Category: Investors

By Taofik Salako, Deputy Group Business Editor

To create more cashless alternatives for the public, Advans La Fayette Microfinance Bank has launched two new cashless centres in Offa, Kwara state, and Iseyin, Oyo State.

The two new agile branches brought the number of Advans cashless centres serving hundreds of financially undeserved in Nigeria to three, and a total of 17 branches.

Managing Director, Advans La Fayette Microfinance Bank, Gaetan Debuchy said the expansion was one of the company’s innovative approaches to providing seamless, affordable and transparent financial services to micro, small and medium scale enterprises in the nooks and crannies of Nigeria.

“It will help us as a bank to make more impact with less resources so as not to increase the cost of service to clients,” Debuchy said.

He added that Advans is a model microfinance institution that has continued to promote private sector-led economic and social development in Nigeria, and nine other countries.

Speaking on the decision of where these cashless branches are situated, the Chief of Business & Strategy, Elvis Oheneba quipped that factors like proximity to small businesses, and convenience for individuals and business owners, were put into consideration.

“We intend to increase the number of cashless branches from three to six by the end of the year 2021,” Debuchy said.

Deputy Chief Executive Officer, Advans La Fayette Microfinance Bank, Jean-Luc Nzoubou,  who also oversees the business activities for the bank network across Nigeria, explained that ‘a cashless centre’ can do everything a full branch can do.

“Customers can apply for loans, open savings and current accounts, get access to business advisory, and also carry out other transactions without having to travel long distances,” Nzoubou said.

According to him, the cashless centres will also provide an extensive array of other products and services and wealth management services which underscores the bank’s mission to provide client-centric financial services to under- served populations in a sustainable and responsible manner.

Advans Nigeria is a member of the Advans group, which provides innovative financial solutions to over 1.1 million clients in nine countries. The group offers a complete range of financial services that have helped to build over five million small businesses.

By Taofik Salako, Deputy Group Business Editor

Securities and Exchange Commission (SEC) has cautioned the investing public against patronising unregistered firms and individuals masquerading as capital market operators.

In a circular, SEC noted that laws  vested the regulation of investments in it and that any unregistered operators or schemes are fraudulent.

“The Commission also uses this medium to remind the general public that by virtue of Section 38 (1) of the Investments and Securities Act (ISA) 2007, only persons and institutions registered with the Commission are permitted to engage in capital market activities,” it stated.

SEC urged the public to seek clarification as may be required through its established channels of communication on investment products advertised through conventional or online mediums.

According to the Commission, a list of registered capital market operators is available on its website as well as its offices across the country.

SEC dispelled insinuations in some sections that MBA Capital and Trading Limited was a registered capital market operator with the Commission.

A victim of an alleged scam perpetrated by MBA Capital and Trading Limited, Misan Sagay had reportedly stated that he had verified “on-line” and ascertained that the company was registered with the Commission.

SEC stated that MBA Capital and Trading had never been registered by the Commission and as such unfit to offer any investment service or product to the public.

By Taofik Salako, Deputy Group Business Editor

Securities and Exchange Commission (SEC) has directed investment crowdfunding portals and digital commodities investment platforms to register their operations with the Commission or cease operations by June 30, 2021.

The Commission stated that there were requirements and eligibility criteria for raising funds through crowdfunding as well as operating a crowdfunding portal.

According to the SEC, the rules governing crowdfunding business came into effect on the January 21, 2021, which was part of efforts by the Commission to ensure investor protection while encouraging innovation in the conduct of securities business.

“In line with the transitional provisions of the Rules, all persons and entities operating an investment crowdfunding portal and digital commodities investment platform prior to the commencement of the rules were expected to restructure all operations in accordance with the requirements of the rules and apply for registration not later than 90 days from the effective date.

“While the transitional period elapsed on the April 21, 2021, the Commission hereby directs investment crowdfunding portals and digital commodities investment platforms to note the requirements and eligibility criteria for raising funds through and operating a crowdfunding portal and comply with the registration requirements or cease operations by the June 30, 2021, failing which the operations of such platform would be categorized as illegal and attract regulatory sanction as stipulated in the rules,” SEC stated.

The NASD Plc, the owner of NASD OTC Securities Exchange, the trading platform for unlisted public securities, plans to launch trading in digital currency and equity crowd funding in 2021 as part of major initiatives to further deepen and diversify product base and services at the over-the-counter (OTC) exchange.

According to the NASD workplan for 2021, the Exchange also plans to launch its NASD Private Market to cater for specific fund raising requirements and open up a new vista in commercial paper (CP) issuance and trading.

SEC had earlier unveiled initial regulatory framework for all digital assets as part of its mandate to protect the investing public and regulate investment and securities business in Nigeria.

SEC noted that while digital assets offerings provide alternative investment opportunities for the investing public; it is essential to ensure that these offerings operate in a manner that is consistent with investor protection, the interest of the public, market integrity and transparency.

According to the Commission, the general objective of regulation is not to hinder technology or stifle innovation, but to create standards that encourage ethical practices that ultimately make for a fair and efficient market.

“Section 13 of the Investment and Securities Act, 2007 conferred powers on the Commission as the apex regulator of the Nigerian capital market to regulate investments and securities business in Nigeria. In line with these powers, the SEC has adopted a three-pronged objective to regulate innovation, hinged on safety, market deepening and providing solution to problems. ‘’

This will guide its strategy, its regulations and its interaction with innovators seeking legitimacy and relevance,” SEC stated.

SEC stated that it would henceforth regulate crypto-token or crypto-coin investments when the character of the investments qualifies as securities transactions.

SEC’s position is that virtual crypto assets are securities, unless proven otherwise and the burden of proving that the crypto assets proposed to be offered are not securities and therefore not under the jurisdiction of the Commission, is placed on the issuer or sponsor of the said assets.

Coronation Merchant Bank Limited and Mixta Real Estate Limited have listed their latest commercial paper issuances on the FMDQ Securities Exchange, paving the way for secondary trading on the investments.

FMDQ Securities Exchange listed Coronation Merchant Bank’s N11.36 billion Series 18 Commercial Papers (CP), which was issued under the bank’s N100 billion CP issuance programme. It also listed Mixta Real Estate’s N1.02 billion Series 36 Commercial Paper, which was issued under the company’s N20 billion commercial paper issuance programme.

Coronation Merchant Bank had, in 2018, joined the league of other companies whose debt profiles have been raised through the value-packed quotations service offered by FMDQ Exchange.

FMDQ noted that the continuous admission of securities to its platform is reflective of the potential of the debt capital market and the commendable level of confidence demonstrated by both issuers and investors in the market.

Coronation Merchant Bank is Africa’s premier investment bank that provides innovative solutions to the needs of corporations, governments and other financial services organisations.

The net proceeds from the new CP issuance would be used to finance Coronation Merchant Bank’s working capital requirements.

The net proceeds from the CP quotation will be used to finance Mixta Real Estate’s short-term funding requirements.

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

Mixta Real Estate had developed more than 5,000 properties spanning across affordable homes, luxury residences, and commercial projects. The company continues to seek innovative solutions to activate development finance for affordable housing in Nigeria.

FMDQ Group prides itself as Africa’s first vertically integrated financial market infrastructure group, strategically positioned to provide registration, listing and quotation services, seamless trading, clearing, settlement, risk management, and depository of financial market transactions, as well as data and information services, across the debt capital, foreign exchange, derivatives and equity markets, through its wholly owned subsidiaries – FMDQ Exchange, FMDQ Clear Limited and FMDQ Depository Limited.

Mixta commenced operations in February 2006 as a real estate investment fund management company promoted by Asset & Resource Management Company (ARM) Limited.

In 2007, the fund was converted to a property company, ARM Properties Plc, as a result of operational and tax limitations encountered due to current legislation governing real estate investment funds in Nigeria.

In 2015, ARM acquired Mixta Africa, an Africa-focused large scale property development company headquartered in Spain with subsidiary operations in several countries across North and sub-Saharan Africa. The combination of ARM Properties and Mixta Africa gave birth to Mixta Real Estate Plc.

By Taofik Salako, Deputy Group Business Editor

Securities and Exchange Commission (SEC) has granted NG Clearing Limited (NG Clearing) registration to become a central counterparty (CCP).

The registration permits NG Clearing to clear and settle exchange traded derivative products. The registration took effect from June 7.

Chairman,  NG Clearing Limited, Mr. Oscar Onyema, said NG Clearing would deliver an unparalleled CCP experience for the financial and capital markets.

According to him, the company will optimise the deployment of its resources to achieve long-term value creation for its stakeholders using a state-of-the-art risk management framework, which complies with global best practices for mitigating settlement risk.

He added that the company’s main role is to improve the soundness and safety of the financial market by delivering best-in-class post-trade services that manage counterparty credit risk and reduce systemic risk by interposing itself as a guarantor to both parties in a transaction, thus ensuring the successful execution of derivatives and other trades from various trade points in Nigeria.

Managing Director, NG Clearing Limited, Mr. Tapas Das said the company shall be playing a key role in the financial market ecosystem in the region, upholding stability and safety of the marketplace, through efficient and timely settlement of derivative trades.

According to him, the aim is to strengthen the country’s investment environment through solutions that systematically reduce risks, enhance operating efficiency, and minimise costs for  market participants, thereby serving as a catalyst to development.

Das stated that the company has sufficient financial resources, including settlement guarantee fund, to cover participants’ risk exposures.

He noted that members would have access to several financial reports that equip them with extensive knowledge and enable them make informed decisions, as well as access to NG Clearing’s bespoke clearing and settlement software application which will support the clearing and settlement of derivative instruments across various asset classes i.e., futures and options contracts on indices, equity shares, commodities, currency, rates etc.

NG Clearing was incorporated on May 24, 2016 to facilitate derivatives trading in the market.

The company is promoted by the Nigerian Exchange Group (NGX)  Plc and Central Securities Clearing System Plc (CSCS) along with key stakeholders, including Nigeria Sovereign Investment Authority (NSIA), Access Bank Plc, Consonance Kuramo Special Opportunities Fund I, Coronation Merchant Bank Limited, Greenwich Merchant Bank Limited, Union Bank of Nigeria Plc (Union Bank), United Bank for Africa Plc (UBA) and Association of Securities Dealing Houses of Nigeria (ASHON)

By Linus Oota, Lafia and Jide Orintunsin, Abuja

Nasarawa State Governor, Abdullahi Sule, has identified infrastructure, as major challenge confronting investors in the country.

Sule spoke yesterday shortly after undertaking a tour of a facility owned by the Halibis Industries, a private firm owned by an indigine of Nasarawa State, operating in Abuja.

Sule, who spoke from his experience in the organized private sector, specifically identified lack of good motorable roads, power supply, capital, among others, as factors responsible for the high cost of production in Nigeria.

According to him, companies in countries such as India and China, produce at low cost mostly because of the minimal cost of energy and labour, among others factors.

He called for adoption of Private Public Partnership (PPP) as a means of reducing the increasing rate of unemployment in the country.

He said PPP will greatly help to boost state economy of the country in the face of global economic recession.

He expressed satisfaction with what he saw at the factory, commending the President of Halibis Industries, Alhaji Adamu Aliyu, for his vision and initiative, noting that Halibis Industries can metamorphose into the next Nestle or Cadbury.

Sule added that it was a thing of pride to see an indigene of Nasarawa State, venturing to set up such an industry, starting in even a much bigger manner than most of the big players in the food industry.

The governor explained that he is always excited when he sees people being employed and empowered, adding that the state government will partner with Halibis Industries, with a view to expanding the business.

“I want to appeal to you, as you expand, Nasarawa State needs lot of employment, try to remember Nasarawa in your employment status,” Sule said.

Earlier, President of Halibis Industries, Alhaji Adamu Aliyu, said his company, which produces food items for distribution nationwide, seeks to take the company to the next level by establishing the Afritox, an offshoot of Halibis Industries, that will export products to other African countries.

Aliyu, an indigene of Nasarawa Local Government Area, added that the Afritox is attracting lots of partners, with Halibis Industries, soon to get approval, for the groundbreaking of the project.

The Halibis Industries president sought for the support of the Nasarawa State government, adding that there are lots of opportunities in the venture.

Wema Bank Plc has brought innovation to digital banking with ALAT, a fully-digital bank, ahead of the competition in mobile and internet banking.The bank’s Managing Director/CEO, Ademola Adebise, says Nigeria’s oldest indigenous commercial bank is deploying technology to meet the needs of its customers in innovative and compelling ways, writes COLLINS NWEZE.

Digital transactions are defining the way banking is done with banks introducing various products and services to key into and dominate the e-payment space.

For Wema Bank Plc, ALAT has made it possible for Nigerians to complete the most complex banking transactions right from the comfort of their homes. And from inception till date, ALAT hasn’t just provided the latest banking technology, but fit perfectly into the lifestyle of Nigerians, making life easier for everyone.

Managing Director/Chief Executive Officer (CEO), Wema Bank Plc, Ademola Adebise, said  consumers gravitate towards value and will continue to patronise brands and institutions that serve them and provide some kind of needed value at the right time, and it stands to reason that as a supplier of value.

He said customers’ patronage has kept the bank going for 76 years, and will keep it going as it heads into the future.

Speaking on his vision for the bank, three years  since he became the CEO, he said: “My vision at that time was to see the bank grow rapidly. We had just come out of our successful launch of ALAT, and there was this sense of pressure as stakeholders and the market at large were keeping an eye out for the next thing out of Wema.

“I knew that we had to take advantage of the improved customer perception and grow in all the right ways. This was the seed of what became the bank’s Double-in-Two strategic vision, in which we were to work to double our performance across all metrics in two years. Thankfully, we were able to achieve this, and we have moved on to our Digital Dominance in three strategic vision, which will cover the three year period spanning 2021 to 2023. Can you share with us some of the challenges and successes you have recorded so far.’’

Continuing, he said the most notable challenge thus far has been COVID-19 and  2020.

”Every other thing pales into insignificance when placed side by side with the pandemic and the vagaries of last year, as so many changes occurred in a short period of time and one was constantly on his toes trying to plan, analyse and react to a number of equally pressing concerns.

“As for successes, I will list the awards for customer satisfaction and digital platform performance, as well as the successful deployment of ALAT 4.0, which is a major step on our journey to digital dominance and the attainment of our strategic goals. Additionally, the bank paid out dividends to its shareholders for the third consecutive year in 2020; this are notable successes, as it is in line with our aspirations of continuously providing value for our stakeholders.

“We were able to weather the storm of COVID-19 by first, harnessing an agile mindset that allowed us to pivot our operations and services very quickly in response to the realities of the New Normal of remote working. Secondly, we applied a vigorous cost-savings regimen to ensure that our income lines, which were, like the income lines of banks and businesses all over the country and the globe, hit by a number of shocks.

“This allowed us to see some gains, as our operating expenses dropped by 3.19 per cent year-on-year. All of this occurred while we continued to aggressively push for increases in customer deposits, loan disbursals and other income lines. This double-pronged approach led to the positive results for last year,” he said.

He addedthat Wema Bank’s long-term vision is to be the financial institution of choice in service delivery and financial returns.

He continued:  “Our short-term ambition is to be the dominant digital banking platform in the country; this fits in perfectly with the long-term vision, first because to be the dominant banking platform means that individuals (Wema Bank customers and non-customers alike) consider Wema Bank as the de facto first choice at every instant where they try to access financial services. Furthermore, attaining this magnitude of scale (in terms of customer numbers), will allow us to harness economies of scale and reduce per unit cost to serve, which will in turn allow us to offer the best possible rates and returns to our customers.

He said the bank has outlined a comprehensive strategy which details the ways and means of how we intend to attain this vision.

He said the bank intends to improve its efficiency and optimise our balance sheet by improving deposits and increasing capital.

“We will strive to increase our active customer base and review our value propositions to attract new customers and re-attract dormant ones,  position ourselves as the bank of choice for fintechs and tech start-ups and develop an ecosystem through mutually rewarding partnerships, continue to transform the experiences of our customers across all our channels and products and design and deploy the right architecture and infrastructure that will allow us to judiciously harness the insights gained from data to serve our customers better.

“We will also push the right skills and grow the necessary in-house culture which will ensure that our staff are properly positioned and inclined to allow for the attainment of this vision, among others.”

By Taofik Salako, Deputy Group Business Editor

The Central Bank of Nigeria  (CBN) needs to ensure consistency in its policies to make recent move aimed at stabilising foreign exchange realistic and sustainable.

In a report on forex outlook, analysts at FSDH Group said while the recent action by the Central Bank to unify the exchange rate is a positive move for the economy, the apex bank must address other concerns to achieve stable forex situation.

According to analysts,  with the recent move to bridge market rate with official rate, the CBN has taken a step towards ensuring clarity and improving market confidence.

FSDH noted that Nigeria can also unlock funding from several multilateral organisations such as the IMF and World Bank and ease the pressure on the exchange rate in the medium term.

“However, exchange rate unification is not a sufficient factor in attracting significant capital into the country. What should follow the CBN’s recent actions, in our view, are a set of consistent forex policies that seek to improve market liquidity and prevent every form of forex arbitrage and unnecessary forex subsidies.

“The CBN will also need to clear forex backlogs to further instil confidence in the market. In February 2021, the IMF estimated backlogs at US$2 billion. We believe this will be done gradually,“ FSDH stated.

According to analysts, as much as Nigeria needs effective management of forex and unification of exchange rate to boost confidence, the supply shortage of forex is still a major problem.

They pointed out  that  Increasing forex supply from non-CBN sources is vital in maintaining exchange rate stability in the I &E window and reducing speculative activities.

They added that the planned issuance of Eurobond by the government is expected to provide some relief in the market and boost external reserves in the short term.

“From the fiscal and trade perspective, Nigeria will need to leverage the African Continental Free Trade Area (AfCFTA) Agreement to boost non-oil exports and increase forex inflows. Providing direct incentives for businesses to produce for exports, implementing port reforms as well as developing a comprehensive industrial and trade strategies are important steps that the government must take.

“We believe that the Naira will settle around N430 per dollar in the latter part of 2021. Forex inflows are expected to also improve, especially when the Eurobond is issued, but increasing demand pressures from imports and other payments, will continue to exert pressure on the rate,” FSDH stated.

Nigeria’s largest food-focused agro-allied conglomerate, Flour Mills of Nigeria Plc has invested more than N141 billion in the expansion of its sugar business.

In a regulatory filing at the stock market, Flour Mills of Nigeria  (FMN) stated that it has further expanded its sugar backward integration programme (BIP) with the acquisition of 20,450 hectares of land in Nasarawa State.

The land is situated in Umaisha Development Area of Toto Local Government Area of Nasarawa State on the north bank of the Benue river, about 70 kilometres upstream from Lokoja.

According, to the company, the investment demonstrated its commitment to the backward integration programme of the Nigeria Sugar Master Plan, and the overall growth strategy of the Sugar industry in the country.

The signing ceremony held in Abuja, to commemorate the handover of the land by  Governor Abdullahi Sule, to FMN.

Group Managing Director, FMN, Mr. Omoboyede Olusanya, in the company of other senior executives of FMN, accepted the handover of the site for FMN.

“It is expected that land preparation, including, surveys and the initial designs will start immediately in anticipation of the commencement of operations during the course of this year.

“The plan is to develop up to 15,000 hectares under cane and to construct a state-of-the-art sugar mill in line with our BIP commitments and Nigeria’s drive for self-sufficiency in sugar production.

“Similar to our investments at Sunti, Niger State, the development plan of the Nasarawa BIP will significantly benefit neighbouring communities who will be impacted by numerous community improvement projects that have already been earmarked to begin soon, including access roads, electrification projects, primary healthcare and educational facilities and expanded youth job opportunities – including the extsension of our out-grower scheme that will empower farmers, and ultimately improve lives. The total projected cost to achieve this bold new plan is at least $300 million,” FMN stated.

By Taofik Salako, Deputy Group Business Editor

The latest auditing standard set out by AAOIFI will help to strengthen governance and growth of the Islamic finance market, S & P Global Ratings has said.

In a review of the new standard, S & P Global ratings stated that external auditing of Sharia compliance will strengthen governance in Islamic finance.

According to the global rating agency, the new standard sets out criteria for external auditing of a financial institution’s Sharia compliance and provides some guidance on the key considerations, when performing this exercise.

Global Head, Islamic Finance, S&P Global Ratings, Dr. Mohamed Damak, noted that while there were no unified Sharia rules that Islamic financial institutions must follow, the new standard by AAOIFI addresses this gap by creating a hierarchy of the existing standards and regulations.

“In our view, enforcing the new auditing standard should enhance Sharia governance and market discipline in Islamic financial institutions,” Damask stated.

He pointed out that while AAOIFI does not specify if the standard will apply to market instruments issued by entities that are not subject to internal Sharia audit, such as corporate or sovereign sukuk issuers, extending the practice of external audits to these instruments could also help strengthen their credibility.

Global Islamic finance assets are expected to rise to $3.69 trillion by 2024 as latest data showed a major surge in Islamic finance activities.

The 2020 Islamic Finance Development Report projected that global Islamic finance assets might rise to $3.69 trillion by 2024 after posting its recent highest growth of 14 per cent to close 2019 $2.88 trillion.

The 2020 Islamic Finance Development Report was a collaborative effort of the Islamic Corporation for the Development of the Private Sector (ICD) and Refinitiv, one of the world’s largest providers of financial markets data and infrastructure. ICD is the private sector development arm of the Islamic Development Bank (IsDB).

The report noted that Islamic finance assets increased 14 per cent to $2.88 trillion in 2019, the highest recorded growth for the industry since the global financial crisis.

According to the report, global Islamic finance assets increased by 14 per cent year-on-year totalling $2.88 trillion in 2019. Islamic Finance assets of Gulf Cooperation Council (GCC) reached $1.2 trillion in 2019, followed by Middle East and North Africa (MENA) at $755 billion, excluding the GCC, and Southeast Asia at $685 billion.

The Islamic banking sector contributes the bulk of the global Islamic finance assets. The sector grew 14 per cent in 2019, equating to $1.99 trillion in global assets. This compares with just one per cent growth in 2018 and an average  yearly growth of five per cent from 2015 to 2018.

The report indicated that the top five developed countries in Islamic finance were Malaysia, Indonesia, Bahrain, United Arab Emirates (UAE) and Saudi Arabia. Indonesia recorded one of the most notable improvements in the Islamic Finance Development Indicator (IFDI), moving into second place for the first time due to its high knowledge and awareness ranking.

The report covered 135 countries and was based on five key metrics comprising of quantitative development, knowledge, governance, awareness, and corporate and social responsibility (CSR).

According to the report, green and socially responsible investments (SRI) increased in the UAE and Southeast Asia in 2020. The pandemic was a game changer as several Islamic banks reported losses and reduced profits throughout the year. The pandemic has also led to growth in some areas of the industry as some regulators turned to Islamic finance to mitigate the economic impact.

Corporate Sukuk issuance has also picked up after a cautious halt in the first quarter of 2020. The report indicates that companies are taking advantage of low borrowing costs to shore up their finances, while the pandemic continues to batter trade and economies.