The Nation Newspaper

Category: Money

  • CBN approves Aso Savings’ acquisition of Union Homes

    CBN approves Aso Savings’ acquisition of Union Homes

    The Central Bank of Nigeria (CBN) has cleared Aso savings and Loans Plc to proceed with its acquisition of Union Homes Savings and Loans Plc, paving the way for the two quoted companies to conclude shares purchase and transfer side of the transaction.

    A regulatory filing by Aso Savings made available by the Nigerian Stock Exchange (NSE) indicated that the CBN, which supervises the two financial services companies, has issued a “no objection letter” to the Transaction Implementation Agreement (TIA), which spelt how the acquisition transaction between Aso Savings and Union Bank of Nigeria (UBN) Plc, the parent company of Union Homes; Union Homes and Union Homes Investment Nigeria Limited.

    UHNL is the special purpose vehicle through which Aso Savings will acquire the UBN divestment shares and recapitalised UHSL.

    The “no objection” from the apex bank is required to enable Aso proceed with the signing of a share purchase agreement (SPA) between Aso and UBN.

    In furtherance of the acquisition, Aso Savings last week filed notice of intention to notify the NSE about the impending acquisition. Both Aso Savings and Union Homes are quoted on the NSE. As part of the listing requirements, NSE requires all quoted companies to inform it of any information ahead of its release to the public and before the party takes any action on it.

    As part of Central Bank Nigeria’s (CBN) approved restructuring exercise, Union Bank of Nigeria Plc decided to sell UHSL Plc. After a bidding process, Aso Savings was selected as the preferred bidder in October, 2013.

    Towards achieving this objective, Aso Savings proceeded to execute a Memorandum of Understanding (MOU) with UBN Plc under the supervision of the CBN.

    The board of Aso had approved and subsequently submitted the TIA to the CBN on December 31, 2013.

    UBN is divesting from its non-core-banking subsidiaries to comply with CBN’s regulatory regime which requires banks to either sell non-core-banking subsidiaries or form a holding company to hold such businesses.

    The Scope of Banking Activities and Ancillary Matters No 3, 2010 requires banks to fully concentrate on core banking functions. The new model requires banks to either sell all non-core banking businesses or form a holding company to hold such non-core banking businesses including activities such as insurance, asset management and capital market operations.

    Most other banks including Access Bank Plc, Diamond Bank Plc, Fidelity Bank Plc, Guaranty Trust Bank (GTB) Plc, Skye Bank Plc, Sterling Bank, Zenith Bank, Unity Bank and Wema Bank have chosen to divest from non-banking subsidiaries. However, First Bank, Stanbic IBTC and FCMB have formed holding companies to sustain their non-core banking businesses.

     

     

     

  • JPMorgan, HSBC plan to bid for $4b Saudi IPO

    JPMorgan, HSBC plan to bid for $4b Saudi IPO

    JPMorgan Chase & Co. and HSBC Holdings Plc (HSBA) are among banks planning to compete for a role in the largest Saudi Arabian share sale in at least 12 years, according to five people with knowledge of the matter.

    The banks will vie with local lenders including Banque Saudi Fransi (BSFR) and Gulf International Bank to be appointed as financial adviser on the sale of a 15 percent stake in Jeddah-based National Commercial Bank, the people said, asking not to be named as the information isn’t public. NCB, as the lender is known, sent out a request for proposals to banks to manage the initial public offering earlier this week, the people said.

    The first Saudi bank IPO since 2008 could raise about 16 billion riyals ($4.3 billion) based on NCB’s profits and trading values of other Saudi banks, according to Asim Bukhtiar, head of research at Riyad Capital, the investment-banking unit of Riyad bank. That would surpass the 15 billion-riyal offering by Saudi Telecom Co. (STC) in 2002, according to data compiled by Bloomberg.

    Saudi Arabia’s Public Investment Fund is selling part of its 69 percent holding in NCB, bank chairman Mansoor Al Maiman said Feb. 27.

    A request for proposals “was sent to a selected number of authorized persons to act as the financial advisor for the IPO process as per CMA requirements,” NCB said in an e-mailed statement yesterday, referring to the Saudi financial market regulator. “Once the selection is made, the selected financial advisor will be announced.”

    Saudi Arabia’s stock market is the Gulf’s largest, with a market value of about $506 billion. Foreign investors cannot trade directly on the exchange, instead they have to invest through swaps or funds.

    Bloomberg reported that NCB is one of several companies planning IPOs to take advantage of the surging Tadawul All Share Index, which has gained 9.2 percent this year.

     

    ACWA Power International, a Saudi Arabian energy producer, earlier this month hired Saudi Fransi Capital to advise on a sale that could raise as much as $1.1 billion, according to two people familiar with the matter. Samba Financial Group in February said it was appointed financial adviser for an offering of shares in the cargo arm of Saudi Arabian Airlines.

    JPMorgan was adviser and sole underwriter on the $2.5 billion IPO of Saudi Arabian Mining Co. (MAADEN) in 2008. The U.S. bank, along with HSBC, GIB and NCB’s own investment banking arm, last month arranged a 5 billion-riyal sukuk for NCB.

    A spokeswoman for JPMorgan declined to comment, as did spokesmen at HSBC and Saudi Fransi. A spokeswoman for GIB didn’t immediately respond to calls seeking comment.

  • Private equity fund eyes Nigeria, Kenya

    One Thousand & One Voices LLC, an Africa-focused private-equity fund, said it’s in talks about investing in two Nigerian companies and another in Kenya.

    In Nigeria, “one is a purely consumer-facing opportunity the other is also in the manufacturing space with a consumer theme to it,” Hendrik Jordaan, president and chief executive officer of the fund, said in an interview yesterday. “The companies we’re looking at are all private.”

    One Thousand & One Voices, started by John Coors, the great grandson of Coors Brewing Co.’s founder, is hunting for private-equity investments that tap Africa’s growing consumer markets. The fund, which hired former TPG Capital partner Dag Skattum, has received commitments from more than 15 of the world’s richest families since starting last May and expects to meet a goal of raising $300 million by December, Jordaan said.

    “We have sufficient capital from over 15 families that allows us to close on all the transactions in our pipeline,” Jordaan told Bloomberg in Lagos, Nigeria’s commercial capital, adding that the fund is also in talks with potential family investors in Latin America, Southeast Asia and Africa. “I’m going to be in London and Paris later this week, meeting with leading families in those geographies.”

    The fund is in talks with wealthy Nigerian families, said Jordaan, who declined to be more specific. Since November one South African family has joined the fund, he said.

    One Thousand & One Voices will probably lead a delegation of families to the World Economic Forum’s conference in Nigeria’s capital, Abuja in May, Jordaan said.

    The fund, which expects to close at least one deal in southern Africa in the second quarter of this year, said today that Skattum, 53, will be the firm’s London-based managing director. It also hired Kate Matheny, 45, as chief financial officer, based in Denver, according to a statement from the fund. She held the same position at KRG Capital, the fund said.

     

     

     

     

  • Ecobank rewards winners in card promo

    Ecobank has rewarded winners of its Card-4-Prizes promo in Lagos, Port Harcourt and Abuja.

    The 15 lucky winners, who emerged from electronic draws, went home with different prizes, including smart phones; LCD TV; air conditioners; home theatres and generating sets.

    Some of the winners from Port Harcourt centre included Nwite Okoroafor ( generator); Ejiroghene Josephine (home theatre); and Ojo Omorovbie (air conditioner).

    The Abuja winners are Ogunsola Adewale Waidi (generator); Sarki Abdullahi Move ( home theatre); Agharite Dorah Derume (air conditioner) while in Lagos, the winners were Sani Musa Mairiga (Samsung Galaxy Mega Mobile Phone); Iwara Obeten (LED TV 32’’) and Agboola Sunday (air conditioner).

    According to Tunde Kuponiyi, the bank’s Head, Cards and e-banking, the promo is part of efforts aimed at supporting the use of alternative payment channels by customers and also strengthening the CBN’s cash-less policy.

    He explained that the promo planned to run for three months will see customers of the bank winning prizes that includes sedan cars, all-expense paid trip to Brazil and scholarships worth N300, 000 each by winners to be drawn from various parts of the country.

    To select winners, Kuponiyi affirmed that “a point based rating” will be applied “meaning winning customers will be awarded points for every transaction done on the bank’s alternative channels.’

    Kuponiyi said customers were expected to accumulate a minimum of 20 points to qualify for the monthly draw, while the grand finale draw which will also hold in the three centres,, would be based on total accumulated points during the promo.

    According to him, the alternative channels are cash withdrawals from Ecobank’s ATMs, transactions made on PoS terminals and internet payments.

     

  • Access Bank partners oil sector players

    ACCESS Bank is working with independent and small producers in the oil sector to improve their governance structure, its Group Managing Director Herbert Wigwe has said.

    He spoke at the Nigerian Oil and Gas Exhibition and Conference in Abuja.

    He said this would enable the operators to attract more cash for their operations.

    He said the lender has noted the challenges confronting indigenous operators and is helping them to address these by strengthening their governance structure, as well as helping to address the issue of infrastructure in the sector.

    He explained that despite the problems and challenges facing the subsector, banks are working together with international institutions to support the sector.

    According to Wigwe, local banks working together with international institutions have been able to support much larger projects, so the capacity is building.

    “There are several problems that have to do with the companies themselves. The first and most important one is governance. Most of them lack the corporate governance structure to support that kind of debt and even when they do have the structure, there are issues around capacity and how much equity they have built in and there are also issues of those that are growing a bit too rapidly and the capacity to manage their growth,” he said.

    He expressed confidence on the viability and bankability of indigenous oil companies, stating that some of the companies have put in place the right structures from the governance standpoint, while a number of them have also built up enough equity which they are deploying into the business.

    He maintained that the bankable oil companies will stand the test of time, while the weaker ones will fizzle out overtime. He noted that the bank will support the gas sector the same way it supported the oil sector, saying, “It is often said that Nigeria has oil, when in actual fact, we have much more gas than oil.”

  • Interbank rate falls on N300b bond repayment, budget disbursal

    The interbank lending rates closed on Friday at 10.41 per cent, about 8.59 percentage points decline from 19 per cent the previous week.

    Bloomberg said the decline followed a liquidity boost from N300 billion matured bonds and budget disbursals that reached banking.

    The Central Bank of Nigeria (CBN) last Wednesday paid N300 billion ($1.82 billion) to retire matured bonds, in addition to the disbursal of government budget allocations and cash call payment to joint oil production partners by the Nigeria National Petroleum Corporation (NNPC).

    Dealers said the cash balance that lenders hold at the CBN opened at N527.21 billion in surplus on Friday, compared with N158 billion the previous week.

    “We see rates stable at the present level …, but the outcome of the central bank’s policy meeting next week could alter liquidity,” one dealer said.

    The CBN is likely to maintain a tight monetary policy at its next interest-rate meeting on Tuesday, to curb liquidity and support the naira.

    Last week, the cost of funds shot up sharply to 19 per cent for overnight placement after Nigeria’s Deposit Insurance Corporation charged lenders about N100 billion for insurance premiums against bank deposits.

    The secured Open Buy Back eased to 10.25 per cent, from 18 per cent last week, 1.75 percentage points below the CBN’s benchmark rate of 12 per cent. The overnight placement and call money fell to 10.50 per cent each, compared with 19 per cent and 20 per cent last week

  • Union Bank unveils growth plans

    Union Bank Nigeria Plc has unveiled a five-year strategic plan that will see the lender becoming a highly respected provider of quality banking services, its Group Managing Director/CEO, Emeka Emuwa has said.

    Specifically, Emuwa said the bank’s strategic ambition would focus on quality of customer experience, quality of client base, quality of talent, quality of banking platform, quality of professional standards and quality of earnings.

    “Last year, we had two important tasks ahead of us. First, to immediately improve the bank’s operations by dealing with existing operational and services and second to develop a roadmap to firmly establish Union bank as significant player within the Nigerian banking industry.

    “However, after months of hard work during, which we considered our strength as a bank, our challenges and also the landscape within which we operate, we have emerged with a strategy that will guide the bank for the next three to five years. This strategy has been approved by the board of Union bank,” he said.

    The Union Bank boss said the lender remains focused on building on the progress it made in 2013. “One of such was the launch of bank of the future branch in Lagos as well as rolling out over 300 Automated Teller Machines (ATMs),” he said, adding” the bank may not open new branches but roll out future branch model of the bank that would offer convenient banking activities while additionally 300 ATMs will be installed this year in 338 branches of the bank nationwide.”

    On the rumours about Union Bank seeking to raise fresh capital, Emuwa said the bank has sufficient capital to fund its restructuring and expansion and will not be seeking further capital in the near to medium term.

  • Enterprise Bank ready for sale in October

    The sale of Enterprise Bank will be completed in October, its Chief Executive Officer (CEO) Ahmed Kuru has said, adding that the lender and its management are ready for a new investor to come and takeover the bank.

    Kuru who spoke during a media briefing held in Lagos, said bank’s sale was originally scheduled to be completed this quarter.

    He said the bank has fully returned to profitability after its acquisition by the Asset Management Corporation of Nigeria (AMCON) in 2011.

    Kuru said the management of the bank was now ready to transfer the bank to new investor in October as directed by AMCON. “For us, we have achieved quite a lot when we came in because it was a 50-50 chance but we turned around the bank within a year,” he said.

    He said the lender has in the last three years, taken positive steps aimed at repositioning, its services and adherence to regulations.

    “We have been able to turn around the bank on the line of profitability; enhanced the quality of its workforce, upgraded the bank’s technology and processes,” he said.

    Kuru added that the bank was not bothered about the next investors who would take over the bank in October. According to him, the change of ownership is not a new thing. “We are very happy that at the end of the day we are going to hand over a strong, reliable and profitable bank to AMCON for new investors”.

    Kuru also said that the bank had recorded increased returns on equity. He added that the bank’s lending rate had grew from N5 billion in 2011 to N76 billion in 2013 adding that the lender plans to achieve N130 billion by December.

    According to him, the management has been able to re-engineer the bank professionally and commercially through the delivery of better services. Kuru added that the bank was not interested in ‘size game’, adding that the banking industry of today was not about branches but about e-banking.

  • Enterprise Bank ready for sale in October, says CEO

    Enterprise Bank ready for sale in October, says CEO

    The sale of Enterprise Bank will be completed in October, its Chief Executive Officer (CEO) Ahmed Kuru has said, adding that the lender and its management are ready for a new investor to come and takeover the bank.

    Kuru who spoke yesterday during a media briefing held in Lagos, said bank’s sale was originally scheduled to be completed this quarter.

    He said the bank has fully returned to profitability after its acquisition by the Asset Management Corporation of Nigeria (AMCON) in 2011.

    Kuru said the management of the bank was now ready to transfer the bank to new investor in October as directed by AMCON. “For us, we have achieved quite a lot when we came in because it was a 50-50 chance but we turned around the bank within a year,” he said.

    He said the lender has in the last three years, taken positive steps aimed at repositioning, its services and adherence to regulations.

    “We have been able to turn around the bank on the line of profitability; enhanced the quality of its workforce, upgraded the bank’s technology and processes,” he said.

    Kuru added that the bank was not bothered about the next investors who would take over the bank in October. According to him, the change of ownership is not a new thing. “We are very happy that at the end of the day we are going to hand over a strong, reliable and profitable bank to AMCON for new investors”.

    Kuru also said that the bank had recorded increased returns on equity. He added that the bank’s lending rate had grew from N5 billion in 2011 to N76 billion in 2013 adding that the lender plans to achieve N130 billion by December.

    According to him, the management has been able to re-engineer the bank professionally and commercially through the delivery of better services. Kuru added that the bank was not interested in ‘size game’, adding that the banking industry of today was not about branches but about e-banking.

     

  • Union Bank unveils growth strategies

    Union Bank Nigeria Plc has unveiled a five-year strategic plan that will see the lender becoming a highly respected provider of quality banking services, its Group Managing Director/CEO, Emeka Emuwa has said.

    Specifically, Emuwa said the bank’s strategic ambition would focus on quality of customer experience, quality of client base, quality of talent, quality of banking platform, quality of professional standards and quality of earnings.

    “Last year, we had two important tasks ahead of us. First, to immediately improve the bank’s operations by dealing with existing operational and services and second to develop a roadmap to firmly establish Union bank as significant player within the Nigerian banking industry.

    “However, after months of hard work during, which we considered our strength as a bank, our challenges and also the landscape within which we operate, we have emerged with a strategy that will guide the bank for the next three to five years. This strategy has been approved by the board of Union bank,” he said.

    The Union Bank boss said the lender remains focused on building on the progress it made in 2013. “One of such was the launch of bank of the future branch in Lagos as well as rolling out over 300 Automated Teller Machines (ATMs),” he said, adding” the bank may not open new branches but roll out future branch model of the bank that would offer convenient banking activities while additionally 300 ATMs will be installed this year in 338 branches of the bank nationwide.”

    On the rumours about Union Bank seeking to raise fresh capital, Emuwa said the bank has sufficient capital to fund its restructuring and expansion and will not be seeking further capital in the near to medium term.