The Nation Newspaper

Category: Capital Market

  • CWG’s shareholders approve 400% increase in dividend payout

    CWG’s shareholders approve 400% increase in dividend payout

    Shareholders of CWG Plc at the weekend approved a 400 per cent increase in dividend payout after the leading integrated information technology solution provider recorded strong performance in 2023.

    Key highlights of the audited report and accounts of CWG, formerly known as Computer Warehouse Group, showed significant increase in revenue, totalling N23.5 billion in 2023, representing a remarkable 66 per cent growth from N14.2 billion in 2022. Gross profit increased by 24 per cent from N3.8 billion to N4.7 billion. Profit before tax stood at N1.1 billion in 2023, reflecting a 53 per cent increase from the previous year.

    Despite facing challenges such as supply chain interruptions and economic uncertainties, CWG demonstrated resilience and operational efficiency, achieving a 22 per cent increase in operating expenses to support its growth initiatives.

    The report showed that the company, with footprints across Africa and Middle East, expanded its market reach and strengthened its position as a provider of innovative solutions, particularly in key sectors such as telecommunications, finance and government. 

    At the annual general meeting, shareholders approved the payment of a dividend per share of 16 kobo for the year ended December 31, 2023, 400 per cent rise increase on 4.0 kobo paid for the 2022 business year.

    The board of the company stated that the increase in payout reflected the company’s confidence in its financial stability, growth prospects, and ability to generate sustainable returns.

    Read Also: Shareholders okay Zenith Bank HoldCo structure transition

    Chairman, CWG Plc, Mr. Philip Obioha, said the increased dividend payment reflected the company’s confidence in its performance and outlook.

    “CWG remains steadfast in its commitment to delivering value to all stakeholders, and this dividend payment underscores that dedication,” Obioha said.

    Group Chief Executive Officer, CWG Plc, Mr. Adewale Adeyipo, noted that despite the challenging operating environment, CWG has delivered exceptional results, underscoring the resilience and dedication of the team.

    He said the enhanced dividend payment demonstrates the group’s sound financial performance and unwavering commitment to creating value for its stakeholders.

    “We remain focused on driving sustainable growth, enhancing shareholder value, and contributing to Africa’s digital transformation journey,” Adeyipo said.

  • Fund manager advises investors to invest in mutual funds

    Fund manager advises investors to invest in mutual funds

    Chief executive officer, Stanbic IBTC Asset Management Limited, Bunmi Dayo-Olagunju, has advised investors to take advantage of mutual funds to hedge their risks and minimize the possible negative fallouts from the volatility in the capital market.

    Speaking in Lagos, Dayo-Olagunju said considering the volatility in the equities and commodity markets, it is imperative for investors to diversify their portfolios by investing in mutual funds and other investment vehicles.

    She outlined that the attractiveness of mutual funds or collective schemes is the number of advantages it offers over other investment vehicles, such as flexibility, which makes it possible to either invest a lump sum or make regular instalments every month; liquidity, which means the funds can be accessed at any time by the investor who may require money for a variety of purposes such as healthcare, education, vacation and housing. Others include steady returns, professional management, and risk reduction, among others. 

    “Mutual funds offer investors the advantages of portfolio diversification and professional management at low cost. These advantages are particularly important because diversification and professional management ensure steady returns when compared to other investment instruments. Mutual funds offer an opportunity for steady growth in assets while reducing the attendant risk associated with investing in individual securities,” Dayo-Olagunju said.

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    She said Stanbic IBTC Asset Management Limited is particularly committed to ensuring that investors are availed the opportunity of viable investment vehicles so that they can spread their risks, which is why the company continues to develop an array of products targeted at the needs of Nigerians.

    According to her, Stanbic IBTC Asset Management Limited remains totally committed to helping Nigerians build a portfolio of financial instruments from which they can meet their unique investment objectives.

    “We must reiterate that there are numerous benefits in investing in mutual funds, especially the expertise that is brought to bear in maximizing returns to investors without compromising safety,” Dayo-Olagunju said.

    Prominent mutual funds under management by Stanbic IBTC Asset Management Limited include the Stanbic IBTC Nigerian Equity Fund, Nigeria’s largest equity mutual fund; the Stanbic IBTC Ethical Fund, Nigeria’s first and largest socially responsible mutual fund; and Stanbic IBTC Money Market Fund. In 2013, the Stanbic IBTC Imaan Fund, a mutual fund tailored to the needs of those seeking investments compliant with their religious principles and beliefs, was registered.

  • Allow margin loans for investors to buybanks’ shares, stockbrokers urge CBN

    Allow margin loans for investors to buybanks’ shares, stockbrokers urge CBN

    Stockbrokers have urged the Central Bank of Nigeria (CBN) to allow the shares and other securities of publicly listed banks as marginable securities, which enables investors to take loans specifically for purchase of shares.

    Stockbrokers, under the auspices of Chartered Institute of Stockbrokers (CIS), said while the capital market has the capacity to support the ongoing recapitalisation of banks as directed by the apex bank, the market will not be able to reach its full potential without modern practices like margin lending.

    The stockbrokers spoke during a visit by the leadership of the CIS to the CBN Governor, Dr. Olayemi Cardoso in Lagos.

    President, Chartered Institute of Stockbrokers (CIS), Mr Oluwole Adeosun, urged the apex bank to take some strategic initiatives to bolster financial intermediation roles of stockbrokers and boost transactions in the Nigerian securities market.

    “The Nigerian capital market, has the capacity to support the recapitalization exercise. It was amply demonstrated during the indigenisation a far back as 1972 and successive banking sector recapitalisation programmes over the years up till the last major banking recapitalisation exercise between 2004 and 2006.

    “As we did in the last exercise as issuing houses, financial advisers and stockbrokers to the capital issues amongst others and with technology and new subscription channels like mobile apps, the current exercise should record even greater success and bring in more and younger Nigerians into the investment community.

    “We request that securities of publicly listed banks should be allowed as marginable securities as long as these securities pass the “Criteria for Determining Marginable Securities” test. Margin lending drives the growth of capital markets in the advanced countries by enabling investors to acquire securities in excess of their direct savings within a regulated market framework.

    “Our market will not be able to match the required growth rate if investors remain restricted to just their own funds for investments. Our perspective is that bank stocks be allowed, but a specific borrower should not invest in the shares of the bank that gave them the margin loan. The banking sector is one of the most active sectors in the Nigerian stock market and the first choice for most investors’ portfolios,” Adeosun said.

    He pointed out that pension funds are globally the foundational base that drive sustainable liquidity for the local equity market.

    He however noted that while the Pension Act permits the Pension Fund Administrators to invest up to 25 per cent of their pension assets in the equity arm of the capital market, only about 10 per cent of the funds are invested in the equity market, despite the enhanced regulation, investor protection, and high return in the market.

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    “Given the critical role of pension fund investment in galvanizing liquidity in the domestic equity market, Pension Fund Administrators (PFAs) should be investing a substantially higher proportion of their funds on equities. We, therefore, seek the support of the CBN to engage with PenCom in this regard,” Adeosun said.

    While applauding the appointment of senior stockbrokers in some key positions in the economy by the federal government, Adeosun said stockbroking firms required some supports from CBN to enable them operate optimally and attract more participants into the market.

    He noted that Cardoso has been a long-standing member of the institute and affirmed the capacity and willingness of stockbrokers to support the recapitalisation of banks.

    Responding, Cardoso appreciated the visit and assured the institute that all the issues raised would be looked at dispassionately.

    He assured that he would establish an enduring institutionalised structure.

    The newly launched book of CIS, titled: “History of The Nigerian Capital Market was presented to Cardoso. Adeosun was accompanied on the visit by other office holders and five past presidents.

  • Transcorp Power grows profit by 775% to N28.8b in Q1

    Transcorp Power grows profit by 775% to N28.8b in Q1

    Transcorp Power Plc recorded strong three-digit growths across key performance indicators in the first quarter with pre-tax profit rising by 775 per cent to N28.8 billion within the first three months of the year.

    Key extracts of the interim report and accounts of Transcorp Power for the first quarter ended March 31, 2024 showed that turnover jumped by 223 per cent to N67.86 billion in first quarter 2024 as against N21.04 billion reported in first quarter 2023. Profit before tax leapt by 775 per cent from N3.29 billion to N28.77 billion.

    After taxes, net profit soared by 665 per cent from N2.6 billion in first quarter 2023 to N20.1 billion in first quarter 2024. The company’s total assets increased to N276.2 billion in first quarter 2024 as against N223.3 billion in first quarter 2023.

    Management of the company said the results were further demonstration of the company’s strategic focus and effective execution, as part of Transcorp Group’s implementation of its integrated power strategy. Transcorp Power is one of the electricity generating subsidiaries of Transnational Corporation of Nigeria (Transcorp) Plc, one of Africa’s largest publicly quoted conglomerates.

    Managing Director, Transcorp Power Plc, Mr. Peter Ikenga said the company’s ability to sustain growth amidst operating challenging shows the resilience of its business model and the efficient execution of strategic initiatives.

    According to him, against the background of sectoral challenges such as gas supply issues and macroeconomic challenges, the company continued to report robust financial performance.

    “We remain committed to leveraging our strengths to capitalise on emerging opportunities, drive sustainable growth and provide superior value to all our stakeholders.  We will continue to prioritise ingenuity, operational excellence, corporate governance, and stakeholder engagement, to deliver superior value for our long-term growth,” Ikenga said.

    Read Also: Transcorp Power posts N67.86b gross earnings in Q1

    Chief Financial Officer, Transcorp Power Plc, Evans Okpogoro, noted that the underlying ratios of the company’s operations showed significant improvements in operating efficiency and management of resources.

    According to him, the first quarter 2024 saw a gross margin of 51 per cent, a cost to income ratio of 70 per cent and net profit margin of 30 per cent compared with first quarter 2023’s ratios when gross margin was 37 per cent, cost to income ratio was 87 per cent and net profit margin was 13 per cent.

    “These highlight the remarkable operational efficiency gains of the company. Transcorp Power has continued to grow its revenue aggressively and consistently over the last five years.  We expect that by year end 2024, we will see a similar growth trajectory recorded between 2023 and 2024,” Okpogoro said.

    He assured that Transcorp Power remains committed to creating value and driving economic growth, by improving lives through access to electricity and transforming Africa.

    Nigeria’s largest gas-fired power generating company, Transcorp Power, generates more than 10 per cent of the country’s power. The company plans to achieve annual revenue growth of more than N500 billion by 2031, with a target to power a quarter of the country’s households and industries.

    From the rubbles of an underperforming government-owned asset in 2012, Transcorp Power has emerged as one of the nation’s most efficient power companies. Founded on September 24, 2012, as Transcorp Ughelli Power Limited (TUPL), having emerged as the preferred bidder during the privatisation of the national electricity assets by the Federal Government, Transcorp Power is the owner of the 972MW installed capacity Ughelli Power Plant (UPP) at Ughelli, Delta State, (Ughelli Power Plant).

    In 2023, the company became the first power generation company to be discharged from post-privatisation monitoring by the National Council of Privatisation, having met and surpassed set targets. Subsequently, in December 2023, the company converted into a public limited liability company, following which its name was changed to Transcorp Power Plc.

    Transcorp Power recently listed its shares on the Nigerian Exchange (NGX) and has since been one of the best-performing stocks at the stock market.

    Transcorp Power listed by way of introduction 7.5 billion ordinary shares of 50 kobo each at N240 per share. It immediately got off to a rally, rising by the maximum daily allowable price change of 10 per cent for several weeks. It closed weekend at N377 per share.

  • Access Holdings to fast-track global expansion as shareholders okay N2.12tr capital raising

    Access Holdings to fast-track global expansion as shareholders okay N2.12tr capital raising

    • ‘N365b rights issue’ll be oversubscribed’
    • Recapitalisation good for banks, says Aig-Imoukhuede

    Access Holdings Plc will enter a new phase of its global expansion strategy in the second half of this year as Nigeria’s largest financial services group embarks on an ambitious N2.12 trillion capital raising programme.

    At the Annual General Meeting (AGM) at the weekend in Lagos, shareholders of Access Holdings mandated the company to raise $1.5 billion and N365 billion in a multi-tranche, multi-currency and multi-instrument capital raiser.

    Access Holdings stated that its global expansion strategy will enter the consolidation and efficiency phase from second half of 2024, aligning with its five-year plan to accelerate the attainment of its 2027 strategic objectives.

    The group has so far this year struck four deals, including acquisition deals in Kenya, Uganda, Zambia and a Nigerian insurance brokerage firm and a regulatory approval for a new Nigerian, consumer lending subsidiary.

    Access Holdings stated that it remained focused on driving sustainable growth, and delivering value to its shareholders as it continues to build a globally connected community and ecosystem, inspired by Africa, for the world.

    Shareholders at the meeting ratified the appointments of Aigboje Aig-Imoukhuede, Olusegun Ogbonnewo, and Ojinika Olaghere as non-executive directors while commending the return of Aig-Imoukhuede as the chairman of Access Holdings.

    Shareholders recalled Aig-Imoukhuede’s rich history of success with the bank citing his role in driving the bank’s growth during the 2004 recapitalisation of the banking industry.

    Shareholders were unanimous in their support for the new capital raising with an assurance to participate in the rights issue, which is allotted shareholders.

    The net proceeds of the rights issue would be used to support working capital, including organic growth funding for its banking and other non-banking subsidiaries.

    Chairman, Access Holdings Plc, Mr Aigboje Aig-Imoukhuede, in a  chat with reporters after the meeting, said the group is focused on two major issues of banking sector recapitalisation and continuous good returns on investment to shareholders.

    He said the new banking recapitalisation is a “sensible prudential regulation” necessary to ensure that banks are in good position.

    “I think on the issue of recapitalisation, first of all as a group, Access Holdings wholeheartedly endorses the recapitalisation signal by the CBN.

    “Banks, particularly after period of significant devaluation of the domestic currency, volatility in the exchange and interest rates regime are always encouraged to build up the capital buffers to ensure that whatever adverse effect within their balance sheet is a result of these dynamism changes in the environment will not affect their going concern.

    “So, we endorsed the policy by CBN and it is good and sensible prudential regulation. It is not the first time CBN has come up with such policy. In 2004, when Access Bank had about N3 billion capital and it was increased to N25 billion.

    “Between 2004 and 2007, when I was the Chief Executive Officer, our team raised $2 billion common equity capital and, therefore, if come 2024, Access Bank, much older, wiser, stronger, larger and significantly respected by the capital market with over 800,000 shareholders, raising $300 milliion in capital is not much a challenge,” Aig-Imoukhuede said.

    Underlining the reasons for its diverse capital raising, Aig-Imoukhuede said the group believes in ensuing that shareholders of all categories have opportunities to continue with the group in its journey.

    He said the group also has a very unique relationship with capital markets in Nigeria and international, thus the focus of its capital raising.

    Acting Chief Executive Officer, Access Holdings Plc, Bolaji Agbede, said the group would build on its impressive performance in the first quarter to deliver another remarkable performance for 2024.

    Read Also: Recapitalisation: Access Holdings to raise $1.5b to boost operations

    She pointed out that the performance of the group illustrated the success of its strategy, assuring that the company would continue to leverage emerging opportunities to drive growths.

    President, Association for the Advancement of Rights of Nigerian Shareholders (AARNS), Dr. Faruk Umar, said with the enthusiasm shown by shareholders and the track records of the group, the rights issue would be oversubscribed.

    He said shareholders may demand for more than their initial allotments because of their experience with the group and expectations that Access Holdings will continue to be an industry leader in the post-recapitalisation period.

    According to him, while the recapitalisation may alter the dynamics of the banking industry, post-recapitalisation banks would be in better positions to deliver higher returns and play bigger roles in the emerging economy.

    Founder, Independent Shareholders Association of Nigeria (ISAN), Chief Sunny Nwosu said shareholders were thrilled with Aig-Imoukhuede’s return citing his proven track record, experience, and strategic insights.

    He said the new chairman is the ideal leader to further drive Access Holdings towards meeting its lofty targets.

    “During his tenure as CEO, particularly during the recapitalisation directive by the CBN, he steered Access Bank to raise an impressive $2 billion in capital, and this demonstrates his capacity to, once again, lead Access Holdings towards successfully achieving the objectives of our planned capital raise and rights issue targets,” Nwosu said.

    At the meeting, shareholders increased the issued share capital of the company from N17.773 billion of 35.545 billion ordinary shares of 50 Kobo each to N26.659 billion of 53.318 billion ordinary shares of 50 kobo each by the creation of additional 17.773 billion ordinary shares of 50 Kobo, ranking pari-passu with the existing ordinary shares of the company.

    The meeting also approved a resolution empowering the board to establish a capital raising programme of up to $1.5 billion or its equivalent, through the issuance of ordinary shares, preference shares, Alternative Tier 1, convertible and/or non-convertible notes, bonds or any other instruments, whether by way of a public offering, private placement, rights issue, book building process or any other method or combination of methods, in such tranches, series or proportions and at such dates, coupon or interest rates within such maturity periods and upon such terms and conditions as may be determined by the board subject to obtaining the requisite regulatory approvals.

    Shareholders mandated the company to raise capital of up to N365 billion by way of a rights issue on such terms and conditions and on such dates as may be determined by the directors, subject to obtaining the approvals of the relevant regulatory authorities.

    As part of the capital raising process, the meeting approved that any shares not taken by existing shareholders within the period stipulated under the rights issue may be offered for sale to other interested shareholders of the company on such terms and conditions as may be determined by the directors subject to the approvals of the relevant regulatory authorities.

    Shareholders approved the payment of total dividend of N74.65 billion for the 2023 business year, representing a dividend per share of N2.10. This included a final dividend of N63.98 billion or N1.80 per share, in addition to interim dividend of N10.66 billion or 30 kobo per share.

    Audited report and accounts of Access Holdings for the year ended December 31, 2023 showed that gross earnings grew by 87 per cent from N1.388 trillion in 2022 to N2.595 trillion in 2023. The top-line was driven by interest income of N1.65 trillion, the highest within the industry. Profit before tax leapt by 334.8 per cent to N729 billion in 2023 as against N167.68 billion in 2022. While income tax expense jumped by 642 per cent from N14.78 billion to N109.68 billion, net profit after tax grew by 306.9 per cent from N152.20 billion in 2022 to N619.32 billion in 2023. Operating profit had closed 2023 at N1.43 trillion, the highest within the industry. Basic earnings per share thus rose by 288.1 per cent from N4.44 in 2022 to N17.23 in 2023.

    The company’s balance sheet also showed double-digit growths across key parameters. Total assets rose by 77.9 per cent from N14.998 trillion in 2022 to N26.689 trillion in 2023. Total deposits had grown by 75.5 per cent from N11.26 trillion to N19.76 trillion. Customers deposit particularly rose by 65.6 per cent from N9.25 trillion to N15.32 trillion. On the same breath, loan and advances to customers increased from N5.10 trillion in 2022 to N8.04 trillion in 2023. Shareholders’ funds grew by 77.5 per cent to N2.19 trillion in 2023 as against N1.23 trillion in 2022.

  • Wema Bank unveils anti-fraud campaign to protect customers

    Wema Bank unveils anti-fraud campaign to protect customers

    In its quest to protect customers from falling prey to fraudsters, Wema Bank Plc has launched an anti-fraud campaign.

    Besides, the measure is aimed at curtailing fraudulent activities perpetrated by some wallet accounts and fintech partners.

    As the bank at the forefront of digital innovation and a top enabler in the fintech landscape, Wema Bank powers a plethora of fintechs across Nigeria, allowing them to operate seamlessly through Wema Bank’s third party wallet accounts.

    However, due to the upsurge in fraudulent inflows into these wallet accounts, the bank has taken a firm action against fintech partners whose account activities have been found guilty of fraud.

    Wema Bank’s Chief Audit Executive, Oluwole Esomojumi, disclosed that the anti-fraud campaign is designed to protect customers from fraudulent activities and providing them with necessary information for detecting the evolving tactics of fraudster and to also solidify our position as the bank that stands fully against fraud.

    Read Also: Wema Bank Plc year end result excites shareholders

    According to him, “The antics of fraudsters are constantly evolving. To stay steps ahead, it is imperative that consumers have good understanding of what interaction or engagement are telltale signs of fraud and how they can handle suspicious fraudulent engagements, hence the launch of the Wema Bank Anti-Fraud Campaign. We are steps ahead on our end which is why we have taken time to investigate our fintech partners and those found culpable have been disengaged from our payment gateway platform.”

    “As a bank that is resolute in our stance against fraud, we cannot compromise the safety of our beloved Nigerians, especially when these threats of fraud are emanating from fintech who use our platforms. Rest assured, there is no room for fraudsters here. We have multiplied the frequency of our security checks and are committed to rooting them out one by one. No fraudster is safe with Wema Bank because at Wema Bank, customer safety is our priority and empowering the lives and businesses of every customer is our mission,” he stressed.

    The fight against fraud is one that is clearly personal to Wema Bank and with the sturdy layers of security measures initiated and executed by the bank to sustain consumer protection beyond the direct responsibilities of the bank, Wema Bank is making its entire ecosystem inconducive to fraudsters.

    Esomojumi further hinted that to escalate fraud cases connected to any Wema Bank account(s), customers are to send an email to its platform, which is live and active all day round

    Through the anti-fraud campaign launched recently, Wema Bank has successfully investigated, identified, and disengaged three fintechs partners for fraud and suspended four others from its platform in its ongoing efforts to ensure responsible partnership, adherence to regulatory procedures and conformance to CBN KYC guidelines, just as there are ongoing audit and review of fintech partners processes as part of the grand plan to ensure that we get the anticipated/desired results.

    The Anti-Fraud Campaign targeted at creating awareness, educating, and equipping customers with necessary information needed to mitigate, detect and handle fraudulent activities on their bank accounts further underscore the bank’s commitment to safeguarding customers’ finances and personal data.

  • FITC to redefine HR with AI, digitisation for organisational sustainability

    FITC to redefine HR with AI, digitisation for organisational sustainability

    The eagerly anticipated E3 Conference, hosted by FITC, is back for its fourth edition, poised to set new benchmarks in the realm of employee engagement and organizational sustainability.

    Themed “Redefining HR Through AI & Digital Transformation for Organizational Sustainability,” the conference is scheduled to take place on April 17th and 18th.

    In a statement, FITC says the E3 Conference stands as a beacon of innovation, bringing together thought leaders, industry experts, policymakers, and professionals from across Africa and beyond. Set against the backdrop of a rapidly evolving world of work, the event serves as a dynamic platform for exploring the challenges and opportunities presented by AI and digital transformation.

    It explained that in today’s fast-paced landscape, technology such as AI and Automation is reshaping the dynamics of human resource management. The E3 Conference is dedicated to unravelling the potential of these advancements, focusing on topics ranging from talent mobility to the latest trends in managing talent. It’s a journey towards understanding and embracing these transformative shifts, ensuring that businesses are primed for the future of HR.

    With a stellar lineup of over 24 speakers, including C-suite Executives, Subject Matter Experts, and Thought Leaders from various sectors, the conference promises to deliver insights that transcend conventional boundaries. Attendees can expect deep dives into strategies for enhancing productivity, streamlining processes, and maximizing global talent mobility through AI and automation.

    Keynote speakers such as Evi Ifekwe, Executive Director of People & Country Services at TotalEnergies EP Nigeria Limited, and Wale-Smatt Oyerinde, Director-General of NECA, alongside a faculty lineup comprising industry stalwarts, will spearhead discussions on critical issues shaping the future of work.

    The two-day hybrid event will feature four plenary sessions and two master classes, providing attendees with ample opportunities for networking, knowledge exchange, and interactive engagement. Participants will delve into topics such as the impact of AI on the future of work, data-driven performance management, and strategic implementation of AI in HR.

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    The conference is expected to provide insights into cutting-edge strategies for professionals and HR leaders who will gain invaluable insights from industry pioneers on leveraging AI and digital transformation to drive organizational sustainability and employee engagement.

    It will also present networking opportunities and help participants to connect with like-minded professionals, thought leaders, and decision-makers from diverse sectors, fostering collaborations and partnerships that transcend geographical boundaries.

    It is also gives practical learning opportunity for participants to acquire actionable strategies and best practices through interactive master classes and plenary sessions, equipping yourself with the tools to navigate the evolving landscape of HR.

  • Naira closes strong at N1,050/$ at parallel market

    Naira closes strong at N1,050/$ at parallel market

    The naira yesterday exchanged at N1,050 to dollar at the parallel market.

    It exchanged at N1,125 to dollar on over the weekend, representing N75 appreciation. Naira appreciated by 0.56 per cent to close at N1,136 to dollar at the official market.

    The local currency had of recent commenced rapid recovery, as volatility in the market dropped after the Central Bank of Nigeria (CBN) commenced dollar sales to bureau de change operators.

    The CBN recently directed that all authorized dealers to pay Personal and Business Travel, allowances (PTA/BTA) to their customers through electronic channels only, including debit or credit cards instead of cash.

    “In line with the Bank’s commitment to ensure transparency and stability in the foreign exchange market and avoid foreign exchange malpractices, All Authorized Dealer Banks shall henceforth effect payout of PTA/BTA through electronic channels only, including debit or credit cards. For the avoidance of doubt, payment of PTA/BTA by cash is no longer permitted,” the bank said.

    Importers are finding it increasingly difficult to secure the necessary funds from the official FX market and black market.

    Legitimate needs driving the demand include Form A applications for Business Travel Allowance (BTA), Personal Travel Allowance (PTA), school fees, and medical fees. Small and Medium Enterprises (SMEs) are also grappling with the scarcity, as highlighted by the use of Form Q.

    “The problem is that dollars are scarce in the market. People are not bringing dollars and demand is so high that is why the price is going up,” a street trader told Business Day on Tuesday morning.

    Former Executive Director, Keystone Bank Limited, Richard Obire advised that Nigeria’s heavy and skewed outward-oriented consumption of goods and services as seen in decades of long substantial bills for food and energy imports should be reversed to save the naira.

    Also, the massive corruption-driven capital outflows which in turn severely damages Nigeria’s capacity to produce at scale that will enable the country to fully engage its large population to create widespread prosperity works against the naira.

    Read Also: Naira’s fate is in our hands, Reno Omokri tells Nigerians

    Managing Director/CEO, Financial Derivatives Company Limited, Bismarck Rewane disclosed that cost pressures are likely to ease due to the naira’s rebound.

    Rewane, also an economist, said the naira had since February, appreciated significantly across the markets, fueled by sanitisation of the forex market, an increase in forex supply and a fall in the demand for dollars.

    The settlement of the $7 billion verified forex backlog of forward commitments have boosted confidence and improved the credibility of the Central Bank of Nigeria (CBN).

    “However, the pressing question remains, will the naira tumble again? The answer is No, if Nigeria continues to do the right things. Prospects for forex earnings are promising, with foreign portfolio investments on the rise. Nigeria’s key export commodities have also seen significant price surges, with cocoa trading at a record high of over $10,000 per tonne in the global market and oil prices exceeding $85pb as oil production reached an impressive 1.48mbpd in February 2024,” Rewane stated.

  • Axxela wins world’s gold medal in sustainability

    Axxela wins world’s gold medal in sustainability

    Axxela has been awarded a gold medal by EcoVadis, placing the Nigerian company within the top five per cent of companies rated by EcoVadis.

    The gold medal implies that Axxela scored 97 per cent higher than all participating companies evaluated by EcoVadis in the year.

    Axxela had been rated with silver medal last year.

    EcoVadis is the world’s largest and most trusted business sustainability ratings system used by organisations worldwide.

    According to the report, the assessment focused on different sustainability and social corporate responsibility criteria and thematic areas including environment, labour and human rights, ethics and sustainable procurement.

    Axxela attributed the upgrade to its quantitative targets, ethical business practises guided by strong corporate governance and effective policies.

    “With the insights gained from our assessment, we will continue to look for improvement areas even as we further commit to championing a sustainable future through our operations and our service offerings.

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    “It’s not only our company operations that is certified for sustainability even our service offerings carry the sustainability badge by supporting our customers to reduce their carbon footprints while contributing to Nigeria’s net zero target,” Axxela stated.

    Since 2018, Axxela has held a trifecta IMS certification of ISO 9001:2015; ISO 14001: 2015; ISO 45001:2018.

    Axxela is a pioneering private sector-led developer of natural gas; a company co-owned by Helios Investment Partners LLP and Sojitz Corporation. It is a designated natural gas shipper on the West African Gas Pipeline (WAGP), and a member of the West African Power Pool (WAPP).

    Axxela delivers natural gas to about 200 industrial and commercial customers via a vast network of natural gas infrastructure.

  • Nigerian equities lead global markets with N16.30tr gain in Q1

    Nigerian equities lead global markets with N16.30tr gain in Q1

    • Stock market positive hedge against inflation   

    Nigerian stock market closed the first quarter with a net capital gain of N16.30 trillion in a major rally that placed Nigeria as the world’s best-performing stock market in the first three months of the year.

    Benchmark indices for Nigerian equities closed weekend with average year-to-date return of 39.84 per cent, equivalent to net capital gain of N16.30 trillion for the three-month period.

    This implies that investors earned additional N16.30 trillion in capital gains in the first three months of the year, excluding other returns from dividends.

    The performance of the Nigerian equities market, which closed 2023 among the three best-performing markets globally, dwarfed returns across several world’s markets.

    Global stock data tracked by The Nation’s Market Intelligence at the weekend indicated that the stock market was atop the chart of the most resilient and profitable global stock markets in the first quarter.

    The data included 22 of the world’s most prominent stock markets and cut across the various tiers of advanced, emerging and frontier markets. These included United States, United Kingdom, Germany, Japan, France, Hong Kong, Russia, India, Brazil, China, Thailand, Turkey, Saudi Arabia, Qatar and United Arab Emirates (UAE), South Africa, Kenya, Morocco, Ghana, Egypt and Mauritius.

    The All Share Index (ASI)- the common value-based index that tracks all share prices at the Nigerian Exchange (NGX) rose from the year’s opening index of 74,773.77 points to close first quarter at 104,562.06 points.

    Aggregate market value of all quoted equities at the NGX jumped from the year’s opening value of N40.918 trillion to close first quarter at N59.121 trillion, representing an increase of 44.49 per cent or N18.2 trillion. The difference between the ASI and market value was due to straight-through effect of additional listings during the period, including the listing of Transcorp Power.

    United States’ benchmark indices- the Dow Jones Industrial Average (DJIA) and S & P 500, closed the period with returns of 10.1 per cent and 9.3 per cent. United Kingdom’s FTSE 100 Index recorded average return of 2.6 per cent. Japan’s Nikkei 225 Index posted average return of 20 per cent. China’s Shanghai Composite Index recorded 1.2 per cent.

    Others included Germany’s Xetra DAX, 10.3 per cent; France’s CAC 40 Index, 8.9 per cent; India’s BSE Sens Index, 2.0 per cent, Brazil’s Ibovespa, -4.6 per cent; Russia’s RTS Index, 3.9 per cent: Saudi Arabia’s Tadawul All Share Index, -3.1 per cent; Hong Kong’s Hang Seng Index, -3.0 per cent; Thailand’s SET Index, 5.0 per cent; UAE’s ADX General Index, -3.3 per cent; Qatar’s DSM 20 Index, -8.2 per cent and Turkey’s BIST 100 Index, which closed with the second highest return of 21.3 per cent.

    In Africa, South Africa’s FTSE/JSE ASI recorded negative return of -31. Per cent; Kenya’s NSE 20 Index, 16.7 per cent; Mauritius’ SEMDEX Index, 4.2 per cent, Morocco’s Casablanca Masi Index, 7.4 per cent; Egypt’s EGX 30 Index, 10.7 per cent while Ghana’s GSE Composite Index trailed with average return of 10.4 per cent for the period.

    A breakdown of the pricing trend at the Nigerian market showed widespread positive sentiment across the sectors, with all sectoral indices closing positive. This implies that while returns may differ due to portfolio selections, investors generally saw increase in their portfolios during the period.

    The NGX 30 Index, which tracks the 30 largest stocks at the stock market, closed with a year-to-date return of 39.08 per cent. The NGX Industrial Goods Index posted the highest return of 78.49 per cent. The NGX Oil and Gas Index rose by 24.09 per cent. The NGX Consumer Goods Index posted the second highest sectoral gain of 43.66 per cent. The NGX Banking Index recorded average return of 14.76 per cent while the NGX Insurance Index rose by 26.20 per cent. The NGX Pension Index, which tracks stocks specially screened for pension funds’ investments, closed the period with average return of 21.39 per cent while the NGX Lotus Islamic Index, which tracks ethical stocks that meet Islamic investment principles, trailed market’s average return with a three-month return of 37.20 per cent. 

    The first quarter performance set the market on the path to its fifth consecutive positive returns. Analysts at Afrinvest Securities had projected full-year average return of 14.8 per cent for the year, although they expected that new positive triggers could more than double the return. Analysts at CardinalStone said a gradual return of foreign portfolio investors (FPIs) could stimulate additional rally at the stock market, with average return expected above 35 per cent.

    The market closed 2023 with average return of 45.90 per cent, equivalent to net capital gains of N12.81 trillion, one of the three highest returns globally. It had broken its well-known previous cycle of decline in pre-election year to record its third consecutive positive performance in 2022, with full-year average return of 19.98 per cent, equivalent to net capital gain of N4.455 trillion. It had closed 2021 with average return of 6.07 per cent, equivalent to net capital gains of N1.278 trillion. In the throes of the outbreak of COVID-19 pandemic in 2020, it had recorded average return of 50.03 per cent, representing net capital gains of N6.483 trillion.

    Most analysts expected the positive sentiment to continue citing the earnings season, improving macroeconomic outlook and the banking sector recapitalisation.

    “We anticipate that the positive sentiment would linger in April spurred by increased corporate activities following banks recapitalisation announcement and growing foreign portfolio investment (FPI) traction into equities,” Afrinvest Securities stated at the weekend.

    Analysts at Cordros Capital noted that while the increase in benchmark interest rate could intensify risk-off sentiments, earnings releases from banks and accompanying dividend declarations could trigger another wave of positive sentiments.

    Managing Director, HighCap Securities, Mr. David Adonri said the performance of the market in first quarter was due to positive sentiment on the overall macroeconomic outlook.

    According to him, the emergence of President Bola Tinubu had energised the stock market since market participants believe he has ability to rejig the economy and implement economy-friendly policies.

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    He expressed optimism that the market may sustain its positive momentum in the second quarter on the back of banking sector recapitalisation and expected corporate earnings, especially from the banks.

    Chief Executive Officer, Wyoming Capital and Partners, Tajudeen Olayinka, however, cautioned that the equities market has entered a re-pricing mode because of interest rate hike and continued issuances of one-year treasury bills at high effective yield of over 20 per cent.

    “So, we may be witnessing a shift to the fixed income market in the second quarter of 2024,” Olayinka said.

    The overall performance of the equities market has largely been influenced by what the market described as “post-inauguration rally”, referencing the positive sentiments that have trailed the pro-market reforms of the Tinubu’s administration, since May 2023.

    The NGX had stated that experts’ opinions on the strong performance of the market were that the bullish trend was due to “a combination of factors, including investor sentiment influenced by macroeconomic developments such as the formation and swearing-in of the economic cabinet by President Bola Tinubu”.

    The NGX had also attributed the market performance to the “audacious macroeconomic reforms under the new administration” of Tinubu.

    According to the NGX, market operators were of the view that “the policies of the new administration under President Bola Tinubu” had “led to the rise in the fortunes of investors”.

    Afrinvest Securities had said “economy reform optimism” bolstered the market performance, noting that the “the rally in the market followed the promise of critical reforms by the President Bola Tinubu administration”.

    Chief Executive Officer, Crane Securities Limited, Mike Ezeh said the emergence of Tinubu had further energised the market as market participants have hopes in his ability to rejig the economy and implement economy-friendly policies.

    He urged the new government to continue to implement policies that would provide enabling environment for businesses to thrive, noting that this would help boost foreign direct investments (FDIs) and attract issuers to the capital market.