Arecent release of the consolidated financial statements for the last seven years by the Central Bank of Nigeria (CBN) has set many tongues wagging.
The apex bank released the financial statement on its website, making it the first time since 2015 it will be making its book available for public scrutiny.
The suspended CBN Governor, Godwin Emefiele, had come under attack for not releasing the financial statements to the public.
The financials of the CBN has been shrouded in secrecy for years.
According to the CBN Act 2007, the apex bank is expected to publish its report within two months after the end of each financial year.
The released consolidated financial statements are for 2016, 2017, 2018, 2019, 2020,2021 and 2022.
FG debt accounted for 72% of the total loans and receivables in the CBN’s balance sheet.
The Ways and Means provision allows the government to borrow from the CBN if it needs short-term or emergency finance to fund delayed government expected cash receipts.
Here are findings from the report:
1. The CBN declared a profit after tax of N103.8bn in 2022, up from N75.13bn reported a year earlier.
2. CBN borrowed N3.1 trillion ($7 billion) and N230 billion ($500 million) from big global lenders JP Morgan and Goldman Sachs, summing up to a balance of N3.3 trillion ($7.5 billion) in 2021.3.
The apex bank also owes another N3.15tn ($6.3bn) in foreign currency forward which are forex obligations it need to make to foreign investors.
4. The apex bank’s results also show it earned an additional N247 billion and N156 billion from AMCON and via FGN Securities respectively.
The apex bank also reported another N422.7 billion in income derived from “debt instruments measured at fair value through profit and loss (FVTL).
FVTL is a way companies account for certain investments they own. Instead of noting the investment’s original cost, the company regularly updates the investment’s value to reflect its current market price.
5. The apex bank also reported a whopping N875.2 billion in credit losses, almost double the N498.2 billion reported a year earlier.
6. One of the CBN’s most significant roles in the last eight years has been its funding of the Federal Government’s budget deficits.
The central bank’s lending to the federal government through short-term overdrafts known as Ways and Means had ballooned 30 times over to N23.2 trillion between 2015 when former President Muhammadu Buhari took office to the end of last year.
7. CBN’s lending to the government constituted as much as 74 per cent of the loans and receivables that contributed N610 billion of both the total impairment loss and credit loss expenses for the year.
8. Under interest income for the year, the bank included N1.9 trillion as interest receivable from the federal government on the overdraft facility in question without further details of how it arrived at the figure.
9. Its profit after tax stood at N103.9 billion relative to N75.1 billion one year prior. Total assets were up 9.5 per cent at N60 trillion.
The apex bank’s balance sheet expanded by about N22 trillion from N35.5 trillion in 2018 to about N57.9 trillion in 2022.10.
The apex bank also incurred huge expenses on forex and loan impairments. A key feature of the expenses was N888.3 billion incurred by the apex bank as “other operating expenses” during the year (N884.2 billion in 2021).
A breakdown of the amount reveals closer to half of the expenses (N346.2 billion) were losses arising from foreign exchange revaluation losses.
Also included is another N155.5 billion incurred as “rebate expenses” which the apex bank explained was connected to RT 200 and Naira4Dollar, a policy under CBN led by Godwin Emefiele to attract forex inflows