By Ayo Yusuf
For the first time in seven years, the Central Bank of Nigeria, CBN, has released its Consolidated Financial Statement dating back from 2015 which was the last time the apex bank made its book available for public scrutiny.
The Consolidated Financial Statements recently released by the CBN, part of the gains of an ongoing investigation into the bank, covered 2016, 2017, 2018, 2019, 2020, 2021 and 2022 financial periods.
According to the statement, the CBN declared a profit after tax of N103.8bn in 2022, up from N75.13bn reported a year earlier.
However, the bank owes JP Morgan and Goldman Sachs a combined sum of $7.5bn as at the financial year ended December 2022. It also owed another $6.3bn in foreign currency forwards.
The apex bank explained that it owes Goldman Sachs $500 million and JP Morgan $7 billion in what it classified as securities lending.
Part of the 2022 financial statement reads, “The Group entered into a securities lending agreement with Goldman Sachs and J. P. Morgan and as part of the agreement, the Group pledged its holdings on foreign securities in return for cash. The cash received from Goldman Sachs is N0.23tn ($500m), 2021: N0.22tn ($500m), and JP Morgan N3.23tn ($7bn), 2021: N3.05tn ($7bn) is recognised in other foreign securities.”
Securities lending forms part of the CBN’s total external reserves of about N14.3tn or $29bn using the official exchange rate of N494/$1 as of 2022.
However, the apex bank also owes another N3.15tn ($6.3bn) in foreign currency forward which are forex obligations it needs to make to foreign investors.
The financial statements uploaded on the CBN website is an indication that the apex bank, under the leadership of acting Governor Folashodun Shonubi, is ready to open its book to public scrutiny.
The suspended CBN Governor, Mr Godwin Emefiele, had come under attack for not releasing the bank’s financial statements to the public which is in gross violation of the CBN Act.
Since 2005 when it started publishing details of its annual report on its website, the CBN never failed to publish the report until 2016, when it stopped the publication of the crucial documents.
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 Bank shall, within two months after the close of each financial year, transmit to the National Assembly and the President a copy of its annual accounts certified by the Auditor.
“A report required to be submitted to the National Assembly and the President shall be published by the Bank in such a manner as the Governor may direct
“The Board shall ensure that accounts submitted pursuant to this section shall as soon as possible be published in the Gazette.
“The Bank shall as soon as may be practicable after the last day of each month makeup end publish a return of its assets and liabilities as at the close of business on that day, or if that day is a holiday, as at the close of business on the last preceding business day,” the Act read.
Analysts are of the view that the failure of the CBN to publish the report had sent wrong signals to investors and others interested in understanding the state of the economy.
President Bola Tinubu had appointed Jim Obazee as a Special Investigator to probe the activities of the CBN and other related entities.
In a letter dated July 28, Tinubu said the appointment of Obazee, relying on the fundamental objective set forth in Section 15(5) of the Nigerian constitution, was in furtherance of his administration’s anti-corruption fight.
The appointment is with immediate effect, and Obazee is to report directly to the President though the full terms of his engagement as a special investigator was not immediately known.
The President had directed Obazee to investigate the CBN and related entities using a suitably experienced, competent and capable team and to work with relevant security and anti-corruption agencies to deliver on the assignment.
