The Nation Newspaper

Category: Capital Market

  • Nigeria hosts regional parley on capital market

    Nigeria hosts regional parley on capital market

    Nigeria’s apex capital market regulator, Securities and Exchange Commission (SEC), is set to host the the 3rd biennial West Africa Capital Market Conference (WACMaC) in Lagos.

    The 2023 conference, scheduled for Eko Hotel & Suites from October 25 to 26, 2023, has the theme: Infrastructural Deficit and Sustainable Financing in an Integrated West Africa Capital Market.

    At the conference, experts across private and public sectors will examine how to tackle infrastructure deficit in the West African sub-region as well as imperatives for sustainable finance, in a bid to promote regional economic development.

    Read Also: ‘Legacies of Akintola Williams in capital market’

     Director General, Securities and Exchange Commission (SEC), Mr Lamido Yuguda, who is also Chairman of the West Africa Securities Regulators Association (WASRA), said the conference was being jointly hosted by WASRA, Economic Community of West African States (ECOWAS), West Africa Capital Market Integration Council (WACMIC), and the West African Monetary Institute (WAMI).

    He noted that this year’s conference was particularly significant as over 300 stakeholders will convene in Lagos to engage in meaningful discussions, share insights, and forge partnerships that will help shape the future of the regional capital markets.

    According to him, thee organisers have brought together a distinguished array of experts, regulators, policymakers, and industry leaders who will share their knowledge, experiences, and strategies to proffer solutions to the region’s infrastructure deficit.

    Yuguda added that the deficit posed a significant challenge to the region’s sustainable development adding that to address this gap, there is a growing need to adopt innovative financing mechanisms, and sustainable financing options to mobilize the desired funds to meet the region’s critical infrastructure needs, foster economic growth, and achieve sustainable development goals.

  • Stock Exchange mulls private issuance market for non-listed companies

    Stock Exchange mulls private issuance market for non-listed companies

    The Nigerian Exchange (NGX) is considering launching a private issuance market that allows non-listed companies to raise capital and conduct other transactions through the Exchange’s platform.

    Chief Executive Officer, Nigerian Exchange (NGX), Mr. Temi Popoola, said the Exchange has started discussions with the Securities and Exchange Commission (SEC) on the launch of private markets to enable the Exchange do business with non-listed companies.

    According to him, most emerging sectors such as the fintechs and other startups have shown preference for private capital.

    He pointed out that the demand for private capital outweighs public capital, thus the consideration of a private market for non-listed companies like startups.

    The private market initiative is part of NGX’s efforts to access the vast growth potential in Nigeria’s tech startups and other companies, most of which prefer private capital investments.

    Tech start-ups in Nigeria and other parts of the African continent had raised over $1.3 billion in first quarter of the year. One of them, Shuttlers, Nigeria’s leading tech-enabled, scheduled mass transit company, raised an additional $4 million in equity funding to accelerate the growth of its transportation solution.

    Shuttlers has raised a combined $5.6 million. Shuttlers has achieved remarkable traction, growing its fleet by 150 per cent and expanding its routes by 25 times, with a 280 per cent increase in passengers moved daily. The company has already built a loyal customer base in Lagos and is rapidly expanding its services to other cities in Nigeria.

    Read Also: Stock Exchange eyes foreign inflows on Tinubu’s NASDAQ appearance

    The NGX had set up a digital and technology products advisory panel as part of efforts to advance its digital transformation agenda.

    The panel provides a forum for the Exchange to interact with the capital market community and the fintech ecosystem to enhance and increase NGX’s digital product offerings.

    SEC had approved the rules for listing on the NGX Technology Board  last December, to encourage investments in indigenous technologically inclined companies within Nigeria and across Africa by providing greater visibility to these companies.

    NGX also plans to launch Non-Depository Receipts (NDR) to part of innovations to deepen the Nigerian capital market.

    The NDR is expected to grant the   public access to financial instruments listed on an offshore exchange and provide investors with access to alternate investment schemes.

    Under the arrangements, asset managers will sponsor the instrument offshore, convert the receipts and sell off in the market.

  • New MD promises to take NG Clearing higher

    New MD promises to take NG Clearing higher

    Newly appointed Managing Director of NG Clearing, Mr. Farooq Oreagba has assured stakeholders that he would work to uplift the central counterparty (CCP) firm.

    Responding to his appointment, Oreagba said NG Clearing has achieved significant milestones on its journey to becoming Africa’s most trusted central counterparty, a foundation he would build on.

    “I am confident that my appointment aligns with the company’s vision, and with the support of the board, I look forward to working closely with the entire team at NG Clearing, towards breaking new grounds in the market in the foreseeable future,” Oreagba said.

    The board of NG Clearing had unanimously appointed Oreagba as the new managing director, citing his outstanding achievements and expertise in the financial services sector. The appointment is however still subject to approval of the Securities and Exchange Commission (SEC).

    The board noted that Oreagba brings a wealth of experience, having served in various executive leadership roles throughout his illustrious career.

    The board stated that Oreagba’s proven track record in driving innovation, fostering a customer-centric culture, and delivering sustainable growth, aligns perfectly with NG Clearing’s core values and strategic objectives.

    Read Also: NG Clearing to launch West Africa’s first central counterparty

    Chairman, NG Clearing, Mr Oscar Onyema, said the appointment was outcome of a transparent, competitive and comprehensive search process for a world-class leader for the institution.

    “We are thrilled to have Mr. Oreagba as our next MD, and we are confident that his visionary leadership will further enhance the position of NG Clearing as a strategic financial infrastructure in Nigeria’s financial services sector,” Onyema said.

    The appointment of Oreagba comes after the three-year tenure of former managing director, Mr. Tapas Das came to an end.

    The board commended the remarkable tenure of Das, noting that he demonstrated exceptional leadership and strategic vision, driving NG Clearing to a phenomenal historical achievement of clearing the first exchange-traded derivatives contracts in West Africa.

    According to the board, under Das, NG Clearing developed a world-class clearing and settlement system that has successfully integrated with the key exchanges in Nigeria’s financial markets.

  • Conoil’s shareholders approve N1.73b dividend

    Conoil’s shareholders approve N1.73b dividend

    • We’re focused on growth strategies, says Adenuga

    Shareholders of Conoil Plc at the weekend approved the distribution of N1.73 billion as cash dividends for the immediate past business year amid assurances that the company would sustain its growth and deliver higher values to stakeholders.

    At the company’s 53rd Annual General Meeting (AGM) in Uyo, the Akwa Ibom State capital, shareholders approved the proposed final dividend payout of N1.734 billion, representing a dividend per share of N2.50 for the 2022 business year.

    Key extracts of the audited report and accounts of Conoil for the year ended December 31, 2023 showed that gross earnings increased by 5.3 per cent to N145.8 billion in 2022 as against N138.2 billion recorded in the corresponding period of 2021.

    Profit before tax grew by 60.1 per cent to N6.13 billion in 2022 from N3.83 billion in 2021. Profit after tax increased by 60 per cent from N3.08 billion to N4.96 billion. With these, earnings per share rose to N7.14, representing 60.8 per cent increase on N4.44 earned in 2021.

    Chairman, Conoil Plc, Dr. Mike Adenuga (Jnr), in his address to the meeting, assured shareholders of the company’s commitment to continue to deliver strong and sustainable performance that would enhance returns to its shareholders.

    Read Also:Conoil’s shareholders approve 67% increase in dividend payouts

    He said the company remained motivated in creating excellent value for its shareholders, while also ensuring that its share price remains on the rise.

    According to him, while there might be challenges posed by the rapidly changing geopolitical and socio-economic environment, Conoil would concentrate on the strategies that have given it the greatest dividend.

    He noted that the Federal Government has started with critical reforms, such as the elimination of the petrol subsidy and reforms in the foreign exchange market, adding that Conoil would maintain steady growth while exploring emerging opportunities.

     “We have shown a consistent ability to improve our operating margin and grow our volumes across all our locations. We have a great brand portfolio with energised and talented personnel with a reach pan-Nigerian. Our overriding goal is to ensure the continued delivery of excellent services to our customers and ultimately ensuring that our shareholders are rewarded.

    “Conoil Plc plans to consolidate on the progress made in the previous years to deliver a strong and sustainable performance that enhances returns to our shareholders. Regardless of the odds, the company is marching forward in the year with confidence and optimism, as it strategically and continuingly positions its business to take advantage of key opportunities,” Adenuga assured the shareholders.

     “The company will grow its earnings, improve profitability and asset quality and deliver competitive returns to its esteemed shareholders,” Adenuga said.

  • S& P Global rates First Bank higher

    S& P Global rates First Bank higher

    S& P Global Ratings has raised its long-term national scale rating on First Bank of Nigeria (FirstBank) Limited to ‘ngBBB+’ from ‘ngBBB’.

    The global rating agency also affirmed its ‘ngA-2’ short-term national scale rating for the bank.

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    In its latest ratings report, S & P also affirmed its ‘B-/B’ global scale long-term and short-term ratings on the bank with a stable outlook.

    The ratings report also concurrently affirmed S & P Global’s ratings of ‘ngBBB-/ngA-3’ long-term and short-term national scale and ‘B-/B’ long-term and short-term global scale on FBN Holdings, with a stable outlook.

  • This is the best time to invest in Nigeria, says Elumelu

    This is the best time to invest in Nigeria, says Elumelu

    Ongoing macroeconomic reforms have the potential to significantly leverage Nigeria’s investment market and deliver above average returns to investors.

    One of Africa’s leading investors and entrepreneurs, Mr. Tony Elumelu, said the economic atmosphere in Nigeria offers the best opportunity for good returns for investors.

    Elumelu owns the single largest stakes in several publicly quoted companies, including United Bank for Africa (UBA) Plc, Transnational Corporation of Nigeria (Transcorp) Plc, Transcorp Hotels Plc, United Capital Plc and Africa Prudential.

    Elumelu’s Heirs Holdings also own major stakes in insurance, real estate, power and financial services companies.

    Providing an entrepreneurial investor’s perspective to a global audience at the Nigeria-India Presidential Roundtable and Conference in New Delhi, India, Elumelu cited his personal experience, corporate records and researches that underlined a robust outlook for the economy.

    He urged the Indian private sector to seize the opportunity to invest in Nigeria, noting that the country is a large market with immense opportunities for foreign investors.

    Elumelu, who has built pan-African financial service businesses and controls significant power and natural resources operations, with his ‘Africapitalism’ focused on value-creation in Africa, was in Delhi for the G20 Summit, both as an invitee of the President Bola Tinubu, and as co-chair of the Business 20 (B20) Action Council focusing on African economic integration, the private sector counterpart to the G20.

    Read Also: Fed Govt to review performance of hospitals, FMCs, others

    During a keynote address, Elumelu invited Indian private sector leaders to join him and other global investors in accessing the rapidly evolving Nigerian economy, home to 20 per cent of Africans and one of the largest consumer populations globally:

    “This is the time to invest in Nigeria. I speak as a private sector investor in Nigeria, the companies in our group’s investment portfolio demonstrate the opportunity.  I believe you also can take advantage of our track record and success.

    “Nigeria is a huge market; over 200 million people with the largest economy on the continent. Most importantly, the population is not just over 200 million people; the demography of the population is exciting. We have a cohort of young people who are there to consume, and we also have people who are intelligent, energetic, hardworking, who provide the human capital that investors need to drive their businesses,” Elumelu said.

    Elumelu’s ‘Africapitalism’ believes that the private sector is the key enabler of economic and social wealth creation in Africa, a philosophy behind his several long-term investments and strategic capital support to companies across several sectors of the economy, in Nigeria and abroad.

    Elumelu was recently named co-chair of the Business 20 (B20) Action Council focusing on African economic integration, alongside Sunil Mittal, Founder of Bharti Enterprises, owners of Airtel. Established in 2010 within the G20, the B20 comprises corporate business enterprises and organisations and serves as the official platform for dialogue between the G20 and the global business community.

    At the Presidential roundtable, hosted by President Bola Tinubu, and jointly organised by the High Commission of Nigeria to India, the Confederation of Indian Industry (CII) and the Nigeria-India Business Council (NIBC), Indian investors pledged investments of nearly $14 billion to Nigeria.

    The $14 billion investment pipeline followed Tinubu’s inspiring commitment to create the enabling environment for foreign investments to thrive in Nigeria.

  • US grants $28m to 33 firms

    US grants $28m to 33 firms

    No fewer than 33 private firms have benefited from the United States grant under the U.S. Agency for International Development (USAID)-funded West Africa Trade & Investment  Hub (Trade Hub).

    The firms got $28 million non-refundable grants to support their expansion.

    Robin Wheeler, Chief of Party, West Africa Trade and Investment and Evelyn Ayivor, Senior Trade and Investment Adviser, USAID, Nigeria at a workshop on “Leveraging Private Sector Engagement to Promote Sustainable Impact.”

     The event highlighted the Trade Hub’s efforts to expand trade and investment opportunities and improve livelihoods and communities in West Africa.

    “Nigeria is the largest economy and market in Africa and has a vast untapped pool of labuor, creating great potential for economic growth. It has an opportunity to become a leading exporter and hub for the West Africa region and the broader continent.

     “Over the past five years, USAID has promoted private sector-led economic growth in Nigeria by facilitating $205 million in debt and equity investments for Nigerian agribusinesses.

    “USAID has also provided partial risk guarantees that will support up to $120 million in loans to agricultural, health, and renewable energy businesses,” Wheeler said.

    Read Also: Fed Govt to review performance of hospitals, FMCs, others

    Ayivor said the Trade Hub improves private sector competitiveness with a focus on increasing the agricultural productivity and profitability of smallholder farmers in Nigeria and promoting West Africa’s regional and international trade.

    “Using a market-based approach, the project also increases partnerships with firms in various sectors through a co-investment grant facility to improve private sector productivity, profitability, and competitiveness.

    “Since the Trade Hub was launched in 2019, the project has catalyzed 93 private sector investments across 16 West African countries. In Nigeria, partners include fruit and cereal processing companies, agricultural input companies, financial advisers, investment firms, and anchor farms.

    “The Trade Hub has awarded $82.6 million in co-investment grants to these companies, generating over $463 million in sales, and creating over 60,000 jobs,” Ayivor said.

    USAID’s Acting Mission Director Sara Werth said, together, with private sector partners and local and national governments throughout the region, USAID has achieved major results.

    “As we continue to partner in the work necessary for sustainable economic growth, financial inclusion, and climate resilience, today’s learning event provides the environment to fuel continued collaboration and build new connections,” Werth said.

    During the event, private sector partners shared their successes in leveraging

    Trade Hub funds and direct partnerships with investment firms and other businesses to unlock new private investment.

    They also discussed the strategies implemented to grow their businesses while navigating challenges and crises such as COVID-19, insecurity, and inflation.”

  • VON hails Tinubu’s investment drive in India

    VON hails Tinubu’s investment drive in India

    VON Automobile Nigeria, a subsidiary of Stallion Group and maker of Ashok Leyland buses, has expressed its support for President Bola Tinubu’s efforts aimed at enhancing foreign and domestic investments.

    Its Managing Director, Dr. Harpreet Singh, spoke against the background of the president’s visit to India for investment talks and the G20 Summit.

    He commended Tinubu’s efforts and highlighted the prospective investment in Nigeria’s auto industry that resulted from his visit to India.

    Tinubu’s meeting with Mr. Gopichand Hinduja, Chairman and CEO of the Hinduja Group of Companies, a conglomerate with a total asset portfolio exceeding $100 billion, led to the signing of a Memorandum of Understanding (MoU) for further investment in Nigeria’s auto industry.

     Mr. Hinduja pledged a multi-billion dollar investment and expressed his commitment to bus and automobile manufacturing in Nigeria.

    Read Also; Akeredolu signs LCDAs Bill

    Singh welcomed the news, expressing confidence that Tinubu’s administration would prioritise the nation’s automobile industry. He stated that VON Automobile, as a pioneer and leading automobile assembler since 2013, remains dedicated to supporting the government’s push for a clean and eco-friendly environment with mass transit buses running on clean and affordable energy sources.

     The company is modifying its locally assembled mass transit buses to run on compressed natural gas (CNG) and electric power.

    The locally assembled Ashok Leyland buses, including the Falcon and Hawk models, have been available in Nigeria since 2014. These buses, designed specifically for the Nigerian environment, offer durability, power, safety, and a longer lifespan.

     Singh emphasised that the CNG and electric-powered Falcon and Hawk buses will help reduce running costs for Nigerians, particularly in light of recent fuel subsidy removal measures. VON Automobile’s state-of-the-art service centres and certified technical specialists are also ready to provide world-class after-sales support to extend the lifespan of the buses.

    VON Automobile’s assembly plant, located along Lagos-Badagry Expressway in Lagos, Nigeria, not only produces buses, but also cars, pickups, trucks, and other vehicles that serve as viable alternatives to imported fully built-up new and used vehicles.

  • NGX urges banks on global competitiveness

    NGX urges banks on global competitiveness

    Chief Executive Officer, NGX Regulation Limited (NGX RegCo), Ms Tinuade Awe has emphasised the importance of banks swiftly integrating environmental, social, and governance (ESG) principles into their business strategies.

    She noted that following Nigeria’s commitment to adopt the International Sustainability Standards Board (ISSB) standards, compliance with ESG principles would provide Nigerian banks with a competitive edge in the global market.

    This call to action was made during a panel session entitled: ESG in the Financial Services Industry: Challenges, Opportunities, and the Next Steps, held at the 16th Annual Banking and Finance Conference organised by the Chartered Institute of Bankers in Nigeria (CIBN) in Abuja.

    Awe highlighted that ESG reporting is a dynamic and significant issue with various global standards and frameworks in place, leading to complexity for investors and companies worldwide.

    She emphasised the growing international consensus on the necessity for standardised ESG reporting and suggested that Nigeria’s banking sector could play a pivotal role in adopting and implementing these standards.

    “Early adoption of ESG standards, particularly those established by the ISSB, is a critical move for Nigeria, including its banking sector. It ensures consistency, attracts foreign investment, and allows Nigeria to have a voice in shaping its ESG reporting criteria,” Awe said.

    Read Also; Akeredolu signs LCDAs Bill

    She further explained the importance of avoiding fragmentation and the opportunity for Nigeria to establish its unique cultural and social identity within the ESG reporting framework, rather than being subject to foreign standards.

    Awe also pointed out that the introduction of the European Sustainability Standards by the European Union could have ripple effects beyond the EU, potentially affecting Nigeria.

    In addition, she highlighted that the International Sustainability Standards Board (ISSB) is set to implement its IFRS 1 and 2 standards next January.

    She stressed the necessity of collaboration with relevant institutions to prevent fragmentation and ensure a unified approach to ESG reporting.

    “Embracing ESG principles is not only a strategic move for Nigerian banks but also an opportunity for the country to define its role in the global ESG landscape,” Awe said.

  • PPP best model to bridge infrastructure gap, says SEC

    PPP best model to bridge infrastructure gap, says SEC

    Securities and Exchange Commission (SEC) has identified private- public partnership (PPP) has the most viable model to bridge the country’s huge infrastructural deficit.

    Director-General, Securities and Exchange Commission (SEC), Mr. Lamido Yuguda said Nigeria’s  public expenditure on infrastructure is abysmally low and it could take the countryabout 300 years to attain some level of infrastructural development, unless there is a change in financing approach.

    Yuguda, who spoke at the  Chartered Institute of Stockbrokers (CIS) National Workshop in Abuja, said the capital market has the capacity and has been well-positioned to finance PPPs for infrastructure projects across the country.

    Speaking on the theme: Leveraging the capital market to drive public-private partnership for effective national economic growth, Yuguda, citing a World Bank report, pointed out that Nigeria’s level of public spending on infrastructure is one of the lowest globally.

    He noted that lack of adequate infrastructural investment has resulted in a significant infrastructure gap, which has adversely affected the quality of infrastructure and limited access to essential services.

    Read Also: Fed Govt to review performance of hospitals, FMCs, others

    Yuguda, who was represented by the Executive Commissioner, Corporate Services, Ibrahim Boyi, highlighted that given the current rate of capital expenditure, it would take approximately 300 years to bridge Nigeria’s infrastructure gap.

    He stressed the need for a new approach to financing infrastructure development in Nigeria to stimulate economic growth and argued that leveraging public-private partnerships is essential, and the capital market can play a crucial role in this regard.

    He explained that the capital market, with its patient capital and established project financing options, is well-suited to finance PPP infrastructure projects at various levels. He cited the common model used in many developed countries, where governments and private sector partners raise debt capital for PPP projects through bonds and loans.

     “This is an infrastructure financing model that is a common choice in many developed nations of the world. Capital markets allow governments and private sector partners to raise debt capital for PPP projects. Governments can issue bonds to finance their share of the project costs while private companies can secure loans or issue corporate bonds for their contributions.

     “The capital market’s ability to provide funding, risk management tools, liquidity, and efficient allocation of resources makes it a crucial partner in the success of PPP projects. It allows governments and private sector partners to leverage their strengths and resources to deliver essential public infrastructure and services,” Yuguda said.

    He  praised the CIS for its role in developing the economy by equipping individuals and organisations with the necessary skills and expertise in the financial sector, which is crucial for the success of PPP projects