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COVID-19: Capital market community lauds PTF, donates ambulance

Ngozi Amuche
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COVID-19: Capital market community lauds PTF, donates ambulance

The Presidential Task Force on COVID-19 has been commended for its efforts to contain the spread of the virus in Nigeria.

Director General of the Securities and Exchange Commission made the commendation during the donation of an ambulance to the PTF by the Capital Market Support Committee on COVID-19 in Abuja on Wednesday.

According to Yuguda, the capital market community acknowledges the efforts so far made by both the government and private sector since the country recorded its COVID-19 index case in February this year.

“We are here today on behalf of the capital market because we recognise the need to lend our support towards strengthening the available response mechanisms as well as ameliorating the burdens on those affected,” he said.

In his response, Secretary to the Government of the Federation/Chairman of the PTF on COVID-19, Mr. Boss Mustapha, urged Nigerians to protect themselves and others from the virus by observing the protocols laid down by the authorities, assuring that the PTF would ensure that resources donated were efficiently deployed.

Mustapha, who was represented by the Permanent Secretary, General Services, Mr. Adekunle Olusegun, decried Nigerians’ level of compliance to the protocols, which he described as abysmal.

He said, “We would like to use this opportunity again to solicit your cooperation in helping us spread the message that COVID-19 is real. It has changed everything the way we know them, but we must change our behaviour to contain its spread.

“Even if you do not love anyone, I believe you love yourself. Secure yourself properly by adhering to laid-down protocols. Masks should be worn properly when in public places. If you are not wearing your mask properly, you are at risk. In your offices, ensure that you are very strict on the use of face mask.”

There are still some challenges ahead, especially in the area of behavioural change, the SGF said and urged the capital market community to use whatever opportunity available to enlighten stakeholders.

His words, “This is a serious health emergency that we are experiencing in our generation. It has challenged the strength and weaknesses of the system globally and no nation is immune from this.”

He assured that the ambulance would be deployed in the most useful manner and urged the capital market community to continue to support the health sector, even after the pandemic.

FBN Holdings advises investors on enhanced ROI

Ngozi Amuche
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FBN Holdings advises investors on enhanced ROI

FBN Holdings (FBNH) Plc has stressed the need for retail investors to invest in companies with strong fundamentals, sustainable growth and profitability to ensure enhanced returns on investment.​
Head FBNH, Investor Relations, Mr. Tolulope Oluwole, stated this at the Capital Market Correspondents Association of Nigeria virtual forum in Lagos on Wednesday.

He urged retail investors to go beyond speculation and invest in stocks with strong fundamentals, sound management and potential for growth, adding that the Coronavirus Disease and downturn in the stock market provided opportunity for investors.

According to him, understanding investment in good companies such as FBNH is key at this time for investors not to have their fingers burnt again.
Oluwole noted that there was opportunity in any ​market downturn, urging investors to key into the present opportunities in the equities market.

“At this time of economic challenge, we have seen an increase in the domestic retail and institutional investors participation in the market,” he stated.
He was optimistic that foreign investors, who fled the country due to the economic crisis, would find their way back to the market in a matter of time with strong business fundamentals.

In his presentation entitled ‘Financial Media and Engagement With Retail Investors,’ he said there were different investors with varied levels of interest in a company’s investment story.

While the majority of the audience has broadly similar requirements, there are subtle differences and it is critically important to ensure consistency in the messages to avoid misinterpretation, he noted.​

Knowing and understanding potential investors, Oluwole asserted, is very crucial when presenting the equity story, saying, “Investor Relations plays a pivotal role in providing detail about the health of an organisation to a wide range of interested parties.”

He called on the Capital Market Correspondents to continue to ensure good understanding of businesses in the financial community and bridge any perceived gap between businesses and the retail investor.

Nigeria records $42.7bn forex inflow in Q1

Ngozi Amuche
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Nigeria records $42.7bn forex inflow in Q1

The Central Bank of Nigeria has said that foreign exchange inflow into the Nigerian economy in the first quarter of  2020 stood at $42.71bn.

CBN, in its economic report for Q1 2020 obtained by Financial Street, showed that the amount of forex inflow recorded in the period under review indicated an increase of one per cent and 13.8 per cent above the levels in the preceding quarter and the corresponding period of 2019 respectively.

The development was attributed to an 11.2 per cent increase in inflow through the bank.

A breakdown of the sum showed that oil sector receipts stood at $3.36bn (7.9 per cent), declined by 7.6 per cent and 21.1 per cent below the levels in the preceding quarter and the corresponding period of 2019.

Further analysis of the data showed that non-oil public sector inflow, at $11.65bn or 27.3 per cent of total in the review period, rose by 18.1 per cent above the level in fourth quarter of 2019, but declined by 17.6 per cent below the level in the corresponding period of 2019.

Autonomous inflow, at $27.71bn in first quarter of 2020, declined by 3.8 per cent, compared with the level in the preceding quarter, but rose by 44.7 per cent above the level in the corresponding period of 2019, while inflow from autonomous sources accounted for 64.9 per cent.

The data showed that aggregate forex inflow into the CBN within the period under review amounted to $15.01bn, an increase of 11.2 per cent above the level in the fourth quarter of 2019, but a decrease of 18.4 per cent below the level in the corresponding period of 2019.

“The development, relative to the preceding quarter, reflected, mainly, the rise in non-oil receipts, driven by proceeds from the Treasury Single Account and third party receipts. Aggregate outflow from the CBN was $17.62bn, indicating an increase of 9.4 per cent and 8.1 per cent above the levels in the preceding quarter and the corresponding period of 2019 respectively.

“The rise in outflow, relative to the level in the preceding quarter, reflected, mainly, the increase in interbank utilisation, external debt service, national priority projects, foreign exchange special payment, bank and Special Drawing Rights charges/fees and funds returned to Remitta,” the report added.

The quarterly report indicated that at N2.527tn federally-collected revenue in the first quarter of 2020 was lower than the quarterly budget estimate of N3.947tn by 36 per cent. It also fell below the receipt in the preceding quarter by 4.8 per cent.

The decline in gross federally-collected revenue, relative to the quarterly budget estimate, was attributed to shortfalls in receipt from both oil and non-oil revenue components during the review period.

Gross oil receipt, at N1.523tn (60.3 per cent), was below the quarterly budget estimate and the receipt in the preceding quarter by 31.2 per cent and 2.6 per cent, respectively, according to the report.

The decline in oil revenue, relative to the quarterly budget estimate, was due to shortfall in receipt from Petroleum Profit Tax and royalties, while gross non-oil revenue, at N1.004tn (39.7 per cent), fell below the quarterly budget estimate of N1.733tn by 42.1 per cent.

“It also fell below the level in the preceding quarter by eight per cent. The lower non-oil revenue, relative to the quarterly budget estimate, was due to the decline in receipt from VAT and corporate tax,” noted the report.

“Nigeria’s crude oil production, including condensates and natural gas liquids, averaged 1.84 mbd or 167.44 mb in the review quarter. This represented a decrease of 1.1 per cent, compared to the 1.85 mbd or 170.20 mbd produced in the preceding quarter. Crude oil export was estimated at 1.39 mbd, representing a decrease of 0.7 per cent, against the 1.40 mbd recorded in the preceding quarter.

“The estimated decrease in production was attributed to the aftermath of the December 2019 Organisation of the Petroleum Exporting Countries meeting, where members and their allies pledged a further production cut by 500,000 bpd beginning January 2020 to stabilise the global crude market.

CBN approves N50bn revival fund for textile industry

Ngozi Amuche
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CBN approves N50bn revival fund for textile industry

The Central Bank of Nigeria has announced N50bn special mechanism funds to revive the country’s ailing textile industry.

The funds to be administered by the Bank of industry at 4.5 per cent interest rate will use any of the CBN-approved non-interest financing instruments for refinancing of projects, long- term financing for acquisition of plant and machinery and working capital for the beneficiaries.

A statement, titled, ‘CBN Non-Interest Guidelines for Intervention in the Textile Sector,’  by CBN Director, Financial Policy and Regulation Department, Kelvin Amugo, stated that the funds would be used to resuscitate the sector, restructure facilities and provide further facilities for textile firms with genuine need for intervention.

According to CBN, the seed fund, which is a one-off intervention, will terminate by December 31, 2025 with the maximum financial amount pegged at N2bn for a single obligor for new facilities and N1bn for refinancing.

The regulator said the plan to turn around the sector was perfected at the August 7 meeting between the CBN Governor, Godwin Emefiele, and textile mill owners.

The resolutions reached at the meeting were that the textile mills articulate the status of their BoI Cotton Textile and Garment Loans, stating their outstanding balances, tenure, interest rate, interest payment and the assistance being sought from CBN.

The CBN listed activities to be covered under the Intervention as operations in the CTG value chain include cotton ginning (lint production), spinning (yarn production), textile mills, integrated garment factories (for military, para-military and schools and other uniformed institutions).

The eligibility criteria for participation in the scheme indicated that any textile company with an existing facility in the books of BoI under the CTG scheme, any textile company with existing facilities in Deposit Money Banks/Non Interest Financial Institutions, textile companies that are not participating under the Small and Medium Enterprises/Restructuring/Refinancing Fund are qualified while projects financed before June 2009 (inception of the BoI CTG Loan) will not be eligible to participate.

CBN releases N16bn for Anchor Borrowers’ Programme

Ngozi Amuche
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CBN releases N16bn for Anchor Borrowers’ Programme

The Central Bank of Nigeria has released N16bn for Anchor Borrowers’ Programme while receiving applause for its new foreign exchange policy restricting forex access for maize imports.

The Maize Association of Nigeria said the CBN acted in the best interest of the economy, urging farmers to explore the opportunities presented by the restrictions to increase production capacity.

The President of the association, Abubakar Bello, while speaking at a news conference in Abuja, listed the achievements of the last planting season.

According to him, though the association is targeting about 25m metric tonnes of maize production in this year’s planting season, this might suffer about 25 per cent reduction due to the COVID-19 pandemic.

He said maize farmers cultivated about 250,000 hectares of maize in this year’s rainy season.

Huawei half year revenue increases by 13.1% year on year

Kolawole Onasanya
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Huawei half year revenue increases by 13.1% year on year

Huawei has announced its business results for the first half of 2020, where it generated CNY454 billion in revenue during the period, which is a 13.1 per cent increase year-on-year, with a net profit margin of 9.2 per cent.

Huawei’s carrier, enterprise, and consumer businesses achieved CNY159.6 billion, CNY36.3 billion, and CNY255.8 billion in revenue, respectively.

As countries around the globe are grappling with the COVID-19 pandemic, information and communications technologies (ICT) have become not only a crucial tool for combatting the virus, but also an engine for economic recovery. Huawei reiterated its commitment to working with carriers and industry partners to maintain stable network operations, accelerate digital transformation, and support efforts to contain local outbreaks and reopen local economies.

The complex external environment makes open collaboration and trust in global value chains more important than ever. Huawei has promised to continue fulfilling its obligations to customers and suppliers, and to survive, forge ahead, and contribute to the global digital economy and technological development, no matter what future challenges the company faces.

The financial data disclosed are unaudited figures compiled in compliance with the International Financial Reporting Standards, at an exchange rate of $1 = CNY7.0677 at the end of June 2020:

Huawei is a leading global provider of information and communications technology (ICT) infrastructure and smart devices. With integrated solutions across four key domains – telecom networks, IT, smart devices, and cloud services, the company said it would continue to be committed to bringing digital to every person, home and organization for a fully connected, intelligent world.

Banks’ loan to economy increase by N3.3tn in Q2

Ngozi Amuche
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Banks’ loan to economy increase by N3.3tn in Q2

Banks’ total loan to the Nigerian economy  increased by N3.3tn in June 2020, despite the coronavirus pandemic.

According to information contained in the monetary policy communique of the Central Bank of Nigeria, banks’ aggregate domestic credit grew by 5.6 per cent in June 2020 compared with 7.7per cent growth recorded in May 2020.

This resulted in a total increase in gross credit from N15.56tn in May to N18.9tn as of end of June 2020. The CBN attributed the increase to its Loan to Deposit Ratio initiative, a policy that forces banks to lend at least 65 per cent of its deposits.

“Aggregate domestic credit (net) grew by 5.16 per cent in June 2020 compared with 7.47 per cent in May 2020. The Committee commended the CBN Loan-to-Deposit Ratio (LDR) initiative to address the credit conundrum as the total gross credit increased by N3.33tn from N15.56tn at end-May 2019 to N18.90tn at end-June 2020,” said CBN.

The MPC revealed that most of the loans went to the manufacturing, consumer credit, general commerce,  information and communication and agriculture sectors.

According to the document, the CBN favours credit deployment to these sectors which it considers productive. Data from the financial sector revealed that most of the banking sector’s credit went to the oil and gas sector with the “productive sectors” (as defined by the CBN) falling behind.

Commercial banks have been hesitant to lend to the sectors due to its high rate of non-performing loans. Banks recorded an aggregative non-performing loans (specific provisions) of 6.5 per cent as of December 2019.

Sectors like the Agriculture sector saw their non-performing loans spike by over 40 per cent last year.

The construction and education sector also recorded significant increase in non-performing loans in 2019 compared to 2018. In general, total non-performing loans dropped from N1.78tn in 2018 to just over one trillion in 2019.

Fidelity Bank appoints Nneka Onyeali-Ikpe CEO-designate

Ngozi Amuche
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Fidelity Bank appoints Nneka Onyeali-Ikpe CEO-designate

Fidelity Bank Plc has appointed Nneka Onyeali-Ikpe as the Managing Director/Chief Executive Officer, effective January 1, 2021.

The bank made the announcement on Monday in a notice to the Nigerian Stock Exchange. The notice was signed by Ezinwa Unuigboje, the bank’s Company Secretary.

According to the statement, the appointment followed the impending retirement of the incumbent Managing Director/Chief Executive Officer, Nnamdi Okonkwo, from the Board of Directors of the bank, with effect from December 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 MD/CEO designate of the bank, to assume office with effect from January 1, 2021.

“The approval of the Central Bank of Nigeria has been obtained for the appointment,” said the statement.

It said the board also approved the appointment of Kevin Ugwuoke, the bank’s current Chief Risk Officer 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 MD/CEO on January 1, 2014.

Okonkwo, according to the bank, implemented a digital-led strategy which led to significant growth across key performance metrics and increased market share, with the bank currently ranked sixth in Nigeria on most performance indices.

The bank under his leadership, Fidelity successfully accessed the local and international markets through the issuance of N30bn Corporate Bonds in 2015 and $400m 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 in 2015 as an executive director and currently oversees the “Lagos and Southwest Directorate.”

She was credited with leading the transformation of the directorate to profitability and sustained its impressive year-on-year growth across key performance metrics.

The bank said Onyeali-Ikpe was an integral part of the current management team responsible for the remarkable increase in the bank’s performance in the last five years, noting further 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.

“She holds Bachelor of Laws (LLB) and Master of Laws (LLM) degrees from the University of Nigeria, Nsukka and Kings College, London, respectively,” the bank’s statement explained.

Onyeali-Ikpe 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, among others, according to the statement.

It added that Onyeali-Ikpe was currently undergoing a diploma programme in Organisational Leadership at Said Business School, Oxford University, UK.

Airtel extends network with WorldRemit on instant money transfers

Ngozi Amuche
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0
Airtel extends network with WorldRemit on instant money transfers

Airtel Africa, a leading provider of telecommunications and mobile money services in 14 countries across sub-Saharan Africa, is scaling up its operations with WorldRemit.

WorldRemit is a global digital money transfer service that operates in over 50 countries.
Building on the successful connection to Airtel Money services in Democratic Republic of Congo, Uganda, Zambia, Tanzania, Malawi and Niger, customers can now also send to Airtel Money in Rwanda via WorldRemit.

WorldRemit will enable customers from across the globe to receive money into Airtel Money wallets. Users can visit WorldRemit.com or download the free mobile App; choose Mobile Money and Airtel as the operator, then follow the prompts.

The diaspora living in more than 50 countries around the world can quickly and easily send money transfers at any time via WorldRemit to Airtel Money customers back home.

Managing Director for Middle East & Africa, WorldRemit, Andrew Stewart, said, “The connection to more Mobile Money accounts through Airtel Africa allows us to expand our payout network and options available to customers across the continent.

“It is really exciting and important to us that we continue to increase financial inclusion for our customers in Africa while delivering a fast, affordable and secure service.”

Chief Executive Officer, Airtel Africa, Raghunath Mandava, said, “We are committed to enhancing financial inclusion in the countries where we operate through building a huge infrastructure of cashing in and cashing out locations in the markets and increasing our distribution.

“This means that our customers can now receive fast digital payments via WorldRemit from around the world directly to their mobile phones, as well as access their funds at our exclusive kiosks and branches at their convenience.”

Airtel Money enables mobile money users to send local and international money transfers, make utility payments, pay merchants, save money in their mobile wallets, purchase airtime and access a range of mobile financial products.

CBN maintains 12.5% lending rate

Chika Onwuji
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CBN maintains 12.5% lending rate

The Central Bank of Nigeria on Monday retained its monetary rate, which guides lending, by leaving its headline rate at 12.5 per cent along with every other parameter around the Monetary Policy Rate.

This was the high point of its Monetary Policy Committee meeting on Monday.

In May, the apex bank loosened its stance by lowering the lending rate by 100 basis points from 13.5 per cent as part of its COVID-19 intervention to make access to credit cheaper, particularly to entrepreneurs. The policy is expected to boost start-ups and expand existing businesses to create jobs.

At the end of the meeting, the MPC explained in a communiqué, “The committee reviewed the policy options before it and argued that the option of tightening at this time would contradict the noble initiative of expansion of affordable credit to the real sector. This would heighten the cost of production, which will translate to higher prices of goods and services as well as harder economic condition for people.

“On the other hand, loosening monetary stance would provide the desired succour for stimulating growth and rapid recovery, but with implications for domestic private investment and capital mobilisation to support the huge domestic financing gap. Further cut in MPR may not necessarily lead to a corresponding decrease in market interest rate, considering the current economic challenges.”

The committee noted that the earlier downward adjustment of the MPR by 100 basis points to 12.5 per cent to signal the loosening monetary policy stance was yielding results, as credit increased significantly in the economy.

“In summary, the MPC voted to retain the MPR at 12.5 per cent, retain the asymmetric corridor of +200/-500 basis points around the MPR, retain the CRR at 27.5 per cent, and retain the Liquidity Ratio at 30 per cent,” the communiqué added.

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