The Nation Newspaper

Category: Investors

  • Lagos ‘ponzi’ firm shut

    Securities and Exchange Com-mission (SEC) has sealed up the premises of an Ikeja-based firm, Growing Circle International (G-Circle) for allegedly engaging in ponzi scheme.

    In a circular, SEC stated that it conducted surveillance on G-Circle activities after it received complaint from a member of the public.

    According to the Commission, investigation revealed that G-Circle was operating a pyramid scheme and soliciting funds from unsuspecting members of the public through various means including its website www.growingscircle.com.

    SEC said it sealed up the premises of G-Circle in Lagos in line with its commitment to protect the investing public.

    “The Commission wishes to inform the general public that Growing Circle International and any individual representing the company are not registered by the Commission and therefore, not permitted to engage in any capital market-related activity in Nigeria,” SEC stated.

    Read also: Social Security expansion to get serious hearing in U.S. House

    The apex capital market regulator advised investing public to confirm the registration status of any company, individual and the products they offer before entering into any transaction with such persons. Such confirmation can be done on SEC’s website.

     

  • Stanbic IBTC grows net profit by 54% to N74.4b

    Stanbic IBTC Holdings Plc has recorded considerable growths across all key performance indicators in 2018 with the net profit rising by 54 per cent to N74.4 billion.

    Key extracts of the audited report and accounts for the year ended December 31, 2018 showed that the group grew its top-line earnings to N222.4 billion in 2018 compared with the N212.4 billion in 2017. Profit before taxation rose by 44 per cent to N88.2 billion as against N61.2 billion while profit after tax rose by 54 per cent to N74.4 billion in 2018 as against N48.4 billion in 2017.

    The balance sheet showed that group’s total assets grew by 20 per cent to N1.66 trillion in 2018 compared with the N1.39 trillion in 2017. Customer deposit grew by seven per cent to N807.7 billion from N753.6 billion. Gross non-performing loans decreased by 50 per cent to N17.7 billion in 2018 compared with N35.3 billion. This decrease impacted positively the gross non-performing loan to total loan ratio, which improved to 3.9 per cent, well below the regulatory threshold of 5.0 per cent and 8.6 per cent recorded in 2017. The non-performing loans figure became more impressive when viewed against the 14 per cent increase in gross loans and advances from N403.9 billion in 2017 to N458.9 billion in 2018.

    Stanbic IBTC Holdings Plc Chief Executive Officer, Mr Yinka Sanni, said the balance sheet size was impacted by growth in risk assets and financial investment portfolio, which reflected investment expertise and quality management.

    According to him, strong growth in fees and commission income as well as write-backs, which resulted from recoveries made on previously written off loans and reversals on some non-performing loan, contributed to the strong showing.

    He outlined that performances across its three divisions, corporate and investment banking, wealth management businesses, and personal & business banking, were strong and contributed to the turnover.

    “As a financial institution we will continue to leverage our universal financial services capability, unrelenting focus on cost control, digitisation and client centricity to ensure that we continue to grow our capacity to provide incomparable high quality end-to-end financial solutions to our customers in a sustainable manner,” Sanni said.

     

  • Stockbroking firms to hold summit

    Association of Stockbroking Houses of Nigeria  (ASHON) has concluded arrangements to hold a special summit on financial inclusion in Lagos as part of its commitment towards deepening the capital market.

    The summit’s theme: “Financial inclusion: The capital market perspective“, has been carefully chosen to address the strategies for bringing every segment of the society under the same financial umbrella. It holds on Friday, March 29 in Lagos.

    ASHON President, Chief Patrick Ezeagu said the association has also shortlisted some prominent Nigerians and institutions for distinguished awards, following their contributions to the growth and development of the financial market.

    He noted that coming at a period when the Federal Government is putting financial inclusion on the front burner, the outcome of the presentation shall be ASHON’s professional contribution to the government’s policy direction on financial inclusion.

    The keynote speaker, and former National Planning Minister, Dr Shamshuddeen Usman is scheduled to speak on “Driving financial inclusion through the capital market“.

    Usman is bringing to the summit, a robust wealth of experience from the academia, private and public sectors to articulate workable strategies by which the capital market can be deployed as a platform to ensure financial inclusion in the country.

     

  • Major investors scoop Lafarge Africa’s N89.2b rights

    Less than one per cent of applicants bought about 98.4 per cent of the N89.2 billion rights issue by Lafarge Africa Plc, in a major skew expected to consolidate the shareholding of the majority core investor in the Nigerian cement group.

    Allotment results approved by the Securities and Exchange Commission (SEC) and filed at the Nigerian Stock Exchange (NSE) by Lafarge Africa showed that the rights issue was fully subscribed, raising N89.212 billion in new equity funds for the cement group.

    Lafarge Africa had offered 7.43 billion ordinary shares of 50 kobo each at N12 per share. The rights were pre-allotted on the basis of six new ordinary shares for every seven ordinary shares held as at the close of business on December 4, 2018. Acceptance list for the N89.2 billion rights issue opened on December 17, 2018 and closed on January 28, 2018.

    A breakdown of the allotment results showed that 16 applicants out of a total of 1,826 applicants bought 7.313 billion ordinary shares of 50 kobo each, representing 98.37 per cent of the total shares on offer. The remaining 1,810 applicants were allotted 121 million shares, representing 1.63 per cent of the total shares on offer.

    The allotment results showed that 1,734 shareholders accepted their rights in full totaling 5.93 billion ordinary shares, out of which 738.73 million ordinary shares were traded on the floor of the NSE. The report also showed that out of 1,734 shareholders who took up their rights in full, 734 shareholders also applied for additional 1.300 billion ordinary shares and were allotted in full from the renounced rights.

    A total of 92 shareholders with a provisional allotment of 395.875 million ordinary shares partially accepted their rights for 202.40 million ordinary shares, thus the balance of 193.47 million ordinary shares were renounced. Also, 34 subscribers purchased rights of 738.73 million ordinary shares on the floor of the NSE.

    The N89.2 billion rights issue was Lafarge Africa’s second issue in 14 months. Lafarge Africa had sold its November 2017’s rights issue of about 3.1 billion ordinary shares of 50 kobo each at N42.50 per share. The N89.2 billion rights issue was also structured like the November 2017 rights issue, including a convertible deal that allowed the majority core investor- LafargeHolcim, to convert its debts to equities.

    Market analysts had expressed fears that with the debt-to-equities conversion and investors’ apathy at the primary market, the percentage shareholding of the majority core investor-LafargeHolcim, might increase after the latest rights issue.

    The November 2017’s rights issue had increased LafargeHolcim’s majority shareholding to 76.32 per cent. Lafarge Africa needs to maintain a minimum of 20 per cent of its shareholdings in the hands of minority shareholders to sustain its listing on the Nigerian Stock Exchange (NSE). With 76.32 per cent majority equity stake, LafargeHolcim already has the much-needed three-quarters percentage shareholdings necessary for major corporate changes.

    LafargeHolcim had taken advantage of the November 2017’s rights issue to increase its majority equity stake by 4.97 percentage points from pre-rights issue position of 71.35 per cent to 76.32 per cent after the rights issue.

    LafargeHolcim had picked up its rights fully and further subscribed to the un-allotted shares, thus raising its percentage shareholding. It subscribed fully to its rights under a debt-for-equities deal that saw conversion of LafargeHolcim’s dollar-based loan to equities.

    Lafarge Africa Plc Chairman, Mr Mobolaji Balogun, has said the additional capital raised from the latest rights would further help to deleverage the company’s balance sheet and provide head room for the expansion of its business.

    He said the company foresees a stable pricing environment and favourable economic conditions in its Nigeria market while its South Africa operations are undergoing a turnaround plan.

    Chief Executive Officer, Lafarge Africa Plc, Mr. Michel Puchercos said the company’s refinancing plan is aimed at preparing for future development in Nigeria by improving the company’s leverage as well as strengthening its profitability.

    Key extracts of the interim report and accounts of Lafarge Africa for the nine-month period ended September 30, 2018 had shown that sales rose from N223.67 billion in third quarter 2017 to N234.30 billion in third quarter 2018. With cost of sales rising from N165.76 billion to N178.21 billion, the cement company, however, ended with a pre-tax loss of N14.36 billion in 2018 as against pre-tax profit of N1.09 billion in comparable period of 2017.

    After tax gain of N4.04 billion, net loss after tax stood at N10.37 billion in third quarter 2018 compared with net profit after tax of N937.91 million in comparable period of 2017. With these, loss per share for the nine-month period stood at N1.20 in 2018 as against positive earnings per share of 10 kobo in corresponding period of 2017.

  • African companies raise $10.7b in 130 IPOs

    African companies have floated 130 initial public offerings (IPOs) and raised $10.7 billion from both African and international stock exchanges over the past five years. This represents about N3.27 trillion at current official exchange rate.

    A report by PwC- 2018 African Capital Markets Watch, indicated that African companies have continued to access both the continent and global stock markets to raise funds to finance their operations.

    The 2018 African Capital Markets Watch analysed equity and debt capital market transactions, which took place between 2014 and 2018, as well as transactions by African companies on international exchanges.

    The report listed all new primary market equity initial public offerings (IPOs) and further offers (FOs) by listed companies, where capital was raised on Africa’s principal stock markets and market segments. The report also included IPO and FO activity on international exchanges or non-African companies on African exchanges, on an annual basis.

    Overall, African equity capital market (ECM) activity in 2018 declined both in volume and value in the wake of global and local economic and socio-political uncertainty. Despite 2018 starting on a positive note with some landmark transactions, capital markets activity declined year-on-year by 25 per cent in volume and 40 per cent in value.

    In 2018, $2.2 billion was raised in 17 IPOs compared to $3.1 billion raised through 30 IPOs in 2017, representing a year-on-year decrease of 43 per cent and 27 per cent in volume and value of IPOs, respectively. Further offer (FO) or supplementary offer activity also declined both in volume and value as $6.1 billion was raised in 77 FO deals in 2018 compared to $10.7 billion raised in 95 deals in 2017.

    The financial sector constituted 53 per cent of the total number of IPOs recorded in 2018, followed by the consumer services sector with 17 per cent. With regard to FO activity, the financial sector dominated both the number of deals and proceeds recorded, contributing 41 per cent and 47 per cent, respectively.

    In the African IPO market,  the report showed that South Africa continued to lead African capital markets activity despite the challenges facing the country’s economy. Since 2014, capital raised from 43 IPOs recorded on the JSE was $5.9 billion, representing 57 per cent of total African IPO capital raised, and 34 per cent in terms of transaction volume.

    During 2018, four of the top 10 IPOs by proceeds were launched on domestic exchanges in North Africa, three on the Egyptian Exchange (EGX), and one on the Casablanca Stock Exchange. Three were launched on the Johannesburg Stock Exchange (JSE), and one each on the West African Bourse Régionale des Valeurs Mobilières (BRVM), the Ghana Stock Exchange and the Uganda Securities Exchange.

    Over the five-year period, the JSE was followed in terms of volume and value of IPO transactions by the EGX with 17 issuances accounting for $1.6 billion. Third place in terms of volume was the Bourse de Tunis with 12 issuances, and third in terms of value was the Nigerian Stock Exchange with $571.1 million.

    In the African supplementary offer market, South African companies also continued to dominate FO activity in 2018, accounting for 63 per cent of FO proceeds and 49 per cent of FO volume. The nature of these FOs reflected a mixed landscape, with a significant portion of funds raised for debt refinancing and expansion strategies.

    Over the past five years, there have been 413 FOs by African companies, raising $44.7 billion on both African and international exchanges, a two per cent increase in capital raised over the preceding five-year period, 2013-2017.

    PwC Capital Markets Partner, Andrew Del Boccio noted that the positive trend recorded in 2017 in overall ECM activity, in terms of an increase in volume and value, was not sustained in 2018 despite the strong market indications at the beginning of the year.

    “While 2018 started with several landmark IPOs and FOs, as the year progressed, companies retreated from the capital markets or suspended listing plans as uncertainty and volatility increased across Africa and the globe,“ Del Boccio said.

     

     

     

     

     

     

     

     

     

     

     

  • Fed Govt offers 12.62% return on new savings bonds

    The Federal Government has opened application list for a new tranche of its Federal Government of Nigeria Savings Bond (FGNSB), providing retail investors opportunity to invest in sovereign securities.

    The application for the new FGNSB opened on March 04, 2019 and will run till March 08, 2019. The government, through the Debt Management Office (DMO), is offering two tenors of two years and three years. The minimum subscription is N5,000 and thereafter in multiples of N1,000 up till a limit of N50 million.

    The two-year tenured savings bond with a maturity date of March 13, 2021 carries interest rate or coupon of 11.62 per cent while the three-year savings bond, which has maturity date March 13, 2022, carries a coupon of 12.62 per cent. The interest income is tax exempt.

    The interest will be paid quarterly in arrears while the principal will be paid at maturity together with the last interest payment.

    In a circular, the DMO indicated that the FGNSB will be listed on the Nigerian Stock Exchange (NSE).

    Bondholders will have their holdings credited into their investment accounts at the Central Securities Clearing System (CSCS) within three working days after the closure of application on Friday.

    The coupon or interest for the FGNSB will be paid quarterly on June 13, September 13, December 13 and March 13 through the tenor of the issue.

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

     

     

     

     

     

     

     

     

     

     

     

     

  • FSDH launches N1.5b IPO for treasury bills fund

    FSDH Asset Management Limited has opened an application list for the initial public offering (IPO) of its FSDH Treasury Bills Fund.

    The asset management firm is offering 15 million units of its Treasury Bills Fund at par value of N100 each. The minimum investment amount is 100 units or N10,000 with multiples of 100 units or N10,000 thereafter. The IPO, which opened on March 01, 2019, is scheduled to close on, March 28, 2019.

    The FSDH Treasury Bills Fund, a money market collective investment scheme, is an open-ended fund that will primarily invest in low risk short-term securities such as treasury bills, commercial papers and fixed deposits. The fund is authorised by the Securities and Exchange Commission (SEC) in accordance with the provisions of Section 160 of the Investment and Securities Act (ISA).

    In an executive summary on the new fund, FSDH stated that the objective of the fund is to provide investors with capital preservation, stable and consistent income flows.

    According to the company, the fund manager will achieve its objective by pooling funds together to actively manage and obtain competitive returns for investors.

    FSDH noted that the fund is targeted towards investors, who are interested in fixed deposits and are looking to achieve higher returns that ordinarily are not achievable with minimal funds.

    The company urged investors with low risk appetite, investors that require liquidity and those seeking to establish, on ongoing basis, a savings plan to invest in the new fund.

    Authorities at the Nigerian Stock Exchange (NSE) last week launched a new trading platform for mutual funds. The platform is expected to facilitate electronic transactions with seamless connection among key parties in transactions, including the Exchange, Central Securities Clearing System (CSCS), stockbrokers and fund managers.

    A mutual fund is a pool of funds brought together by a professional fund manager from several investors to invest in selected underlying securities. The underlying securities can be one or a combination of the following: stocks, fixed income securities, real estate, and commodities. A mutual fund portfolio is structured and maintained to match different investment objectives. The type of mutual fund an individual invests in depends on their financial objectives and appetite for risk.

    Most mutual funds are open-ended investment schemes. This means that the fund manager can create additional units for new investors on demand. The fund manager is also able to provide active liquidity by redeeming units from existing investors, who want to sell units for cash. Through this pool of funds, an investor creates wealth over a long period of time by making the money work for him through regular saving and investment.

    In addition to liquidity, mutual funds offer a range of benefits to investors, including portfolio diversification and lower transaction costs. The existence of a Trustee and Custodian to a mutual fund ensures the safety of investments, as the Trustee ensures that the fund is managed in line with approved investment guidelines, and the Custodian holds the fund assets.

  • Edo sponsors world digital exhibition

    Edo State Government has taken up the permanent host city sponsorship of World Digital Exhibition (Worldex), a global technology trade fair hosted annually to link up sub-Saharan Africa with the global technology community.

    In a letter to Alford Conferences Limited Managing Director Mr. Frederick Apeji,  the promoter of the technology trade exhibition, Mr. Taiwo Akerele, Chief of Staff to Edo State Governor, stated that Governor Godwin Obaseki has approved the request for Benin City as permanent host city for the annual digital exhibition. The 2019 edition is scheduled to begin in August 2019.

    Akerele said the government approved the proposal in line with the state’s technology drive, assuring that the state will work with the team in order to achieve the laudable objectives of the exhibition.

    At a meeting with some of the event management partners (EMPs) for Worldex in Abuja recently to formally announce this sponsorship, Apeji said the partnership with Edo State Government will support the state’s vision of a rapid economic growth.

    Apeji explained that Worldex seeks to be a credible innovation platform for sub-Saharan Africa to engage with the rest of the world, noting that the event is a business to business (B2B) and a business to customer (B2C) trade fair, which focuses on the information and communication technology (ICT) and allied sectors.

    According to him, Worldex inaugural edition is expected to attract exhibitors, exhibition attendees, event sponsors, conference speakers and delegates, and media professionals drawn from Nigeria, Africa and the rest of the world.

    He said Worldex comprises a product exhibition, conferences addressing various critical digital subjects, and various awards programmes. “This technology trade show offers global tech brands a valuable and powerful platform to enter or to expand in several fresh markets across sub-Saharan Africa. Next to Asia, Africa is the world’s 2nd most populous continent. This region has the most youthful population in the world, and the majority of its youths are increasingly mobile, web and social media savvy,” Apeji said.

    Head, Media and Communications, Bukky Olajide noted that despite its challenges in basic economic infrastructure, Africa is the most virgin territory for global technology brands, and the continent very often offers the highest return on investment (ROI) on most tech business lines.

    According to her, with democracy and the rule of law maturing in Nigeria, Ghana, South Africa, Liberia, Senegal, Zambia, Kenya, Tanzania, and many other countries, sub-Saharan Africa is increasingly become a more peaceful and more stable place to do business.

    She pointed out that decision makers drawn from ICT, ministries and agencies, telecom regulators, and investment and export promotion agencies from Nigeria and other major African economies, as well as entrepreneurs, chief executives, and top officials of the leading tech and allied companies across sub-Saharan Africa are also expected to attend the exhibition.

     

  • Court remands MD in prison over N58m shares fraud

    Justice Muslim Hassan of the Federal High Court 12, Ikoyi Lagos has remanded Brentonwoods Limited Managing Director, Mr. Samuel Adebanjo in prison custody over alleged fraudulent sale of a client’s shares.

    Adebanjo and his firm were dragged before the court on a two-count charge of fraud relating to illegal sale of shares of a client.

    When the case came up for hearing, Adebanjo pleaded not guilty to the charge and the court adjourned the matter to March 19, 2019 while the defendant is to be remanded in prison custody till the next adjourned date.

    According to the charges, Brentonwoods Limited and Samuel Adebanjo are alleged to have conspired within themselves to commit a felony to wit: defraud by selling and convert to their own personal use the proceeds of 537,872 shares of Nigeria Breweries Plc and 21,260 shares of Guinness Nigeria Plc all valued at N58.46 million belonging to the family of Akin Olugbade.

    They, therefore, committed an offence contrary to Section 516 of the Criminal Code Act, laws of the Federation of Nigeria 2004 and punishable under the same Section.  The offence was alleged to have been committed between 2004 and 2014 in Lagos.

    Authorities at the Nigerian capital market and law enforcement agencies have stepped up efforts to tackle the problem of unauthorised sale of client’s shares. The Nigerian Stock Exchange (NSE) recently launched an amendment to existing rules and regulations, which enables it to henceforth maintain a record to be known as “Blacklist” in which it will keep records of all corrupt persons and indicted officials who are deemed unfit to engage in stock market activities.

    In the new amendment, the NSE has now been mandated to formally open a “blacklist” for the purpose of records of corrupt persons. The amendment, approved by the Securities and Exchange Commission (SEC), strengthened the Exchange’s zero tolerance for infractions and places greater responsibility on all capital market operators.

    Those to be included in the “blacklist” included any person that the Exchange determines that he or she is no longer entitled to privileges, services, recognition or access to the Exchange and its facilities as well as those not permitted to deal or transact with or be employed by a dealing member or person.

    The rule applies to dealing member, an authorised clerk, an employee or director of a dealing member, a sub-broker, or any other capital market operator.

    A check indicated that about 90 per cent of the existing blacklisted persons were due to unauthorised sales of client’s shares. Other ranking crime was manipulation of the market or share prices.

    The Nation had recently reported that the Economic and Financial Crimes Commission (EFCC) was investigating about 35 fraud cases at the Nigerian capital market.

    Although the full details of the cases could not be disclosed due to legal confidentiality and ongoing investigations, a review of the preliminary findings indicated that most cases relate to fraudulent sale of clients’ shares and diversion of clients’ funds, impersonation and false representation of products and services.

    Already, EFCC is pursuing about five cases in court, in collaboration with the Nigerian capital market authorities. The anti-corruption agency had successfully prosecuted a case that led to a seven-year jail sentence and forfeiture of assets of a former managing director of a stockbroking firm.

    SEC and EFCC had earlier in January 2017 signed a Memorandum of Understanding (MoU) that formally established the alliance between the two Commissions. The MoU seeks to promote the efficient investigation and conclusion of all cases reported by either of the institutions to each other and to promote the integrity, efficiency and soundness of the Nigerian capital market and the economy in general.

  • Exchange lifts suspension on Goldlink Insurance

    •Firm posts N149m loss

    The Nigerian Stock Exchange (NSE) has lifted suspension on trading in Goldlink Insurance Plc shares, after the insurance firm submitted its relevant financial statements to the Exchange.

    The NSE had on July 5, 2017 suspended trading in Goldlink Insurance shares and other companies for failing to adhere to best corporate governance and extant post-listing requirements that require quoted companies to submit their periodic financial statements and reports within stipulated timelines.

    Post-listing rules at the NSE require quoted companies to submit their audited earnings reports, not later than 90  calendar days, or three months, after the expiration of the period. The rules also require quoted companies to submit interim report not later than 30 calendar days after the end of the relevant period.

    Not less than 83 per cent of quoted companies use the 12-month Gregorian calendar year as their business year. The business year thus terminates on December 31. While March 31 is usually the deadline for submission of annual report for companies with Gregorian calendar business year, the deadline for the quarterly report is a month after the quarter.

    The NSE said Goldlink Insurance, “which was among the companies suspended, has submitted its outstanding audited and interim financial statements to the Exchange” citing the rules that state that “the suspension of trading in the issuer’s securities shall be lifted upon submission of the relevant accounts, provided the Exchange is satisfied that the accounts comply with all applicable rules of the Exchange”. The lifting of suspension took effect on Monday, February 18, 2019.

    Key extracts of the interim report and accounts for the third quarter ended September 30, 2018 showed improvements in the operations of the insurance company, although it remains in loss.

    Goldlink Insurance suffered net loss after tax of N149.26 million in 2018 as against net loss of N243.29 million in 2017. Loss before tax reduced from N222.70 million to N132.44 million while turnover improved marginally from N786.13 million in 2017 to N799.23 million in 2018.