• Nigeria - 20 YEAR TREASURY BON
  • Issue No:12-07-2017-10 Year
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The Nigerian stock market opened for four trading days this week as the Federal Government of Nigeria declared Thursday 1st October 2020 a Public Holiday.

The All-Share Index appreciated by 2.53% while Market Capitalization appreciated by 2.55% to close the week at 26,985.77 and N14.105 trillion respectively. Investors gained a whopping N350.12bn.

A total turnover of 1.532 billion shares worth N16.901 billion in 17,882 deals was traded this week by investors on the floor of the Exchange, in contrast to a total of 1.567 billion shares valued atN20.559 billion that exchanged hands last week in 18,396 deals.

The Financial Services industry (measured by volume) led the activity chart with 1.292 billion shares valued at N10.562 billion traded in 10,046 deals; thus contributing 84.29% and 62.49% to the total equity turnover volume and value respectively.

The Conglomerates Industry followed with 62.395 million shares worth N89.205 million in 453 deals. The third place was the Industrial Goods industry, with a turnover of 55.168 million shares worth N2.976 billion in 1,752 deals.

Trading in the top three equities namely Zenith Bank Plc, Sterling Bank Plc and United Bank for Africa Plc. (measured by volume) accounted for 815.646 million shares worth N7.311 billion in 4,461 deals, contributing 53.22% and 43.26% to the total equity turnover volume and value respectively.

Thirty-six (36) equities appreciated in price during the week, higher than thirty-five (35) equities in the previous week.

Fifteen (15) equities depreciated in price, lower than twenty-eight (28) equities in the previous week, while one hundred and twelve (112) equities remained unchanged, higher than one hundred (100) equities recorded in the previous week. Top gainers

TOTAL NIGERIA PLC. up 21.00% to close N96.80

OANDO PLC up 12.81% to close N2.29

STERLING BANK PLC. up 10.34% to close N1.28 CHAMPION BREW. PLC. up 9.88% to close N0.89 IKEJA HOTEL PLC up 9.78% to close N1.01 AIICO INSURANCE PLC. up 9.72% to close N0.79 ETERNA PLC. up 9.60% to close N2.74 CONSOLIDATED HALLMARK INSURANCE PLC up 8.82% to close N0.37 INTERNATIONAL BREWERIES PLC. up 8.33% to close N3.90 GUARANTY TRUST BANK PLC. up 7.41% to close N29.00 Top losers CORNERSTONE INSURANCE PLC down 15.49% to close N0.60 UNIVERSITY PRESS PLC. down 12.68% to close N1.24 E-TRANZACT INTERNATIONAL PLC down 9.96% to close N2.35 UACN PROPERTY DEVELOPMENT COMPANY PLC down 8.00% to close N0.92 NIGERIAN BREW. PLC. down 6.76% to close N49.00 LIVESTOCK FEEDS PLC.down 6.67% to close […]

Joseph Olaoluwa

The total expenses made on transportation and freight costs of oil products by three major oil marketing companies in the country in the first six months of the year amounted to N1.5bn.

This is in contrast to the N1.9bn the oil firms spent for the same purpose in 2019.

The oil marketing companies, Total Nigeria Plc, MRS Oil Nigeria Plc and Conoil, saw their combined transport expenses for the period ended June 30 decline by N400m.

This is a 21.05 per cent reduction in transport costs in the first half of the year, compared with the same period of 2019.

The unaudited financial statements of the companies listed on the Nigerian Stock Exchange showed that they collectively spent a lesser amount on freight and transportation costs in the first half of the year.

This coming on the back of a lockdown that restricted activities with strict movement conditions like curfews that negatively impacted the delivery of goods and services.

Total Nigeria spent N707.7m by June 2020 compared to N864.3m by June 2019 in terms of transport supplies expenses incurred by the oil firm, according to checks by our correspondent.

Conoil spent N722.1m by June 2020 compared to N948.3m by June 2019 in terms of freight costs incurred by the oil firm.

MRS Oil Nigeria spent N144.8m by June 2020 compared to N170.6m by June 2019 in terms of freight expenses incurred by the oil firm.

Meanwhile, Total Nigeria, a subsidiary of French oil major, Total, recorded a loss of N537.19m in the first half of the year compared to a profit after tax of N129.97m in the same period of 2019. Its revenue fell by 29 per cent to N106.70bn from N150.83bn.MRS Oil Nigeria Plc made a loss of N329.71m in the first half of the year, compared to N990.71m loss in H1 2019. The company saw its revenue drop to N23.68bn from N29.79bn.Conoil’s after-tax profit dipped by 67 per cent to N338.69m in the first half of the year from N1.03bn in H1 2019, while its revenue fell to N57.46bn from N72.22bn.The President, Major General Muhammadu Buhari (retd.), had on March 30, ordered lockdown for an initial period of 14 days in the Federal Capital Territory, Lagos and, Ogun states. Copyright PUNCH. All rights reserved. This material, and other digital content on this website, may not be reproduced, published, broadcast, rewritten or redistributed in whole or in part without prior express written permission from PUNCH. […]

WorldStage Newsonline– The Nigerian Stock Exchange (NSE) market capitalisation crossed N14 trillion mark on the last trading day of September due to sustained confidence.

Speficially, the market capitalisation on Wednesday rose by N118 billion or 0.84 per cent to close at N14.025 trillion against N13.907 trillion achieved on Tuesday.

The increase in the market capitalisation was as a result of the listing of 146,878,241 ordinary shares of Dangote Sugar Refinery.

The additional shares listed on NSE arose from the Scheme of Merger between Dangote Sugar Refinery and Savannah Sugar Company Limited.

With this listing of the additional 146,878,241 ordinary shares, the total issued and fully paid up shares of Dangote Sugar Refinery increased from 12,000,000,000 to 12,146,878,241 ordinary shares of 50k each.

However, the All-Share Index increased by 201.80 points or 0.76 per cent to close at 26,813.76 compared with 26,611.96 posted on Tuesday.

The upturn was impacted by gains recorded in large and medium capitalised stocks, amongst which are; Total, Dangote Cement, MTN Nigeria Communications, Guaranty Trust Bank and UACN.

Consequently, market sentiment closed positive with 20 stocks in contrast with eight losers.

Total led the gainers’ chart in percentage terms, gaining 10 per cent to close at N96.80 per share.

Eterna followed with 9.60 per cent to close at N2.74, while UACN rose by 9.45 per cent to close at N6.95 per share.

Wapic Insurance rose by 5.71 per cent to close at 37k, while Jaiz Bank appreciated by 5.17 per cent to close at 61k per share.Conversely, University Press dominated the losers’ chart in percentage terms, dropping 6.77 per cent to close at N1.24 per share.Nigerian Breweries trailed with a loss of 6.76 per cent to close at N49, while PZ Cussons Nigeria lost 5.88 per cent to close at N4 per share.Wema Bank shed 5.26 per cent to close at 54k, while Union Bank of Nigeria depreciated by 2.91 per cent to close at N5 per share.However, the total volume traded decreased by 21.87 per cent with an exchange of 322.77 million shares, worth N4.04 billion traded in 4,046 deals.This was in contrast with a turnover of 413.10 million shares valued at N4.53 billion traded in 4,681deals on Tuesday.Transactions in the shares of Sterling Bank topped the activity chart with 83.69 million shares worth N105.44 million.Access Bank sold 46.10 million shares valued at N308.35 million, while Zenith Bank traded 24.87 million shares worth N443.39 million.Lafarge Africa transacted 18.70 million shares valued at N280.59 million, while […]

Lagos — Fourteen Deposit Money Banks (DMBs) listed on the Nigerian Stock Exchange have recorded N1.187 trillion gross revenue for the first six months of 2020.

They had earned N1.114tn in the corresponding period of 2019.

Despite the effects of the coronavirus, that trimmed physical banking activities for nearly three months, the banks still grew their revenue by an additional N72.5 billion, 6.5 percent growth.

They also grew profit after tax from N484.4bn in half-year 2019 to N495.5bn in half-year 2020, representing N11.1bn 2.3%profit growth.

Ecobank made the highest return with N405bn followed by Access Bank with N396bn and Zenith Bank with N331bn. UBA grossed N300bn, First bank N296bn and GTB N225bn.

Despite the cumulative growth in the revenue of the 14 banks, three banks had revenue drop: Zenith’s profit dropped from N346bn in 2019 to N331bn in 2020; Sterling dipped from N72bn to N70bn; Wema Bank also dipped from N40.8bn to N38.2bn in H1, 2020.

However, Zenith Bank recorded the highest net profit for the period amounting to N111.7bn higher than the N103.8bn it recorded in H1, 2019. GTB made N94.3bn, Access Bank N61bn, FBNH N49.5bn, Ecobank N48.5, Stanbic N45.2bn and UBA N44,3bn.

Of the 14 banks analysed, seven banks (Access, GTB, UBA, Ecobank, Sterling, Union, WEMA) saw their net profit dipped in 2020 compared to 2019.

The United Bank for Africa (UBA) Plc yesterday released its audited results for the half year ended June 2020, which showed that the pan-African bank recorded profit after tax of N44.431 billion, compared with the N56.7 billion it realised in the comparable period of 2019.

The results obtained on the Nigerian Stock Exchange (NSE) website also showed that the UBA Group recorded profit before tax of N57.1 billion as of the period under review, as against the N70.3 billion it garnered as of June 2019.

The development was clearly a reflection of the impact of the Covid-19 which disrupted economic activities in Nigeria, other African countries where the bank has its subsidiaries as well as the global economy, in the second quarter of 2020.

However, UBA’s operating income improved by 7.7 per cent to N197.1 billion in the review period, as against the N182.9 billion it made last year.

The bank’s gross earnings also grew to N300.2 billion, compared with the N294 billion it made in the comparable period of 2019.

In the review period, its total loans to customers grew by 6.1 per cent to N2.186 trillion, as against the N2.061 trillion recorded last year, just as its deposits from customers increased significantly by 25.2 per cent, from N3.832 trillion last year, to N4.8 trillion.

The UBA Group’s total asset as at first half of 2020 was N6.8 trillion, as against the N5.8 trillion it was in the comparable period of last year, while net interest income grew by 8.4 per cent to N119.3 billion.

Nigerian Breweries major shareholder, Heineken disclosed it purchased 274,542 units at an average price N35.76 per unit.

Insider disclosures are reported on the Nigerian Stock Exchange as a regulatory requirement especially when it informs a major shareholder or director of a company purchasing shares in the company they own.

In a related development, its chairman Chief Kolawole Babalola Jamodu also purchased 10,000 units at N37 per unit.

Nigeria Breweries closed at N36 per share on Friday trading at a price to earnings of 34x. The company has about 8 billion shares outstanding with Heineken as the majority shareholder.

What this means : Insider purchases are often an indication of how shareholders perceive the company’s valuation. It can also mean a lot of things from a possible capital raise to a strengthening of their existing holdings.

Nigerian Breweries has struggled for growth over the last few years as consumers continue to experience a change to taste and preference for alcohol.

Stanbic Bank Kenya CEO Charles Mudiwa during an investor briefing on August 8, 2019. PHOTO | DIANA NGILA | NMG Stanbic Holdings has posted a 37.2 percent decline in six-month net profit on account of reduced income and increased provisioning for loan defaults as Covid-19 pandemic continues to batter the economy.

Net profit dropped to Sh2.55 billion in contrast to Sh4.06 billion posted in a similar period last year.

The profit of Stanbic Bank and its investment arm, SBG Securities, both declined pulling down the group’s performance.

Stanbic becomes the third tier I lender to post a fall in profit. Net earnings of KCB Group and Cooperative Bank fell by 40 percent and 3.6 percent respectively having raised their provisioning for loan defaults.

Stanbic’s net interest income dropped by 5.9 percent to Sh6.3 billion despite the loan book having grown by 32.7 percent to Sh235 billion. This was on the back of reduced interest rates in line with falling indicating rates.

Non-interest income, which comes from fees and commissions, dropped by 19 percent to Sh4.96 billion on the back of the Central Bank of Kenya’s order to zero-rate transfers between banks and mobile wallets such as M-Pesa.

The group increased provisioning for non-performing loans by 61 percent to Sh1.98 billion, piling pressure on the bottom-line through increased operating expenses.

Stanbic has restructured loans worth Sh38 billion between March and June as borrowers ran into economic shock after Covid-19 hit Kenya.

Gross non-performing loans rose by Sh3.3 billion or 18.4 percent to Sh21.2 billion during the period under review.

The lender will be hoping for a turnaround in the second half of the year given the relaxed Covid-19 control measures such as reduced curfew hours and opening up of movement across counties.

“We are starting to see positive growth in the economy following the ease of the lockdown, hence the next six months will be crucial to ensure we defend earnings and register growth,” said CEO Charles Mudiwa.

Nigeria’s banks are expected to take a big hit to revenues and face rising borrowing costs this year as Central Bank of Nigeria’s (CBN) measures to support the naira squeeze lenders already hit by fallout from coronavirus and the oil price shock, analysts told Reuters.

Banks in Africa’s largest economy – a mainstay for equity and fixed income frontier market investors – have learned to navigate challenges in a country that has long struggled with dollar shortages and multiple exchange rates.

But the prospect of anaemic growth, dwindling oil revenues, declining remittances and dollar shortages exacerbated by the central bank’s latest action aimed at curbing naira liquidity and currency speculation are putting pressure on lending by banks and the quality of existing assets.

The central bank has sucked as much as N900 billion out of the local banking system since raising the cash reserve ratio (CRR) by five per cent to 27.5 per cent in January, according to analysts’ calculations.

"General sentiment in the markets is that CRR debits are carried out quite close to FX auctions to prevent the banks from presenting large ticket FX demands at auctions," said Nkemdilim Nwadialor at Tellimer Capital.

Those debits also hamper wider lending, going against central bank measures of lowering banks’ loan to deposit ratios, she said.

"Banks are dealing with slow growth, fall in lending, a lack of forex in the market and asset quality issues," senior director EMEA bank ratings at Fitch, Mahin Dissanayake said.

He expects banks’ revenues to drop at least 20 per cent this year, though he did not expect any to make a loss.

Some banks had already indicated they expect a hit.

In April, mid-tier lender Fidelity Bank had warned 2020 profits would drop by 15 per cent.

Bankers said lenders were relying on existing customers to weather the storm as new lending looked risky with the economy expected to tip back into recession.Fitch predicts impaired loan ratios will rise sharply in 2020 with Nigerian banks the most exposed to stress in the oil sector compared to their peers in emerging markets elsewhere.Nwadialor expected a, "significant pick-up" of non-performing loan ratios from 6.6 per cent in the first quarter to an average of 10 per cent for the full year – double the central bank’s benchmark.Some banks have already announced plans to tackle this. Mid-tier lender FCMB plans to complete a restructuring of half its loan book at the end of April. A central […]

THE banking sector has remained sound and stable, with levels of capital and liquidity above regulatory requirements.

According to the Bank of Tanzania (BoT) Monetary Policy Statement for June, banks maintained adequate capital buffer to withstand shocks, as the ratio of core capital to total risk weighted assets and off-balance sheet exposure was 17.4 per cent in April this year, well above the minimum regulatory benchmark of 10.0 per cent.

The report said banks have remained liquid, evidenced by the ratio of liquid assets to demand liabilities of around 32.7 per cent against the minimum regulatory requirement of 20.0 per cent.

The quality of assets of banks deteriorated as reflected by the ratio of nonperforming loans to gross loans that rose to 11.0 per cent in April this year, from 10.7 per cent in June 2019.

The monetary and fiscal policy measures implemented to cushion the economy from the impact of coronavirus are expected to significantly reduce the risk of further deterioration of quality of loan portfolios of banks due to slow down of some businesses such as tourism.

The measures include flexibility on regulatory requirement for loan restructuring in various forms.

This was manifested in a number of measures, including reduction of the statutory minimum reserves (SMR) requirement ratio in two stages from 8.0 per cent to 7.0 per cent, and further down to 6.0 per cent, downward revision of discount rate from 7.0 per cent to 5.0 per cent.

The haircuts on government securities pledged for central bank borrowing windows for banks were reduced, from 10.0 per cent to 5.0 per cent for securities maturing within one year, and from 40.0 per cent to 20.0 per cent for securities with remaining maturities exceeding one year.

Furthermore, the BoT intensified deployment of instruments for injection of liquidity, including reverse repo transactions and standing credit facilities.

The measures significantly improved liquidity in the banking sector and ultimately lowering interbank interest rates.

Specifically, overnight interbank cash market interest rate averaged at 4.83 per cent in April 2020, from 5.47 per cent in June 2019 and 5.20 per cent in April 2019.Likewise, overall weighted average yields of Treasury bills decreased to an average rate of 4.88 per cent in April 2020, compared with 8.69 per cent and 8.20 per cent in June 2019 and April 2019, respectively.The overall interest rates charged by banks on loans also declined, albeit moderately, to an average of 16.85 per cent during the period July 2019 […]

The market data shows that among actively traded stocks, 27 or 47 per cent of the companies registered gains while 30 or 53 per cent posted losses. FILE PHOTO | NMG Troubled Kenya Airways leads a group of loss-making companies to emerge with the best stocks from a period when the country imposed tight coronavirus restrictions and the market shed Sh18 billion.

Bamburi Cement ranks worst.

The KQ share gained 127 percent since March 13, when the first case was confirmed, and closed trading at Sh3.83 on July 3 when it was suspended from trading on the Nairobi Securities Exchange (NSE) .

This means an investor who put Sh1 million in the stock on March 13 has gained Sh1, 270,000.

In contrast, investors who bought Bamburi shares worth Sh1 million suffered a loss of Sh480,000 given the share has shed 48 per cent since Kenya reported its first case of coronavirus to stand at Sh26.10 at the close of trading Thursday.

This analysis is based on investors who bought shares in mid-March and measures their return at the end of the trading yesterday.

The review does not capture speculators who enter and exit stocks in short periods.

The market data shows that among actively traded stocks, 27 or 47 per cent of the companies registered gains while 30 or 53 per cent posted losses.

While the Covid-19 pandemic has been blamed for the overall market decline that has seen the benchmark NSE-20 Index drop to levels last seen in 2003, the performance of individual stocks has been driven by speculators with little link to a firm’s business indicators.

Williamson Tea is the only profitable firm among the top five best-performing stocks that includes Sameer Africa , East Africa Cables and struggling Uchumi Supermarket .

Hotel operator TPS Eastern Africa , for instance, dropped by a marginal 0.4 per cent to Sh13.45 despite being among the victims of the ban on international travel. Cigarette maker BAT Kenya also dropped 22.8 per cent to Sh310 despite improved profitability that was partly caused by lower taxes.The jump in KQ shares was driven by investors accumulating the airline’s stock in anticipation of being bought out later at a premium by the government, which plans to nationalise the company.The expectation led investors to ignore the firm’s losses and negative equity which stood at Sh12.9 billion and Sh17.8 billion respectively in the year ended December 2019.Details of KQ’s nationalisation, including the price at which the […]