Category: Equities

By Lucas Ajanaku

 

Visa Foundation has committed $210 million to two programmes to support small and micro businesses to address urgent needs from local communities following the spread of COVID-19.

Its Chairman, Mr Al Kelly, on Tuesday in Lagos said the support aligned with the foundation’s long-term focus on women’s economic advancement and inclusive economic development.

In a statement, Kelly said the first programme of $10 million was designated for immediate emergency relief to support charitable organisations on the frontlines responding to the COVID-19 pandemic.

These include  public health and food relief in each of the five geographic regions in which Visa operates.

Said Kelly: “As COVID-19 continues to unfold, communities are feeling the effects and need our immediate support.

“As a global company that operates a very local business, we recognise this need.

“We are also committed to the long-term recovery, and will continue to explore way to accelerate economic activity in line with our mission to help individuals, businesses and economies thrive.”

Kelly said the second programme was a five-year strategic $200 million commitment to support small and micro businesses around the world, focussing on fostering women’s economic advancement.

He said this would expand the Foundation’s long-standing support for small and micro businesses globally.

He said: “The funds from the Visa Foundation will provide capital to non-government organisations (NGOs) and investment partners supporting small and micro businesses.

“Small and micro businesses are backbone of the global economy, accounting for more than 90 per cent of worldwide businesses and contributing 50 to 60 per cent of global employment.

“There is a $300 billion annual credit deficit in funding for women-owned small and micro businesses.

“This is expected to grow given the recent economic turmoil unfolding due to COVID-19.

Read Also: COVID-19: CBN invites more private sector donors

 

“Now, more than ever, we must accelerate our support for small businesses on the frontlines driving economic growth.’’

“As many small and micro business owners are women, there will be a ripple effect supporting women’s economic advancement.

“We believe this is one of the most important ways to achieve gender equality, reduce poverty and foster inclusive economic development.”

Also speaking, its President, Mr Graham Macmillan,  said through the $200 million SMEs programme, the  Foundation would provide $60 million in grants to NGOs dedicated to supporting small and micro business owners, many of whom are women, in every region where Visa operates.

Macmillan said: “The Visa Foundation will also allocate $140 million  with investment partners that generate positive social and financial returns for small and micro businesses.

“$200million in new financial resources demonstrates our continuing commitment to support small and micro businesses, with a focus on women’s economic advancement globally.

“When women thrive, communities thrive. We know this matters now, more than ever as the global economy seeks to recover and rebuild.”

By Taofik Salako Deputy Group Business Editor

 

Stanbic IBTC Holdings Plc has indicated that a conversion price of N24.79 per share for any shareholder that elects to convert his cash dividend to scrip dividend under the ongoing convertible policy of the holding company.

The board of the holding company has recommended payment of N21 billion as dividend for the 2019 business year, implying a dividend per share of N2, 33.3 per cent increase on N1.50 per share paid for the 2018 business year.

Under a resolution passed at its extraordinary general meeting in August 2016, shareholders of Stanbic IBTC Holdings may choose to receive dividends declared by the company, up to year 2020, either in cash or as new ordinary shares in the company.

Under the conversion programme, the reference price to be used in determining any scrip dividend allotment shall be the volume weighted average price (VWAP) of the company’s shares on the NSE for the five business days commencing on the day the ordinary shares are first quoted ex-dividend.

Where a shareholder elects to receive the whole or a part of his dividends by way of new ordinary shares, such scrip shares shall only be allotted after receipt of any required regulatory. In order to be valid, any scrip dividend election by shareholders must be made to the company’s Registrars, not later than seven days prior to any dividend payment date.

“With respect to the N2 dividend indicated above, the reference price for determining the scrip dividend allotment is N24.79,” Stanbic IBTC Holdings stated.

Stanbic IBTC Holdings recorded a net profit of N75.04 billion in 2019 as the financial holding company sustained steady growths across key performance indicators.

Key extracts of the audited report and accounts for the year ended December 31, 2019 showed that gross earnings rose from N222.36 billion in 2018 to N233.81 billion. Profit before tax increased from N88.15 billion in 2018 to N90.93 billion in 2019.

Profit after tax also improved marginally from N74.4 billion to N75.04 billion. Earnings per share however dropped from N7.04 in 2018 to N6.92 in 2019. The decline in earnings per share was due to additional shares due to cash-to-scrip dividend conversion policy of the company.

Read Also: Stanbic IBTC joins OPS in fight against COVID-19

 

Chief Executive Officer, Stanbic IBTC Holdings Plc, Yinka Sanni, said the financial results were largely in line with market guidance as the company achieved double digit growth in both assets under management and loans.

He pointed out that loan-to-deposit ratio was 67.5 per cent, above the regulatory minimum of 65 per cent as at the year end while non-performing loans ratio was 3.9 per cent, similar level with prior year and within acceptable limit of 5.0 per cent.

“The group’s total assets grew by 13 per cent aided by the growth in loans and financial investments portfolio. Our personal and business banking division contributed to profit yet again with a significant improvement in profit after tax year-on-year.

Cost of risk was 0.2 per cent compared to the writeback in prior year due to a nonoccurrence of a significant recovery, however it is still well below our guidance of 3.0 per cent.

Our sustained focus on cost containment coupled with revenue growth during the year yielded an improvement in cost-to-income ratio of 50.4 per cent from 52.9 per cent in 2018,” Sanni said.

While acknowledging that the regulatory and economic environment could sometimes be challenging, Sanni said the company remained resolute in its target to emerge as Nigeria’s leading end-to-end financial solutions provider.

“While we look to 2020 with great optimism, we are fully aware of the challenging macro-economic and regulatory headwinds that we must contend with as we enter a new decade. Nonetheless, our strategic journey towards becoming the leading end-to-end financial solutions provider by 2023 continues as we leverage our universal capabilities whilst focusing on cost management, digitisation and client centricity in accelerating growth in 2020,” Sanni said.

He added that the Stanbic IBTC continues to benefit from its adoption of a digital strategy as well as operating a holdings company structure which enables subsidiaries to cross-sell and also leverage expertise within the group.

By Taofik Salako Deputy Group Business Editor

 

Consolidated Hallmark Insurance Plc has secured regulatory approval to extend its N1.056 billion rights issue for one month. The extension was due to the disruptions caused by the Coronavirus pandemic.

The offer period for the rights issue, which was scheduled to close on Wednesday, April 1, 2020, has now been extended till Friday, May 1, 2020, according to regulatory filing at the weekend. The extension of the offer period was approved by the Securities and Exchange Commission (SEC).

Consolidated Hallmark Insurance is seeking to raise N1.056 billion in new equity funds through the issuance of 2.03 billion ordinary shares of 50 kobo each to existing shareholders at 52 kobo per share.

The rights issue had been pre-allotted on the basis of one new ordinary share of 50 kobo each for every four ordinary shares of 50 kobo each held as at close of business on February 3, 2020.

The net proceeds of the supplementary issue will be used to strengthen the balance sheet of the insurance company.

Read Also: COVID-19: NAICOM issues forebearance to ensure availability of services

 

Consolidated Hallmark Insurance, a general business and special risks insurer, provides insurance coverage across several sectors including aviation, oil and gas, marine cargo and hull business and other non-life insurance underwriting including motor, fire and special perils, goods-in-transit, engineering insurance, amongst others.

Insurance companies are in a hot race to raise new equity capital to meet new minimum capital requirements for various insurance functions as directed by the National Insurance Commission (NAICOM).

NAICOM had in May 2019 released new capital requirements for insurance businesses with a 13-month compliance period for operators to shore up their minimum capital base to the required level.

The minimum paid-up share capital of a life insurance company was increased from N2 billion to N8 billion, non-life insurance from N3 billion to N10 billion, composite insurance from N5 billion to N18 billion while re-insurance companies were directed to raise their capital base from N10 billion to N20 billion. NAICOM had extended the deadline for the recapitalisation to December 31, 2020.

By Collins Nweze

 

Polaris Bank has acquired 400 specialised hospital beds,  with mattresses and accessories to be handed over to the Lagos State government; being the state most hit by the pandemic, the Nigeria Centre for Disease Control (NCDC) and other state governments.

The bank also announced that it would partner the Nigeria Coalition Against COVID-19 (NCAC), non-governmental  organisations (NGOs), health institutions and state governments in stemming the tide of the COVID-19 pandemic by delivering additional materials to cover the areas of testing, isolation, treatment and training.

The bank’s Managing Director, Tokunbo Abiru, who disclosed this in a letter to the customers and stakeholders of the bank, explained that the bank, working with relevant partners and government, remains committed to ”doing everything possible to keep our environment safe for all”.

Read Also: How Access Bank is helping to contain COVID-19 pandemic

 

“At Polaris Bank, we will continue to devote all necessary resources to contribute to the safety of our esteemed customers and our environment as a whole, while maintaining all of the banking services you need to stay safe,” he said.

The also affirmed his commitment to the total well-being of Nigerians and the fight against COVID-19, noting: “As new developments emerge, the bank would continue to share information about safety of its staff and working environment as well as the efficiency of its operations and service to stakeholders.’’

By Taofik Salako, Deputy Group Business Editor

The loss suffered in equities by investors within a month after Nigeria recorded its first confirmed case of Coronavirus (COVID-19) was put at N2.56 trillion on Tuesday.

As the country contend with rising cases of COVID-19, investors scurried for the exit, creating a buyer’s market that saw most transactions closing at significantly lower prices.

The benchmark indices for the equities market indicated average decline of 18.75 per cent in March, equivalent to net capital depreciation of N2.56 trillion.

The aggregate market value of all quoted equities at the Nigerian Stock Exchange (NSE) dropped from the March’s opening value of N13.658 trillion to close yesterday at N11.101 trillion.

The All Share Index (ASI) – which tracks all share prices at the Exchange, also declined from the month’s opening index of 26,216.46 points to close March at 21,300.47 points.

Read Also: Equities rally N15b gain amid bargain-hunting

With the steep decline in March, the three-month average year-to-date return for the Nigerian equities market closed the first quarter at -20.7 per cent, equivalent to net loss of N2.68 trillion.

This implies that investors in the Nigerian stock market had lost more than one-fifth of their portfolios in the first three months of the year.

The ASI opened the year at 26,842.07 points while the aggregate market value opened at N12.958 trillion. The sectoral indices for the first quarter showed that most investors had suffered above-average losses.

The performance of the market last month was the worst in recent period but most analysts said they expected the bearishness to continue as Nigeria struggles with external shocks of falling crude oil price and domestic containment of spreading COVID-19 pandemic.

“We expect the bearish sentiment to continue however, there exist bargain hunting opportunities in the equities market,” Afrinvest Securities stated yesterday.

Investors in Nigerian equities had lost N1.35 trillion in February with average decline of 9.11 per cent, counterbalancing net capital gain of N966.7 billion that accrued in January 2020.

Capital market experts agreed that COVID-19 has started impacting the market and the general economy, as the market serves as barometer for the economy.

Pundits agreed that the extent of the impact depends on the duration of the restrictions or lock down, the containment strategy and government’s economic recovery strategy. Despite the stimulus packages for companies in the healthcare sector, not a few analysts agreed that Coronavirus will have a generally negative impact on the capital market and the economy.