Category: Capital Market

Polaris Bank has commenced a nationwide savings campaign to promote savings culture and good financial habits among Nigerians.

The campaign tagged ‘Polaris Save & Win Promo’ will give away millions of naira in cash rewards to its loyal and prospective customers who would partake and emerge winners in the promo.

Four millionaires will emerge alongside 4,379 Nigerians who will be rewarded with other cash gifts from N100,000 up to N500,000 per person in a monthly, quarterly and special draws over a period of 12 months.

According to the bank, the ‘Save & Win’ promo is aimed at making millionaires of everyday Nigerians by encouraging current customers of the bank to grow their existing accounts by N5,000 in 30 days while prospective customers are encouraged to open and save in their account, a minimum of N2,000 and grow it to N5,000 within a month to qualify for the monthly draws, and stand a chance of winning N100,000.

The bank explained that for the quarterly draw, existing and prospective customers stand the chance of winning N1 million in rent as first prize; N500,000 for first runner up and N250,000 for second runner up within the promo period. The campaign, which started on October 1, 2022, will run till September 30, 2023.

According to the bank, the first draw, which will herald the first set of winners for the month of October, will be announced in the first week of November 2022. On that day, the first set of winners, 62 in all, will receive N100,000 each as their reward in commemoration of the 62nd independence anniversary of Nigeria.

Read Also: Polaris Bank, LSETF launch N1b fund to empower artisans

“The same process will be repeated in subsequent months where 100 Nigerians will win N100,000 each. In December however, the first quarter of the campaign draw will hold where three winners will go home with N1m in rent prize: N500,000 and N250,000 cash prizes alongside 100 winners of N100,000 each across the six geo-political zones in the monthly reward draw.

“There will also be special draws for Nigeria’s Independence, Xmas, Valentine, Easter and Eid-el-Kabir seasons. Additionally, the campaign has a targeted draw component where 200 winners comprising of artisans, trade association members will emerge per month-10 winners per cluster with 20 clusters activated every month,” the bank stated.

Group Head, Product and Market Development, Mrs. Adebimpe Ihekuna while kicking off the campaign, said the essence of the exercise, was to give back to customers and encourage savings amongst Nigerians.

She added that the campaign was a reward for the traders, artisans, public servants and indeed professionals who in spite of the challenging times, are able to put aside some money.

She reiterated that in challenging times such as we are now, there is a compelling need to save, not only to win a prize, but also to plan for the rainy day.

Explaining further on the dynamics of the campaign, Ihekuna, noted that both current and new savings account customers of the bank are eligible to participate in the promo.

She disclosed that the joy of winning lies in the ability to continuously grow savings to have greater chances of winning.

“Winners will emerge from four routes or reward categories namely, monthly draws, quarterly draws, targeted draws and special draws through a transparent electronically generated process that will be supervised by relevant regulatory institutions,” Ihekuna said.

 

Nigeria and Ghana at the weekend signed a revised Memorandum of Understanding (MoU) to further strengthen existing cooperation between their capital markets and foster harmonization of African securities markets.

The agreement was signed by the apex capital market regulators for both countries in Accra, Ghana.

Director General, Securities and Exchange Commission (SEC Nigeria), Mr. Lamido Yuguda said that both countries had enjoyed a long period of progressive and mutually beneficial brotherhood and partnership with same applying to both institutions which resulted in the first MoU in 2003.

According to him, the enduring relationship between the two jurisdictions is more amplified by the fact that Ghana and Nigeria both have the largest markets in the West African sub-region and it will only be good foresightedness that they seize the advantage of their size and peculiarities and explore viable areas of cooperation, even as they continue to work assiduously with other stakeholders to integrate the markets and provide greater opportunities for the economic prosperity of their peoples and economies.

He said the revised MOU would usher in an era of strengthened strategic cooperation and mutual support in the regulation of the markets towards the ultimate objective of enhancing their efficiency, transparency, depth, strength and indeed, global competitiveness.

Yuguda added that in the spirit of African Continental Free Trade Area (AfCFTA) and what nations in the region are hoping to achieve on a wider scale with WASRA, the collaboration will be a good pedestal for future and wider collaborations with other neighbors in the sub-region and beyond.

He said that with the revised MoU, both countries have developed a robust and inclusive document that is all-encompassing and reflective of current trends, emphasizing that the goal of the West African capital markets integration programme is the creation of an enabling environment for cross-border securities transactions and the integration of all capital markets jurisdictions in the ECOWAS region.

“It will therefore be equally expected that we develop a tool of cooperation that enables our two institutions to effectively police our respective markets and ensure that the standards of regulation set out by IOSCO are sustained, and where possible, improved upon.

“However, without the readiness of all concerned, the lofty aims of the programme may as well continually remain a dream. It goes to say, unequivocally, that this goal can only be achieved seamlessly when all member states of ECOWAS come on board and actively commit to achieving the noble objectives of the enhanced collaborative structure that these nature of agreements enable,” Yuguda said.

He added that both the SEC Ghana and SEC Nigeria are desirous of achieving these ideals and have taken the lead by example by driving this project in the sub-region while hopefully aiming to someday expand its coverage beyond the sub-regional frontiers onto other parts of the continent of Africa.

Read Also: ‘Insurance sector needs capital, professionalism’

He expressed appreciation to other agencies like the African Development Bank towards the growth and integration of capital markets in the sub region adding that capital markets in the region are working with other institutions to ensure provision of robust infrastructure in superintending over the capital market.

Director General, Securities and Exchange Commission (SEC Ghana), Rev. Daniel Ogbarmey Tetteh said both securities commissions were ready to work together and develop the potentials of the capital market by examining issues and exploring ways to resolve them to make the capital markets work better.

“This is a good framework that will benefit both countries and the sub region. If you want to go far, it is better to go along with others and that is why we always have discussions on co-operation in the capital market. We had an MoU in 2003 which centred on collaboration and leveraging the potentials of the capital markets in the sub region. We are better off when we pull together to attain the potentials of our capital markets.

“Some progress has been made in the past but we are not yet where we want to be, we could do more. Ghana and Nigeria can push forward in ways that will bring about the mutual benefits of leveraging the capital market. We need to have our markets open to each other so that we can achieve more and then attain one big capital market”.

“The MoU has been revised to accommodate new direction to strengthen bilateral relations and measures towards deepening and growing markets through exchanges. This is significant and the Ghana SEC will be committed to play our role to ensure that this MoU results in tangible benefits. We will put it into operation so that our capital market will be deepened and experiences growth that will lead to economic development.

“We need to come closer and take deliberate steps to achieve bilateral co-operation. We are very keen on this relationship. There is a strong relationship between us so we need to continue to nurture and grow it and create institutions that will help our people have better living standards. I hope we can achieve a lot by bringing our capital markets together. We need to make our institutions stronger as well as our economic activities.

“We need this collaboration in a bid to make the process of accessing our markets as seamless as possible, easy for people to transfer assets, make investments and have confidence that the investments are protected in Ghana as they are in Nigeria and vice versa,” Tetteh said.

 

Shareholders have expressed concerns over the adverse impact of the recent escalation between the Kogi State Government and Dangote Cement Plc, which led to forced shut down of the cement plant.

They called on the Federal Government to urgently intervene and prevail on the government of Kogi State to honour its commitment to protect investors in Kogi State.

They decried the use of extrajudicial means to embarrass investors noting that such actions as meted out to Dangote Cement will strongly discourage both local and foreign investments into the country.

President, Association for the Advancement of the Rights of Nigerian Shareholders (AARNS), Dr. Umar Faruk, while speaking on the development criticised the state government for being so insensitive to its populace, thousands of whom are depending on the Dangote’s Obajana plant for their means of livelihood.

He said it is unfortunate that someone who has championed investment, worth billions of naira into a state in Nigeria, is being treated this way.

He called on the federal government to, as a matter of urgency, caution the government of Kogi State in  its dealing with investors in the state.

“Why should the governor of a state in Nigeria, mobilized vigilantes to seal a publicly quoted company? The same governor did exactly the same thing to First Bank, making the bank close some of its branches in the state. Is that not executive rascality, using the state assembly to commit such an atrocious act?

“Federal Government should swing into action by protecting investors, else, the efforts being made to attract both foreign and local investors will come to naught. I hope the state realizes that Dangote Cement has foreign shareholders. What impression do you want these people to have of our government? I also urge the Federal Government to fish out those thugs, used by the state, for prosecution, so as to serve as a deterrent to others…This action will lead to loss of revenue, even for the Government, in terms of taxes, and erode the shareholder’s value,” Umar said.

Founder, Independent Shareholders Association of Nigeria (ISAN), Sir Sunny Nwosu said the state government should have gone to court against any publicly quoted company rather than resort to underhand method of chasing workers with guns and cutlass.

“What the Kogi State Government did, honestly was very bad and disappointing. How can a state use vigilante with guns and cutlasses against a company that is feeding thousands of its people? A reasonable government should have gone to court and not taken laws into its hands.

“This action is bad and will smear the image of both the federal and state government. It will also affect the ranking of ease of doing business in Nigeria. Kogi is blessed with so many natural resources, but with the attitude of this government, I doubt if any reasonable investor, either local or foreign, will want to do anything with the state anymore,” Nwosu said.

Read Also: Obajana: Dangote Cement, Kogi continue war of words

President, Pragmatic Shareholders Association, Mrs. Bisi Bakare said investors were not happy about the way things were going.

“If the state has problems with Dangote Cement on tax issues or any issue at all, there are a far better-civilized ways of handling it than sealing a factory that is contributing more than 30 per cent of the cement Nigerians are consuming.

“The governor should realize that his position is transient and that the people of his state, whom he has deprived their means of livelihood will always remember him for bad! Can you imagine the number of people that will be out of jobs and the huge revenue loss to the government, the company, and us, the shareholders? The state, to me, has done a very grave mistake and the earlier the company is re-opened the better,” Bakare said.

It would be recalled that the government of Kogi State last week forcefully shut down Dangote Cement’s Obajana plant, claiming that the company had refused all entreaties to resolve alleged state shareholding in the cement group among other allegations.

The Organised Private Sector (OPS) operators under the aegis of the National Association of Chambers of Commerce, Industries, Mines and Agriculture (NACCIMA) had lent its voice to the ongoing spat between Dangote Cement and Kogi State government which culminated into the closure of the Obajana plant of the cement company.

NACCIMA expressed regret that the issues between the company and the state over tax disputes ought not to have led to sealing of the company but should have been resolved in a conciliatory and amicable atmosphere.

The body, in a statement signed by its Director-General, Olusola Obadimu, and issued in Lagos, said the state government should have trodden a path of caution and called for the immediate reopening of the factory for normal production activities to resume.

Obadimu stated that NACCIMA’s position was based on some key considerations bordering on the impact of the factory’s closure on the economy and thousands of people whose means of livelihood depend on the production activities of the factory.

“It is vital to note that it is a huge production plant that supplies key domestic input (cement) into the economy and employs hundreds of thousands of Nigerians, directly and indirectly. This is aside from its substantial budget for corporate social responsibility outside of taxes.

“Shutting off the factory does not necessarily help the controversial issue of compliance on tax remittable to Kogi state government. Rather a continuous operation of the plant would more likely facilitate a faster resolution of the dispute,” Obadimu said.

 

He urged that the factory be reopened as quickly as possible to enable it to continue its operation and fulfil its necessary responsibilities, not just on tax obligations, but also keep the hundreds of thousands of Nigerians in its direct and indirect employment dutifully engaged; while sustaining its crucial services not just to the people and government of Kogi State but Nigeria in general.

 

The Nigerian-Canadian Association of Calgary (NCAC) has conferred its Distinguished Citizen Award on the chairman and founder of NOVA Merchant Bank, Mr. Phillips Oduoza, in recognition of his sterling contributions to the development of the financial services sector in Nigeria and beyond.

The association also honoured Dr Ngozi Okonjo-Iweala, the Director-General of World Trade Organisation (WTO) and former Minister of Finance, during its gala night event to mark Nigeria’s Independence Day in Calgary, Canada at the weekend.

President, Nigerian-Canadian Association of Calgary (NCAC), Dr. Patrick Etokudo, said Oduoza and Okonjo-Iweala were honoured because of their distinguished services and contributions to the financial and economic development of Nigeria, Africa and the world at large.

“In these two Nigerians – Mr. Phillips Oduoza and Dr Ngozi Okonjo-Iweala, we have esteemed personalities who have shown commitment to the growth of mankind and Nigerian-Canadian relationships with their contributions, thus representing the best of Nigeria,” Etokudo said.

Phillips Oduoza has over 30 years banking experience in major financial institutions and is the founder and chairman of the board of Nova Merchant Bank Limited. He is an internationally recognised and accomplished banker with diverse knowledge and experience in commercial and corporate banking.

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While giving his acceptance speech, Oduoza thanked the association for the award, and called on Nigerians and Africans in Canada and larger diaspora to prioritise investments in Nigeria and on the continent, saying the situation at home was not as bad as being portrayed by some sections of the media.

“Every country has its own peculiar challenges and Nigeria is not an exception. Nigeria is a country with enormous opportunities across all sectors. I am convinced that Nigeria and larger Africa will get it right soon,” Oduoza said.

He also urged Nigerians in Canada to continuously touch base with the home country.

The NCAC marks the Nigerian independence anniversary annually in an event that not only brings together over a thousand guests to celebrate the country’s freedom but also showcases the Nigerian culture, excellence and successes. It is the highest-profiled Nigerian event in North America with professionals and businesses coming together to celebrate.

This year’s event was attended by leaders in business, public and private sectors including representatives of the Governor of Alberta and Nigerian High Commissioner.

 

• Share price rises 18%

• Transition continues

Shareholders of Nigerian Exchange Group (NGX Group) Plc at the weekend reviewed the performance of the company after its historic conversion with a commitment to support the ongoing transition of the group.

The NGX Group recorded the second highest gain at the stock market at the weekend with a gain of 17.65 per cent for the week. The share price opens today at N20 per share. The NGX Group’s share performance counteracted the decline in the overall market position. Nigeria’s equities market benchmark recorded marginal average decline of 0.01 per cent.

After more than three decades as a not-for-profit, member-owned mutual organisation, the then Nigerian Stock Exchange (NSE) had in March, last year converted to a profit-making public limited liability company and changed its structure to a holding group structure.

With the conversion, otherwise known as demutualisation, came a new non-operating holding company, the Nigerian Exchange Group Plc (NGX Group), which shares were allotted to former members of the defunct NSE.

The NGX Group has three operating subsidiaries, namely: Nigerian Exchange Limited (NGX Limited), the operating exchange, which took on the listing and trading function of the NSE; NGX Regulation Limited (NGX RegCo), the independent regulation company, which took on the self regulatory functions of the NSE; and NGX Real Estate Limited (NGX RELCO), the real estate company that took ownership of real estate and other assets, including the iconic Stock Exchange building in Lagos.

At the Annual General Meeting at the Stock Exchange’s House in Lagos, shareholders reaffirmed their commitments towards realisation of the objectives of the demutualisation and strengthening the group to become a globally competitive securities exchange hub.

The meeting approved the reappointment of directors that were presented for re-election as well as key corporate governance structures including appointment of Ernst & Young as NGX Group’s external auditors; the board’s authority to fix the auditors’ remuneration; the disclosure of NGX Group’s executive remuneration; and the re-election of the statutory audit committee.

Two directors- Mr. Apollos Ikpobe and Dr. Okechukwu Itanyi, who retired by rotation, were re-elected as non-executive directors. Professor Enase Okonedo’s resignation was earlier approved by the board and as such she was not presented for re-election. Chairman, NGX Group , Otunba Abimbola Ogunbanjo, who was due for re-election for a period of one year until 2023, voluntarily retired from the board and did not present himself for re-election. Four other non-executive directors were re-elected including Mrs. Fatimah Bintah Bello-Ismail, Mr. Oluwole Adeosun, Mr. Chidi Agbapu, and Mr. Patrick Ajayi.

To allow for wider consultations and further engagement with shareholders, the special business to raise funds of up to N35 billion for business expansion was not presented.

Ogunbanjo said the group has made significant progress since after its demutualisation and is poised for stronger performance in the period ehad.

He commended shareholders for working with the board and management in delivering the dividends of demutualisation and enhancing shareholder value.

“We released our dividend policy in line with our mandate to shareholders after the completion of our recent extraordinary General Meeting. We also created a revised corporate governance framework, already approved by shareholders and consistent with securities regulations to realign the interests of all stakeholders.

“In closing, I would like to thank the board and management of NGX Group for their support since I assumed office as chairman of the group in 2021. As I retire from the board, I trust that my successor will continue the legacy of service and bring greater accomplishments as the sustainable exchange group championing Africa’s socio-economic growth,” Ogunbanjo said.

Group Managing Director, Nigerian Exchange Group (NGX Group) Plc, Mr. Oscar Onyema, said the group recorded 22 per cent increase in profitability while top-line gross earnings grew by 13 per cent during the year ended December 31, 2021.

He assured that the group would enhance its performance going forward, urging shareholders to support the company.

After the meeting, the board of directors appointed Mr. Apollos Ikpobe as acting chairman. Ikpobe promised to work with all stakeholders to ensure the stability and growth of the company during this transition.

He commended Ogunbanjo for his selfless service to the group over the years and reaffirmed his commitment to discharging the enormous responsibility bestowed on him as the leading director.

According to the scheme of arrangement for the conversion, NGX Group has an authorised share capital of 2.5 billion ordinary shares. About 2.0 billion ordinary shares of 50 kobo each were registered with SEC and issued in the immediate period of the conversion. The post-demutualisation shareholders’ base consisted of 255 institutional shareholders and 177 individual shareholders.

The post-demutualisation shareholding arrangement was arrived at by converting the existing dealing members of the Exchange to institutional shareholders and ordinary members to individual shareholders. Shareholdings were on equal basis in the immediate conversion period with each institutional shareholder holding 6.01 million ordinary shares of 50 kobo each while each individual shareholder held 2.44 million ordinary shares of 50 kobo each. Thus, each institutional shareholder held 0.3 per cent equity stake while each individual shareholder held 0.1 per cent equity stake, in line with the current membership-share conversion ratio of 78 per cent for dealing members and 22 per cent for ordinary members.

The Federal Government, through the Bank of Industry (BOI), many state governments including Adamawa State and several prominent Nigerian businessmen and policy experts are among a total of 432 individuals and institutions that hold shares of NGX Group in the immediate period of the conversion.

Other shareholders include Mr Akintola Williams, late Senator Theophilus Adebayo Doherty, late Sir Odumegwu Ojukwu, late Alhaji Shehu Bukar, late former President Umaru Yar’Adua, late Bashorun MKO Abiola, late Dr Abdul Lateef Adegbite and late Mr Gamaliel Onosode among others.

Other individual shareholders are Chief Ernest Shonekan, Alhaji Aliko Dangote, Alhaji Abdul Rasaq, Alhaji Aminu Dantata, Mr Tony Elumelu, Mr. Oba Otudeko, Mr. Pascal Dozie, Chief Bayo Kuku, Chief Christopher Ogunbanjo, Dr Christopher Abebe, Mr Goodie Ibru, Alhaji Isyaku Umar,   Otunba Adekunle Ojora, Mr Phillip Asiodu, Rear Admiral Allison Madueke, Rabiu Gwadabe, Mr Raymond Obieri, Senator Udo Udoma and Senator David Dafinone among others.

Institutional shareholders will include GTI Securities Limited, CSL Stockbrokers Limited, Capital Assets Limited, Cowry Asset Management Limited, Meristem Securities Limited, APT Securities and Funds Limited, Capital Bancorp Limited, Centre-Point Investments Limited, Chapel Hill Denham Securities Limited, Emerging Capital Limited, Stanbic IBTC Stockbrokers Limited, Trust Yields Securities Limited and Vetiva Capital Management Limited among others.

The demutualisation of the defunct NSE brought the Exchange to the full cycle of its history. The NSE was established as the Lagos Stock Exchange (LSE) on September 15, 1960 under the provisions of the Companies Ordinance 1922, with a share capital of £5,000 divided into 500 ordinary shares of £10 each. At incorporation, each of the original subscribers subscribed to five shares in the Exchange.

Subscribers at incorporation included C. T. Bowring & Co. (Nigeria) Limited, Senator Chief Theophilus Adebayo Doherty, John Holt Nigeria Limited, The Investment Company of Nigeria Limited, Sir Odumegwu Ojukwu,  Akintola Williams and Alhaji Shehu Bukar.

The share capital of the Exchange was subsequently increased to N20,000 consisting of 1,000 ordinary shares of N20 each, pursuant to an ordinary resolution dated December 2, 1977. The name of the Exchange was then changed from the Lagos Stock Exchange to the Nigerian Stock Exchange on December 15, 1977.

However, following the enactment of the Companies and Allied Matters Act (CAMA) 1990, companies limited by guarantee were prohibited from being registered with a share capital; and all such existing companies were mandated to re-register without a share capital. The NSE was re-registered on December 18, 1990 as a company limited by guarantee and the then existing share capital of N20,000 was cancelled; and the equity rights of the initial subscribers extinguished. Thus, from then till the demutualisation, the NSE operated as a mutual company limited by guarantee with no issued or paid-up share capital; as such no individual or corporate entity had equity-based ownership rights.

The new majority core investor in Capital Hotels Plc may soon launch a tender offer to acquire minority shareholdings in the holding group for Sheraton Abuja Hotel.

Multiple market sources confirmed to The Nation that the acquisition of majority equity stake and the emergence of a new core investor has triggered the extant provision that requires a new major core investor to offer similar deal that led to its emergence to minority retail shareholders.

Section 131, Part XII of the Investment and Securities Act, No. 29, 2007 and Rule 445 of SEC Rules and Regulations, 2013 underlined the requirement for a mandatory tender offer (MTO) for a new core investor.

Section 131 of the Investment and Securities Act (ISA) and Rule 445 of SEC make it mandatory for any institution or person that acquires at least 30 per cent of a company to make an MTO to other minority shareholders. The MTO is usually at the transaction price for the deal that led to the emergence of the major shareholding.

Regulatory filing last week showed that 22 Hospitality Ltd had acquired 66.13 per cent controlling equity stake in Capital Hotels, which owns Abuja Sheraton Hotel and a related company to Ikeja Hotel Plc.

22 Hospitality Limited acquired 1.61 billion ordinary shares of 50 kobo each or 51 per cent of the equity share capital of the company through private placement. It also acquired through offer for sale 456.64 million and 21.56 million ordinary shares of 50 kobo each, representing 14.45 per cent and 0.68 per cent of the paid up share capital of the company, from Hans Gremlin Nigeria Limited and Associated Ventures International Limited.

The private placement and offer for sale deals gave 22 Hospitality Limited a total of 2.09 billion ordinary shares of 50 kobo each, representing 66.13 per cent of the paid up share capital of Capital Hotels.

The Nation’s check indicated that  the Securities and Exchange Commission (SEC) has applied the MTO rule, although framework allows the regulator to make exception in rare cases.

Several companies that had seen major acquisition in recent period had launched MTOs including Eterna Plc, Heineken’s Champion Breweries, Ardova Plc, NPCO’s 11 Plc-formerly known as Mobil Oil Nigeria and Lafarge Africa’s Ashaka Cement among others.

Capital Hotels is an associated company of Ikeja Hotel, another publicly quoted company that controls a chain of hotels directly and through other subsidiaries and affiliates including Tourist Company of Nigeria (TCN) Plc and Capital Hotels Plc. Ikeja Hotel owns Sheraton Hotel, Ikeja, Lagos. TCN owns Federal Palace Hotel, Lagos while Capital Hotels owns Abuja Sheraton Hotel.

The Ibru family owns the single largest individual shareholding in Ikeja Hotel.

Following the emergence of 22 Hospitality Limited as the new core investor, the board of directors of Capital Hotels resigned and the new core investor took over. Directors that resigned their appointments included former chairman, Chief Anthony Idigbe,Dr Alexander Thomopulos,Mrs Fadeke Olugbemi, Mrs Helen Da-Souza and Mr Akpofure Ibru.

The new board of directors included Mr Ramesh Kansagra as chairman, Rishi Kansagra as a non-executive director;  Ravi Bachu  as executive director;  Aminu Abdulkadir as non-executive director; Chief Paul Obi as non-executive director and Pascal Demarchi as executive director. Also, Mr. Chuma Anosike, Alhaji Abatcha Bulama and Mr. Toke Alex-Ibru were appointed as independent non-executive directors.

Kansagra said the new board would reposition the hotel to its former glory by turning it into the number one hotel in Abuja.

He said the new core investor had always paid dividends in all their companies and Capital Hotels would not be an exception going forward.

Capital Hotels was incorporated in January 1981 as a private limited liability company and became a public liability company in May 1986. Its hotel, Sheraton Abuja Hotel commenced business in January 1990.

• Pension funds melt down

• Net return drops to N3.3tr

Investors in Nigerian equities closed weekend with average loss of about N1.50 trillion in the third quarter as escalated global energy and commodity crises triggered massive portfolio realignments across markets.

Benchmark indices at the stock market closed weekend with average negative return of 5.39 per cent for the third quarter, equivalent to net capital depreciation of N1.50 trillion for the three-month period.

The third-quarter performance underlined sustained decline in recent months with investors losing an average of 1.63 per cent or N430 billion in the month. The market had lost about N28.3 billion in August and suffered its highest loss within the quarter at the onset with a N772 billion loss in July.

The year-to-date return, however, remained positive with average year-to-date return of 14.77 per cent, equivalent to net capital gain of about N3.3 trillion for the nine-month period.

The All Share Index (ASI) – the value-based index that tracks all share prices at the Nigerian Exchange (NGX) – closed weekend at 49,024.16 points as against 51,817.59 points recorded at the beginning of the quarter.

Aggregate market value of  quoted equities dropped from third quarter’s opening value of N27.935 trillion to close weekend at N26.451 trillion, a decrease of about N1.50 trillion. The almost perfect correlation between market capitalisation and ASI underlined that the depreciation was mainly due to decline in share prices rather than primary market changes such as reduction in number of shares.

An analysis showed no safe haven for investors during the period. All sectoral indices closed negative, driven by selloffs within the large and mid-cap stocks. The NGX 30 Index- which tracks the 30 largest stocks at the NGX, posted average loss of 7.45 per cent in the third quarter. The NGX Banking Index- the most active index, declined by 4.67 per cent.

Also, the NGX Insurance Index, the most populous index, dropped by 5.46 per cent during the period. The NGX Industrial Goods Index recorded the highest decline of 17.61 per cent within the three-month period. The NGX Oil and Gas Index depreciated by 6.80 per cent in third quarter 2022. The NGX Consumer Goods Index declined by 6.30 per cent. The NGX Pension Index, which tracks stocks in line with the stringent pension funds’ investment guidelines, depreciated by nine per cent while the NGX Lotus Islamic Index- which tracks equities that comply with the more stringent Islamic investment rules, declined by 6.51 per cent in the third quarter.

Analysts attributed the market performance to the worsening domestic and global economic risks characterised by rising inflation and higher interest rates.

Most analysts remained cautious of the outlook in the months ahead citing worsening economic fundamentals and political risks.

“Despite the commencement of third quarter earnings season, we anticipate that the bearish momentum would persist in October given the expected uptrend in fixed-income yields following the Monetary Policy Rate (MPR) hike,” Afrinvest West Africa stated at the weekend.

“Overall, we expect the local bourse to maintain cautious trading sentiments as electioneering activities kick off in full gear. However, we advise investors to take positions in only fundamentally justified stocks as the fragility of the macroeconomic environment remains a significant headwind for corporate earnings,” Cordros Securities stated in an investment review issued at the weekend.

Vice President, Highcap Securities Limited, Mr, David Adonri, had noted that the stock market commenced decline performance when the Monetary Policy Committee (MPC) of CBN increase interest rate to 14 per cent. The MPC last week further increased interest rate by 150 basis points to 15.50 per cent.

He noted that other macroeconomic indicators such as inflation rate, and scarcity of foreign exchange have also diminished demand for stocks as investors moved to fixed income markets.

He added that the fundamentals of foreign and domestic macroeconomic indicators in three months have impacted negatively on the stock market.

He projected that the market might remain bearish given happening in global and domestic economy.

“The Russia-Ukraine war is one of them and the current happening in China as regarding power blackout is causing global anxiety among investors. People are afraid that it can cause recession in China and it can increase global inflation and Nigeria is vulnerable to such.

“Mind you, we have 2023 general election that politicians are commencing campaign from September and we are already experiencing foreign currency scarcity. We are for a serious challenge in the stock market going forward in 2022,” Adonri said.

Investment analyst, PAC Holdings, Mr. Wole Adeyeye had pointed out that some investors migrated from stock market to fixed-income market to take advantage of high yields triggered by recent hike in MPR.

He added that foreign investors were avoiding the Nigerian stock market due to the upcoming general elections, weak local currency and insecurity in the country.

He noted that the trend may likely continue in September as yield in the fixed-income market is expected to remain attractive.

According to him, foreign investors may not patronise the Nigerian equities market at the moment due to the uncertainty surrounding the economy.

“Nevertheless, our medium-long term outlook for the Nigerian equities market remains positive. This provides an opportunity for investors that want to take advantage of cheap stocks in the market at the moment” Adeyeye said.

Three banking stocks – Jaiz Bank Plc, Guaranty Trust Holding Company (GTCO) Plc and Zenith Bank International Plc – were the most-traded stocks at the stock market as investors sought to lock in into value stocks.

Trading data at the weekend indicated that the three banking stocks accounted for 45.81 per cent and 47.7 per cent of the total turnover volume and value at the stock market last week.

The three most active stocks accounted for 460.22 million shares worth N4.963 billion in 4,281 deals, representing 45.81 per cent and 47.69 per cent of the total equity turnover volume and value respectively.

Jaiz Bank – Nigeria’s premier and leading non-interest bank – was the most active stock and the third highest gainer during the week. Its share price rose 15.38 per cent to close at 90 kobo per share.

The increased momentum of activities on the three banking stocks boosted overall market performance with total turnover rising by 78.5 per cent to 1 billion shares worth N10.406 billion in 17,844 deals last week. Total turnover had stood at 562.856 million shares valued at N9.438 billion in 16,013 deals two weeks ago.

Trading analysis showed that financial services sector remained atop the activity chart with 757.289 million shares valued at N6.947 billion in 9,483 deals; thus contributing 75.38 per cent and 66.76 per cent to the total equity turnover volume and value.

The conglomerates sector occupied a distant second position with 75.118 million shares worth N82.955 million in 494 deals while the consumer goods sector placed third with a turnover of 50.186 million shares worth N1.457 billion in 2,798 deals.

Also, a total of 5,937 units of exchange traded products (ETPs) valued at N21.716 million were traded in 18 deals compared with a total of 4,938 units valued at N2.135 million traded in 18 deals penultimate week.

At the secondary debt market, a total of 35,327 bond units valued at N35.758 million were traded in 21 deals compared with a total of 2,961 bond units valued at N2.994 million swapped in eight deals two weeks ago.

The overall pricing trend remained negative, although the trend showed resistant with more gainers and lesser losers than the previous week.

The All Share Index (ASI)- the common index that tracks all share prices at the Nigerian Exchange (NGX) closed the week at 49,024.16 points as against the week’s opening index of 49,026.62 points, representing a marginal decline of 0.01 per cent. Aggregate market value of all quoted equities however rose from the week’s opening value of N26.445 trillion to close the week at N26.451 trillion, representing an increase of 0.03 per cent. The increase in market capitalisation was due mainly to additional listing of shares by eTranzact International Plc.

There were 25 gainers and 33 losers during the week compared with 17 gainers and 42 losers recorded in the previous week. Multiverse Mining And Exploration recorded the highest gain, in percentage terms, of 30.85 per cent to close at N3.69 per share. Nigerian Exchange Group followed with a gain of 17.65 per cent to close at N20 per share. Cadbury Nigeria ranked fourth with a gain of 14.77 per cent to close at N13.60. Eterna rose by 9.91 per cent to close at N6.32 while BUA Cement appreciated by 8.67 per cent to close at N52 per share.

On the negative side, Neimeth International Pharmaceuticals led the decliners with a drop of 10.26 per cent to close at N1.40 per share. Nestle Nigeria dropped by 10 per cent to close at N1,215. Africa Prudential declined by 9.91 per cent to close at N5. Royal Exchange dipped by 9.80 per cent to close at 92 kobo while Fidson Healthcare declined by 9.05 per cent to close at N9.05 per share.

Banking stocks were the most active and the largest representative group in the top gaining chart at the stock market as the global stock markets panicked over long-drawn effect of rising general prices on returns.

Negative sentiments were pervasive across the global stock markets with the stock market closing weekend with average decline of 0.91 per cent.

With some three losses in every four price, investors in Nigerian equities lost N241 billion in net capital depreciation. These moderated the average year-to-date return for Nigerian equities to 14.77 per cent.

The All Share Index (ASI) – the common, value-based benchmark index for the Nigerian equities market closed weekend at 49,026.62 points as against the week’s opening index of 49,475.42 points.

Aggregate market value of all quoted equities at the Nigerian Exchange (NGX) also mirrored the benchmark index dropping from its week’s opening value of N26.686 trillion to close weekend at N26.445 trillion.

The market mirrored the generally negative global stock market outlook. All major global stock markets closed on the downside as concerns mounted over the impact of increased fixed-income rates on the equities market. In United States of America, the S & P 500 Index fell by 4.6 per cent, the NASDAQ dropped by 5.1 per cent while the Dow Jones Industrial Average (DJIA) dipped by 2.4 per cent.

In United Kingdom, the FTSE 100 Index dropped by 1.1 per cent while the FTSE All Share Index slumped by 3.2 per cent. Germany’s XETRA DAX Index declined by 3.5 per cent. France’s CAC 40 Index lost 4.8 per cent. Japan’s Nikkei 225 Index dropped by 1.5 per cent. China’s Shanghai Composite Index depreciated by 1.2 per cent. Russia’s RTS Index worsened with 10.2 per cent drop while India BSE Sens Index declined by 1.3 per cent.

All Africa’s major markets also closed in the red. South Africa’s FTSE/JSE All Share Index dropped by 4.8 per cent. Kenya’s Nairobi Stock Exchange (NSE) 20 Index slipped by 0.1 per cent. Ghana Stock Exchange (GSE) Composite Index declined by 0.5 per cent while Egypt’s EGX 30 Index lost 1.4 per cent.

Broad indices also underlined the pervasive negative sentiments across the markets. The STOXX 600 Index- which tracks European markets, depreciated by 2.3 per cent. The MSCI EM Index- which tracks emerging markets, dropped by 2.3 per cent while the MSCI FM Index-which tracks the frontier markets, declined by 2.2 per cent.

Banking stocks appeared to be the safe havens in the Nigerian market as investors realigned portfolios amid increased socio-economic and political risks. The NGX Banking Index was the lone gainer during the week, with average gain of 2.27 per cent at the weekend. All other sectoral indices closed in the red.

The NGX 30 Index-which tracks the 30 largest stocks in Nigeria, dropped by 0.99 per cent. The NGX Oil and Gas Index recorded the highest loss of 4.68 per cent. The NGX Industrial Goods Index lost 3.92 per cent. The NGX Insurance Index lost 2.08 per cent. The NGX Consumer Goods Index slipped by 0.16 per cent.

Ethical investors booked major loss as the NGX Lotus Islamic Index-which tracks stocks that comply with Islamic rules, declined by 1.07 per cent. However, the NGX Pension Index – which tracks stocks that comply with pension funds’ investment rules rode on the back of gains in the banking sector to close with modest gain of 0.05 per cent.

Two major banks-Zenith Bank and Guaranty Trust Holding Company were among the top three most traded stocks during the week. Together with the Nigerian Exchange Group (NGX Group) Plc, the top three most active stocks accounted for 183.929 million shares worth N3.499 billion in 3,628 deals, contributing 32.68 per cent and 37.07 per cent to the total equity turnover volume and value.

The bank-led financial services industry remained the most active on the NGX with 381.958 million shares valued at N4.551 billion traded in 8,627 deals; thus contributing 67.86 per cent and 48.21 per cent to the total equity turnover volume and value. The information and communication (ICT) industry occupied a distant second with 59.345 million shares worth N2.480 billion in 1,272 deals whole the services industry ranked third with a turnover of 32.212 million shares worth N95.807 million in 607 deals.

The momentum of activities slowed down generally with total turnover of 562.856 million shares worth N9.438 billion in 16,013 deals last week as against a total of 719.398 million shares valued at N8.004 billion traded in 17,444 deals two weeks ago.

Also, a total of 4,938 units of exchange traded products (ETPs) valued at N2.135 million were traded in 18 deals compared with a total of 2,172 units valued at N352,773 traded in 18 deals penultimate week.

At the secondary debt market, a total of 2,961 bond units valued at N2.994 million were traded in eight deals compared with a total of 15,945 bond units valued at N16.238 million swapped in 15 deals two weeks ago.

Further pricing trend analysis showed that there were 42 losers against 17 gainers during the week as against 39 losers and 13 gainers recorded in the previous week. Three banking stocks made the top 10 gainers. Vitafoam Nigeria led the advancers, in percentage terms, with a gain of 12.25 per cent to close at N22.45.

Fidelity Bank followed with a gain of 10.85 per cent to close at N3.78 per cent. Unity Bank rose by 10 per cent to close at 44 kobo. E-Tranzact International rose by 9.97 per cent to close at N3.20. R T Briscoe appreciated by 9.37 per cent to close at 35 kobo. Trans-Nationwide Express chalked up 8.70 per cent to close at 75 kobo.

International Breweries rose by 6.25 per cent to close at N5.10. Access Holdings appreciated by 6.02 per cent to close at N8.80. Regency Assurance rose by four per cent to close at 26 kobo while AIICO Insurance inched up by 3.70 per cent to close at 56 kobo per share.

On the negative side, Academy Press led with a drop of 22.73 per cent to close at N1.70. The Nigerian Exchange Group declined by 13.92 per cent to close at N17. Cadbury Nigeria dropped by 13.82 per cent to close at N11.85. BUA Cement depreciated by 10.39 per cent to close at N47.85 while CWG, Associated Bus Company and Chams Holding Company lost 10 per cent each to close at 81 kobo, 27 kobo and 27 kobo respectively.

Market analysts remained cautious about the outlook for the market. Analysts at Cordros Securities said investors would be focused on the outcome of the Monetary Policy Committee (MPC) meeting of the Central Bank of Nigeria (CBN), which opens today, to gain further clarity on the movement of yields in the fixed-income market.

“As a result, we envisage an extension of the cautious trading theme, especially from domestic investors. Notwithstanding, we reiterate the need for positioning in only fundamentally sound stocks as the weak macro environment remains a significant headwind for corporate earnings,” Cordros Securities stated at the weekend.

Analysts at Afrinvest Securities expected “bargain hunting activities to boost market performance” as investors seek out low-priced value stocks.

Analysts at Arthur Stevens Asset Management said the next pricing cycle at the market would determine the general trend. Analysts noted that if the market slips below its current level to around 48,554.76 points; the bearishness may worsen and conversely, if it rises above 49,445.31 points; a bullish rally may ensue.

“Investors should pay close attention to global indicators as well as trends under the current global situation. We would like to reiterate that investors should go for stocks with good fundamentals,” Arthur Stevens Asset Management stated.

The Securities and Exchange Commission (SEC) has said that the passage of the Investments snd Securities Bill 2022 would aid the functioning of the capital market as well as facilitate the on-going economic diversification in the country.

Director General, Securities and Exchange Commission (SEC), Mr. Lamido Yuguda, said that the passage and enactment of the Bill will be a pivotal step in revamping the economy and therefore enjoins and appeals for the buy-in of key stakeholders to make this aspiration a reality.

Speaking on some highlights of the major innovations and changes in the   Bill, Yuguda disclosed that the Bill expands the categories of issuers, as a key step towards the introduction of new innovations and offerings such as crowd-funding as well as the facilitation of “commercial and investment business activities”, subject to the approval of the Commission and other controls stipulated in the Bill.

“The Bill expands the definition of a Collective Investment Scheme to include schemes offered privately to qualified investors. Minor reviews on various Sections of the extant law have been carried to provide greater clarity.

Importantly, the Bill introduces an express prohibition of Ponzi/Pyramid Schemes as well as other illegal investment schemes. The Bill also prescribes a jail term of not less than 10 years for promoters of such schemes.

“This Bill contains an entirely new Part which provides for the regulation of Commodity Exchanges and Warehouse Receipts. These provisions are essential to allow for the development of the entire gamut of the Commodities ecosystem” he stated.

Yuguda spoke during the Public Hearing on the ISB 2022 and the Chartered Institute of Stockbrokers Bill 2022 in Abuja.

He also said that a recommendation is made in the Bill for the inclusion of the National Pension Commission (PenCom) on the SEC Board for increased collaboration between the two agencies, particularly to encourage greater investment of pension funds and in capital market products/instruments.

Also, according to the SEC DG, a new part on the management of systemic risk has been introduced covering the following themes: monitoring, management and mitigation of systemic risk in the Nigerian capital market; arrangements with other regulators relating to information required from entities that are regulated by other regulators; sharing of information between financial sector regulatory authorities or government agencies; and use of a legal entity identifier to provide for proper monitoring of systemic risks.

“Securities Exchanges are now classified into Composite Exchanges and Non-composite Exchanges. A Composite Exchange is one in which all categories of securities and products can be listed and traded, while a Non-composite Exchange focuses on a singular type of security or product.

“Furthermore, the duties/responsibilities of Exchanges have been expanded and the conditions for revocation of registration clearly stated. There are also new provisions on Financial Market Infrastructures such as Central Counter Parties, Clearing Houses, Trade Depositories etc” he added.