment of 80.0 per cent equity and was expected to generate about
US$6.0 billion for the government. EMA Consortium was confirmed as the
preferred bidder for the Benin and Calabar generation companies with a bid
of US$580.0 million and US$625.0 million, respectively. Dozzy Integrated Power
Limited was confirmed the preferred bidder for Egbema generation
company with a bid of US$415.7 million.
Seoul Electric Power Limited, was confirmed the preferred bidder for Geregu
generation company with a bid of US$690.2 million, while Ogorode and
Olorunsogo generation companies had Daniel Power Consortium and ENL
Consortium Limited as their preferred bidder with a bid of US$532.8 million
and US$751.2 million, respectively. Omotosho Electric Power also emerged as

the preferred bidder for Omotosho Generation Company with a bid of
US$659.9 million. The sale of Alaoji, Omoku and Gbarain generation
companies were stepped down, pending the resolution of outstanding
litigation.
The auto industry also received a boost in the period under review, following
the various incentives in the National Automotive Industry Development Plan
(NAIDP). Sixteen (16) companies were at various stages of establishing
assembly plants in the country. In addition, Peugeot Automobile Nigeria
Limited, Leyland, Fiat, Volkswagen and Mercedes, which businesses waned
as a result of unfavourable operational environment, had commenced
rehabilitation work to resume business operations in the country. Also, the
Stallion Group, a West African conglomerate, successfully rolled out its first
Nissan-branded vehicle from its Lagos assembly plant in the period. The feat
followed the signing of an MoU on local assembly between the RenaultNissan Alliance and the Stallion Group in 2013.
To sustain these positive developments and put the nation on a sustainable
economic path, the Federal Government approved new tariff regime of zero
per cent on completely knocked down units to support local assemblies.
Also, the duty and levy on imported new and used cars were raised from 20.0
to 70.0 per cent, to be implemented in phases. The first phase of the policy
involving 35.0 per cent duty increase, came into effect in the period under
review, while the second phase of 35.0 per cent increase in levy would
commence in January 2015.
4.3.2.2 Industrial Production
Provisional data showed improved activities in the industrial sector in the first
half of 2014. At 140.1 (1990=100), estimated index of industrial production
increased by 1.9 per cent over the level in the corresponding period of 2013.
This was attributed to increased activities in the manufacturing and electricity
sub-sectors.

Figure 68
Industrial Production Index
(First Half 2014, 1990=100)


1st Half 2012
1st Half 2013
1st Half 2014
Manufacturing
Mining
Electricity
Industry

4.3.2.3 Manufacturing
At 114.2 (1990=100), estimated data indicated a 5.3 per cent increase in the
index of manufacturing above the level in the corresponding period of 2013.
Similarly, capacity utilisation rose by 1.7 percentage points to 59.3 per cent.
The improvement in the manufacturing sub-sector was attributed to
increased
activities
in
chemical
and
pharmaceuticals,
non-metallic
products, textile and apparel, occasioned by macroeconomic stability.
Figure 69
Average Manufacturing Capacity Utilisation
(First Half 2014, Per cent)

1st Half 2012
1st Half 2013
1st Half 2014

4.3.3 Crude Oil
4.3.3.1 Crude Oil Production and Demand
Total crude oil production, including natural gas liquids (NGLs) and
condensates by the Organization of Petroleum Exporting Countries (OPEC)
was projected at an average of 35.9 million barrels per day (mbd) in the first
half of 2014. This represented a decrease of 0.1 and 1.3 per cent from the
levels in the preceding and corresponding periods of 2013, respectively. The
fall in output was largely accounted for by production decline from Nigeria,
Iraq and Libya. Non-OPEC supply was estimated at an average of 56.45
mbd, indicating an increase of 6.6 per cent above the level in the
corresponding half of 2013. Total world supply was estimated at an average
of 92.35 mbd, reflecting a 3.4 per cent increase over the level in the first half
of 2013.
World crude oil demand was estimated at at an average of 90.93 mbd in the
first half of 2014, compared with 89.72 mbd in the corresponding half of 2013,
showing an increase of 1.4 per cent. The breakdown showed that daily
average demand from the Organization for Economic Co-operation and
Development (OECD) countries was estimated at 45.6 mbd, while that of
non-OECD was 45.3 mbd. High demand, especially, from OECD Americas,
China and the Middle East accounted for more than half of the growth in
total demand.
Nigeria’s average daily crude oil production stood at 1.91 mbd or 345.71
million barrels (mb), representing a drop of 4.0 per cent below the level of
1.99 mbd or 360.19 mb attained in the first half of 2013. The drop in output
was attributed to the incessant theft and closure of oil installations in the
Niger Delta region. Aggregate export of crude oil for the period under review
was estimated at 278.7 mb or 1.46 mbd, compared with 264.3 mb or 1.54
mbd in the corresponding half of 2013.

Figure 70
Crude Oil Production and Exports

0.5

1.5

2.5
1st Half 2013
2nd Half 2013
1st Half 2014
Million barrels per day
Output
Exports
Domestic Consumption


4.3.3.2 Crude Oil Prices
The average spot price of Nigeria’s reference crude, the Bonny Light (37o API)
increased by 0.9 per cent above its level in the first half of 2013 to US$111.29
per barrel. The average prices of the UK Brent, Forcados and West Texas
Intermediate also rose, by 0.8, 0.5 and 5.3 per cent, to US$109.38, US$112.26
and US$97.40 per barrel, respectively, in the review period. Increased world
demand for crude and the escalating violence in Libya and Ukraine, which
exacerbated supply concerns, largely accounted for the rise in crude oil
prices. The average price of the OPEC basket of twelve crude streams was
US$105.30 per barrel, compared with US$105.09 per barrel in the same period
of 2013.
Figure 71
Average Spot Prices of Selected Crudes


1st half 2013
2nd half 2013
1st half 2014
US Dollar per barrel
U.K. BRENT
WEST TEXAS INTERMEDIATE
BONNY LIGHT
FORCADOS
OPEC BASKET

Source: Reuters

4.3.4 Gas
The Nigerian Content Development and Monitoring Board (NCDMB)
recorded a landmark achievement during the review period. An indigenous
oil servicing company, PEM Offshore Limited, began the test run of the first
phase of the West Africa’s 1st Offshore Simulation and Innovation Centre. On
completion, the Centre would have a full suite of Offshore Anchor Handling
Simulation Equipment, Dynamic Positioning, Power Management and Crane
Simulation Systems. Also, the Centre would support the training of local and
foreign offshore personnel involved in oil and gas operation.
Total associated gas production was estimated at 1,286,592.81 million
standard cubic feet (mmscf) in the first half of 2014, indicating an increase of
25.7 per cent above the level in the corresponding period of 2013. Total
volume of gas utilized and flared during the period was estimated at
1,046,099.91 mmscf and 240,492.90 mmscf, indicating an increase of 30.1 and
9.5 per cent above the respective levels in the first half of 2013.

Figure 72
Gas Production and Utilisation

1st Half 2013
2nd Half 2013
1st Half 2014
Million Standard Cubic Feet (mmscf)
Gas Produced
Gas Utilised
Gas Flared

4.3.5 Petroleum Products
The estimated quantity of petroleum products distributed by the major and
independent marketing companies in the review period was 3,169.9 million
litres. These included: 2,359.8 million litres (74.4%) of Premium Motor Spirit
(PMS); 293.5 million litres (9.3%) of Dual Purpose Kerosene (DPK); 325.5 million

litres (10.3%) of Automotive Gas Oil (AGO); and 184.1 million litres (5.8%) of
Low Pour Fuel Oil (LPFO), while others was 7.0 million litres.

Figure 73
Distribution of Petroleum Products
(First Half 2014)
PMS
74.4%
DPK
9.3%
AGO
10.3%
LPFO
5.8%
Others
0.2%

4.3.6 Solid Minerals
The Solid Mineral Sector received a boost during the period under review,
following the commissioning of the National Geosciences Research
Laboratories located in Zaria and Ministry of Solid Minerals, for public and
commercial operations. This was achieved through the collaborative efforts
of Nigeria Geological Survey Agency (NGSA), Cargo Defense Fund (CDF)
and NEXIM Bank. The laboratories would provide operators in the sector with
world class mineral services in solid minerals analysis and estimation. This
would reduce cost for miners and give credence to minerals mined in
Nigeria.
Solid minerals production in the first half of 2014 from provisional data of the
Ministry of Mines and Steel Development increased by 6.9 per cent from the
level in the corresponding period of 2013 to 25.27 million tonnes. Increase in
the production of some principal minerals such as clay, coal, lead/zinc and
laterite accounted for this development.

4.3.7 Electricity Generation
Estimated average electricity generation in the first half of 2014 rose by 1.8
per cent, compared with 3,488 MW/h in first half of 2013. The marginal
increase was attributed to improved generation from hydro power plants.
4.3.8 Electricity Consumption
At 3,133.77 MW/h, average estimated electricity consumed increased by 2.7
per cent, relative to the level in the same period of 2013. The improvement in
electricity consumption was due to the increase in electricity delivered to the
distribution companies.
4.3.9 Industrial Financing
4.3.9.1 NEXIM
The total disbursement the Nigeria Export Import Bank (NEXIM) to various
beneficiaries in the period under review was N5.49 billion. This amount was
41.1 per cent higher than the level of disbursement in the corresponding
period of 2013. Of the total disbursement, Manufacturing and Agriculture
sub-sectors received 57.2 per cent and 28.0 per cent, respectively, while
Services and Solid Minerals sub-sectors received 12.2 per cent and 2.6 per
cent, respectively.

Figure 74
Sectoral Disbursement of NEXIM Loans, First Half 2013

Agric and Agro
Allied
18.4%
Manufacturing
22.8%
Solid Minerals
3.9%
Services
54.9%


Source: NEXIM Bank

4.3.10 Telecommunications
Telecommunications recorded considerable growth in the first half of 2014
owing to robust activities within the sub-sector. Available data from the
Nigerian Communications Commission (NCC) indicated that the total
number of active telephone lines rose from 120.4 million at end-June 2013 to
130.8 million at end-June 2014, indicating an increase of 8.6 per cent.
Accordingly, teledensity increased to 93.4 per 100 inhabitants at end-June
2014 from 86.0 per 100 inhabitants at end-June 2013, exceeding the
International Telecommunication Union (ITU) minimum standard of 1:100. The
growth in the sector was driven mainly by an 8.8 per cent increase in the
number of active lines in the mobile telephony sub-sector, which grew from
120.0 million at end-June 2013 to 130.6 million at end-June 2014. The
development was as a result of relatively cheaper call tariffs, arising from
increased competition and product innovation.

Figure 75
Total Active Lines and Teledensity

1st Half 2013
2nd Half 2013
Jun-14
No. of Active Mobile Lines (Millions)
and
Teledensity per 100 Inhabitants
Teledensity
Mobile
Fixed
4.3.11 Consumer Prices
The general price level maintained a moderate upward trend in the first half
of 2014. The all-items composite Consumer Price Index (CPI) stood at 158.6
(November 2009=100), at end-June 2014, compared with 146.6 and 152.3 at
end-June and end-December 2013, respectively. Food CPI was 161.9 in the
period under review, compared with 147.5 and 154.3 at end-June and end-

December 2013, respectively. The all-items less farm produce CPI, which
stood at 145.5 and 153.0 at end-June and end-December 2013, respectively,
increased to 157.4 at end-June 2014.

Figure 76
Consumer Price Indices
(November 2009 = 100)

1st Half 2013
2nd Half 2013
1st Half 2014
CPI
Composite
Core
Food


4.3.11.1 Headline Inflation
The year-on-year headline inflation fluctuated in the first half of 2014 and
stood at 8.2 per cent at end-June 2014, representing a decrease of 0.2 and
an increase of 0.2 percentage point, compared with the levels at end-June
and end-December 2013, respectively. The 12-month moving average
inflation rate declined to 8.0 per cent at end-June 2014, from 10.4 and 8.5
per cent at end-June and end-December 2013, respectively. The decline in
headline inflation was attributed mainly to the fall in the prices of some items
in the consumption basket, especially non-farm produce.
4.3.11.2 Core Inflation
Core inflation (all-items less farm produce), on a year-on-year basis,
increased gradually to 8.1 per cent at end-June 2014, compared with 5.5 per
cent at end-June 2013 and 7.9 per cent at end-December 2013. The 12month moving average, core inflation stood at 7.4 per cent, relative to 10.7
and 7.7 per cent, at end-June and end-December 2013, respectively. Core
inflation accelerated at a faster rate towards the end of the first half of 2014.
The increase was attributed largely by rise in prices across various groups of
items, especially electricity/gas and other fuels, processed food, housing,

clothing and footwear, household equipment and maintenance, furniture
repairs, transport, and education.
4.3.11.3 Food Inflation
The year-on-year food inflation fluctuated in the first half of 2014. It stood at
9.8 per cent at end-June 2014, compared with 9.6 and 9.3 per cent at endJune and end-December 2013, respectively. The 12-month moving average
food inflation was 9.5 per cent at end-June 2014, compared with10.4 per
cent at end-June 2013 and 9.7 per cent at end-December 2013. The
increase in food inflation was as a result of the rise in the prices of
commodities owing to distribution constraints arising from the unresolved
security challenges in some parts of the country, especially the North-East.

Figure 77
Inflation Rate
(Year-on-Year, Per cent)

1st Half 2012
2nd Half 2012
1st Half 2013
2nd Half 2013
1st Half 2014
Headline
Food
Core

4.3.11.4 Urban and Rural Consumer Price Indices and Inflation Rates
The all-items Urban CPI, which stood at 145.5 at end-June and 151.4 at endDecember 2013, increased to 157.6 at end-June 2014. The increase was
attributed mainly to the increase in the contributions of food and nonalcoholic beverages, tobacco and narcotics; clothing and footwear;
furnishing and household equipment maintenance; health; communication;
education, restaurants and hotels; and miscellaneous goods and services.
Consequently, the year-on-year urban inflation rate stood at 8.4 per cent at

end-June 2014, compared with 8.4 per cent at end-June and 8.1 per cent at
end-December 2013.
All-items Rural and Urban CPI exhibited similar trend during the review period.
It increased from 147.9 and 153.3 at end-June and end-December 2013 to
159.7 per cent at the end of June 2014. The increase was largely accounted
for, largely, by the contributions of transport; communication; recreation and
culture; restaurants and hotels; education; and miscellaneous goods and
services. As a result, the year-on-year rural inflation rate stood at 8.0 per cent
at end-June 2014, compared with 8.3 per cent at end-June and 7.9 per cent
at end-December 2013.
Urban core inflation increased to 8.0 per cent at end-June 2014, compared
with 5.4 and 7.6 per cent at end-June and end-December 2013, respectively.
Similarly, Urban food inflation rose to 10.4 per cent, compared with 9.5 at
end-June 2013 and 9.8 per cent at end-December 2013.
Rural core inflation rate stood at 8.2 per cent at end-June 2014, compared
with 5.6 and 8.1 per cent at end-June and end-December 2013, respectively.
Rural food inflation rate stood at 9.4 per cent at end-June 2014, compared
with 9.8 and 8.9 per cent at end-June and end-December 2013, respectively.
The rural food inflation rate at end-June 2014 represented a decrease of 0.4
percentage point below the level at end-June 2013, but was an increase of
0.5 percentage point above the level at end-December 2013.
Figure 78
Urban and Rural Consumer Price Indices
(First Half, November 2009 = 100)


1st Half 2012
2nd Half 2012
1st Half 2013
2nd Half 2013
1st Half 2014
Urban Consumer Price Index
Rural Consumer Price Index

4.3.12 Health
The National Health Bill 2014 was passed by the Nigerian Senate during the
review period. The Bill sought to establish a framework for the regulation,
management and development of the nation's health system. The Bill
provides for government contribution of 1 per cent from the Consolidated
Revenue Fund for the development of Primary Health Care (PHC) in the
country.
To further boost the health sector, the governments of Nigeria and Japan
signed an MoU during the period under review for a loan facility of US$85.0
million to eradicate polio in Nigeria. The Government also launched new
national guidelines for the implementation of interventions to eliminate
malaria and lymphatic filariasis (elephantiasis) in the country.

4.3.13 Housing and Urban Development
During the period under review, the Nigerian Mortgage Refinance Company
(NMRC) opened business to provide secondary mortgage market services for
primary mortgage lenders for on-lending to teeming Nigerian hosuing loan
applicants. The NMRC, a Public Private Partnership agreement between the
Federal Government of Nigeria and the private sector was established to
create access to affordable funds by mortgage finance companies. The
NMRC is expected to reduce Nigeria’s current housing deficit by raising
mortgages from an annual average of 20,000 mortgages to at least 200,000
in the next three years.
The World Banka pproved a concessional US$300.0 million 40 years
International Development Association (IDA) loan at 0.75%, to facilitate the
execution of the Housing Finance Programme. US$250.0 million of the IDA
loan will be disbursed in installments to NMRC as Tier 2 Capital, based on key
performance indicators. The amount will be retained on NMRC’s balance
sheet to provide credit support for NMRC’s bond issuances. The balance of
US$50.0 million will be allocated to other components of the Housing Finance
Programme as follows: US$25 million for the establishment of a Mortgage

Guarantee Facility for lower income borrowers and US$25 million to support
the development and piloting of Housing Microfinance Products.
4.3.14 Aviation Services
4.3.14.1 Policy and Airport Development
The upgrading of twenty-two (22) Federal airports across the country
continued through the first half of 2014.
In a bid to ensure accurate data, security and easy facilitation of passengers
at the Nigerian international airports, the Federal Government, through the
Nigerian Immigration Service (NIS), introduced machine-readable cards at
the country’s five international airports in Lagos, Kano, Enugu, Abuja and
Port-Harcourt in the first half of 2014. The machine would seamlessly enhance
the facilitation of passengers and security checks at airports, thereby
ensuring faster airport processes while creating a database for movement of
persons across borders.
The Nigerian Airspace Management Agency (NAMA) completed the
installation of solar powered airfield lighting systems at the Lagos and Port
Harcourt international airports in the first half of 2014. The installed lighting
system was expected to increase the progression of night/low visibility
operations and reduce operational cost to the airlines. Other expected
benefits include low maintenance and running cost due to the elimination of
power generation and cabling.
4.3.14.2 Domestic Operations
A total of 5,673,899 passengers were airlifted by domestic airlines in the first
half of 2014. This represented a 27.5 per cent growth over the 4,449,026
passengers airlifted in the corresponding period of 2013. Total aircraft
movement for the first half of 2014 was 135,087, a 54.0 per cent growth over
the movement of 87,713 recorded in the corresponding period of 2013.

4.3.14.3 International Operations
The number of passengers airlifted by airlines on international routes in the first
half of 2014 rose by 4.8 per cent to 2,165,985, compared with 2,067,352 million
in the first half of 2013. Aircraft movement also rose by 4.4 per cent to 23,007
in the review period, compared with 22,042 in the corresponding period of
the preceding year.
Cargo movement at designated airports rose by 1.0 per cent to 88.54 million
kg over 87.65 million kg recorded in the first half of 2013. Mail movement also
rose by 52.8 per cent to 3.04 million kg in the first half of 2014, compared with
1.99 million kg recorded in the corresponding period of 2013.
4.3.15 Maritime Services
Efforts to raise security level of ships and port facilities in Nigeria continued
during the first half of 2014 as thirteen (13) more port facilities were fully
compliant with the International Ships and Ports Facility Security (ISPS) Code.
This brought the number of compliant port facilities in the country to twentytwo (22).
The level of operations at Nigerian ports witnessed positive change in the first
half of 2014. Cargo throughput stood at 41,317,962 tonnes in the first half of
2014, compared with 35,812,858 tonnes recorded in the corresponding
period of 2013, representing a 15.4 per cent
increase.
A total of 2,719 ocean going vessels with a
total gross registered tonnage (GRT) of
70,659,820
berthed
at
Nigerian
ports,
compared with 2,427 vessels with GRT of
60,096,179 recorded in the corresponding period of 2013. This represented a
12.0 and 17.6 per cent growth in the number of vessels and GRT, respectively.
The
achievements
in
the
sector
were
attributed,
largely,
to
the
implementation of e-payment in January 2014 which, tremendously reduced
the turn-around time of vessels from 5.3 days to 4.6 days, following faster
The maritime services witnessed enhanced
efficiency and reduced cost of doing business
at the nation’s sea ports due to the
implementation of e-payment.

payment means for business dealings and prompt confirmation of payments.
A significant increase in LNG shipment resulting from the European economic
recovery effort after the debt crisis also contributed significantly to the
increase in cargo traffic.
4.3.16 Railway Services
Concerted efforts at resuscitating and revitalizing the Nigerian railway
continued in the review period. The Nigerian Railway Corporation (NRC)
inaugurated and released two Diesel Multiple Units (DMUs) train sets with
passenger-carrying capacity of about 540 on Lagos mass transit routes. There
was also the delivery of 68-seater first class air-conditioned passenger
coaches for Lagos and Kano express routes. A total of 2,020,943 passengers
and 69,032 tonnes of freight were moved by the NRC.
4.4. EXTERNAL SECTOR DEVELOPMENTS
Provisional data showed that the external sector was under pressure
reflecting the depletion of the external reserves and huge short term capital
reversal in the first half of 2014. Despite the development, the current
account sustained a surplus equivalent to 2.3 per cent of gross domestic
product (GDP) occasioned by robust trade balance and increased home
remittances. The capital and financial account also registered a net liability
position, representing 0.6 per cent of GDP in the first half of 2014, compared
with 0.5 per cent of GDP in the first half of 2013. The external reserves, at
US$37.33 billion, declined by 12.9 per cent from the level at end-December
2013 and could support 8.0 months import cover (goods only) or 5.6 months
of imports of goods and services. The external debt, however, increased to
US$9.17 billion from US$6.92 billion and US$8.82 billion in the first and second
halves of 2013, respectively.
4.4.1 Current Account
4.4.1.1 Trade
The estimated value of external trade at N11,540.53 billion constituted 27.3
per cent of GDP. The oil component of total trade accounted for 68.2 per
cent and constituted 18.6 per cent of GDP, while the non-oil at 8.8 per cent

of GDP accounted for the balance. Despite the sustained increase in the
international crude oil price, the value of crude oil exports declined by 8.7
per cent owing to the fall in domestic crude oil production from an average
of 1.99 million barrels per day in the first half of 2013 to 1.91 million barrels per
day in the review period. However, gas export, at 2.0 per cent of GDP,
increased by 17.4 per cent to N841.41 billion over the level in the first half of
2013. The dismal performance of the non-oil export sector, at 0.8 per cent of
GDP in the reporting period, reflected the lingering structural rigidities in the
economy.

Figure 79
Exports, Imports and Trade Balance
(N’ Billion)

1st Half 2013
2nd Half 2013
1st Half 2014
N billion
Exports
Imports
Trade Balance

A disaggregation of non-oil exports by product, revealed that agricultural
produce accounted for 46.0 per cent of the total, while semi-manufactured
goods, manufactured goods, “others” and minerals accounted for 36.1, 15.1,
2.3 and 0.5 per cent, respectively.

Figure 80
Non-Oil Exports by Products
(First Half 2014)

Further analysis showed that aggregate imports, which represented 10.4 per
cent of GDP increased by 9.7 per cent, compared with the level in the
corresponding period in 2013. The development resulted from increased
domestic demand for raw materials and finished goods as non-oil imports
rose by 28.7 per cent above the level in the first half of 2013. Its share in total
imports rose to 76.3 per cent, while oil sector imports fell to 23.7 per cent due
to the positive effects of the on-going reforms in the petroleum sub-sector.
Sectoral breakdown of non-oil imports showed that, finished goods (food
and manufactured products) accounted for 47.4 per cent; industrial sector,
40.7 per cent; transport sector, 8.2 per cent; and other sectors 3.7 per cent of
the total.

Figure 81
Non-Oil Imports by Sector
(First Half 2014)


4.4.1.2 Services
Transactions in the services account resulted in a net deficit position of
N1,846.78 billion, equivalent to 4.4 per cent of GDP. The deficit widened by
20.7 per cent over the level in the corresponding period due, largely, to
higher net out-payments in respect of transportation (N581.05 billion), travels
(N543.52 billion) and other business services (N331.93 billion). Transportation
services were the highest with 31.5 per cent share of the total. The share of
travels accounted for 29.4 per cent of the total, other business services, 18.0
per cent; government services, 4.1 per cent; and other services accounted
for the balance.

Figure 82
Share of Services Out-Payments
(First Half 2014)
Transport
31.5%
Travel
29.4%
Other Bussiness
18.0%
Government
4.1%
Others
17.0%

4.4.1.3
Income
The income account posted a lower deficit of N1,682.54 billion or 4.0 per cent
of GDP, compared with the level recorded in the corresponding period in
2013 as a result of enhanced investment income abroad, and lower
repatriation of profit and dividends. Projected out-payments with respect to
dividends and distributed branch profits by foreign investors declined by 16.3
per cent, while inflow of investment income grew by 44.8 per cent over the
level in the first half of 2013.
4.4.1.4
Current Transfers
The estimated current transfers (net) recorded a surplus equivalent to 4.1 per
cent of GDP, compared with 4.3 per cent of GDP in the corresponding
period of 2013. The development was driven mainly by inflow of personal
home
remittances
by
non-resident
Nigerians.
Workers’
remittances
accounted for 92.5 per cent of total inward transfers; while general
government transfers (net), comprising payments to foreign embassies and
international organizations increased by 8.5 per cent to N138.50 billion from
N127.61 billion.
Figure 83
Private Home Remittances
(US$ billion)

First Half 2013
Second Half 2013
First Half 2014

4.4.2 Capital and Financial Account
The capital and financial account registered a net liability of N249.74 billion in
the first half of 2014, as against N183.55 billion recorded in the corresponding
period of 2013. This was attributed largely to inflow of other investment
liabilities in form of loans drawn by the general government, which increased
by 30.5 per cent from N77.88 billion in the first half of 2013 to N101.61 billion in

the review period
The aggregate foreign financial assets, however, declined by 19.7 per cent
to N1,602.86 billion in the review period due to the sharp drop in direct
investment (abroad) by 84.3 per cent. The outcome was influenced largely
by the 86.8 per cent decline in equity capital from N77.28 billion in the first
half of 2013 to N10.23 billion in the review period. However, trade credits,
which represented 2.5 per cent of GDP increased by 28.7 per cent, relative
to the level at end-June 2013.
Provisional data on foreign financial liabilities showed a decline of 15.0 per
cent to N1,852.60 billion due largely to huge short-term capital reversal from
N1,626.95 billion at end-June 2013 to N890.47 billion in the review period. This
reflected improved conditions in other global financial centres. In the other
investment liability account, loans to general government, banks and other
sectors amounted to N454.47 billion, compared with N13.82 billion in the first
half of 2013. The stock of external debt rose to US$9.38 billion from US$8.8
billion in the preceding half of 2013.
4.4.2.1 Foreign Direct Investment
Foreign direct investment (FDI) inflow, which comprised equity capital, reinvested earnings and other capital inflow declined by 52.4 per cent to
N258.33 billion from the level in the corresponding period of 2013. This was
largely due to the 74.4 per cent decline in equity capital to N85.43 billion in
the review period. Similarly, reinvested earnings and other capital declined
by 16.6 and 42.4 per cent from their respective levels in the corresponding
period of 2013. Direct investment abroad also declined by 84.3 per cent
below the level recorded in the first half of 2013.
4.4.2.2 Portfolio Investment
Portfolio investment inflow decreased by 45.3 per cent to N890.47 billion
below the level recorded in the corresponding half of 2013. The divestment
was attributed to improved conditions in other financial centres. Despite the
development, the inflow of portfolio investment accounted for 48.1 per cent

of total investment inflow. In contrast, outward portfolio investment increased
to N706.52 billion in the first half of 2014, induced by increased risk appetite
for foreign assets by resident investors.
Figure 84
Foreign Direct Investment and Portfolio Investment Inflows

1st Half 2013
2nd Half 2013
1st Half 2014
N billion
FDI Inflows
Portfolio Inflows

4.4.3 Capital Importation by Sector and Capital Outflow
The total value of new capital imported into the economy amounted to
US$9.73 billion in the review period. A sectoral analysis indicated that the
inflow was mainly directed at the capital market (shares), which accounted
for 77.0 per cent, while financing, servicing and trading were 14.4, 3.3 and 2.0
per cent, respectively. “Others” sector accounted for the balance.
On the other hand, capital outflow amounted to US$4.24 billion, of which,
capital transfers stood at US$2.43 billion or 57.7 per cent of the total.
Remittance of dividends by foreign investors was US$1.53 billion, and
accounting for 36.2 per cent, while “Others” accounted for the balance.

Figure 85
Capital Importation by Sector
(First Half 2014)
Shares
77.0%
Others
3.3%
Servicing
3.3%
Trading
2.0%
Financing
14.4%
Shares
Others
Servicing
Trading
Financing

Figure 86
Capital Outflow and Outward Transfers
(First Half 2014)
Capital Transfers
57.7%
Dividends
36.2%
Others
6.1%

4.4.4 Reserve Assets and Months of Import Cover
The stock of external reserves at end-June 2014 stood at US$37.33 billion,
compared with US$42.85 billion and US$44.96 billion at end-December 2013
and the corresponding period of 2013, respectively. The development arose
mainly from increased rDAS utilisation in the review period.
A breakdown of the external reserves by composition showed that of the
total, federation reserves was US$3.80 billion (10.2%); Federal Government
reserves, US$3.66 billion (9.8%); and CBN reserves, US$29.85 billion (80.0%). The
increase in federation reserves reflected growing excess crude savings, while
the FGN portion grew largely from the Federal Government’s funding of the
JVC cash calls account and receipts of recovered sovereign looted funds.

The external reserves could support 8.0 months of import cover (goods),
compared with 10.0 months and 10.5 months in the second and the
corresponding halves of 2013, respectively.
Of the discretionary component of the CBN portion of external reserves, the
liquidity tranche stood at US$5.03 billion; investment tranche, US$10.55 billion;
and the stable tranche, US$10.67 billion. The latter comprised interbank bond
portfolio (US$0.51 billion) and external fund portfolio, (US$10.16 billion). The
non-discretionary component on the other hand, comprised the Special
Drawing Rights (SDR) and LC collateral funds, which amounted to US$2.59
billion and US $1.03 billion, respectively, in the review period.
The Bank earned the sum of US$44.82 million on US$500.00 million from the
external reserves invested in Chinese renminbi since December 2011. A loss of
N3.96 billion was, however, incurred on the external reserves portfolio in the
first half of 2014 due to the current low coupons on bonds and the damping
effect of likely interest rate rise in the US and other advanced economies.
Figure 87
Stock of External Reserves and Months of Import Cover


1st Half 2013
2nd Half 2013
1st Half 2014
Months
US$ Billion
External Reserves
Months of import Cover

4.4.5 External Assets of Financial Institutions
Provisional data on the total external assets of the banking system in the first
half of 2014 stood at N7,693.27 billion, compared with N9,164.43 billion and
N8,513.27 billion in the first and second halves of 2013, respectively. Of the
total, CBN’s holdings fell by 18.0 per cent to N6,200.00 billion, accounting for
80.6 per cent of total assets, compared with 82.5 and 81.0 per cent in the first

and second halves of 2013, respectively. Banks’ holdings of foreign assets,
similarly, decreased by 6.9 per cent to N1,493.27 billion and accounted for
19.4 per cent of the total, compared with 17.5 and 19.0 per cent, at endJune and end-December 2013, respectively.

Figure 88
Total External Assets,
(First Half 2014)
Banks
19.4%
CBN
80.6%

5.0
INTERNATIONAL ECONOMIC RELATIONS
5.1
Regional Institutions
5.1.1 Presidential Taskforce Meeting on ECOWAS Monetary Cooperation

Programme
The inaugural meeting of the Presidential Task Force on the ECOWAS
Monetary Cooperation Programme (EMCP) was held in Niamey, Republic of
Niger, from February 20-21, 2014. The purpose of the meeting was to
deliberate on the status of implementation of the convergence criteria by
member countries towards attaining a single currency union in the subregion.
The meeting was attended by the governors of central banks of ECOWAS
member states, Union Economique et Monetaire Ouest Africaine (UMEOA),
and the ECOWAS Commission. At the meeting, member countries expressed
concerns on the constraints which inhibited their progress, and also proffered
solutions on accelerating the process of convergence towards a common
currency. The meeting concluded that member states should continue to
work towards the deadline of 2020 for the monetary union project.

5.1.2 West African Monetary Zone (WAMZ)
The West African Monetary Institute (WAMI) and the West African Institute for
Financial and Economic Management (WAIFEM) were held in Banjul, The
Gambia from January 8 - 17, 2014. The WAMZ Committee of Governors
(COG):
Directed the standardization of the computation of non-performing
loans (NPLs) across the Zone based on Basel core principles reporting
templates to ensure a uniform reporting format by member states;
Directed the presentation of report showing the extent of member
states implementation of the recommendations of the roadmap of the
EMCP at its next meeting;
Directed a review of the budgetary contributions of member countries
in line with the relevant ECOWAS protocol to be applied with effect
from 2015;
Noted the interim report on the “State of Preparedness of WAMZ
countries for a Monetary Union in January 2015” and endorsed the
presentation of the final report at the next meeting;
Accepted the proposal for a fast-track approach to monetary
integration whereby two countries (Nigeria and Ghana) would drive
the single currency programme before other members follow; and
Approved the report of the College of Supervisors of the WAMZ
(CSWAMZ) and directed the college to undertake studies on
“Dollarization in the Zone” and “GAP analysis on prudential guidelines
in the Zone”.
5.1.3 West African Institute for Financial and Economic Management
(WAIFEM)
The meeting of the Board of Governors of WAIFEM approved:
A five-year strategic plan for the sustainability of WAIFEM. The
programme would enable WAIFEM to run Diploma and Master’s
Degree courses in areas of the Institute’s niche, such as Banking
Supervision, Risk and Portfolio Management, etc; and

The proposal for Visiting Scholar Scheme.
5.1.4 West African Monetary Agency (WAMA)
The 2013 Statutory Meeting of WAMA was held in Banjul, The Gambia, from
January 8 - 17, 2014. Also, the 46th Ordinary Meeting of the Committee of
Governors of Central Banks of ECOWAS Member States was held in Dakar,
Senegal on June 30, 2014. At the two meetings, the ECOWAS Committee of
Governors (COG):
Urged member states to ensure speedy ratification and domestication
of regional protocols, conventions and legal instruments relating to
monetary integration;
Encouraged member states to effectively implement the ECOWAS
Trade Liberalization Scheme (ETLS);
Urged member states to integrate the macroeconomic convergence
criteria into their national macroeconomic frameworks;
Appealed to the ECOWAS Commission to accelerate the process of
harmonization
of
public
finance
frameworks,
and
statistical
methodologies in the region;
Approved the revised matrix on the Roadmap for the ECOWAS Single
Currency Programme;
Urged member states to strengthen the modernization of revenue
collection mechanism and improve the governance structures for tax
administration to minimize revenue leakages;
Encouraged members to rationalize public expenditure, especially
wage bill, transfers, interest payments and subsidies to contain
increasing budget deficits;
Urged members to accelerate export diversification to sustain foreign
exchange earnings; and
Urged the consolidation efforts to resolve the security concerns in the
sub-region to enhance economic activities.

5.1.5 African Union Summit
The 22nd Assembly of Heads of State and Government of the AU was held in
Addis Ababa, Ethiopia from January 21 – 31, 2014. The theme of the Summit
was “Transforming Africa’s Agriculture: Harnessing Opportunities for Inclusive
Growth and Sustainable Development”. The leaders discussed issues relating
to agricultural development and transformation in Africa. The Summit also
marked the 10th anniversary of the Comprehensive Africa Agriculture
Development Programme (CAADP). The programme is a pan-African
framework for revitalizing agriculture, food security and nutrition, and assisting
African countries attain a higher path of economic development. Under
CAADP, African governments have made a commitment to allocate at least
10 per cent of their national budgets to the agricultural sector yearly.
5.1.6 Association of African Central Banks (AACB)
The 1st 2014 Ordinary Meeting of the Bureau of the Association of African
Central Banks (AACB) was held on February 26, 2014, in Dakar, Senegal. It
was preceded by the Technical Committee Meeting, held on February 24 -
25, 2014. At the meeting, the implementation of the African Monetary
Cooperation Program (AMCP) and the decisions of the Assembly of
Governors at the 37th Ordinary Meeting held in Mauritius in August, 2013 were
reviewed. The Meeting approved the:
Report of the Joint AUC-AACB Study and the Strategy for the creation
of the African Central Bank;
Draft terms of reference for the 2014 Continental Seminar on the
theme, “The Imperatives for Improvement and Integration of Payment
Systems in Africa”, to be hosted by Banque d’Algérie; and
Work plan for 2014-2016, budget, and internal rules for the Community
of African Banking Supervisors.
5.1.7 African Development Bank (AfDB)
The 49th Annual Meetings of the Board of Governors of the AfDB and the 40th
Annual meeting of African Development Fund were held in Kigali, Rwanda

from May 19 – 23, 2014. The theme of the meeting was “The Next 50 Years –
The Africa We Want”. The theme focused on Africa’s transformation agenda
and how the continent could grow its economy through diversification,
export
competitiveness,
increased
productivity,
integration
and
technological innovation by broader collaboration between the public and
the private sectors.
The meetings discussed several issues including: Enterprising Africa;
Facilitating Africa’s trade; The economic benefits of investing in women;
Reducing
perceived
riskiness
of
investing
in
Africa’s
infrastructure;
International bonds markets; Capital market development in Africa; What
Africa needs to do to develop global value chains (GVC); among others. The
meeting
identified
harnessing
natural
resources
and
employment
opportunities, particularly the extractive industries; and agro-business as
Africa’s potential entry points into the GVC. The report on MoU signed
between the Government of India and the African Development Bank
Group on the public-private partnership (PPP) model of infrastructure delivery
to facilitate its implementation in African countries was presented.
The meeting also emphasized the opportunity in the concept of the Africa50
Fund, adopted to mobilize African savings to finance infrastructure in the
continent. It was agreed that the time for the AfDB to mobilise African savings
– currently estimated at US$1,000 trillion – to build the Africa of tomorrow is
now. The AfDB Governors approved the creation of the Fund and the release
of US$30 million for its feasibility studies.
5.1.8 African Union (AU) and Economic Commission for Africa (ECA)

Conference
of
Ministers
of
Finance,
Planning
and
Economic

Development
The 7th Joint Annual Meetings of AU/ECA Conference of Ministers of Finance,
Planning & Economic Development was held in Abuja, Nigeria from March
29 – 30, 2014, on the theme, “Industrialization for Inclusive and Transformative
Development in Africa”. A caucus meeting of African central bank
Governors was held on the sidelines, to deliberate on key issues that were

relevant to central bank’s role in fostering industrialization for structural
transformation and inclusive development in Africa through appropriate
macroeconomic management. The Ministerial Conference elected Dr. (Mrs.)
Ngozi Okonjo Iweala, Coordinating Minister of the Economy and Minister of
Finance of Nigeria, as the Chair of the Bureau for the next one year. The
plenary entailed high-level ministerial policy dialogues focused on the
theme. The major recommendations were:
Strategies that will aid industrialization at sub-regional level should be
strengthened for regional cooperation;
African capital should be made to work for Africa’s development;
Expansion of central banks’ mandates to include development
financing and involvement of central banks in credit facilitation to
development finance institutions;
Development of small and medium enterprises and micro finance
institutions to encourage talents and improve skills acquisition;
Government budget should be targeted at stimulating private sector
development;
Sensitization of all governments globally on the need to stem illicit
financial flows; and,
African ministers to ensure credibility of data and statistics generated
by institutions and agencies of government.
5.2 Multilateral Economic and Financial Institutions
5.2.1 G20 Finance Ministers and Central Bank Governors
The G-20 Finance Ministers and Central Bank Governors met in Sydney,
Australia, from February 22-23, 2014. The meeting focused on global growth,
especially as it affected G20 countries. Coordinating policies to maximize
growth and minimize unintended effects remained a central focus of the
G20 in 2014. Also, new approaches to ensure sustainable growth were
discussed as the only way to bolster confidence, create employment

opportunities, lift people out of poverty and build national prosperity. The
meeting welcomed recent signs of improvement in the global economy, in
particular, growth strengthening in the United States, the United Kingdom
and Japan alongside continued robust growth in China and many emerging
market economies, and the resumption of growth in the euro area.
It was also noted that despite these recent improvements, the global
economy remained far from achieving strong, sustainable, and balanced
growth. The meeting agreed that the global economy faced weaknesses in
some areas of demand, and growth was still below the rates needed to get
citizens back into jobs and meet their aspirations for development.
Recent volatilities in financial markets, high levels of public debt, continuing
global imbalances and remaining vulnerabilities within some economies
were identified as major challenges. The G20 primary response was to further
strengthen and refine their domestic macroeconomic, structural and
financial policy frameworks.
5.2.2 Intergovernmental Group of Twenty Four (G24)
The G24 Meeting was held in Luxor, Egypt from March 10 – 11, 2014. Four
sessions were held on the global economy, development finance, debt and
debt sustainability, and administrative matters. The following were the
highlights of the meeting:
World economic recovery was still in a parlous state with crisis
management in the US and Europe being handled in a poor manner,
while China’s response was seen to have created excess capacity
and debt overhang;
Most developing countries mismanaged the revenue derived from
high commodity prices and/or capital flows;
Recoveries from financial crises were sluggish as it takes time to repair
balance sheets, reduce/ restructure debt overhang and rationalize
excessive and unviable investment; and,

The huge infrastructure gaps in developing countries show that there
was need for long-term financing.
5.2.3 World Economic Forum on Africa (WEFA)
The World Economic Forum on Africa was held in Abuja, Nigeria from May 7 –
9, 2014. The Forum was attended by about 1,000 regional and global leaders
and participants on the theme, “Forging Inclusive Growth, Creating Jobs”.
The Forum discussed innovative structural reforms and investments that could
sustain the continent’s growth while creating jobs and prosperity for all
citizens. About 40 sessions were held covering issues such as private sector,
public works; engaging in energy; Africa growth outlook; Industries for
Impact; Africa Rising; Unlocking Job-Creating Growth; and sustaining
business in Africa.
The Forum ended with over $68 billion investment commitment to boost
economic growth in Africa. The funds would come from FDI as well as public
and private investments across countries in the continent. The funds would
be used for projects to foster growth in the agriculture sector, and improve
infrastructure such as railways, roads, education, hospitals, ICT and skill
development. The Forum revealed that global investors were beginning to
recognise the vast opportunities in the continent, while FDI in several African
countries and private investments were on the increase.
In addition, the ‘Safe Schools Initiative’ was launched by the Nigerian
coalition in collaboration with the United Nations and UN Special Envoy to
protect young people’s right to education in Nigeria and ensure safer
learning environment.
5.2.4 The World Bank/ IMF Spring Meetings
The 2014 Spring Meetings of the Board of Governors of the World Bank Group
and the International Monetary Fund (IMF) were held in Washington D.C.,
USA from April 7 – 13, 2014. Other meetings, seminars, conferences and
events were also held on the fringe of the Spring Meetings. The G-24 Ministers,

the International Monetary and Finance Committee (IMFC) and the
Development Committee held their respective meetings.
The G-24 Ministers:
Observed the strengthening recovery in major advanced economies
(AEs), but noted that growth remained tepid and subject to
considerable risk;
Expressed concern about the adverse impact of disruptive capital flow
and exchange rate volatility resulting from abrupt changes in monetary
policy in a few major AEs;
Urged policymakers, especially in countries that issue reserve currencies,
to pursue multilaterally coordinated actions to mitigate adverse spillover
effects of monetary policy,
Urged AEs to do more to stimulate global demand and facilitate
rebalancing; and
Emphasized the necessity of ensuring that Emerging Markets and
Developing Countries (EMDCs) have adequate access to financial
safety nets, including those from the international financial institutions
(IFIs).
The IMFC:
Called for carefully calibrated and communicated monetary policy
actions in major countries, with cooperation among policymakers to
manage spillovers and spillbacks;
Noted that the continued tapering of asset purchases by the Federal
Reserve remained appropriate, while the European Central Bank had
maintained accommodative monetary conditions and should consider
further action if low inflation becomes persistent;
Urged the euro area to build on recent progress by completing its
banking union;

Encouraged emerging markets and frontier low-income countries not
facing inflationary pressures and have credible policy frameworks to use
accommodative monetary policies in response to growth slowdowns;
and
Urged removal of structural impediments to inclusive growth to address
high unemployment, especially among the youth, and rising inequality.
The Development Committee:
Noted that economic recovery in high-income countries showed signs of
strengthening with growth continuing in many emerging market
economies, although risks remained;
Observed that fostering strong, inclusive and sustainable growth in the
interconnected
global
economy
required
policy
adjustments,
appropriate coordination, and communication; and
Encouraged the World Bank Group and the IMF to work jointly with all
member countries in pursuing sound and responsive economic policies
to
address
underlying
macroeconomic
vulnerabilities;
rebuild
macroeconomic buffers; and strengthen prudential management of the
financial system.
5.2.5 The Institute of International Finance (IIF)
The Institute of International Finance (IIF) Outreach Event was held on June
10, 2014 in Lagos, Nigeria. The event brought together senior-level bank
executives, experts from banks, other financial institutions, and the Central
Bank of Nigeria and covered topics on IIFs activities. Participants were
acquainted with the offers of IIF and how to harness it’s expertise for the
benefit of their institutions. These bordered on enabling access to off-shore
funding, improved corporate governance and attracting capital flows,
investment in risk and control structures, upgrading the quality of local
regulation and good risk appetite setting, among others.

5.2.6 International Commodity Organisation
The 89th Regular Session of the International Cocoa Organisation (ICCO)
was held in Zurich, Switzerland from March 10 – 14, 2014, with the following
highlights:
Nigeria’s suspension was lifted and her voting rights restored after
paying contribution for 2012/2013; and
Nigeria and Togo were urged to provide statistics on their output and
export of cocoa beans.
6.0
OUTLOOK FOR THE SECOND HALF OF 2014
Despite the unfavourable global economic environment, Nigeria’s output
growth for the second half of 2014 was expected to remain resilient amidst
disruptions of agricultural activity on account of insecurity. Firmed-up
domestic demand would continue to drive the services and manufacturing
sectors, while the strengthening of growth in advanced economies would
bolster external demand. Although there are signs of domestic inflationary
pressures, pass-through effect of foreign prices on domestic inflation was
expected to be dampened as global inflation expectations have remained
well anchored. In addition, proactive monetary policy measures would stem
the liquidity surfeit from accommodative fiscal policy anticipated in the
second half of the year. Consequently, domestic inflation would remain
reasonably contained within its recent historical average.
The outlook for the external sector for the rest of 2014 remained promising,
given the sustained high international crude oil price and stable domestic
economic conditions. The fiscal outlook is, however, mixed. Despite the
sustained increase in international oil prices above the FGN budget
benchmark price of US$77.5/barrel, the reduction in US demand for Nigeria’s
crude due to the discovery of shale oil might adversely affect total revenue.
However, it was expected that the recovery in some emerging markets might
boost the demand for Nigeria’s Brent and, thereby, dampen the effect of the
reduced crude oil demand from the US on federation revenue and
accretion to the excess crude account. It was also expected that capital

expenditure implementation would intensify in the second half of the year
along with upsurge in recurrent expenditure due to the financial outlay for
the 2015 election activities.

Table 16
Open Market Operations (OMO) Sessions
Total
Amount
Average
Average Yield
Bids
Sold
Tenor (Days)
(%)
(N' Million)
(N' Million)

January
0.00
0.00

0.00
February
0.00
0.00

0.00
March
0.00
0.00

0.00
April
275,500.00
120,000.00

2.41
May
116,942.00
40,000.00

2.45
June
0.00
0.00

0.00
Total
392,442.00
160,000.00
Average
196,221.00
80,000.00

2.43
July
0.00
0.00

0.00
August
0.00
0.00

0.00
September
70,250.00
24,000.00

5.10
October
2,000.00
2,000.00

8.60
November
47,250.00
29,500.00

10.00
December
99,181.00
53,250.00

7.40
Total
218,681.00
108,750.00
Average
54,670.25
27,187.50

7.78

January
255,939.22
140,539.22

9.30
February
0.00
0.00

0.00
March
123,421.18
69,918.18

6.78
April
142,516.59
23,387.18

9.27
May
119,335.12
48,607.55

9.61
June
80,450.00
25,470.00

9.08
Total
721,662.11
307,922.13
Average
120,277.02
51,320.36

8.81
July
227,418.50
97,815.50

8.55
August
590,156.17
351,676.17

8.91
September
327,028.16
170,997.21

10.90
October
652,222.53
465,381.71

16.25
November
811,607.10
343,676.63

16.58
December
731,097.91
428,815.76

18.03
Total
3,339,530.37
1,858,362.98
Average
556,588.40
309,727.16

13.20

January
799,840.00
246,660.00

16.36
February
1,124,220.00
297,000.00

15.89
March
1,150,240.00
491,600.00

15.27
April
973,640.00
304,180.00

14.57
May
956,240.00
363,130.00

13.99
June
48,220.00
14,110.00

14.50
Total
5,052,400.00
1,716,680.00
Average
842,066.67
286,113.33

15.10
July
17,320.00
50.00

14.10
August
137,790.00
4,500.00

14.00
September
714,000.00
318,420.00

14.25
October
1,330,810.00
882,800.00

14.03
November
1,525,360.00
939,540.00

13.77
December
952,950.00
650,270.00

13.40
Total
4,678,230.00
2,795,580.00
Average
779,705.00
465,930.00

13.92

January
2,958,460.00

1,756,660.00

13.73
February
2,302,710.00

1,351,600.00

12.54
March
2,061,290.00

1,265,240.00

13.30
April
2,228,780.00

1,516,690.00

13.55
May
1,476,320.00

1,127,400.00

13.22
June
505,190.00

81,950.00

14.09
Total
11,532,750.00
7,099,540.00
Average
1,922,125.00
1,183,256.67

13.40
July
1,078,590.00

508,740.00

14.02
August
96,480.00

91,730.00

13.37
September
337,350.00

150,510.00

13.41
October
1,956,950.00

1,206,860.00

12.80
November
1,109,670.00

791,090.00

12.52
December
797,960.00

599,470.00

12.51
Total
5,377,000.00
3,348,400.00
Average
896,166.67
558,066.67

13.10

January
1,271,958.85
1,091,488.65

12.47
February
405,786.77
307,403.51

13.17
March
836,869.23
714,571.36

13.76
April
359,329.93
285,940.65

12.87
May
1,229,507.61
905,994.13

11.29
June
1,351,007.15
1,179,539.92

11.20
Total
5,454,459.54
4,484,938.22
Average
909,076.59
747,489.70

12.46
Source: Central Bank of Nigeria
Period

Table 17
Treasury Bills: Issues and Allotments
(Naira Million)
Deposit Money
Banks
Non-Bank
Public

June

December

Annual Total

Annual Average
166,996.08
114,888.19
50,067.47

June

December

Annual Total
3,046,262.94
1,999,006.25
1,047,256.69
Annual Average
253,855.24
166,583.85
87,271.39

June

December

Annual Total

Annual Average


June

December

Annual Total

Annual Average


January

February

March

April

May

June

Half Year Total

Half Year Average

Source: Central Bank of Nigeria
Period
Issues
Central
Bank
Allotment to Subscriber

Table 18
Monetary and Credit Developments
(N’ Million)
Item
Jun 2010
Dec 2010
Jun 2011
Dec 2011
Jun 2012 /3
Dec 2012
Jun 2013 /3
Dec 2013
Jun 2014
(1) Domestic Credit (Net)
8,612,939.99
8,708,545.45

8,889,638.55

13,686,730.20

13,567,429.11

12,698,205.05

13,149,382.49

15,040,696.01

15,173,560.61

(a) Claims on Federal Government (Net)
-1,489,877.51
(1,121,798.63)

(1,068,311.33)

(496,861.62)

(1,133,629.28)

(2,453,557.09)

(2,542,654.43)

(1,468,776.49)

(1,790,219.61)

By Central Bank
-3,272,806.06
(2,884,013.44)

(2,733,579.77)

(3,514,447.09)

(3,723,009.95)

(3,574,376.40)

(3,519,920.52)

(2,101,616.08)

(2,730,498.83)

By Commecial Banks
1,782,928.55
1,762,214.81

1,665,268.44

3,017,585.48

2,584,468.21

1,120,543.34

937,527.48

596,989.86

904,620.71

By Merchant Banks
-

39,738.60

36,606.47

36,414.13

By Non Interest Banks
0.00
-

-

-

4,912.46

275.98

-

(756.74)

(755.62)

(b) Claims on Private Sector
10,102,817.50
9,830,344.08

9,957,949.88

14,183,591.82

14,701,058.40

15,151,762.15

15,692,036.93

16,509,472.50

16,963,780.23

By Central Bank
396,545.27
632,171.02

726,392.50

4,569,146.02

4,652,650.38

4,708,311.82

4,703,313.19

4,917,493.06

4,684,233.83

By Commercial Banks
9,706,272.23
9,198,173.06

9,231,557.39

9,614,445.80

10,048,406.52

10,440,956.33

10,949,139.46

11,543,649.93

12,223,369.91

By Merchant Banks
-

32,218.12

37,919.13

41,171.58

By Non Interest Banks
-

-

1.50

2,493.99

7,366.15

10,410.38

15,004.91

(i) Claims on State and Local Govts
319,167.11
369,809.82

420,237.95

513,218.66

586,273.65

665,879.27

661,034.92

779,126.93

733,441.16

By Central Bank
0.00
-

-

-

-

-

-

-

-

By Commercial Banks
319,167.11
369,809.82

420,237.95

513,218.66

586,273.65

665,879.27

660,341.02

776,698.03

731,041.16

By Merchant Banks
-

693.90

1,428.90

-

By Non Interest Banks
-

-

-

1,000.00

2,400.00

(ii) Claims on Non-Financial Public Ent's


23,574.95

By Central Bank


23,574.95

By Commercial Banks
0.0
0.0
-

-

By Merchant Banks
0.0
0.0
-

-

By Non Interest Banks
0.0
0.0
-

-

(iii) Claims on Other Private Sector
9,783,650.39
9,460,534.26

9,537,711.94

13,670,373.16

14,114,784.74

14,485,882.87

15,031,002.01

15,706,767.28

16,206,764.12

By Central Bank
396,545.27
632,171.02

726,392.50

4,569,146.02

4,652,650.38

4,708,311.82

4,703,313.19

4,893,914.78

4,660,658.88

By Commercial Banks
9,387,105.12
8,828,363.23

8,811,319.44

9,101,227.14

9,462,132.86

9,775,077.06

10,288,798.44

10,766,951.89

11,492,328.75

By Merchant Banks
-

31,524.22

36,490.23

41,171.58

By Non Interest Banks
1.50

2,493.99

7,366.15

9,410.38

12,604.91

(2) Foreign Assets (Net)
6,484,759.01
6,506,618.59

6,453,690.26

7,138,672.78

7,522,255.04

9,043,678.68

9,164,430.15

8,513,268.89

7,693,274.34

By Central Bank
5,401,021.13
5,372,285.81

4,922,626.64

5,823,794.26

6,025,336.84

7,393,557.68

7,561,183.53

6,898,546.52

6,200,004.89

By Commecial Banks
1,083,737.87
1,134,332.78

1,531,063.63

1,314,878.51

1,496,918.19

1,647,936.45

1,599,504.06

1,611,727.94

1,482,366.77

By Merchant Banks
-

1,936.05

1,089.63

8,419.57

By Non Interest Banks
-

2,184.56

1,806.50

1,904.80

2,483.10

(3) Other Assets (Net)
-4,252,200.90
(3,689,633.70)

(3,171,232.11)

(7,521,908.48)

(7,606,624.73)

(6,258,036.21)

(6,720,640.13)

(7,885,012.61)

(6,938,457.25)

Total Monetary Assets
10,845,498.10
11,525,530.34

12,172,096.71

13,303,494.50

13,483,059.41

15,483,847.53

15,593,172.51

15,668,952.29

15,928,377.70

Quasi-Money /1
5,927,508.17
5,954,260.45

6,534,832.17

6,531,913.01

6,883,664.88

8,062,901.35

8,653,623.30

8,656,124.80

9,341,094.52

Money Supply
4,917,989.92
5,571,269.89

5,637,264.54

6,771,581.49

6,599,394.54

7,420,946.18

6,939,549.21

7,012,827.49

6,587,283.17

Currency Outside Banks
795,412.07
1,082,295.07

1,016,449.92

1,245,135.35

1,088,325.98

1,301,160.63

1,127,804.88

1,447,060.44

1,162,380.36

Demand Deposits /2
4,122,577.85
4,488,974.82

4,620,814.62

5,526,446.14

5,511,068.56

6,119,785.55

5,811,744.33

5,565,767.05

5,424,902.81

Total Monetary Liabilities
10,845,498.10
11,525,530.34

12,172,096.71

13,303,494.50

13,483,059.41

15,483,847.53

15,593,172.51

15,668,952.29

15,928,377.70

GROWTH RATE OVER THE PRECEDING
DECEMBER (In Percentages)
Credit to the Domestic Economy (Net)

Credit to the Private Sector

Claims on Federal Government (Net)

By Central Bank

Claims on State and Local Governments

Claims on Non-Financial Public Enterprises
Claims on Other Private Sector

Foreign Assets (Net)

Quasi-Money

Money Supply (M1)

Broad Money (M2)

Other Assets (Net)

Source: Central Bank of Nigeria
/1 Quasi-Money consists of Time, Savings and Foreign Currency Deposits of Deposit Money Banks excluding takings from Discount Houses.
/2 Demand Deposits consist of state and local government as well as parastatals deposits at the CBN on the one hand and state and local government and private sector deposits
as well as demand deposits of non-financial public enterprises at the Deposit Money Banks.
/3 Revised

Table 19
Value of Money Market Assets
(Naira Million)

June
Dec
June
Dec
June
Dec
June
Dec
June
Treasury Bills

Treasury Certificates

Development Stocks

Certificates of Deposits

Commercial Papers

Bankers' Acceptances

FGN Bonds

Total

Treasury Bills

Treasury Certificates

Eligible Development Stocks

Certificates of Deposits

Commercial Papers

Bankers' Acceptances

FGN Bonds

Percentage Change of Total

Source: Central Bank of Nigeria
1/ Provisional
Percentage Change Over Preceding December

Instrument

Table 20
Selected Interest Rates
(End-Period Rate)

Jun
Dec
Jun
Dec
Jun
Dec
Jun
Dec
Jun
End-Period Rates
Monetary Policy Rate

Treasury Bills Issue Rate

Inter-bank Call Rate
1.18

8.83

10.92

14.10

15.26

10.56

10.42

10.50

10.50

Open Buy Back (OBB)
1.09

8.25

9.11

13.57

14.46

10.29

10.29

11.50

10.25

NIBOR 7-days
2.43

9.67

11.75

14.63

15.58

11.38

10.75

10.88

NIBOR 30-days
5.17

12.17

12.83

15.25

16.04

12.96

11.00

11.13

12.07

Deposit Money Banks (DMBs)
(Weighted Average Rates)
Savings Deposit Rate

Time Deposit Rate (3 months)

Prime Lending Rate

Maximum Lending Rate

Sources: Financial Market Dealers Association (FMDA) and Central Bank of Nigeria

Table 21
Federation Account Operations /1
(N’ Billion)
1st Half
1st Half
1st Half
1st Half
2nd Half
1st Half
Budget
Total Revenue (Gross)
3,275.88

4,758.96

5,577.22

4,806.50

5,109.03

5,437.75

Oil Revenue (Gross)
2,445.42

3,828.05

4,357.61

3,648.04

3,604.39

3,582.40

Crude oil / Gas Exports
834.31

1,007.66

959.01

842.94

1,094.04

1,920.37

PPT and Royalties etc.
813.25

1,698.91

2,160.16

2,003.29

1,713.36

1,335.54

Domestic Crude Oil / Gas Sales
793.74

1,119.63

1,190.62

785.17

748.21

323.28

Other Oil Revenue
4.13

1.86

47.82

16.64

48.78

3.22

Less:
Deductions
1,141.34

2,136.53

2,214.56

1,281.47

1,124.72

1,076.73


Oil Revenue (Net)
1,304.08

1,691.53

2,143.05

2,366.57

2,479.67

2,505.67

Non-oil Revenue
830.45

930.91

1,219.61

1,158.46

1,504.64

1,855.35

Corporate Tax
261.50

243.26

281.82

341.37

582.31

493.13

Customs & Excise Duties
140.70

210.57

226.97

207.20

257.91

391.19

Value-Added Tax (VAT)
282.38

307.11

352.75

379.18

407.95

422.72

Independent Revenue of Fed. Govt.
65.21

92.93

226.70

82.20

134.01

226.02

Education Tax
31.57

14.57

48.71

51.80

18.57

81.01

Customs Special Levies (Federation Account)
44.92

61.82

79.10

92.91

44.93

111.23

National Information Technology Development Fund (NITDF)
4.17

0.64

3.57

3.80

2.04

4.70

Customs Special Levies (Non-Federation Account)

Less:
Cost of Collection
31.60

36.27

41.27

43.33

217.35

88.81

Non-Oil Revenue (Net)
798.85

894.64

1,178.34

1,115.14

1,287.29

1,766.54

Estimated Balances in Special Accounts for the previous year

Federally-collected revenue (Net)
2,102.93

2,586.16

3,321.39

3,481.71

3,766.96

4,273.60

Federation Account Allocation:
2,102.93

2,586.16

3,321.39

3,481.71

3,766.96

4,273.60

Transfer to Federal Govt. Ind. Revenue
65.21

92.93

226.70

82.20

134.01

226.02

Transfer to VAT Pool Account
271.08

294.82

338.64

364.01

391.63

405.82

Other Tranfers 3/
80.66

77.03

131.37

148.51

122.45

198.85

Distributable Amount
Amount Distributed
1,685.98

2,121.38

2,624.68

2,886.98

3,118.87

3,442.91

Federal Government
795.99

1,001.70

1,235.91

1,358.79

1,473.20

1,642.13

State Government
403.74

508.08

626.87

689.20

747.23

832.91

Local Government
311.26

391.70

483.29

531.34

576.08

642.14

13% Derivation
174.99

219.90

278.60

307.65

322.36

325.74

Vat Pool Account
271.08

294.82

338.64

364.01

391.63

405.82

FG
40.66

44.22

50.79

54.60

58.74

60.87

SG
135.54

147.41

169.32

182.00

195.82

202.91

LG
94.88

103.19

118.52

127.40

137.07

142.04

Special Funds (FGN)
61.60

77.80

96.55

107.49

116.89

130.30

Federal Capital Territory
14.74

18.61

23.10

25.71

27.97

31.17

Ecology
14.74

18.61

23.10

25.71

27.97

31.17

Statutory Stabilization
7.37

9.31

11.55

12.86

13.98

15.59

Natural Resources
24.76

31.27

38.81

43.20

46.98

52.37

FCT VAT
2.71

2.95

3.39

3.64

3.92

4.06

Overall Balance


Deductions
1,141.34

2,136.53


JVC Cash calls
488.82

499.35


Excess Crude Proceeds
391.64

548.29


Excess PPT & Royalty
27.24

819.83


Domestic Subsidy

Others
0.00
-


Distribution from Excess Crude
442.82


Federal Government
202.95


State Government
102.94


Local Government
79.36


13% Derivation
57.57


Provisional Dist & Actual Budget (Diff)
39.87

162.90


Federal Government
18.27

74.66


State Government
9.27

37.87


Local Government
7.15

29.20


13% Derivation
5.18

21.18


Exchange Rate Gain

Federal Government

State Government

Local Government

13% Derivation

SURE-P 6/

Federal Government

State Government

Local Government

13% Derivation

NNPC Refund

Federal Government
State Government

Local Government

13% Derivation

Federation Revenue Augmentation
414.22

145.95

462.02

613.88

0.00
0.00
Federal Government
189.84

66.89

211.75

281.35

0.00
0.00
State Government
96.29

33.93

107.40

142.71

0.00
0.00
Local Government
74.24

26.16

82.80

110.02

0.00
0.00
13% Derivation
53.85

18.97

60.06

79.80

0.00
0.00
Total Excluding VAT
2,582.88

2,430.23

3,304.94

4,069.34

3,362.63

3,784.58

Federal Government
1,207.06

1,143.25

1,514.63

1,879.74

1,570.95

1,819.15

State Government
612.23

579.87

802.04

975.88

811.78

925.88

Local Government
472.01

447.06

618.34

752.36

625.85

713.81

13% Derivation
291.59

260.05

369.94

461.36

354.05

325.74

Total Statutory Revenue and VAT Distribution 3/
2,853.97

2,725.06

3,643.58

4,433.35

3,754.26

4,190.40

Federal Government
1,247.72

1,187.48

1,565.42

1,934.34

1,629.69

1,880.03

State Government
747.78

727.29

971.36

1,157.89

1,007.60

1,128.79

Local Government
566.89

550.25

736.86

879.76

762.92

855.85

13% Derivation
291.59

260.05

369.94

461.36

354.05

325.74

Source: Office of the Accountant-General of the Federation (OAGF)
1/ Revised
2/Provisional
3/ Includes Education Tax, Customs Levies and NITDF
Memorandum Items

Table 22
Summary of Federal Government Finances
First Half, 2014
(N’ Billion)

2010 First Half
2011 First Half
2012 First Half
2013 1/ First Half 2014 2/ First Half
2014 First Half
Budget
Total Federal Government Retained Revenue

Share of Federation Account (Gross)
795.99

1,001.70

1,235.91

1,358.79

1,473.20

1,642.13

Share of VAT Pool Account
40.66

44.22

50.79

54.60

58.75

60.87

Federal Government Independent Revenue
65.20

92.93

128.56

82.20

134.01

226.02

Revenue Augmentation

Share of Excess Crude Account

SURE-P

Others 3/


7.56
70.84
Total Expenditure

Recurrent Expenditure

Goods and Services

Personnel Cost
540.21

832.42

869.78

775.06

753.13

884.52

Pension
97.73

54.76

76.92

66.27

73.88

93.73

Overhead Cost
424.40

348.01

162.98

239.28
152.26
249.20
Interest Payments

Foreign
19.62

20.90

21.97

29.59

36.37

24.20

Domestic 4/
150.95

204.25

286.90

361.02

441.43

331.81

Transfers

FCT & Others (Special Funds)
64.31

86.28

134.69

152.38

120.81

134.36

Others

Capital Expenditure & Net Lending 5/

Domestic Financed Budgets

Budgetary

SURE-P

Transfers

NDDC

NJC
45.50
47.50


UBE
22.16
23.04


Refund of Signature Bonuses/Others
8.17
9.52


Balance Of Revenue And Expenditure
Primary Surplus (+)/Deficit (-)
(257.36)

(425.09)

30.32

(24.79)

152.70

(126.10)

Current Surplus(+)/Deficit(-)
93.02

(238.51)

348.77

245.78

193.39

416.24

Overall Surplus(+)/Deficit(-)
(427.93)

(650.23)

(278.55)

(415.40)

(325.11)

(482.10)

Financing:
502.95

723.56

278.55

415.40

325.11

482.10

Foreign(Net)
75.03
73.33


Domestic(Net)
427.93

650.23

278.55

415.40

325.11

482.10

Banking System

CBN

DMBs

Non Bank Public

Privatization Proceeds

Loans from Special Accts

Excess Crude

Other Funds


(293.04)

0.00
Source: Office of the Accountant-General of the Federation (OAGF)
1/ Revised
2/ Provisional
3/ Includes FG's share of Federation Revenue Augmentation and Share of Difference between Provisonal and Approved Budget.
4/ Include Ways and Means Advances
5/ Includes net deductions for loans on lent to State,local governments and Federal parastatals/companies.

Table 23
Functional Classification of Federal Government Recurrent and Capital
Expenditure
First Half, 2014
(Naira Billion)

Half - Year

Half - Year

Half - Year

Half - Year

Half - Year 1/
TOTAL EXPENDITURE
1,818.16

1,958.34

2,180.56

2,375.56

2,096.37

A. RECURRENT EXPENDITURE
1,297.22

1,546.61

1,553.24

1,714.39

1,577.88

A1. ADMINISTRATION
498.45

600.99

601.91

626.12

460.13

General Administration
257.79

281.14

310.89

313.47

140.61

Defence
98.80

109.47

109.88

117.52

119.89

Internal Security
141.86

210.38

181.14

195.14

199.63

A2. ECONOMIC SERVICES
155.62

195.35

172.59

178.34

202.19

Agriculture
13.37

15.99

22.09

19.01

18.91

Roads & Construction
17.89

20.57

19.21

21.31

25.88

Transport & Communications
35.96

43.33

47.29

46.72

53.99

Others
88.41

115.46

84.00

91.30

103.41

A3. SOCIAL & COMMUNITY SERVICES
240.99

287.08

288.70

300.67

249.04

Education
107.17

130.42

138.57

138.21

103.65

Health
48.76

57.63

70.29

64.80

63.76

Others
85.07

99.02

79.83

97.66

81.62

A4. TRANSFERS
402.15

463.20

490.05

609.26

666.52

Public Debt Charges (Int)
170.56

225.15

308.87

390.61

477.80

Domestic
150.95

204.25

286.90

361.02

441.43

Foreign
19.62

20.90

21.97

29.59

36.37

Pensions & Gratuities
97.73

54.76

76.92

66.27

67.91

FCT & Others
64.31

86.28

134.69

152.38

120.81

Contingencies (Others)
-

-

-

-

-

External Obligations
-

-

-

-

-

Extra-Budgetary Expenditure
-

-

-

-

-

Deferred Customs Duties
-

-

-

-

-

Unspecified Expenditure
-

-

-

-

-

Others
69.54

97.02

(30.44)

-

-

B. CAPITAL EXPENDITURE
445.11

303.62

259.25

499.69

353.15

B1. ADMINISTRATION
111.06

116.13

110.38

176.19

122.34

General Administration
69.12

75.05

68.16

110.77

64.61

Defence
18.09

15.99

16.45

26.41

22.76

Internal Security
23.85

25.09

25.77

39.01

34.96

B2 ECONOMIC SERVICES
249.50

118.89

97.82

221.44

90.42

Agriculture & Natural Resources
35.67

19.30

20.79

38.22

29.79

Manuf., Mining & Quarrying
10.35

7.81

5.72

12.23

-

Transport & Communications
41.99

28.21

29.21

51.97

26.93

Housing
-

-

-

-

-

Roads & Construction
72.01

36.08

36.38

71.15

33.70

National Priority Projects
-

-

-

-

-

JVC Calls/NNPC Priority Projects
-

-

-

-

-

PTF
-

-

-

-

-

Counterpart Funding
-

-

-

-

-

Others
89.49

27.50

5.72

47.86

-

B3 SOCIAL & COMMUNITY SERVICES
62.98

54.85

39.62

79.11

43.26

Education
20.76

17.90

19.57

30.32

21.57

Health
17.15

14.97

15.68

24.82

21.69

Others
25.06

21.98

4.37

23.97

-

B4 TRANSFERS
21.57

13.75

11.43

22.94

97.13

Financial Obligations
-

-

-

-

-

Capital Repayments
-

-

-

-

-

Domestic
-

-

-

-

-

Foreign
-

-

-

-

-

External Obligations
-

-

-

-

-

Contingencies 2/
-

-

-

-

-

Capital Supplementation
18.47

10.60

8.19

17.99

97.13

Net Lending to States/L.G.s/Parast.
-

-

-

-

-

Grants to States
-

-

-

-

-

Others
3.10

3.15

3.23

4.95

-

C. STATUTORY TRANSFERS
75.83

108.10

368.06

161.49

165.34

NDDC
0.00
28.04

0.00
0.00
15.49
NJC
45.50

47.50

39.17

33.50

27.92

UBE
22.16

23.04

31.80

38.99

29.36

Others
8.17

9.52

297.10

89.01

92.58

1/ Provisional
Sources: Federal Ministry of Finance, Office of the Accountant-General of the Federation
Central Bank of Nigeria


Table 24


Summary of Statutory & VAT Revenue Allocation to State Governments
First Half, 2014
(Naira Billion)
Gross Stat. Alloc.
Deductions 13% Derivation
Total Net Stat.
Alloc.
Augmentation
Exchange Gain Excess Crude 2/
VAT
Total Gross
Allocation
Total Net Alloc.
Gross Stat. Alloc.
Deductions 13% Derivation
Total Net Stat.
Alloc.
Augmentation
Exchange Gain Excess Crude 2/
VAT
Total Gross Alloc.
Total Net Alloc.
Gross Stat. Alloc. Deductions 13% Derivation
Total Net Stat.
Alloc.
Augmentation
Exchange Gain Excess Crude 2/ NNPC Refund SURE-P
VAT
Total Gross Alloc.
Total Net Alloc.
Gross Stat. Alloc. Deductions 13% Derivation
Total Net Stat.
Alloc.
Augmentation
Exchange Gain Excess Crude 2/ NNPC Refund SURE-P
VAT
Total Gross Alloc.
Total Net Alloc.
Gross Stat. Alloc.

Abia
9.73

0.53

2.75

11.95

3.17

0.30

3.28

2.79

22.02

21.49

12.25

0.24

2.29

14.29

2.14

3.01

19.67

19.43

15.11

0.30

2.30

17.11

2.59

0.27

0.42

0.55

0.40

3.48

25.12

24.82

16.61

0.46

4.94

21.09

3.44

-

1.73

0.55

1.20

3.76

32.23

31.76

18.45

Adamawa
10.86

1.01

-

9.86

2.59

0.25

2.65

2.92

19.28

18.27

13.67

0.72

-

12.96

1.93

3.17

18.77

18.06

16.87

1.97

-

14.90

2.89

0.31

0.47

0.62

0.44

3.63

25.22

23.25

18.54

0.05

-

18.49

3.84

-

1.94

0.62

1.33

3.91

30.18

30.12

19.63

Akwa Ibom
10.99

1.26

49.09

58.82

17.73

1.71

18.84

3.53

101.88

100.62

13.83

(0.87)

55.39

70.09

11.08

4.08

84.38

85.25

17.06

6.17

99.61

110.50

2.92

0.31

0.47

0.61

0.45

4.44

125.88

119.70

18.76

4.93

121.52

135.35

3.88

-

1.96

0.61

1.35

4.74

152.82

147.89

19.81

Anambra
10.97

0.32

-

10.65

2.62

0.25

2.68

3.24

19.76

19.44

13.81

0.30

-

13.51

1.95

3.53

19.29

18.99

17.04

0.10

-

16.93

2.92

0.31

0.47

0.62

0.45

4.04

25.84

25.74

18.73

0.23

-

18.50

3.88

-

1.96

0.62

1.35

4.34

30.87

30.64

19.59

Bauchi
12.73

0.87

-

11.86

3.04

0.29

3.11

3.33

22.49

21.62

16.02

1.39

-

14.63

2.26

3.62

21.90

20.51

19.76

2.45

-

17.31

3.39

0.36

0.55

0.69

0.52

4.13

29.40

26.94

21.73

1.44

-

20.28

4.50

-

2.27

0.69

1.56

4.47

35.22

33.78

23.57

Bayelsa
8.72

5.83

20.27

23.15

8.32

0.80

8.80

2.51

49.41

43.58

10.97

12.48

42.77

41.26

9.12

2.78

65.64

53.16

13.52

14.53

69.26

68.26

2.32

0.24

0.38

0.48

0.36

3.29

89.85

75.32

14.88

11.43

95.92

99.36

3.08

-

1.55

0.48

1.07

3.76

120.74

109.30

17.44

Benue
11.73

0.77

-

10.96

2.80

0.27

2.87

3.18

20.84

20.07

14.76

2.18

-

12.58

2.09

3.47

20.32

18.14

18.21

2.31

-

15.90

3.12

0.33

0.51

0.66

0.48

4.08

27.40

25.09

20.03

2.12

-

17.90

4.15

-

2.09

0.66

1.44

4.27

32.64

30.51

22.10

Borno
12.94

0.11

-

12.83

3.09

0.30

3.16

3.23

22.72

22.61

16.29

0.07

-

16.21

2.30

3.50

22.09

22.02

20.10

1.37

-

18.73

3.44

0.36

0.56

0.70

0.53

4.05

29.75

28.39

22.10

0.20

-

21.89

4.58

-

2.31

0.70

1.59

4.25

35.52

35.32

24.48

Cross River
10.20

2.29

-

7.91

2.43

0.23

2.49

2.83

18.18

15.89

12.83

0.40

2.27

14.71

2.20

3.05

20.35

19.96

15.83

1.60

2.86

17.10

2.71

0.29

0.44

0.58

0.42

3.54

26.67

25.07

17.41

0.92

0.32

16.81

3.60

-

1.82

0.58

1.25

3.85

28.83

27.91

19.82

Delta
10.98

2.24

42.74

51.49

15.77

1.52

16.74

3.80

91.56

89.32

13.82

2.03

44.56

56.35

10.79

4.09

73.26

71.23

17.05

9.51

80.23

87.77

2.92

0.31

0.47

0.62

0.45

4.99

107.05

97.54

18.75

7.81

95.47

106.40

3.88

-

1.96

0.62

1.35

4.72

126.74

118.92

20.01

Ebonyi
9.01

0.22

-

8.78

2.15

0.21

2.20

2.63

16.20

15.97

11.33

3.50

-

7.84

1.60

2.90

15.83

12.34

13.98

3.65

-

10.34

1.92

0.25

0.39

0.52

0.37

3.34

20.77

17.13

15.37

2.93

-

12.45

3.18

-

1.60

0.52

1.11

3.54

25.33

22.40

17.63

Edo
10.25

0.96

3.15

12.45

3.42

0.33

3.54

3.22

23.91

22.96

12.90

0.96

3.88

15.82

2.65

3.38

22.81

21.85

15.92

3.98

6.90

18.84

3.20

0.29

0.44

0.61

0.42

4.01

31.79

27.81

17.50

3.49

9.35

23.36

3.62

-

1.83

0.61

1.26

4.14

38.31

34.82

18.43

Ekiti
9.08

0.18

-

8.90

2.17

0.21

2.22

2.65

16.33

16.15

11.43

0.14

-

11.29

1.62

2.89

15.94

15.79

14.11

2.94

-

11.17

2.42

0.26

0.39

0.52

0.37

3.35

21.41

18.47

15.51

2.22

-

13.29

3.21

-

1.62

0.52

1.12

3.62

25.59

23.37

17.62

Enugu
10.25

0.47

-

9.78

2.44

0.24

2.50

2.95

18.39

17.91

12.90

0.17

-

12.73

1.82

3.23

17.95

17.78

15.91

0.62

-

15.30

2.73

0.29

0.44

0.57

0.42

3.72

24.08

23.47

17.50

0.08

-

17.42

3.62

-

1.83

0.57

1.26

3.98

28.75

28.68

19.82

Gombe
9.64

0.66

-

8.97

2.30

0.22

2.35

2.68

17.18

16.52

12.13

0.42

-

11.70

1.71

2.90

16.74

16.31

14.96

3.14

-

11.82

2.30

0.27

0.42

0.53

0.39

3.35

22.22

19.07

16.45

2.43

-

14.01

3.41

-

1.72

0.53

1.18

3.58

26.86

24.43

18.56

Imo
10.94

2.76

2.69

10.87

3.44

0.33

3.56

3.11

24.07

21.31

13.77

3.12

2.51

13.16

2.36

3.42

22.06

18.95

16.99

2.75

4.04

18.28

3.17

0.31

0.47

0.61

0.45

3.93

29.97

27.22

18.68

2.22

5.09

21.56

3.87

-

1.95

0.61

1.34

4.27

35.81

33.59

20.49

Jigawa
12.02

0.82

-

11.20

2.87

0.28

2.94

3.28

21.38

20.56

15.13

0.15

-

14.98

2.14

3.63

20.90

20.75

18.66

1.04

-

17.63

3.20

0.34

0.52

0.67

0.49

4.10

27.98

26.95

20.52

0.36

-

20.16

4.25

-

2.14

0.67

1.48

4.47

33.53

33.17

22.04

Kaduna
13.70

0.87

-

12.83

3.27

0.31

3.35

3.86

24.49

23.62

17.24

1.81

-

15.43

2.44

4.20

23.87

22.07

21.27

1.82

-

19.45

3.64

0.39

0.59

0.75

0.56

4.97

32.18

30.36

23.38

1.94

-

21.45

4.84

-

2.44

0.75

1.68

5.17

38.27

36.33

25.82

Kano
17.17

0.52

-

16.65

4.09

0.39

4.20

5.32

31.18

30.66

21.61

0.44

-

21.17

3.05

5.62

30.28

29.84

26.66

1.95

-

24.71

4.57

0.48

0.74

0.92

0.70

6.47

40.54

38.59

29.31

0.58

-

28.73

6.07

-

3.06

0.92

2.11

6.92

48.38

47.81

31.26

Katsina
13.06

0.77

-

12.29

3.11

0.30

3.19

3.72

23.38

22.62

16.43

0.67

-

15.76

2.32

4.03

22.78

22.11

20.27

0.22

-

20.05

3.47

0.37

0.56

0.72

0.53

4.63

30.56

30.34

22.29

0.53

-

21.76

4.62

-

2.33

0.72

1.60

4.92

36.47

35.94

24.22

Kebbi
10.92

1.58

-

9.34

2.60

0.25

2.67

2.94

19.39

17.80

13.74

0.24

-

13.51

1.94

3.21

18.89

18.66

16.96

2.02

-

14.93

2.91

0.31

0.47

0.60

0.45

3.73

25.41

23.39

18.64

0.21

-

18.43

3.86

-

1.95

0.60

1.34

3.98

30.37

30.15

20.81

Kogi
10.89

0.77

-

10.13

2.60

0.25

2.66

3.14

19.54

18.78

13.71

0.91

-

12.80

1.94

3.30

18.95

18.04

16.92

1.21

-

15.71

2.90

0.31

0.47

0.60

0.45

3.82

25.46

24.25

18.60

0.09

-

18.51

3.85

-

1.94

0.60

1.34

3.97

30.29

30.20

21.78

Kwara
9.93

0.19

-

9.74

2.37

0.23

2.43

2.71

17.66

17.48

12.49

0.10

-

12.39

1.77

2.93

17.19

17.09

15.41

0.09

-

15.32

2.64

0.28

0.43

0.55

0.41

3.35

23.07

22.98

16.95

0.09

-

16.85

3.51

-

1.77

0.55

1.22

3.58

27.57

27.48

17.54

Lagos
15.51

3.75

-

11.76

3.70

0.36

3.79

23.74

47.09

43.34

19.52

3.63

-

15.89

2.76

26.34

48.62

44.99

24.08

3.77

-

20.31

4.13

0.44

0.67

0.87

0.63

30.01

60.82

57.06

26.47

8.93

-

17.54

5.48

-

2.76

0.87

1.90

32.69

70.18

61.24

26.40

Nasarawa
9.30

0.63

-

8.67

2.22

0.21

2.27

2.50

16.50

15.87

11.71

1.48

-

10.22

1.65

2.69

16.05

14.56

14.44

2.17

-

12.27

2.47

0.26

0.40

0.52

0.38

3.07

21.55

19.38

15.88

1.79

-

14.09

3.29

-

1.66

0.52

1.14

3.34

25.83

24.04

18.17

Niger
12.70

1.57

-

11.14

3.03

0.29

3.10

3.15

22.28

20.71

15.99

2.17

-

13.82

2.26

3.39

21.63

19.46

19.73

2.99

-

16.74

3.38

0.36

0.55

0.70

0.52

3.91

29.13

26.15

21.69

1.88

-

19.81

4.49

-

2.26

0.70

1.56

4.19

34.89

33.01

23.34

Ogun
10.62

0.21

-

10.41

2.53

0.24

2.59

3.08

19.07

18.86

13.36

0.26

-

13.10

1.89

3.39

18.64

18.39

16.49

0.13

-

16.36

2.82

0.30

0.46

0.59

0.43

3.95

25.04

24.91

18.12

0.11

-

18.01

3.75

-

1.89

0.59

1.30

4.20

29.86

29.74

18.31

Ondo
10.18

0.42

9.83

19.59

5.45

0.52

5.72

3.05

34.76

34.34

12.81

0.78

7.52

19.55

3.25

3.27

26.85

26.06

15.81

3.32

13.50

25.99

2.71

0.29

0.44

0.58

0.42

3.88

37.62

34.30

17.38

2.71

18.02

32.69

3.60

-

1.81

0.58

1.25

4.03

46.67

43.96

18.34

Osun
10.07

0.48

-

9.59

2.40

0.23

2.46

3.00

18.17

17.69

12.67

0.26

-

12.41

1.79

3.25

17.71

17.45

15.64

0.36

-

15.28

2.68

0.28

0.43

0.56

0.41

3.73

23.74

23.38

17.19

2.69

-

14.50

3.56

-

1.79

0.56

1.24

4.01

28.36

25.67

17.97

Oyo
12.69

1.46

-

11.23

3.03

0.29

3.10

3.84

22.95

21.49

15.97

1.09

-

14.88

2.26

4.17

22.39

21.30

19.70

0.64

-

19.05

3.38

0.36

0.55

0.70

0.52

4.60

29.80

29.16

21.66

0.38

-

21.28

4.48

-

2.26

0.70

1.56

4.97

35.64

35.25

22.10

Plateau
10.65

1.00

-

9.65

2.54

0.24

2.60

2.94

18.99

17.98

13.41

0.60

-

12.80

1.89

3.18

18.49

17.88

16.54

0.40

2.20

18.34

2.83

0.30

0.46

0.60

0.44

3.71

27.08

26.68

18.19

0.48

6.60

24.31

3.77

-

1.90

0.60

1.31

4.08

36.44

35.96

20.58

Rivers
11.91

0.62

44.47

55.76

16.52

1.59

17.54

5.42

97.45

96.83

14.99

2.16

55.98

68.81

12.03

5.46

88.47

86.30

18.49

1.58

88.99

105.89

3.17

0.33

0.51

0.66

0.49

5.74

118.38

116.79

20.33

0.80

104.06

123.59

4.21

-

2.12

0.66

1.46

7.01

139.87

139.06

21.25

Sokoto
11.33

0.15

-

11.18

2.70

0.26

2.77

3.05

20.11

19.96

14.25

0.14

-

14.12

2.01

3.41

19.68

19.54

17.59

1.03

-

16.56

3.01

0.32

0.49

0.63

0.46

3.88

26.39

25.36

19.34

0.26

-

19.08

4.00

-

2.02

0.63

1.39

4.19

31.57

31.31

21.72

Taraba
10.73

0.07

-

10.66

2.56

0.25

2.62

2.63

18.78

18.71

13.50

0.05

-

13.45

1.91

2.86

18.27

18.22

16.66

0.03

-

16.63

2.85

0.30

0.46

0.59

0.44

3.33

24.64

24.61

18.31

0.29

-

18.03

3.79

-

1.91

0.59

1.32

3.54

29.46

29.17

18.98

Yobe
10.65

0.22

-

10.43

2.54

0.24

2.60

2.66

18.69

18.47

13.40

0.23

-

13.17

1.89

2.95

18.24

18.01

16.53

0.57

-

15.96

2.83

0.30

0.46

0.58

0.44

3.37

24.51

23.94

18.18

0.11

-

18.07

3.76

-

1.90

0.58

1.31

3.57

29.29

29.18

19.57

Zamfara
10.68

0.72

-

9.96

2.55

0.25

2.61

2.90

18.98

18.26

13.44

0.93

-

12.51

1.90

3.12

18.46

17.53

16.58

3.59

-

12.99

2.84

0.30

0.46

0.60

0.44

3.70

24.91

21.32

18.23

0.37

-

17.86

3.78

-

1.90

0.60

1.31

4.01

29.83

29.46

19.61

Disputed Deriv.
-

-

-

-

-

-

-

-

-

-

0.05

0.05

-

0.05

0.05

-

-

0.05

0.05

-

-

-

-

-

-

0.05

0.05

-

Rivers/Akwa Disputed Fund
-

-

-

2.73

2.73

1.24

3.97

3.97

-

-

0.01

0.01

-

0.01

0.01

-

-

0.01

0.01

-

-

-

-

-

-

0.01

0.01

-

403.74

37.29

174.99

541.43

150.14

14.45

156.22

135.54

1,035.08

997.79

508.08

45.35

219.90

682.63

111.95

-

-

147.41

987.33

941.99

626.86

86.33

369.95

910.48

107.40

11.35

17.44

22.45

16.53

169.32

1,341.30

1,254.97

689.20

67.60

461.36

1,082.96

142.71

-

71.94

22.45

49.58

182.00

1,619.25

1,551.65

747.23

2/ Includes the share of Oil-producing states from the excess crude
Source: Federation Account Allocation, Federal Ministry of Finance
1/ Provisional
TOTAL
S/N
States
First Half 2010
First Half 2011
First Half 2012
First Half 2013


Table 25
Allocation to Local Governments from the Federation and VAT Pools Accounts
First Half, 2014
(Naira Billion)
Fed. Acct.
Excess
Crude
Budget
Augmentat
ion
Exchange
Gain
NNPC
Refunds
SURE-P
VAT
Total
Fed. Acct.
Excess
Crude
Budget
Augmentat
ion
Exchange
Gain
NNPC
Refunds
SURE-P
VAT
Total
Fed. Acct.
Excess
Crude
Budget
Augmentat
ion
Exchange
Gain
NNPC
Refunds
SURE-P
VAT
Total
Fed. Acct.
Excess
Crude
Budget
Augmentat
ion
Exchange
Gain
NNPC
Refunds
SURE-P
VAT
Total
Fed. Acct.
Excess
Crude
Budget
Augmentat
ion
Exchange
Gain
NNPC
Refunds
SURE-P
VAT
Total
1 Abia
6.75

1.65

1.55

0.15

-

-

1.66

11.77

8.17

-

1.15

-

-

1.79

11.11

10.08

0.28

1.73

0.18

0.36

0.27

2.07

14.96

11.08

1.15

2.28

-

0.36

0.80

2.24

17.90

11.96

-

-

-

0.24

0.80

2.42

15.41

2 Adamawa
8.09

2.13

1.99

0.19

-

-

2.00

14.40

10.51

-

1.49

-

-

2.16

14.16

12.97

0.36

2.22

0.23

0.48

0.34

2.47

19.08

14.26

1.45

2.88

-

0.48

1.03

2.67

22.76

15.08

-

-

-

0.32

1.03

2.84

19.27

3 Akwa-Ibom
11.02

2.81

2.63

0.25

-

-

2.98

19.68

13.86

-

1.96

-

-

3.39

19.21

17.10

0.48

2.93

0.31

0.58

0.45

3.74

25.60

18.80

1.93

3.84

-

0.58

1.35

4.00

30.51

20.09

-

-

-

0.39

1.35

3.92

25.75

4 Anambra
8.28

2.11

1.97

0.19

-

-

2.21

14.77

10.42

-

1.47

-

-

2.41

14.30

12.86

0.36

2.20

0.23

0.50

0.34

2.76

19.25

14.13

1.46

2.90

-

0.50

1.02

2.96

22.97

15.16

-

-

-

0.33

1.02

3.23

19.74

5 Bauchi
9.58

2.44

2.28

0.22

-

-

2.22

16.74

12.05

-

1.70

-

-

2.41

16.17

14.87

0.41

2.55

0.27

0.49

0.39

2.75

21.74

16.35

1.66

3.29

-

0.49

1.18

2.98

25.94

17.21

-

-

-

0.33

1.18

3.21

21.93

6 Bayelsa
3.52

0.90

0.84

0.08

-

-

0.91

6.26

4.43

-

0.63

-

-

1.02

6.08

5.47

0.15

0.94

0.10

0.19

0.14

1.22

8.22

6.01

0.67

1.34

-

0.19

0.43

1.44

10.09

7.01

-

-

-

0.13

0.43

1.47

9.04

7 Benue
9.74

2.48

2.32

0.22

-

-

2.30

17.07

12.25

-

1.73

-

-

2.51

16.50

15.12

0.42

2.59

0.27

0.55

0.40

2.94

22.30

16.62

1.80

3.58

-

0.55

1.20

3.09

26.84

18.73

-

-

-

0.37

1.20

3.35

23.65

8 Borno
11.19

2.85

2.67

0.26

-

-

2.58

19.55

14.08

-

1.99

-

-

2.79

18.86

17.38

0.48

2.98

0.31

0.61

0.46

3.23

25.44

19.10

1.96

3.88

-

0.61

1.37

3.41

30.33

20.34

-

-

-

0.40

1.37

3.68

25.79

9 Cross-River
6.95

1.77

1.66

0.16

-

-

1.75

12.29

8.75

-

1.24

-

-

1.88

11.87

10.80

0.30

1.85

0.20

0.40

0.28

2.19

16.02

11.87

1.26

2.50

-

0.40

0.85

2.37

19.27

13.11

-

-

-

0.27

0.85

2.58

16.81

10 Delta
9.19

2.34

2.19

0.21

-

-

2.78

16.72

11.57

-

1.63

-

-

2.98

16.18

14.27

0.40

2.45

0.26

0.53

0.38

3.61

21.90

15.69

1.62

3.21

-

0.53

1.13

3.50

25.68

16.80

-

-

-

0.36

1.13

3.66

21.95

11 Ebonyi
4.95

1.26

1.18

0.11

-

-

1.30

8.82

6.24

-

0.88

-

-

1.44

8.55

7.69

0.21

1.32

0.14

0.28

0.20

1.65

11.50

8.46

0.93

1.85

-

0.28

0.61

1.75

13.88

9.70

-

-

-

0.18

0.61

1.87

12.36

12 Edo
6.96

1.77

1.66

0.16

-

-

1.98

12.54

8.76

-

1.24

-

-

2.08

12.08

10.81

0.30

1.85

0.20

0.43

0.28

2.47

16.34

11.88

1.24

2.45

-

0.43

0.85

2.55

19.41

12.85

-

-

-

0.29

0.85

2.67

16.67

13 Ekiti
5.66

1.44

1.35

0.13

-

-

1.51

10.09

7.13

-

1.01

-

-

1.64

9.77

8.79

0.24

1.51

0.16

0.32

0.23

1.90

13.15

9.67

0.98

1.95

-

0.32

0.70

2.05

15.67

10.21

-

-

-

0.21

0.70

2.15

13.26

14 Enugu
6.71

1.71

1.60

0.15

-

-

1.77

11.94

8.44

-

1.19

-

-

1.93

11.57

10.42

0.29

1.78

0.19

0.37

0.27

2.23

15.55

11.45

1.26

2.49

-

0.37

0.82

2.38

18.78

13.06

-

-

-

0.24

0.82

2.56

16.69

15 Gombe
4.90

1.25

1.17

0.11

-

-

1.21

8.64

6.16

-

0.87

-

-

1.31

8.34

7.60

0.21

1.30

0.14

0.26

0.20

1.51

11.23

8.36

0.86

1.71

-

0.26

0.60

1.62

13.41

8.95

-

-

-

0.17

0.60

1.69

11.41

16 Imo
9.71

2.48

2.32

0.22

-

-

2.50

17.23

12.22

-

1.73

-

-

2.74

16.69

15.08

0.42

2.58

0.27

0.52

0.40

3.15

22.42

16.58

1.69

3.34

-

0.52

1.19

3.40

26.72

17.50

-

-

-

0.35

1.19

3.60

22.64

17 Jigawa
10.19

2.60

2.43

0.23

-

-

2.61

18.06

12.82

-

1.81

-

-

2.87

17.51

15.82

0.44

2.71

0.29

0.56

0.42

3.26

23.49

17.40

1.77

3.51

-

0.56

1.25

3.54

28.03

18.39

-

-

-

0.37

1.25

3.87

23.88

18 Kaduna
10.93

2.79

2.61

0.25

-

-

2.76

19.33

13.76

-

1.94

-

-

3.00

18.69

16.97

0.47

2.91

0.31

0.61

0.45

3.53

25.25

18.66

1.99

3.95

-

0.61

1.34

3.69

30.24

20.68

-

-

-

0.41

1.34

3.96

26.39

19 Kano
17.94

4.57

4.28

0.41

-

-

5.01

32.21

22.57

-

3.19

-

-

5.34

31.10

27.85

0.77

4.77

0.50

0.97

0.73

6.14

41.75

30.62

3.17

6.29

-

0.97

2.20

6.58

49.83

32.92

-

-

-

0.64

2.20

7.07

42.84

20 Katsina
13.12

3.34

3.13

0.30

-

-

3.34

23.23

16.50

-

2.33

-

-

3.62

22.46

20.36

0.57

3.49

0.37

0.73

0.54

4.16

30.21

22.39

2.41

4.79

-

0.73

1.61

4.44

36.37

25.06

-

-

-

0.48

1.61

4.82

31.98

21 Kebbi
8.15

2.08

1.94

0.19

-

-

2.01

14.36

10.25

-

1.45

-

-

2.19

13.89

12.65

0.35

2.17

0.23

0.45

0.33

2.54

18.72

13.91

1.52

3.02

-

0.45

1.00

2.71

22.61

15.82

-

-

-

0.30

1.00

2.96

20.08

22 Kogi
8.44

2.15

2.01

0.19

-

-

2.13

14.93

10.63

-

1.50

-

-

2.24

14.37

13.11

0.36

2.25

0.24

0.45

0.35

2.59

19.34

14.41

1.57

3.12

-

0.45

1.04

2.71

23.30

16.35

-

-

-

0.30

1.04

2.88

20.56

23 Kwara
6.48

1.65

1.55

0.15

-

-

1.54

11.37

8.16

-

1.15

-

-

1.66

10.98

10.07

0.28

1.73

0.18

0.37

0.27

1.90

14.79

11.07

1.11

2.21

-

0.37

0.80

2.03

17.59

11.57

-

-

-

0.25

0.80

2.17

14.78

24 Lagos
10.90

2.78

2.60

0.25

-

-

14.22

30.75

13.71

-

1.94

-

-

15.40

31.05

16.92

0.47

2.90

0.31

0.65

0.45

17.82

39.51

18.60

1.90

3.76

-

0.65

1.34

19.27

45.51

19.71

-

-

-

0.43

1.34

21.68

43.16

25 Nassarawa
5.19

1.32

1.24

0.12

-

-

1.22

9.08

6.53

-

0.92

-

-

1.30

8.76

8.06

0.22

1.38

0.15

0.29

0.21

1.49

11.80

8.86

0.99

1.97

-

0.29

0.64

1.63

14.37

10.32

-

-

-

0.19

0.64

1.75

12.90

26 Niger
10.52

2.68

2.51

0.24

-

-

2.40

18.34

13.23

-

1.87

-

-

2.59

17.69

16.33

0.45

2.80

0.30

0.58

0.43

2.98

23.87

17.95

1.84

3.65

-

0.58

1.29

3.20

28.51

19.10

-

-

-

0.39

1.29

3.44

24.22

27 Ogun
7.78

1.98

1.86

0.18

-

-

2.05

13.84

9.79

-

1.38

-

-

2.25

13.42

12.08

0.34

2.07

0.22

0.44

0.32

2.61

18.08

13.28

1.31

2.60

-

0.44

0.96

2.78

21.37

13.63

-

-

-

0.30

0.96

2.95

17.83

28 Ondo
7.18

1.83

1.71

0.16

-

-

1.89

12.79

9.04

-

1.28

-

-

2.03

12.34

11.15

0.31

1.91

0.20

0.40

0.29

2.41

16.68

12.26

1.25

2.49

-

0.40

0.88

2.50

19.78

13.02

-

-

-

0.27

0.88

2.66

16.83

29 Osun
9.79

2.50

2.33

0.22

-

-

2.60

17.44

12.32

-

1.74

-

-

2.82

16.88

15.20

0.42

2.60

0.28

0.58

0.40

3.24

22.72

16.71

1.70

3.37

-

0.58

1.20

3.48

27.04

17.63

-

-

-

0.39

1.20

3.79

23.01

30 Oyo
12.52

3.19

2.99

0.29

-

-

3.35

22.33

15.75

-

2.23

-

-

3.63

21.60

19.43

0.54

3.33

0.35

0.70

0.51

4.06

28.93

21.37

2.14

4.25

-

0.70

1.54

4.38

34.37

22.24

-

-

-

0.46

1.54

4.75

28.99

31 Plateau
7.16

1.83

1.71

0.16

-

-

1.76

12.63

9.02

-

1.27

-

-

1.91

12.20

11.12

0.31

1.91

0.20

0.39

0.29

2.22

16.45

12.23

1.34

2.66

-

0.39

0.88

2.44

19.95

13.94

-

-

-

0.26

0.88

2.57

17.65

32 Rivers
9.38

2.39

2.24

0.22

-

-

3.64

17.87

11.81

-

1.67

-

-

3.68

17.15

14.57

0.41

2.50

0.26

0.51

0.38

3.94

22.57

16.02

1.66

3.30

-

0.51

1.15

4.70

27.34

17.28

-

-

-

0.34

1.15

4.48

23.25

33 Sokoto
8.99

2.29

2.14

0.21

-

-

2.21

15.85

11.32

-

1.60

-

-

2.45

15.37

13.96

0.39

2.39

0.25

0.50

0.37

2.80

20.67

15.35

1.68

3.32

-

0.50

1.10

3.02

24.98

17.41

-

-

-

0.34

1.10

3.27

22.12

34 Taraba
7.16

1.83

1.71

0.16

-

-

1.49

12.34

9.01

-

1.27

-

-

1.62

11.91

11.12

0.31

1.90

0.20

0.39

0.29

1.89

16.11

12.22

1.26

2.49

-

0.39

0.88

2.00

19.24

13.05

-

-

-

0.26

0.88

2.15

16.33

35 Yobe
6.94

1.77

1.66

0.16

-

-

1.57

12.10

8.74

-

1.23

-

-

1.74

11.71

10.78

0.30

1.85

0.20

0.39

0.28

1.99

15.78

11.85

1.26

2.50

-

0.39

0.85

2.11

18.97

13.12

-

-

-

0.26

0.85

2.24

16.47

36 Zamfara
6.52

1.66

1.55

0.15

-

-

1.55

11.44

8.20

-

1.16

-

-

1.67

11.03

10.12

0.28

1.73

0.18

0.34

0.27

1.98

14.91

11.13

1.14

2.26

-

0.34

0.80

2.15

17.83

11.85

-

-

-

0.23

0.80

2.24

15.12

37 FCT Abuja
2.77

0.71

0.66

0.06

-

-

3.89

8.09

3.49

-

0.49

-

-

4.70

8.68

4.31

0.12

0.74

0.08

0.14

0.11

5.07

10.56

4.73

0.50

1.00

-

0.14

0.34

5.62

12.34

5.23

-

-

-

0.09

0.34

6.49

12.16

-

-

-

311.26

79.36

74.24

7.15

-

-

94.88

566.89

391.70

-

55.35

-

-

-

103.19

550.25

483.29

13.44

82.81

8.75

17.31

12.74

118.51

736.86

531.34

55.46

110.02

-

17.31

38.23

127.40

879.76

576.08

-

-

-

11.54

38.23

137.07

762.92

Source: Federation Account Allocation, Federal Ministry of Finance.
1/ Revised
2/ Provisional
VAT: Value Added Tax
LGA: Local Governments Areas
S/N
TOTAL
First Half 2010
First Half 2011
First Half 2012
First Half 2013 1/
First Half 2014 2/
State

Table 26
Domestic Debt of the Federal Government
First Half, 2014
(Naira Billion)
First Half 2010
First Half 2011
First Half 2012
First Half 2013 1/
End-Dec 2013
First Half 2014 2/
1. Composition of Debt
i Treasury Bills
901.02

1,561.42

2,084.59

2,483.29

2,581.55

2,735.87

ii Treasury Bonds
392.07

372.90

353.73

334.56

315.39

315.39

iii Development Stocks
0.22


iv FGN Bonds
2,408.43

3,276.11

3,714.55
4,032.90
4,222.04

4,369.84
v Promissory Note
63.03


Total
3,764.76

5,210.44

6,152.87

6,850.75

7,118.98

7,421.10

2. Holders
i Banking System
2,690.50

3,917.38

3,824.81

3,928.45

3,762.69

4,694.35

a. Central Bank
311.80

313.32

439.62

243.74

468.86

466.83

b. Deposit Money Banks /3
2,378.70

3,604.06

3,385.19

3,684.71

3,293.83

4,227.52

ii Non-Bank Public
928.12

1,141.75

2,166.11

2,760.05

3,197.69

2,542.68

iii Sinking Fund
146.14

151.30

161.95

162.25

158.59

184.07

Total Debt Outstanding
3,764.76

5,210.43

6,152.87

6,850.75

7,118.97

7,421.10

Source: Debt Management Office
1/ Revised
2/ Provisional
3/ Includes holdings of Discount Houses


Table 27
Domestic Debt Service Payments of the Federal Government By Instruments
First Half, 2014
(Naira Billion)
1st Half 2010
1st Half 2011
1st Half 2012
1st Half 2013
2nd Half 2013
1st Half 2014 1/
i Treasury Bills
14.23

73.38

173.60

170.34

85.11

173.08

ii Treasury Bonds
18.75

18.75

18.75

18.75

7.43

18.75

iv Development Stocks
0.33

0.23

-

-

-

-

v FGN Bonds
111.87

136.24

156.55

234.13

142.67

247.35

Total
145.18

228.61

348.90

423.22

235.20

439.18

Source: Debt Management Office
Note: Debt Service excludes sinking fund charges
1/ Provisional

Table 28
External Debt Outstanding
First Half, 2014
(US$ Million)
Holders
End-June 2010
End-June 2011
End-June 2012
End-June 2013
End-December 2013
End-June 2014 /1
1. Multilateral
3,860.68

4,563.39

4,950.66

5,538.70

6,275.21

6,730.45

2. Paris Club
-

-

-

-

-

-

3. London Club
-

-

-

-

-

-

4. Promissory Notes
-

-

-

-

-

-

5. Others 2/
409.03

834.65

1,085.00

1,381.40

2,546.61

2,646.66

Total Debt Outstanding
4,269.71

5,398.04

6,035.66

6,920.10

8,821.82

9,377.11


Table 28 Continued
External Debt Stock /1
First Half, 2014
(US$ Million)
Holders
End-June 2010
End-June 2011
End-June 2012
End-June 2013
End-December 2013
End-June 2014 /1
Federal
4,269.71

5,398.04

6,035.66

6,920.10

6,005.80

6,363.90

1. Multilateral
3,860.68

4,563.39

4,950.66

5,538.70

3,518.19

3,826.18

2. Others 2/
409.03

834.65

1,085.00

1,381.40

2,487.61

2,537.72

States and FCT
-

-

-

-

2,816.02

3,013.22

1. Multilateral
-

-

-

-

2,757.02

2,904.26

2. Others 2/
-

-

-

-

59.00

108.95

Total Consolidated Debt
4,269.71

5,398.04

6,035.66

6,920.10

8,821.82

9,377.11

Source: Debt Management Office (DMO)
1/ Provisional
2/ Includes Non-Paris Bilateral, Commercial debts and Euro bond

Table 29
External Debt Service Payments
First Half, 2014
(US$ Billion)
First Half 2010
First Half 2011
First Half 2012
First Half 2013 /1
Second Half 2013
First Half 2014 2/
London Club
-

-

-

-

-

-

Paris Club
-

-

-

-

-

-

Multilateral
113.40

95.51

63.81

70.91

24.70

82.43

(i) I. B. R.D.
43.74

27.82

6.89

-

-

-

(ii) E. I. B.
-

-

-

-

-

-

(iii) A.D.B. & Others
69.66

67.69

56.92

70.91

24.70

82.43

Promissory Notes
-

-

-

-

-

-

Others 3/
64.20

80.96

88.35

79.17

25.45

95.75

Total
177.60

176.47

152.16

150.08

50.15

178.18

Source: Debt Management Office
1/ Revised
2/ Provisional
3/ Also includes Oil Warrant, Euro Bond, Non-Paris Bilateral and Non-Paris Commercial Debts


Table 30
Consolidated Debt Outstanding /1
First Half, 2014
(Naira Billion)
Holders
End-June 2010
End-June 2011
End-June 2012
End-June 2013
End-December 2013
End-June 2014
External Debt
640.41

827.56

950.61

1,088.58

1,373.57

1,460.30

Federal
640.41

827.56

950.61

1,088.58

935.11

991.05

States and FCT
-

-

-

-

438.45

469.25

Domestic Debt
3,764.76

5,210.44

6,152.87

6,850.75

7,118.98

7,421.10

Federal
3,764.76

5,210.44

6,152.87

6,850.75

7,118.98

7,421.10

Total Consolidated Debt
4,405.18

6,038.00

7,103.48

7,939.33

8,492.55

8,881.40

Table 30 Continued
Consolidated Debt Service Payment /1
First Half, 2014
(Naira Billion)

Holders
End-June 2010
End-June 2011
End-June 2012
End-June 2013
End-December 2013
End-June 2014
External Debt
177.60

176.47

23.94

23.61

7.89

28.03

Domestic Debt
145.18

228.61

348.90

423.22

235.20

439.18

Total Consolidated Debt
322.78

405.08

372.84

446.83

243.09

467.21

Source: Debt Management Office (DMO)
1/ Provisional


Table 32
Gross Domestic Product at 2010 Constant Basic Prices /1
(Naira Billion unless otherwise stated)
First Half 2012
First Half 2013 /2
First Half 2014 2/
1. Agriculture
5,965.90

6,116.03

6,394.42

21.13
20.64
20.28
(a) Crop Production

(b) Livestock

(c) Forestry

(d) Fishing

2. Industry
6,558.68

6,503.08

6,886.47

23.23
21.95
21.85
(a) Crude Petroleum & Natural Gas

(b) Solid Minerals

(c) Manufacturing

3. Construction

4. Trade

5. Services
9,893.80

10,766.85

11,543.29

35.04
36.33
36.62
(a) Transport

(b) Information and Communication

(c) Utilities

(d) Accommodation and Food Services

(e) Finance & Insurance

(f) Real Estate

(g) Professional, Scientific & Technical Services

(h) Administrative and Support Services Bussiness Servic

(i) Public Administration

(j) Education

(k) Human Health & Social Services

(l) Arts, Entertainment & Recreation

(m) Other Services

TOTAL (GDP)
28,238.55

29,632.18

31,523.30

100.00
100.00
100.00
NON-OIL (GDP)
24,061.03

26,029.75

27,965.26

85.21
87.84
88.71
TOTAL GDP GROWTH RATE (%)
3.79

4.94

6.38

OIL GDP GROWTH RATE (%)
(9.19)

(13.77)

(1.23)

NON-OIL GDP GROWTH RATE (%)
6.43

8.18

7.44

Growth in Total GDP
Agriculture (%)
6.36

2.52

4.55

Industry (%)
(0.96)

(0.85)

5.90

Construction (%)
24.17

13.96

13.99

Trade (%)
1.61

5.91

5.71

Services (%)
4.90

8.82

7.21

Source: National Bureau of Statistics
1/ Revised
2/ Provisional
Activity Sector
First Half 2012
First Half 2013 /2
First Half 2014 2/
Share of Total GDP (Per Cent)


Table 33
Gross Domestic Product at Current Basic Prices /1
(Naira Billion unless otherwise stated)
First Half 2012
First Half 2013 /2
First Half 2014 2/
1. Agriculture
6,417.37

6,797.24

7,225.24

18.77
17.78
17.24
(a) Crop Production

(b) Livestock

(c) Forestry

(d) Fishing

2. Industry
8,499.02

8,660.49

9,530.21

24.86
22.66
22.74
(a) Crude Petroleum & Natural Gas

(b) Solid Minerals

(c) Manufacturing

3. Construction

4. Trade

5. Services
12,064.06

14,367.62

16,092.79

35.28
37.59
38.40
(a) Transport

(b) Information and Communication

(c) Utilities

(d) Accommodation and Food Services

(e) Finance & Insurance

(f) Real Estate

(g) Professional, Scientific & Technical Services

(h) Administrative and Support Services Bussiness Servic

(i) Public Administration

(j) Education

(k) Human Health & Social Services

(l) Arts, Entertainment & Recreation

(m) Other Services

TOTAL (GDP)
34,193.99

38,226.65

41,904.61

100.00
100.00
100.00
NON-OIL (GDP)
28,458.41

33,142.75

36,659.21

83.23
86.70
87.48
TOTAL GDP GROWTH RATE (%)
15.69
11.79

9.62

OIL GDP GROWTH RATE (%)
0.38
(11.36)

3.18

NON-OIL GDP GROWTH RATE (%)
19.36
16.46

10.61

Growth in Total GDP
Agriculture (%)
11.24
5.92

6.30

Industry (%)
8.00
1.90

10.04

Construction (%)
28.48
22.05

19.67

Trade (%)
20.58
15.45

5.51

Services (%)
20.73
19.09

12.01

Source: National Bureau of Statistics
1/ Revised
2/ Provisional
Activity Sector
First Half 2012
First Half 2013 /2
First Half 2014 2/
Share of Total GDP (Per Cent)

Table 34
Selected Real Sector Indicators
(Per cent, except otherwise indicated)

2013 /1
2014 /2
First Half
First Half
First Half
First Half
First Half
Agricultural Production Index (1990 = 100)
Aggregate

Crops

Staples

Other Crops

Livestock

Fishery

Forestry

Indices of Average World Prices of Nigeria's Major Agricultural Export
Commodities (1990 = 100) (Dollar Based)
All Commodities

Cocoa

Coffee

Cotton

Palm Oil

Copra

Soya Bean

GROWTH RATE OVER THE PRECEDING PERIOD (%)
Agricultural Production Index (1990 = 100)
Aggregate

Crops

Staples

Other Crops

Livestock

Fishery

Forestry

Indices of Average World Prices of Nigeria's Major Agricultural Export
Commodities (1990 = 100) (Dollar Based)
All Commodities

Cocoa

Coffee

Cotton

Palm Oil

Copra

Soya Bean

Industrial Production Index (1990 = 100)
Industrial Production Index

Manufacturing Production Index

Mining Production Index

Electricity Production Index

Capacity Utilization Rate (%)

Inflation Rate (12-Month Moving Average)

Inflation Rate (Year-on-Year)

Food Inflation Rate (Year-on-Year)

Non-Food Inflation Rate (Year-on-Year)

1/Revised
2/Provisional
Item

Table 34 cont’d
Selected Real Sector Indicators
(Per cent, except otherwise indicated)
2014 2/
First Half
Second Half
First Half
Second Half
First Half
(1)
(2)
(3)
(1) & (3)
(2) & (3)
(1) & (3)
(2) & (3)
World Crude Oil Production
million barrels per day (mbd)
OPEC

Crudes

NGLs and condensates

Total non-OPEC

Total World Supply

Demand
OECD

Non-OECD

Total World Demand

Nigeria
Output

Exports

Domestic Consumption

Average Spot Price of Selected Crude Oil
at the International Oil Market (US$)
UK Brent

West Texas Intermediate (WTI)

Bonny Light

Forcados

OPEC Basket

Gas Activities
(MMm
3)
Gas Produced

Gas sold to Industries
Gas sold for LNG
Gas used as Fuel
Gas Reinjected
Gas Lift
Gas Converted to NGLs
Total Gas Utilised

Gas Utilised as % of Gas Produced

Gas Flared

Gas Flared as % Gas Produced

Sources: OPEC, NNPC, Reuters & CBN Estimates
1/ Revised
2/ Provisional
Item

Absolute Change
Between
Percentage
Change Between
2013 1/

Table 35
Composite Consumer Price Index
(November 2009=100)
Monthly
Index
Inflation
y-o-y(%)
12-Month
Average
Index
Inflation
12-Month
Average(%)
Monthly
Index
Inflation
y-o-y(%)
Inflation
12-Month
Average(%)
Monthly
Index
Inflation
y-o-y(%)
Inflation
12-Month
Average(%)

January

February

March

April

May

June

July

August

September

October

November

December


January

February

March

April

May

June

July

August

September

October

November

December


January

February

March

April

May

June

July

August

September

October

November

December


January

February

March

April

May

June

July

August

September

October

November

December


January

February

March

April

May

June

Source: National Bureau of Statistics (NBS)
Year
&
Month
All Item (Headline)
All Items less Farm Produce (Core)
Food

Table 36
Urban and Rural Consumer Price Index
(November 2009=100)
All Items
(Headline)
Monthly Index
Headline
Inflation
y-o-y(%)
All Items less Farm
Produce (Core)
Monthly Index
Core
Inflation
y-o-y(%)
Food
Monthly
Index
Food
Inflation
y-o-y(%)
All Items
(Headline)
Monthly Index
Headline
Inflation
y-o-y(%)
All Items less Farm
Produce (Core)
Monthly Index
Core
Inflation
y-o-y(%)
Food
Monthly
Index
Food
Inflation
y-o-y(%)

January

February

March

April

May

June

July

August

September

October

November

December


January

February

March

April

May

June

July

August

September

October

November

December


January

February

March

April

May

June

July

August

September

October

November

December


January

February

March

April

May

June

July

August

September

October

November

December


January

February

March

April

May

June

Source: National Bureau of Statistics (NBS)
Year
&
Month
Urban
Rural

Table 37
Balance of Payments Analytic Presentation
(US$ Million)
1st Half 2013 /1
2nd Half 2013 /1
1st Half 2014 /2
CURRENT ACCOUNT
11,149.42

8,998.77

6,136.80

Goods
23,491.39

20,275.69

17,613.41

Exports (fob)
49,169.95

45,948.10

45,787.80

Oil and Gas
46,602.41

43,972.28

43,739.50

Non-oil
2,567.54

1,975.82

2,048.30

Imports (fob)
(25,678.56)

(25,672.42)

(28,174.39)

Oil
(8,977.21)

(6,166.21)

(6,685.68)

Non-oil
(16,701.35)

(19,506.21)

(21,488.71)

Unrecorded(TPAdj)
-

-

-

Services(net)
(9,802.23)

(10,306.58)

(11,835.84)

Credit
1,043.44

1,372.36

1,034.04

Transportation
460.02

648.25

425.97

Travel
274.76

267.63

275.15

Insurance Services
2.13

1.99

19.35

Communication Services
24.24

27.84

26.64

Construction Services
-

-

-

Financial Services
10.53

11.67

6.73

Computer & information Services
-

-

-

Royalties and License Fees
-

-

-

Government Services
241.91

241.75

242.03

Personal, cultural & recreational services
-

-

-

Other Bussiness Services
29.85

173.24

38.17

Debit
(10,845.67)

(11,678.95)

(12,869.88)

Transportation
(4,392.64)

(4,191.87)

(4,149.84)

Travel
(2,554.80)

(3,357.17)

(3,758.51)

Insurance Services
(330.82)

(382.81)

(474.94)

Communication Services
(262.71)

(309.76)

(372.12)

Construction Services
(11.83)

(75.48)

(45.17)

Financial Services
(293.30)

(455.07)

(559.58)

Computer & information Services
(36.91)

(278.72)

(465.95)

Royalties and License Fees
(132.00)

(128.70)

(126.42)

Government Services
(952.83)

(785.48)

(729.16)

Personal, cultural & recreational services
(16.34)

(4.38)

(22.73)

Other Bussiness Services
(1,861.49)

(1,709.52)

(2,165.47)

Income(net)
(13,238.72)

(12,491.05)

(10,783.25)

Credit
422.00

466.06

567.10

Investment Income
323.11

373.70

467.86

Compensation of employees
98.89

92.36

99.24

Debit
(13,660.72)

(12,957.11)

(11,350.34)

Investment Income
(13,649.53)

(12,945.01)

(11,343.59)

Compensation of employees
(11.20)

(12.10)

(6.76)

Current transfers(net)
10,698.98

11,520.72

11,142.48

Credit
10,935.87

11,776.05

11,315.89

General Government
902.91

1,009.37

887.67

Other Sectors
10,032.96

10,766.68

10,428.22

Workers Remittance
10,020.89

10,755.43

10,318.59

Debit
(236.89)

(255.34)

(173.41)

General Government
(85.03)

(96.33)

(0.05)

Other Sectors
(151.86)

(159.01)

(173.36)

Workers Remittance
(13.80)

(13.80)

(13.80)

CAPITAL AND FINANCIAL ACCOUNT
1,176.46

6,572.38

1,600.54

Capital account(net)
-

-

-

Credit
-

-

-

Capital Transfers(Debt Forgiveness)
-

-

-

Debit
-

-

-

Capital Transfers
-

-

-

Financial account(net)
1,176.46

6,572.38

1,600.54

Assets
(12,800.30)

(1,054.09)

(10,272.59)

Direct investment (Abroad)
(509.56)

(727.93)

(79.95)

Portfolio investment
(1,577.23)

(1,669.39)

(4,528.00)

Other investment
(9,531.80)

(826.61)

(11,191.95)

Change in Reserve
(1,181.71)

2,169.83

5,527.31

Liabilities
13,976.76

7,626.47

11,873.14

Direct Invesment in reporting economy
3,475.38

2,133.09

1,655.60

Portfolio Investment
10,427.18

3,224.97

5,706.93

Other investment liabilities
74.20

2,268.41

4,510.61

NET ERRORS AND OMISSIONS
(12,325.87)

(15,571.15)

(7,737.35)

Memorandum Items:
1st Half 2013 /1
2nd Half 2013 /1
1st Half 2014 /2
Current Account Balance as % of G.D.P
4.50
3.32
2.26
Capital and Financial Account Balance as % of G.D.P
0.47
2.42
0.59
Overall Balance as % of G.D.P
0.48
-0.80
-2.04
External Reserves - Stock (US $ million)
44957.00
42847.31
37330.03
Number of Months of Imports Equivalent
10.50
10.01
7.95
External Debt Stock (US$ million)
6920.10
8821.90
9377.11
Debt Service Due as % of Exports of Goods Non Factor Services
Effective Central Exchange Rate (N/$)
156.03
156.04
156.02
Average Exchange Rate (N/$)
157.30
157.32
157.29
End-Period Exchange Rate (N/$)
157.31

157.26
157.29
Source: Central Bank of Nigeria
1/ Revised
2/ Provisional

Table 38
Balance of Payments Analytic Presentation
(N’ Million)
1st Half 2013 /1
2nd Half 2013 /1
1st Half 2014 /2
CURRENT ACCOUNT
1,739,645.70

1,404,512.82

957,542.65

Goods
3,665,350.98

3,164,776.33

2,748,268.52

Exports (fob)
7,671,959.96

7,171,970.53

7,144,396.56

Oil and Gas
7,271,346.92

6,863,578.62

6,824,794.38

Non-oil
400,613.03

308,391.91

319,602.17

Imports (fob)
(4,006,608.98)

(4,007,194.20)

(4,396,128.03)

Oil
(1,400,705.48)

(962,530.38)

(1,043,185.41)

Non-oil
(2,605,903.50)

(3,044,663.82)

(3,352,942.62)

Unrecorded(TPAdj)
-

-

-

Services(net)
(1,529,438.42)

(1,608,708.86)

(1,846,778.60)

Credit
162,807.22

214,221.88

161,344.40

Transportation
71,776.85

101,190.37

66,465.16

Travel
42,870.73

41,773.55

42,931.96

Insurance Services
332.46

309.98

3,018.76

Communication Services
3,782.16

4,345.43

4,156.71

Construction Services
-

-

-

Financial Services
1,642.28

1,820.93

1,050.73

Computer & information Services
-

-

-

Royalties and License Fees
-

-

-

Government Services
37,745.13

37,734.17

37,764.67

Personal, cultural & recreational services
-

-

-

Other Bussiness Services
4,657.61

27,047.46

5,956.41

Debit
(1,692,245.64)

(1,822,930.74)

(2,008,123.01)

Transportation
(685,383.80)

(654,299.12)

(647,510.58)

Travel
(398,623.49)

(524,012.91)

(586,450.78)

Insurance Services
(51,617.54)

(59,754.66)

(74,106.17)

Communication Services
(40,991.13)

(48,349.91)

(58,063.11)

Construction Services
(1,845.33)

(11,781.15)

(7,047.25)

Financial Services
(45,763.43)

(71,027.08)

(87,313.24)

Computer & information Services
(5,758.31)

(43,498.84)

(72,703.03)

Royalties and License Fees
(20,595.92)

(20,088.30)

(19,725.66)

Government Services
(148,670.13)

(122,608.37)

(113,773.50)

Personal, cultural & recreational services
(2,549.56)

(683.93)

(3,545.94)

Other Bussiness Services
(290,446.99)

(266,826.47)

(337,883.74)

Income(net)
(2,065,625.21)

(1,949,764.48)

(1,682,539.31)

Credit
65,844.53

72,748.10

88,485.92

Investment Income
50,414.78

58,331.62

73,001.13

Compensation of employees
15,429.74

14,416.47

15,484.78

Debit
(2,131,469.74)

(2,022,512.58)

(1,771,025.22)

Investment Income
(2,129,722.77)

(2,020,623.81)

(1,769,970.88)

Compensation of employees
(1,746.97)

(1,888.77)

(1,054.35)

Current transfers(net)
1,669,358.36

1,798,209.83

1,738,592.04

Credit
1,706,320.58

1,838,070.35

1,765,649.22

General Government
140,880.61

157,551.62

138,505.66

Other Sectors
1,565,439.97

1,680,518.73

1,627,143.55

Workers Remittance
1,563,556.03

1,678,762.18

1,610,037.22

Debit
(36,962.23)

(39,860.52)

(27,057.17)

General Government
(13,267.44)

(15,040.79)

(7.03)

Other Sectors
(23,694.79)

(24,819.74)

(27,050.15)

Workers Remittance
(2,153.21)

(2,154.01)

(2,153.25)

CAPITAL AND FINANCIAL ACCOUNT
183,545.01

1,026,287.84

249,737.08

Capital account(net)
-

-

-

Credit
-

-

-

Capital Transfers(Debt Forgiveness)
-

-

-

Debit
-

-

-

Capital Transfers
-

-

-

Financial account(net)
183,545.01

1,026,287.84

249,737.08

Assets
(1,997,244.43)

(164,043.95)

(1,602,860.77)

Direct investment (Abroad)
(79,507.80)

(113,561.44)

(12,475.25)

Portfolio investment
(246,092.11)

(260,576.41)

(706,516.30)

Other investment
(1,487,240.53)

(128,570.52)

(1,746,310.16)

Change in Reserve
(184,403.99)

338,664.43

862,440.94

Liabilities
2,180,789.44

1,190,331.78

1,852,597.85

Direct Invesment in reporting economy
542,260.60

332,955.06

258,327.96

Portfolio Investment
1,626,954.16

503,357.82

890,467.54

Other investment liabilities
11,574.68

354,018.90

703,802.35

NET ERRORS AND OMISSIONS
(1,923,190.71)

(2,430,800.65)

(1,207,279.73)

Memorandum Items:
1st Half 2013 /1
2nd Half 2013 /1
1st Half 2014 /2
Current Account Balance as % of G.D.P
4.50
3.32
2.26
Capital and Financial Account Balance as % of G.D.P
0.47
2.42
0.59
Overall Balance as % of G.D.P
0.48
-0.80
-2.04
External Reserves - Stock (US $ million)
44,957.00

42,847.31

37,330.03

Number of Months of Imports Equivalent
10.50

10.01

7.95

External Debt Stock (US$ million)
6,920.10

8,821.90

9,377.11

Debt Service Due as % of Exports of Goods Non Factor Services
Effective Central Exchange Rate (N/$)
156.03

156.04

156.02

Average Exchange Rate (N/$)
157.30
157.32
157.29
End-Period Exchange Rate (N/$)
157.31

157.26
157.29
Source: Central Bank of Nigeria
1/ Revised
2/ Provisional

Table 39
Foreign Exchange Flows Through the Economy
(US$ Million)
1st Half
1st Half
1st Half
1st Half
2nd Half
CATEGORY

2013 /2
2014 /3
INFLOW
39,297.43

50,257.07

55,548.08

72,277.13

75,643.39

A. Through the Central Bank
12,982.08

19,574.33

22,170.74

19,747.39

22,888.76

1. Oil
12,159.31

18,140.18
21,298.36

18,971.59

21,027.88

2.Non-oil
822.77

1,434.14

872.37

775.80

1,860.88

(i) Drawings on Loans/Grants
-

-

-

-

-

(ii) RDAS/WDAS Purchases
9.30

-

-

20.00

270.00

(iii) Swaps
-

-

-

-

500.00

(iv) Interest on Reserves & Investments
375.98

112.56

89.19

30.32

79.07

(v) Interest Repatriated from overseas
-

-

0.72

0.29

0.12

(vi) Refund on World Bank/IBRD/IMF Loans/SDR Allocation
0.00
0.0
-

-

-

(vii) Eurobond proceeds -fixed income securities)
7.40

(viii) Returned Payments [Wired/Cash]
11.21

(ix) Untilised funds from DAS
134.02

(x) Recovered Funds
226.39

(xi) Other official Receipts
437.49
1,321.59
782.46

725.19

632.67

B. Through Autonomous Sources
26,315.35

30,682.74

33,377.34

52,529.74

52,754.63

1. Non-oil exports
977.56

1,355.60

2,007.62

1,898.23

3,650.25

2. Capital Inflow
30.06

9.83

110.57

151.82

271.85

3. Invisibles
25,307.73

29,317.31

31,259.15

50,479.70

48,832.53

OUTFLOW
17,594.67

21,402.28

20,204.63

18,964.82

29,092.93

A. Through the Central Bank
17,027.91

20,530.52

19,355.49

18,763.71

28,501.99

1. WDAS/RDAS Utilisation
14,146.35

17,002.27

16,687.61

15,440.47

25,172.86

(i) WDAS/RDAS Sales
11,715.11

14,638.04

10,414.10

10,711.04

17,233.85

(ii) WDAS Forward
-

536.51

679.99

-

1,075.86

(iii) BDC Sales
2431.24
1,827.72

3,455.82

2,263.61

3,518.15

(iv) Inter-bank Sales
-

-

1,612.70

2,461.50

3,345.00

(v) Swaps
-

-

525.00

4.33

-

(vi) Invisibles IFEM
-

-

-

-

-

2. Drawings on L/C
406.83

902.43

291.63

204.13

194.70

3. External Debt Service
178.71

176.46

152.16

150.09

178.18

(i) Principal
137.42

127.63

118.26

94.35

95.88

(ii) Interest
2.80

8.49

5.38

5.25

5.21

(iii) Others 1/
38.49

40.34

28.52

50.49

77.09

4. Professional fees/Commission
-

-

0.06

-

5. Contributions, Grants & Equities Invests. (AFC Equity Participation)
-

-

-

-

135.55

6. National Priority Projects (Niger-Delta Payments)
0.00
35.85

50.64

33.33

42.52

7. Other Official Payments
2,296.01

2,413.51

2,173.38

2,885.14

2,427.90

(i) Int'l Organisations & Embassies /4
280.45

244.32

126.47

308.03

176.51

(ii) Estacode
-

-

42.85

57.62

106.26

(iii) Parastatals
195.80

592.42

350.58

545.56

458.29

(iv) NNPC/JV Cash Calls
1,789.14

1,475.16

1,628.69

1,932.07

1,564.81

(v) Miscellaneous (CBN Uses)
30.62

101.61

24.79

41.85

122.02

8. Bank Charges
-

-

-

0.55

0.05

9. NSIA Transfer
50.00

-

10. Funds returned to remitters
0.23

11. 3rd Party MDA Transfer
350.00

B. Through Autonomous Sources
566.76

871.76

849.14

201.11

590.94

1. Imports
498.00

847.53

837.48

179.91

577.23

2. Invisibles
1.61
24.24

11.66

21.21

13.71

NETFLOW THROUGH THE CBN
(4,045.82)

(956.19)

2,815.25

983.68

(5,613.23)

NETFLOW
21,702.77

28,854.79

35,343.45

53,312.31

46,550.46

Source: Central Bank of Nigeria
1/ Includes penalty and service charges
2/ Revised
3/ Provisional
4/ Includes IMF (SDR charges)


Table 40
Nigeria’s Gross External Reserves
(US$ Million)
Month

January
42,075.67

33,131.83

34,136.57

45,824.44

40,667.56

February
41,410.10

33,246.07

33,857.37

47,295.85

36,923.61

March
40,667.03

33,221.80

35,197.44

47,884.12

37,399.22

April
40,322.01

32,835.33

36,660.89

47,903.09

37,105.27

May
38,815.79

32,100.81

36,839.53

47,702.88

35,398.10

June
37,468.44

31,890.91

35,412.50

44,957.00

37,330.03

July
37,155.19

32,521.71

36,285.32

45,834.11

August
36,769.65

32,914.97

39,509.81

45,428.84

September
34,589.01

31,740.23

40,640.40

44,108.48

October
33,597.02

32,594.69

42,167.41

44,155.11

November
33,059.30

32,125.22

42,568.26

43,414.20

December
32,339.25

32,639.78

43,830.42

42,847.31

Source: Central Bank of Nigeria

Table 41
Nigeria Foreign Exchange Cross Rates
Naira per Unit of Foreign Currency (Monthly Average)

Pounds
Euro
CFAFr
US$ (DAS/WDAS)
US$ (BDC)
Jan

Feb

Mar

Apr

May

Jun

1st Half Average

Jul

Aug

Sep

Oct

Nov

Dec

2nd Half Average


Pounds
Euro
CFAFr
US$ (DAS/WDAS)
US$ (BDC)
Jan

Feb

Mar

Apr

May

Jun

1st Half Average

Jul

Aug

Sep

Oct

Nov

Dec

2nd Half Average


Pounds
Euro
CFAFr
US$ (DAS/WDAS)
US$ (BDC)
Jan

Feb

Mar

Apr

May

Jun

1st Half Average

Jul

Aug

Sep

Oct

Nov

Dec

2nd Half Average


Pounds
Euro
CFAFr
US$ (DAS/WDAS)
US$ (BDC)
Jan

Feb

Mar

Apr

May

Jun

1st Half Average

Jul

Aug

Sep

Oct

Nov

Dec

2nd Half Average


Pounds
Euro
CFAFr
US$ (DAS/RDAS)
US$ (BDC)
Jan

Feb

Mar

Apr

May

Jun

1st Half Average

Source: Central Bank of Nigeria

Table 42
Monthly Average Exchange Rate Movements
(N/US$ 1.00)

WDAS
Interbank
BDC
Jan
149.78
150.33
153.55
Feb
150.22
150.97
152.08
Mar
149.83
150.08
151.85
Apr
149.89
150.38
152.00
May
150.31
151.49
153.26
Jun
150.19
151.28
153.87
1st Half
150.04
150.75
152.77
End-Period
149.99
150.00
153.50
Jul
150.10
150.27
152.41
Aug
150.27
150.70
152.23
Sep
151.03
152.62
153.85
Oct
151.25
151.78
153.98
Nov
150.22
150.55
153.13
Dec
150.48
152.63
154.57
2nd Half
150.56
151.42
153.36
End-Period
150.66
152.00
156.00

WDAS
Interbank
BDC
Jan
151.55
152.47
156.13
Feb
151.94
152.86
155.11
Mar
152.51
155.21
157.09
Apr
153.97
154.60
157.05
May
154.80
156.17
158.05
Jun
154.50
155.65
158.32
1st Half
153.21
154.49
156.95
End-Period
153.31
152.52
159.00
Jul
151.86
152.41
163.71
Aug
152.72
153.79
163.10
Sep
155.26
156.70
158.23
Oct
153.26
159.82
161.25
Nov
155.77
158.83
160.35
Dec
158.21
162.17
163.30
2nd Half
154.51
157.29
161.66
End-Period
158.27
159.70
165.00

WDAS
Interbank
BDC
Jan
158.39
161.31
164.62
Feb
157.87
158.59
160.85
Mar
157.59
157.72
159.41
Apr
157.33
157.44
159.37
May
157.28
158.46
159.67
Jun
157.44
162.33
163.43
1st Half
157.65
159.31
161.22
End-Period
157.50
162.85
164.00
Jul
157.43
161.33
163.32
Aug
157.38
158.97
162.24
Sep
157.34
157.78
159.80
Oct
157.32
157.24
159.00
Nov
157.31
157.58
159.32
Dec
157.32
157.33
159.26
2nd Half
157.35
158.37
160.49
End-Period
157.33
157.25
159.50

W/RDAS
Interbank
BDC
Jan
157.30
156.96
159.12
Feb
157.30
157.52
158.70
Mar
157.31
158.38
159.80
Apr
157.31
158.20
159.81
May
157.30
158.02
159.57
Jun
157.31
160.02
160.98
1st Half
157.30
158.18
159.66
End-Period
157.31
162.60
162.00
Jul
157.32
161.12
162.43
Aug
157.31
161.15
162.28
Sep
157.32
161.96
163.14
Oct
157.42
159.83
165.00
Nov
157.27
158.79
167.14
Dec
157.27
159.05
171.40
2nd Half
157.32
160.32
165.23
End-Period
157.26
159.90
172.00

RDAS
Interbank
BDC
Jan
157.29
160.23
171.71
Feb
157.31
163.62
169.45
Mar
157.30
164.61
171.50
Apr
157.29
162.19
170.25
May
157.29
161.86
166.85
Jun
157.29
162.82
167.17
1st Half
157.29
162.55
169.49
End-Period
157.29
162.95
168.00
Source: Central Bank of Nigeria


Table 43
Demand and Supply of Foreign Exchange
(US$ Million)
Year/Month
W/R DAS
BDC
W/R DAS -
W/R DASInterbank
W/R DAS - Forward
Total
Supply**
RDAS
BDC
RDAS -
Demand
Demand
Forward
Demand
Forward
Sales
Sales
Swaps
(Disbursement
on Maturity)
Demand
Demand
Forward
Demand
January

February

March

April

May

June

First Half

July

August


2,958.64
2,944.60
September


3,736.55
3,756.87
October


2,872.73
2,941.51
November


3,319.17
3,335.64
December


2,826.56
2,830.50
Second Half

Source: Central Bank of Nigeria
Total supply* includes W/R DAS sales (spot and forward), BDC and Interbank sales as well as Swaps.
Total supply** includes W/R DAS spot sales, W/R DAS forward disbursement at maturity, BDC and Interbank sales as well as Swaps.
Total
Demand

RDASInterbank
Sales
Swaps
RDAS - Forward
(Disbursement on
Maturity)
RDAS
Sales
BDC
Sales
Total
Supply*
Total
Supply**

Total
Demand
W/R DAS
Sales
BDC
Sales
Total
Supply


Table 44
Sectoral Utilization of Foreign Exchange
(US Dollar)
(1)
(2)
(3)
(1) & (3)
(2) & (3)
(1) & (3)
(2) & (3)
A. Imports


16,631,013,170.43


Industrial Sector

Food Products

Manufactured
Products

Transport Sector

Agricultural Sector

Minerals

Oil Sector

B. Invisibles

Business Services

Communication
Services

Construction and
Engineering

Distribution
Services

Educational
Services

Environmental
Services

Financial Services

Health Related and
Social Services

Tourism and Travel
Related Services

Recreational,
Cultural and
Sporting Services

Transport Services

Other Services not
Included Elsewhere

TOTAL (A+B)


32,905,811,687.40


Source: Central Bank of Nigeria
1/ Revised
2/ Provisional
Percentage Change
2nd Half 2013
1st Half 2014 /2
SECTORS
1st Half 2012/1
2nd Half 2012
1st Half 2013/2
Absolute Change

Table 45
Total External Assets of Financial Institutions
(Naira Million)
First Half 2013 1/
First Half 2014 2/
1. Monetary Authorities
7,614,112.49
6,580,954.19
Foreign Assets
7,614,112.49
6,580,954.19
Gold
19.01
19.01

IMF Tranche
22.62
22.62

Foreign Currencies
34,538.05
57,913.74

Demand Deposits at Foreign Banks
7,188,388.24
6,120,961.56

of which: Domicilliary Accounts
683,696.66
716,973.32

Treasury Bills of Foreign Governments
1.05
51.36

SDR Holdings
391,143.51
401,985.90

2. Semi Official Institutions
-

-

i) BOI
-

-

ii) Others
-

-

3. Deposit Money Banks
1,986,111.81
2,234,406.82
Total Assets
9,600,224.30
8,815,361.01
Total Assets (US$' Million)
61,028.40
56,046.24
Exchange Rate (End-period)
157.31
157.29
Source: Central Bank of Nigeria
1/ Revised
2/ Provisional