The crucial market indices of the Nigerian Stock Exchange (NSE) dropped further on Tuesday with a decline of 0.17 per cent.
The Nigeria News Agency reports that the market capitalisation shed N22 billion or 0.17 per cent to close at N13.005 trillion against N13.027 trillion on Monday.
Similarly, the All Share Index which opened at 26,990.59 lost 46.27 points or 0.17 per cent to close at 26,944.32.
The downturn was impacted by losses recorded in medium and large capitalised stocks, amongst which are; Guinness Nigeria, Stanbic IBTC Holdings, MTN Nigeria, Chemical and Allied Product and Lafarge Africa.
Analysts at Afrinvest Limited said that “We maintain a bearish outlook on the market in the near term as investors book profit following gains in the prior weeks.”
Consequently, market breadth closed negative with 13 gainers compared with 19 losers.
Ikeja Hotel led the losers’ chart in percentage terms, dropping by 9.73 per cent to close at N1.02 per share.
Champion Breweries came second with a decline of 8.82 per cent to close at 93k, while Law Union & Rock Insurance dipped 8.45 per cent to close at 65k per share.
Chams lost 7.89 per cent to close at 35k, while Guinness declined by 6.45 per cent to close at N29 per share.
Conversely, Okomu Oil recorded the highest price to lead the gainers’ table in percentage terms, gaining 9.87 per cent to close at N54.55 per share.
eTranzact followed with a gain 9.66 per cent to close at N2.61, while Royal Exchange and Wapic Insurance appreciated by 8.33 per cent each, to close at 26k and 39k per share, respectively.
Jaiz Bank improved by 4.55 per cent to close at 69k, while Unilever appreciated by 4.24 per cent to close at N18.45 per share.
The total volume traded declined by 23.33 per cent as investors bought and sold 189.01 million shares worth N2.88 billion exchanged in 3,314 deals.
This was in contrast with 246.51 million shares valued at N2.44 billion achieved in 3,093 deals on Monday.
Access Bank dominated the activity chart with an exchange of 35.41 million shares worth N324.55 million.
Guaranty Trust Bank followed with 34.61 million shares worth N1.05 billion, while Zenith Bank accounted for 18.37 million shares valued at N342.41 million.
United Bank for Africa sold 15.91 million shares worth N111.79 million, while Fidelity Bank transacted 7.80 million shares valued at N15.69 million.
Edited & Vetted By: Tayo Ikujuni/Oluwole Sogunle
Custodian Investment moves to purchase 51% equity stake in UPDC
Mr Wole Oshin, Group Managing Director, Custodian Investment, made this known in a statement posted on the Nigerian Stock Exchange (NSE) on Monday in Lagos.
He said the agreement marked the beginning of a partnership between Custodian and UAC that would achieve both companies’ respective objectives in the real estate industry.
“It also marks a significant milestone aligned with UAC’s strategy to focus on its core businesses,” he stated.
He said the sale shares would be in two tranches initial sale of 946,558,467 shares, representing 5.10 per cent of the issued share capital of UPDC, on execution of binding transaction agreements.
Oshin added that there would be subsequent sale of 8,519,026,201 shares, representing 45.90 per cent of the issued share capital of UPDC upon receipt of requisite approvals.
According to him, completion of the sale is subject to regulatory approvals from the NSE and the Federal Competition and Consumer Protection Commission.
Commenting on the transaction, Oshin said the partnership would provide multiple levers for value creation.
“The rationale for the transaction is that Custodian and UAC share the view that their ambitions for capturing opportunity in the real estate industry will be better achieved working in partnership,” he said.
“The transaction is a significant step in achieving our objectives for UPDC.
“In 2018, the Board and Management of UAC embarked on a strategic review to evaluate the performance of the company and its subsidiaries.
“The objective is to achieve sustainable positive financial performance from our existing operations and enable management to focus on businesses that align with our strategy.
“In reviewing UPDC, the board weighed the long-term opportunities in the Nigerian real estate sector against the fundamental differences between the cash flow profile and capital needs of UPDC and those of the other entities in UAC’s portfolio.
“Following its review, the board concluded that it would be in the best interest of UAC to exit its interest in the real estate sector.
” It allows UPDC to operate as a stand alone legal entity, free to source appropriately structured capital and to unlock value for its shareholders,” Aiyesimoju said.
Edited By: Olagoke Olatoye (NAN)
Fidelity Bank appoints Nneka Onyeali-Ikpe MD-designate, assumes office Jan.1, 2021
Fidelity Bank Plc has notified the Nigerian Stock Exchange (NSE) and the general public of the appointment of Mrs Nneka Onyeali-Ikpe, as the incoming Managing Director/Chief Executive Officer, effective Jan. 1, 2021.
The bank made the announcement on Monday in a notice on the NSE website, signed by Ezinwa Unuigboje, its Company Secretary.
The notice said the appointment followed the impending retirement of its Managing Director/Chief Executive Officer, Mr Nnamdi Okonkwo, from the Board of Directors of the bank, with effect from Dec. 31, 2020, upon completion of his contract tenure.
“In compliance with the succession policy of the bank, the board has approved the appointment of Onyeali-Ikpe, the current Executive Director, Lagos and South West Directorate as the designate of the bank, to assume office with effect from Jan. 1, 2021.
“The approval of the Central Bank of Nigeria (CBN) has been obtained for the appointment,” said the statement.
It said the board had also approved the appointment of Mr Kevin Ugwuoke, the current Chief Risk Officer of the Bank, as Executive Director, Chief Risk Officer, subject to the approval of the CBN.
The statement said that Okonkwo was appointed to the Board of the bank in April 2012 as an Executive Director and was subsequently appointed the on Jan.1, 2014.
It said that Okonkwo implemented a digital-led strategy which led to significant growth across key performance metrics and increased market share, with the bank currently ranked sixth amongst Nigerian banks on most performance indices.
According to the statement, the bank under his leadership successfully accessed the local and international markets through the issuance of N30 billion Corporate Bonds in 2015 and $400million Eurobonds in 2017.
“The board seizes this opportunity to express sincere appreciation to Okonkwo for his significant contributions to the growth and development of the Bank during his tenure of the board,” the statement added.
It said Onyeali-Ikpe was appointed to the Board of Fidelity Bank in 2015 as an Executive Director and currently oversees the Lagos and Southwest Directorate.
It stated that she led the transformation of the directorate to profitability and sustained its impressive year-on-year growth across key performance metrics.
The bank said that Onyeali-Ikpe had been an integral part of the current management team responsible for the remarkable increase in the bank’s performance in the last five years.
It stated that the area under her direct responsibility, in the period, contributed over 28 per cent of the bank’s profit before tax, deposits and loans.
“Onyeali-Ikpe has over 30 years of experience across various banks including Standard Chartered Bank Plc, Zenith Bank Plc and Citizens International Bank Limited, where she held several management positions in Legal, Treasury, Investment Banking, Retail/Commercial Banking and Corporate Banking
“She has been involved in the structuring of complex transactions in various sectors including oil & gas; manufacturing, aviation, real estate and export.
“As an Executive Director at Enterprise Bank, she received formal commendation from the Asset Management Corporation of Nigeria (AMCON) as a member of the management team that successfully turned around Enterprise Bank.
It added that Onyeali-Ikpe had attended executive training programmes at Harvard Business School, the Wharton School University of Pennsylvania, INSEAD School of Business, Chicago Booth School of Business, London Business School and IMD amongst others.
According to the bank, Onyeali-Ikpe is currently undergoing a Diploma programme in Organisational Leadership at Said Business School, Oxford University, UK.
Edited By: Oluwole Sogunle (NAN)
Coronavirus: Capital market operators say recapitalisation not desirable for now
Mr Tunde Amolegbe, President, Chartered Institute of Stockbrokers (CIS), gave the advice at a webinar organised by the Capital Market Academics of Nigeria.
Recall that the Securities and Exchange Commission(SEC) in February hinted of plans for recapitalisation of stockbroking firms ahead of the change of ownership of the Nigerian Stock Exchange.
Ms Mary Uduk, then SEC acting Director-General, said with only 10 per cent of the 255 stockbroking firms controlling 80 per cent of the market activities, there was a need for recapitalisation.
Speaking at the webinar, Amolegbe said regulators should suspend any such move for now due to the coronavirus pandemic.
He said COVID-19 had slowed down NSE demutualisation programme, noting that funding challenge of the CIS would be more aggravated.
The CIS president said that given its importance, the Federal Government should treat the capital market as a priority sector with regard to COVID-19 alleviation strategies.
“In view of the existing major constraints with regard to trading liquidity, the Central Bank of Nigeria should formulate policies that will drive more liquidity into the hands of CMOs, especially equity traders,” he said.
Amolegbe said that stability and growth of the equity market would catalyse overall market rebound and economic growth.
“We can start with banks giving significant concessions to CMOs through margin facilities and other lines of credit for trading,” he said.
According to him, banking stocks should be restored to marginable stocks list with strengthened guidelines.
Amolegbe also called for industry-wide effort on reducing unclaimed dividend phenomenon, using innovations brought about due to COVID situation.
He said the time-to-market for new debt and equity issues should be reduced in order to get funding to critical sectors of the economy.
The CIS chief also stressed the need for the launch of a derivatives market because it was needed to hedge investments at a time of elevated risks such as this.
He observed that the Nigerian capital market was substantially challenged even before the coming of the coronavirus.
“The equity market, which drives performance of the other market segments had been characterised by low investor patronage and low liquidity ever since the global financial crisis which hit Nigeria in 2008,” he said.
On recommendations for CMOs, he urged them to embrace and elevate use of technology in their operations, especially remote business devices.
He explained that COVID-19 had shown that it was possible to run 100 per cent e-brokerage without the need for a physical location.
Also speaking, Dr Suleyman Ndanusa, former SEC DG, said regulatory environment must be innovative and as well embrace business continuity plan.
On the role of regulators in mitigating the impact of COVID-19, Ndanusa said modern economy was dependent on sound capital market.
He said that market regulators must ensure ease of doing business to attract more foreign portfolio and direct investment into the country.
Ndanusa said regulators must stay nimble and create regulatory environment for innovation and expect regulatory changes that come with added costs.
He noted that regulatory budgets must be architected for efficiency, savings and value for money.
Ndanusa called for automation of regulatory reporting obligations, Internet of things (IOT) devices and data to automatically prescribe trade malfeasance and remediation.
“The COVID-19 induced crisis is a call to deepen reforms in the Capital Market Regulatory landscape. The future is now, so lets take it,” he said.
Ndanusa tasked regulators on investor protection and transparency to boost confidence in the Nigerian capital market.
Prof. Wilson Herbert, of the Federal University Otuoke, called for introduction of new products that would centre on challenges posed by COVID -19.
Herbert stressed the need for research on bonds such as food security development bonds that would help the country in such trying times.
He noted that importance of education could not be overlooked, being an engine that drives economic development.
According to him, government should increase budget allocation given to education sector and research institutions to achieve the desired growth and development.
The News Agency of Nigeria reports that the webinar was themed: “Mitigating the Impact of COVID -19 on the Capital Market”.
Edited By: Tayo Ikujuni/Oluwole Sogunle (NAN)
Nigeria’s bourse simplifies capital market investment with comic book
The Nigerian Stock Exchange (NSE) has reiterated its commitment to promoting financial literacy with its comic series, ‘StockTown’, issued to simplify ways of investing in the Capital Market.
Mr Olumide Orojimi, the Head, Corporate Communications, NSE, said in a statement made available to the News Agency of Nigeria on Tuesday in Lagos that the NSE had issued the second edition of the comic.
He said that the proliferation of dubious investment schemes that often result in loss of money by unsuspecting members of the public made financial literacy imperative.
“Investor Education is a priority for us at The Exchange. We have identified the need to empower individuals across all levels to make good financial decisions and better their lives now and in the future.
“As the investment landscape continues to evolve to accommodate more retail participants, we are excited to leverage new and existing platforms to present investment products and processes in ways that are both appealing and easy to understand, particularly in this new normal.
“We hope that StockTown becomes a widely-read resource for potential and existing investors, the financially excluded, millennials and the larger public.
“The story picks up from the first edition, following the life of Mora Johnson as she seeks to liberate her family from their financial struggles by investing in the capital market.
“This second edition highlights some major lessons for potential and existing investors including the need for vigilance in avoiding Ponzi schemes and unregulated investments,” he said.
Orojimi advised prospective investors to seek proper guidance before making investment decisions.
According to him, the comic, available in digital format on a dedicated website at www.nse-stocktown.com, builds on the Exchange’s advocacy for safe and trusted investment schemes.
“Readers can look forward to a simplified explanation of the history of the capital market, its evolution over the years, and how anyone can start making investments today in the Frequently Asked Questions (FAQs) section of StockTown.
“StockTown is just one of the many ways NSE demonstrates its strong commitment to promoting financial literacy in Nigeria.
“Even amid the Coronavirus pandemic and the temporary closure of The Exchange’s facilities, NSE continues to host virtual financial literacy workshops with students and young upwardly mobile professionals.
“Furthermore, The Exchange has hosted several webinars on various products including Exchange Traded Funds (ETFs), Green Bonds, and Securities Lending to provide more information to the market on available securities and how to trade them,” he added.
According to him, NSE is a member of the Financial Literacy Technical Committee of the Securities and Exchange Commission (SEC); as well as the National Finance Inclusion Steering Committee led by the Central Bank of Nigeria with a mandate to reduce the level of financial exclusion in Nigeria to 20 per cent.
Edited By: Edwin Nwachukwu/Oluwole Sogunle (NAN)