Category: Capital Market

The London Stock Exchange has announced that Airtel Africa Plc will be joining the FTSE100 today.

Airtel Africa floated on the London Stock Exchange in June 2019, and has since demonstrated significant growth in its customer base, revenues, profits, margins, and cash generation, as well as strengthening its balance sheet through reduced leverage. This has been increasingly recognised by the market.

Chief Executive Officer, Airtel Africa Plc, Mr. Segun Ogunsanya said the group has continued to invest in further execution of its growth strategy to deliver on the significant market potential afforded by the demographics and market dynamics across voice, data and mobile money services.

According to him, the group continues to invest in infrastructure and distribution network across the countries where it operates supporting their economies and communities.

In a statement, the company stated that sustainability is at the core of its strategy, driven by its guiding purpose of ‘Transforming lives’ across Africa, with people, businesses and governments seeking access to more and better connectivity and improved financial inclusion.

Airtel Africa noted that through its mobile telecoms and mobile money services, it has been transforming lives of over 122 million people across the 14 African markets in which it operates.

“I am immensely proud that Airtel Africa will be joining the FTSE 100 only two and a half years after we listed on the London Stock Exchange.

“This achievement has been on the back of all the hard work and success achieved by everyone at Airtel Africa. We look forward to growing the Company further as we continue to sustainably bridge the digital divide, expand financial inclusion and meet the evolving needs of our customers,’’ Ogunsanya said.

Chimera Investment LLC, a member of Abu Dhabi’s Royal Group, recently invested $50 million in Airtel Africa’s mobile money business.

Airtel Africa said the investment made Chimera Investment an additional investor in Airtel Mobile Commerce BV (AMC BV), through the $50 million secondary purchase of shares from a subsidiary of Airtel Africa Plc.

AMC BV is the holding company for several of Airtel Africa’s mobile money operations; and ultimately is intended to own and operate the mobile money businesses across all of Airtel Africa’s 14 operating countries.

In a regulatory filing, Group Company Secretary, Airtel Africa Plc, Simon O’Hara, said Chimera Investment LLC, through its subsidiary Chimetech Holding Ltd, now holds a minority stake in AMC BV alongside the other minority investors, with Airtel Africa continuing to hold the majority stake.

Sterling Bank Plc has said it would organise an award, known as the Sterling Heart Fellowship Award, for young tech founders whose businesses employ innovative solutions to tackle challenges in the HEART sectors.  The award is targeted at tech founders within the age bracket of 14 and 16 and will hold in February under the Founder Institute Lagos Virtual Spring programme.

The HEART sectors include health, education, agriculture, renewable energy and transportation. They represent the sectors where the bank is focusing investments on under its HEART’s of Sterling strategy.

Head, Business Group and Partnerships, Sterling Bank Plc, Mr. David Adebayo said guidelines for selecting founders whose businesses fall within the Sterling HEART Fellowship category include founders who applied through either the customised Sterling HEARTs Fellowship application link or the direct FI Lagos application link.

He added that a founder’s business must fall within the HEART Sectors and the founder must have taken the assessment test and made it to the “Accepted” category to be eligible for the award.

Adebayo said all founders who meet the preceding requirements will be rank-ordered according to their performances and the best from each of the sectors will be offered a Sterling Bank Fellowship to attend the Founder Institute Lagos Virtual Spring programme.

He advised prospective applicants to apply through the special portal and to prepare for an entrepreneur DNA test that is focused on ascertaining the entrepreneurship qualities and capabilities of the founders.

He said the organisers of the fellowship are targeting start-up founders within the age bracket of 14 and 16. The applicants must be young tech founders and tech enthusiasts, especially those with ideas and initiatives within the HEART sectors.

He said the under the selection process, the Founder Institute (FI) will focus on helping tech or tech-enabled businesses at the idea and pre-seed stages, including both solo-founders and teams, adding that this includes established businesses that are pre-funding and traction, MVP and prototype-stage projects as well as part-time founders with just ideas.

He said prospective applicants must meet the listed criteria to be eligible for admission into the Founder Institute Accelarator’s programme for founders. These are bio data, the state of the business-idea, product and service, highest level of education, years of professional experience, years of start-up experience, years of experience working on the idea, years of experience working on the idea, how many hours of work is expected on the idea on a weekly basis, primary skillset and key area of expertise and a short paragraph describing the idea.

All applications to the Founder Institute are human-reviewed while the admissions team is based at its Silicon Valley headquarters who are supported by the local team. They are able to provide an admissions decision via email within 72 hours.

After reviewing the application, the admissions team will assign founders to one of the following categories, including: accepted – accepted founders are invited to complete the final steps to enrollment, and immediately get access to all course materials; reviewing – these are founders whose application or assessment is receiving a more thorough review.

In many cases, the admissions team will reach out to them with specific questions over email and finalist – founders designated as finalists are placed on the “Waiting List” and their application will be re-reviewed at a later date. Declined – declined founders are not accepted to the programme as a result of low performance across all the admissions criteria and the declined founders are given access to free company-building materials from its programme and are welcome to move their existing applications to future semesters for consideration.

On the entrepreneur DNA test, the Founder Institute is serious about its belief that “Great Companies Start with Great People.” In fact, it has been working with leading social scientists since 2009 to develop a test that identifies people with the raw skills and personality traits conducive to entrepreneurship.

After completing the test, founders may get an instant “Entrepreneur DNA Report” but FI do not share the raw results of the assessment because that is proprietary information.

Wema Bank Plc has appointed two independent non-executive directors to its board. The appointment followed the approval of the Central Bank of Nigeria (CBN).

The two new directors are Dr Oluwayemisi Olorunshola and Mrs Bolarin Okunowo.

Managing Director, Wema Bank Plc, Mr Ademola Adebise, said the two new directors brought a wealth of corporate experience and more gender diversity to the bank.

“We warmly welcome the new appointees as they put the experiences garnered over the years to good use on the board. Their appointments affirm our commitment to gender diversity, and we are positive that they will play crucial roles in our quest of becoming Nigeria’s most dominant digital banking platform,” Adebise said.

Olorunshola is an experienced supply chain professional with a cumulative 25 years of experience as a business associate in a multinational organisation and a business manager. She obtained her first degree in Education & Economics from the Obafemi Awolowo University, Ile-Ife; a Master of Business Administration from the University of Liverpool, United Kingdom, and a Doctorate in Business Administration from Walden University in the United States of America.

She is a fellow of the International Institute for African Scholars and a chartered member of the Nigerian Chartered Institute of Personnel Management.

Okunowo is a business leader and finance specialist with over 17 years of experience in investment banking and financial services, manufacturing, oil and gas, real estate, and hospitality.

She is the Managing Director of Chemical and Allied Products Plc, a subsidiary of UAC of Nigeria (UACN) Plc. Before her appointment at CAP, Okunowo served as the immediate past Managing Director of Portland Paints and Products Nigeria Plc, a subsidiary of UACN. Before joining the UACN Group, she was the Head of Energy & Infrastructure Finance at Stanbic IBTC Capital, responsible for the oil and gas, power, and infrastructure debt finance portfolio.

A chartered accountant, Okunowo holds a Bachelor’s degree in Commerce from the University of Birmingham, United Kingdom and a Master’s degree in Information Systems from the London School of Economics.

FMDQ Securities Exchange (FMDQ Exchange) Limited has approved the admission of new commercial papers programmes worth N40 billion to its platform.

FMDQ Exchange approved the registration of Babban Gona Farmer Services Nigeria Limited’s N15 billion commercial paper (CP) programme as well as Mixta Real Estate Plc’s N25 billion CP issuance programme.

Babban Gona Farmer Services Nigeria is a social enterprise that seeks to sustainably improve the lives of smallholder farmers in Nigeria through the provision of comprehensive farming services.

Mixta Real Estate, a subsidiary of Mixta Africa, is a real estate development company in Nigeria, with a track record and diverse real estate portfolio, and operations spanning the residential, commercial, and retail sectors of the real estate industry.

Speaking on the successful registration of the CP programme, Managing Director, Babban Gona Farmer Services Nigeria Limited, Mr. Bukola Masha, said the company, as an agricultural franchise, is committed to curbing the growing trend of poverty and violence in Africa by creating opportunities of dignified and fulfilling work for the rural farmer youths.

“We aim to make farming more profitable for smallholder farmers as we support them across the entire production chain. With the successful registration of this N15 billion CP programme, we are a step closer to achieving this goal; we are delighted at the opportunity to diversify our short-term funding sources and look forward to the participation of the investment community when we launch Series 1 of the CP Programme,” Masha said.

FMDQ Exchange assured that as part of its mandate to organise and govern markets within its purview, and promote credibility and transparency in the Nigerian debt capital market, it shall continue to provide an innovative and efficient platform targeted at supporting the aspirations of corporate entities.

According to FMDQ, it remains committed to making the Nigerian financial markets globally competitive, operationally excellent, liquid and diverse, in line with FMDQ Group’s ‘GOLD’ Agenda, with a view to achieving its full potential of driving growth and development in the nation.

FMDQ Group, a vertically integrated financial market infrastructure group, operates through four wholly owned subsidiaries including FMDQ Exchange, FMDQ Clear Limited, FMDQ Depository Limited and FMDQ Private Markets Limited.

Nigerian equities still have significant headroom for capital gains and are comparatively undervalued, but investors must be cautious as the market may be susceptible to cyclical reversal in 2022.

FSDH Capital, a major investment banking firm, in its latest equities coverage report obtained at the weekend, noted that while benchmark index for Nigerian equities currently shows considerable discounts to its five-year average and global frontier market peers, the outlook for Nigerian equities appeared more downbeat in 2022 than in recent years.

The benchmark market index, the All Share Index (ASI) of the Nigerian Exchange (NGX) trades at a PE ratio of 9.8 times, a 17.3 per cent discount to five-year average of 11.9 times. Similarly, the ASI trades at a 32.2 per cent discount to the MSCI Frontier Market (MSCI FM) index.

“Clearly, the market is undervalued considering the strong growth in company earnings in the past year as well as the additional listing of quality counters in the past 36 months.

“Despite the perceived value in the Nigerian market, we struggle to see a sustained rally in the equities market in 2022. First, we reckon that historically, the 40,000–45,000 points range represents a psychological barrier for investors and the index has not pushed past that level since 2008. Technically, we see this resistance level as a tough barrier for Nigerian equities to break in 2022.

“Also, while we expect to see modest improvement in economic growth in 2022, lack of stability in the foreign exchange market and an overvalued naira will continue to keep foreign investors away. For domestic investors, we expect them to be attracted to the fixed income market given expectation of a higher yield environment in 2022 which could fuel asset rotation from the equities market to fixed income assets,” FSDH stated.

The report however noted that there would be some bright spots in the equities market in 2022, although these may not be broad-based.

FSDH advised investors to play actively in the equities market in this first quarter to exploit opportunities available particularly as companies release their full year numbers as well as announce attractive dividend yields.

It however cautioned investors to hold light exposures in the equities market in second and third quarters as it expects “the yield reversal and asset rotation to kick into full gear from the end of March”.

The investment pundit listed 10 companies as stocks to watch citing current price, lowest and highest prices in one year, all-time highest price, all-time lowest price, current price earnings (PE) ratio, five-year average PE ratio, price-to-book (PB) value, five-year average PB value and dividend yield.

The top 10 recommended stocks included United Bank for Africa (UBA), Access Bank Plc, Jaiz Bank, Total Energies Plc, Fidelity Bank, Guinness Nigeria, Okomu Oil Palm, United Capital, MTN Nigeria Communications and Transnational Corporation of Nigeria (Transcorp) Plc.

According to the report, given expectation of an upward momentum in interest rates, financial services companies, especially banks would thrive in the period ahead as the higher interest environment implies banks would be able to lend at higher rates as well as invest in higher yield government securities in 2022, providing a boost for interest income.

“Also, given CBN’s recent policies, capping interest paid on savings and current accounts, the higher interest rate environment is likely to have just a moderate impact on banks’ interest expense, providing a solid base for stronger net interest margins (NIMs). However, we note that increase in interest rate is a three-way dynamic for banks given the impact on trading income. Higher yields imply fixed income instruments decline in price which indicates treasury units in banks must deploy appropriate strategies such as short-selling and securities lending to sustain growth in trading income. As a result, we advise clients to focus on banks with strong loan growth as well as solid treasury strategies which would be reflected in the bank’s trading income,” FSDH stated.

The report also noted that the official removal of fuel subsidy slated for July 2022 and supply of foreign exchange to downstream oil  and gas companies for importation of white products would restore earning of both wholesale and retail margin.

“Thus, we believe removal of fuel subsidy and resumption of importation by listed petroleum marketers would represent a strong positive driver for their performance and shareholder value,” FSDH stated.

C & I Leasing Plc has rejigged its top management with a charge to sustain and surpass the achievements   of the immediate past management.

The leasing company officially announced the retirement of its Group Managing Director (GMD); Mr. Andrew Otike – Odibi, who had served the company for more than two decades.

Otike-Odibi, a chartered accountant, joined C & I Leasing in 1998 from Diamond Bank, as a Senior Manager and was appointed to the board as an executive director in 2007. He was appointed as the GMD in 2016, following which he led the company through significant growth across the different business support services in Nigeria and Ghana. While serving as the GMD at C&I Leasing, Otike-Odibi bagged several awards including being named as one of the top 25 CEOs in Nigeria in both the 2019 and 2020 editions of the Businessday CEOs Awards.

The company has appointed Mr. Ugoji Lenin Ugoji as the new GMD with immediate effect. Ugoji joined the company as the Chief Operating Officer (COO) and Deputy Group Managing Director (DGMD) in 2021, bringing with him a wealth of over 20 years’ experience in commercial and investment banking, leasing, and asset management.

The company also appointed Mr. Alexander Mbakogu, who was previously the Group Chief Financial Officer as the new Group Chief Operating Officer and Deputy Group Managing Director.

C & I Leasing has also confirmed the appointment of Mr. Okechukwu Nnake as the Group Chief Financial Officer.

Chairman, C & I Leasing Plc, Dr. Samuel Onyishi, described Otike-Odibi as an exemplary leader with several visible achievements.

“Under Andrew’s leadership, we recorded continuous growth and sometimes exceeded shareholders’ expectations, we also commenced diversification into the non-asset-dependent services for our business units, which we shall continue to  nurture and grow to meet the needs of our clients,” Onyishi said.

He reiterated the belief of the board that the competences of the newly appointed officials would be valuable assets for the company’s future.

Onyishi assured all stakeholders of the board’s commitment to support the new management team to exceed the expectations of both the stakeholders and communities served by the company.

Ugoji appreciated the board of directors for their vote of confidence and affirmed his commitment to lead the group through the next phase of growth and service to all clients, stakeholders and communities.

Ugoji’s banking career commenced in 1999 and included stints at United Bank for Africa, formerly Continental Trust Bank and NAL Bank Plc. Ugoji’s extensive experience in the leasing industry commenced in 2005 as a pioneer member of the Aquila Capital Group where he served as the pioneer Group Head – Treasury and Wealth Management with multiple laudable achievements to his credit before he was appointed as the pioneer Managing Director for ‘Aquila Asset Management Limited in 2010.  He joined C & I Leasing from The Mellanby Trust Company Limited; an alternative investment and asset management company.

Mbakogu is a fellow of the Institute of Chartered Accountants of Nigeria, a member of the Institute of Credit and Risk Administration of Nigeria, and a member of the Institute of Chartered Management Accountants of Nigeria. He has held several positions in the group since 1998 when he started his career as an account officer in the finance department of the group. He steadily grew in diverse roles until he became the Head Treasury and Finance before his secondment to the group’s Ghanaian subsidiary – Leasafric  Ghana Limited in 2010 where he served as the General manager until he became the Managing Director, Leasafric Ghana Limited in 2013. He exceeded the assigned business profitability and operational efficiency targets – which have impacted not only the Ghanaian subsidiary as a unit,  but also the group’s overall performance.

Nnake joined the group with over 16 years of business leadership experience in multinational corporations cutting across audit and advisory services, oil and gas, and technology sectors. He has a record of designing and implementing efficient business processes and driving productivity.

Nnake’s expertise includes finance, treasury, tax strategy, business operations, and supply chain. He holds a Master in Business Administration, is a Fellow of the Institute of Chartered Accountants of Nigeria, and is an Associate of the Chartered Institute of Taxation of Nigeria.

C & I Leasing Group serves its clients through three divisions: fleet management, outsourcing, and marine services. It has two subsidiaries in Ghana (Leasafric) and the United Arab Emirates (EPIC International FZE).

C & I Leasing was incorporated as a limited liability company and was licensed by the Central Bank of Nigeria to offer operating leases, finance leases, and other ancillary services in 1990. It commenced full operations, gradually establishing the outsourcing and fleet management units including the commission to own and manage the HERTZ franchise in Nigeria in 1991.  In 2007, C & I Leasing concluded a major restructuring which led to the listing of its shares on the Nigerian Exchange (NGX). In 2015, following the Nigerian local content act, the group commenced investments in the maritime sector and has grown to be a leading provider of marine operations and logistics services in Nigeria.

The Federal Government has launched its 2022 debt issuance programmes with the launching of the January 2022 tranches of the Federal Government of Nigeria Savings Bond (FGNSB).

The Debt Management Office (DMO), which oversees government’s debt issuances and management, at the weekend closed application for two tranches of the FGNSB. The government simultaneously offered a Two-Year FGN Savings Bond due January 19, 2024 and a Three-Year FGN Savings Bond due January 19, 2025. The coupon or interest rate for the two-year bond was 7.542 per cent per annum while the three-year bond carried a coupon of 8.542 per cent per annum.

The settlement or issuance date for the two tranches is Wednesday, January 19, 2022, which will be the effective counting date for the new bonds. The two bonds will subsequently be listed on the Nigerian Exchange (NGX), allowing investors to trade on the securities after the primary offering.

The coupon payment dates for the bonds, which pay interest rate quarterly, will thus be April 19th, July 19th, October 19th and January 19th respectively.

The two bonds were continuation of the monthly FGNSB. The January 2022 offer was the 55th tranche of the savings bond, introduced in 2017.

The coupon rates for the January offers represented marginal increase on the interest rates on the December 2021 issuances of the FGNSB. The DMO had in December 2021 offered a two-year FGN Savings Bond due December 15, 2023 at a coupon of 7.322 per cent per annum. It also simultaneously offered a three-year FGN Savings Bond due December 15, 2024 at coupon of 8.322 per cent per annum.

The government had in December issued a total of 99,014 units of the two-year bond valued at N99.014 million and a total of 203,036 units of the three-year bond worth N203.036 million at par value of N1,000 per unit.

The FGNSB was introduced in 2017 as a mass instrument for nationwide mobilization of savings and investments. Minimum subscription to the FGNSB is usually N5, 000 while the bond pays coupon or interest rate on a quarterly basis.

Usually, the minimum subscription to the bonds, offered at N1,000 per unit, is N5,000 or five units and in multiples of N1,000 thereafter, subject to a maximum subscription of N50 million.

GTI Securities Limited, one of the authorised distribution agents for the FGNSB, noted that the savings bonds help to deepen national savings culture while providing opportunity to all Nigerians irrespective of income level to contribute to and benefit from national development.

According to the stockbroking firm, FGNSB enables all Nigerians opportunity to participate in and benefit from the favourable returns available in the capital market.

GTI Securities noted that the savings bonds are acceptable as collateral for loans by banks and can be sold for cash in the secondary market before maturity.

The bonds are usually listed on the stock exchange for trading, thus providing liquidity for investors who want to exit before maturity.

Savings bonds are good for savings towards retirement, marriage, school fees and house projects among other targets while assuring on its safety as the bonds are backed by the full faith and credit of the Federal Government of Nigeria.

As investors begin to review their portfolios for optimal returns in 2022, Group Managing Director, Futureview Group, Mrs Elizabeth Ebi has advised them to minimize risk and maximize returns by investing in mutual funds.

A mutual fund is a pool of funds collected from numerous investors for investing in securities such as stocks, bonds, money market instruments and related assets. Mutual funds are operated by professional fund managers, who invest the fund’s capital to produce capital gains and income for the investors.

Futureview is offering Futureview Dollar Fund and Futureview Equity Fund. Both Funds are targeted at investors across the board.

Ebi said the asset class provided an ample opportunity for investors to diversify their risks and enjoy regular income.

According to her, investment mutual fund hedges investors against the risk of inflation in an environment characterized by uncertainties. She noted that since mutual funds are managed by professionals, this save investors the ordeal of getting their fingers burnt.

“The benefits of mutual funds cannot be over-emphasised. The asset class enables an investor to diversify his risk and at the same time enjoys steady income. Mutual funds hedge investment against inflation risk and its risk and return trade off positions an investor for enhanced returns irrespective of the nature of an operating environment. I advise investors across different classes to take advantage of this investment option as we begin a new year.” Ebi said.

Futureview Dollar Fund which is targeted at both Nigerians in diaspora, foreign investors, and those in the country is 15,000 units at $100 per unit while  Futureview Equity Fund comprises 5,000,000 units of N100 each, at par.

As part of its investor protection mechanism, the Securities and Exchange Commission (SEC) has restricted mutual fund managers from investing the assets of the fund in their own securities or that of the trustees, custodian or other associates.

An investor’s shares in a mutual fund represent his part ownership and income that the fund generates. In the United States, mutual fund accounts for the largest investment in equity.