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CBN’s operating surplus fall by 73% to N8.8 bn

By Babajide Komolafe
Operating surplus of   the  Central Bank of  Nigeria (CBN) fell sharply for the operating year ended 31st December 2008, reflecting the impact of the global financial crisis on the operations of the bank.


Meanwhile, the number of Naira noted printed by the  Nigerian Security Printing and Minting (NSPM) Plc rose by more than half to 2.65 billion in 2008. Currency in Circulation also rose 20.3 per cent during the year.

In its annual report for 2008, the CBN said, “The audited financial statements of the CBN for the year ended 31st December, 2008 indicated that total income was N307.0 billion, a decline of 0.7 per cent from the level in 2007.

The decline in income largely reflected the decline in interest income, specifically from external sources. Operating cost increased by 69.7 per cent in 2008, thus, bringing the operating surplus before provisions to N8.8 billion, compared with N32.8 billion in 2007.In accordance with the provisions of Part II, Section 5 (3) of the CBN Act, 2007 (as amended), the sum of N6.2 billion was due to the Federal Government while the balance accrued to general reserve. The size of CBN’s balance sheet increased in 2008 as total assets/liabilities rose by 14.7 per cent to N8.8  trillion.

The assets position reflected the increase in external reserves (12.0 per cent), Nigerian government securities (222.4 per cent), loans and advances (41.8 per cent), investments (172.6 per cent) and fixed assets (5.8 per cent).

The increase in total ssets was    compensated for on the liability side by the rise in deposits (31.8 per cent), notes and coins in circulation (20.2 per cent), IMF allocation of Special Drawing Rights (9.6 per cent), and other financial liabilities (5.5 per cent). The paid-up capital of the Bank remained at N5.0 billion while the general reserve increased by 3.5  per cent to N60.9 billion.”

“The continued restructuring of the Nigerian Security Printing and Minting (NSPM) Plc produced satisfactory outcomes in 2008 as the volume of banknotes printed by the company rose significantly. At 2,650.28 million pieces, the banknotes printed increased by 58.2 per cent over the volume in the preceding year.

The increase in output was attributable  to the installation of new machines and the upgrading of equipment at both the Abuja and Lagos factories, staff motivation and training, as well as the strengthening of rapport with stakeholders in the industry.” “At end-December 2008, currency in circulation (CIC)  stood at N1,155.1 billion, an increase of 20.3 per cent over the level at end- December 2007.

The development was due largely to the monetization of large foreign exchange inflows from crude oil sales in the first half of 2008, as well as the seasonal demand for currency for the purchase of goods and services for end-of-year festivities. The growth in CIC in 2008 was, however, lower than the  growth of 23.3 per cent in the preceding year.”


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