The Nation Newspaper

Tag: FBN

  • NSE market indices record further depreciation

    NSE market indices record further depreciation

    Weekly transactions on the Nigerian Stock Exchange (NSE) closed on bearish note on Friday as the market indices depreciated further.

    The News Agency of Nigeria (NAN) reports that the market indices dropped by 0.34 per cent following price losses.

    The NSE All-Share Index lost 112.26 points to close at 33,159.08 against the 33,271.34 posted on Thursday.

    Also, the market capitalisation, which opened at N10.64 trillion, dropped N36 billion to close at N10.60 trillion.

    Total topped the losers’ table with N15 to close at N157 per share.

    Nestle trailed with N2.01 to close at N898, while Unilever lost N1.50 to close at N55 per share.

    Cadbury depreciated by N1.29 to close at N32.21, while Dangote Cement lost N1.15 to close at N158.85 per share.

    On the other hand, Ashaka Cement recorded the highest price gain to lead the gainers’ chart by 29k to close at N23.50 per share.

    Dangote Sugar came second on the gainers’ chart with 20k to close at N7.49, while RT Briscoe gained 18k to close at N2 per share.

    GTBank appreciated by 15k to close at N25.55, while John Holt increased by 14k to close at N1.54 per share.

    NAN reports that in all 123.54 million volume of shares valued N1.61 billion transacted in 3,876 deals.

    This is against the 634.71 million shares worth N4.24 billion exchanged by investors in 4,729 deals.

    Skye Bank emerged the most traded stock, accounting for 14.56 million shares valued N81.36 million.

    It was followed by GTBank with 10.66 million shares worth N272.19 million, whille FBN Holdings sold a total of 8.20 million shares valued at N162.24 million.

  • Inflation to drop to 7.5%, says FBN Capital

    Inflation rate will drop to 7.5 per cent before the end of this year, FBN Capital Limited, a research investment firm, has said.

    The price increase had risen to 9.5 per cent yearly in February, up from nine per cent in January. The Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) met on Monday and yesterday in Abuja to deliberate on the Monetary Policy Rate (MPR). It influences interest rates in the country.

    FBN Capital, in a statement, entitled: Inflation still in single digits, said the inflation rate would fall below nine per cent in March and end at 7.5 per cent by 2013 in line with the CBN’s policy of maintaining a single-digit inflation rate via the use of money market instruments.

    It said: “The CBN has an objective of single-digit headline inflation. It has met its objective for two successive months. In our view, this good run has more legs, and we see the rate below nine per cent year to year in March and at 7.5 per cent at the end of the year.”

    According to the firm, the CBN’s forecast as reported in the personal statements after the last meeting of the MPC in late January, projected year-to year core and headline rates at 6.6 per cent and 8.5 per cent at end-June.

    It noted: “The headline rate of inflation picked up in February to 9.5 per cent year-to-year from nine per cent in January. This was our precise call in analysts’surveys for the wire services. Base effects pointed to a modest acceleration in the headline rate after the dramatic decline of three percentage points in January. Food price inflation increased from 10.1 per cent to 11 per cent year to year, while the rate for the core measure slowed from 11.4 per cent to 11 per cent.”

    FBN Capital recalled that two members of the committee voted for a policy rate cut, while eight ignored the benign inflation outlook at the last meeting.

    “Our expectation is that there will again be no change. Split voting is likely although we feel the majority will be guided by concerns for the global economy, the oil price and the domestic fiscal stance,” it said.

     

     

     

  • FBN Capital floats mutual funds

    FBN Capital Limited through its Asset Management arm has inaugurated mutual fund products to enable it to enhance investors more get returns.

    These investment platform enhances financial growth both for individuals, businesses and corporations. The funds.

    The products are FBN Money Market Fund, Fixed Income Fund and Heritage Fund. They have been admitted to the daily official list of the Nigerian Stock Exchange (NSE) after successful initial offerings.

    A total of 17.98 million units of the Money Market Fund were admitted at par value of N100 each while 1.75 million units of the Fixed Income Fund were admitted at N1, 000 par value.

    The Money Market Fund invests in liquid short term instruments while the Fixed Income Fund offers investors opportunity to invest in Nigeria’s sovereign, state and corporate bonds and other long-tenor securities.

    Director, Asset Management, FBN Capital, Michael Oyebola, said the funds are expected to allow small, medium and large scale investors participate in the funds and benefit from the current high returns accruable from the market using the expertise of FBN Capital.

    He said FBN Capital would continue to offer units of the funds to investors, noting that investors can invest in Money Market Fund with as low as N5, 000 while minimum investment in the FBN Fixed Income Fund and the FBN Heritage Fund is N50, 000.

    According to him, the primary objective of the funds is to achieve a high level of income obtainable from investments that is consistent with prudent investment management, the preservation of capital and maintenance of liquidity.

    He pointed out that the high level of professional management is a major determinant of success in the volatile market.

    According to him, investors would benefit from FBN Capital’s cutting-edge investment process, which combines top-down views on the macroeconomic environment with proprietary local bottom-up analysis.

     

     

     

     

  • FBN capital offers investment products

    FBN capital offers investment products

    FBN Capital is offering a bouquet of high-yield investment products designed to meet individuals and organisations’ desire for good returns and safety of investments.

    For as low as N5,000, with no upper limit, FBN Capital, according to a statement, is offering investment window for small, medium and large scale investors seeking to secure their funds while benefitting from high returns accruable from expertise of the FBN Capital.

    FBN Capital is the investment banking and asset management business of FBN Holdings PLC, Nigeria’s oldest banking group. FBN Capital’s Asset Management products, FBN Money Market Fund and FBN Fixed Income Fund provide investment-savvy individuals and institutions access to short-term liquid money market instruments and high-grade medium to long-term government bonds and other debt instruments.

    The FBN Money Market Fund is a collective investment scheme that pools funds together for investment in a wide range of very liquid short term funds with tremendous investment benefits to all investors.

    With portfolio allocation, spread and diversification that most often may be above the capacity of an average investor, FBN Money Market Fund leverages on its portfolio size, fund management expertise and group synergies to enhance returns to investors by investing in different risk instruments including treasury bills, bank tenured deposits, commercial papers (CPs) and bankers acceptances (BAs).

    The FBN Fixed Income Fund, on the other hand, offers investors the opportunity to invest in Nigeria’s sovereign bonds and other gilt-edge long-tenor debt securities.

    With a minimum investment of N50, 000 the FBN Fixed Income Fund would provide investors with attractive long term returns by investing in a diversified portfolio of government and corporate bonds.

    A total of 17.98 million units of FBN Money Market Fund were last week admitted to the daily official list of the Nigerian Stock Exchange at par value of N100 each. Also, 1.75 million units of FBN Fixed Income Fund were admitted at N1, 000 par value.

    While the money market fund accrues its returns daily and pays it out to investors on quarterly basis, the fixed income fund distributes its returns on half-yearly basis.

    Besides the FBN Money Market Fund and the FBN Fixed Income Fund, FBN capital also offers the FBN Heritage fund which gives investors exposure to the money markets and bond markets as well as the equity and real estate markets too. The fund aims for a higher return by investing in the aforementioned markets meaning it is suitable for investors with a higher risk profile who also desire an even higher yield.

    The FBN Heritage Fund is also open ended, meaning you can subscribe to and/or redeem from the funds on any business day directly from the fund manager. This flexibility offers investors liquidity advantage.

    According to the Director/ Head, Asset Management for FBN Capital, Mr Michael Oyebola, the funds primary objective is to achieve a high level of income obtainable from investments consistent with prudent investment management, the preservation of capital and maintenance of liquidity.

    He noted that high level of professional management drives the achievement of investment results in today’s complicated volatile market. Investors would therefore benefit from FBN Capital’s cutting-edge investment process, in-depth research capabilities, experience and expertise with proven track record of performance.

    According to him, “FBN Capital Investments and management process combines top-down views on the macroeconomic environment with proprietary local bottom-up analysis of credit quality and market factors including supply, demand and liquidity by our credit analysts and markets team.

    “The FBN Capital asset management team has the experience, depth and diversity to actively manage a broad and diversified portfolio of investments. Our tactical asset allocation provides portfolio diversification as well as the offering exposure to different sectors of the economy,” Oyebola noted.

    He pointed out that “diversification across a range of investments reduces risk as often a decline in the value of any specific security may be offset by the stability or increasing value of other securities in the portfolio”.

    According to Mr Oyebola, active valuation of all sectors and individual issuers is also used in an effort to provide potential returns in excess of the overall market.

    “As open-ended funds, investors are able to subscribe to and redeem units on any business day. Investors purchase units in the fund directly from the fund itself rather than from existing unit holders exposing them to the opportunity of achieving good returns from a diversified portfolio of investment,” Oyebola said.

    He added that investors would receive regular information on the performance of the funds on a year-to-date basis and that the current net asset value of the units, which indicates the price at which an investor may purchase or redeem the units, would appear in the fund price listings of selected national newspapers.

  • FBN offers investment opportunities

    Family reunion and exchange of gifts are the widespread features of the Christmas celebration as most people spend the bulk of their income in buying gifts for their friends and families.

    However, FBN Capital Limited is offering a bouquet of investment opportunities to workers and other form of investors this season, especially to enable them invest so as to be able to meet the financial responsibilities that await them in 2013.

    FBN Capital, the investment banking and asset management business of First Bank, was formed from the consolidation of four existing subsidiaries of the Bank: FBN Capital, FBN Securities, First Trustees and First Funds.

    Its target market include high net worth individuals, executive directors, managing directors, top business men and women, private and public institutions, non-governmental organisations, small and medium enterprises, start-up companies, enterprises, small businesses, individuals across a diverse income strata, corporations, ministries, public parastatals, oil and gas companies, telecommunication companies and co-operatives and foundations of oil and gas companies.

    The FBN Money Market Fund (MM) is an investment vehicle which pools investment in a wide range of very liquid short term funds with tremendous investment benefits to individual investors. The fund enhances returns to its holders or investors by investing in low risk instruments like treasury bills, bank deposits, bankers’ acceptances and commercial papers.

    The primary objective of the Fund is to achieve a high level of income obtainable from investments in short term securities that is consistent with prudent investment management, the preservation of capital and maintenance of liquidity.

    “The FBN Capital asset management team has the experience, depth and diversity to actively manage a broad and diversified portfolio of investments. The Fund offers investors exposure to short term and liquid money market instruments. Yields on investments will provide portfolio diversification as well as the ability to gain exposure to different sectors of the economy,” the bank revealed.

    FBN Capital also manages the FBN Fixed Income Fund, which is one of a series of funds launched to satisfy the demand for new and varied investment products by the investing public.

    It also provides full time, high quality professional management services by pooling the resources of many for investment in long tenured debt instruments such as federal government, state government and corporate bonds. The fund aims to achieve attractive long term returns by investing in a diversified portfolio of these instruments. For as little as N50,000 and additional top ups of N10,000, you can start an investment plan that looks to protect your capital as well as give you good returns on your investment.

  • FirstBank’s shareholders to get double dividends

    Shareholders of First Bank of Nigeria (FBN) Plc would receive double dividends from the bank’s strong operational earnings and net proceeds from the lender’s divestment from its share registration business.

    The prospects of expanded cash payouts complement other locked-in values in the restructuring of First Bank into a holding company as the bank concludes the final phase of the transition to holding company (holdco).

    As part of the restructuring into holdco, First Bank would divest from First Registrars through an offering process and distribute the net proceeds to shareholders.

    A top management source at the bank confirmed that the bank would include the net proceeds from the sale of First Registrars in the profit distribution for the period ending December 31, 2012.

    This implies that the bank might adopt a compound lump-sum distribution or special dividend distribution to transfer the net proceeds from the sale of First Registrars to shareholders. Under the compound lump-sum distribution, the net proceeds would be cumulated into operational earnings and distributed as a one single payment to shareholders while the net proceeds could be distributed separately as special dividend alongside normal operational cash dividend.

    There has been a spike in the use of special dividend to distribute earnings to shareholders as companies seek to beat high tax rate. Companies are paying special dividends at four times the pace of last year.

    From the end of September to mid-November, 59 companies in the Russell 3000 stock index declared a one-time cash payment to shareholders, up from about 15 in the year-earlier period, according to data compiled by Bloomberg.

    Interim report and accounts of First Bank for the third quarter ended September 30, 2012 showed that profit after tax rose by 48.5 per cent to N66.26 billion in 2012 as against N44.64 billion in comparable period of 2011. Gross earnings rose from N225.02 billion to N267.69 billion. Profit before tax also jumped from N51.02 billion to N75.72 billion.

    With the third quarter net profit, distributable earnings per share stood at N2.03 in third quarter 2012 as against N1.37 in corresponding period of 2011. At the same rate, probable operational full year earnings per share is estimated conservatively at – N2.71.

    Shareholders of FirstBank had recently approved the transition of the company into a holdco including the sale of First Registrars.

    The shareholders’ approval paved way for the submission of an application to delist FirstBank and list FBN Holdings. Under the transition arrangement, existing shareholders of First Bank will be migrated from First Bank to FBN Holdings. In line with this proposal, all ordinary shareholders of FirstBank as at the terminal date would be migrated to FBN Holdings through a share-for-share exchange between the shareholders of First Bank and FBN Holdings.

    First Bank’s shareholdings in each of the holdco subsidiaries and the associated investments will be transferred to FBN Holdings while the bank’s shareholdings in each of the investment banking and asset management businesses would be transferred to FBN Capital Limited, which in turn will be owned by FBN Holdings. The proposed restructuring will not alter the current beneficial shareholding structure of the FBN Group.

    Managing director, FBN Holdings Plc, Mr. Bello Maccido said the holdco was designed to enhance the group’s competitiveness, streamline and coordinate various operations across non-bank financial services, and further exploit opportunities for synergies between subsidiaries.

    According to him, the new structure would also align the ownership and operation of the bank’s subsidiaries with the overall strategy of creating an operating model that will profitably grow the group’s presence in the market for commercial banking and non-banking financial services in order to achieve the aspiration to be the dominant financial services group in Sub-Saharan Africa.

    He outlined that the banking group will align and cluster similar or overlapping businesses under four broad business groups including commercial banking, investment banking and asset management (ibam), insurance and other financial services.

    First Bank has 11 subsidiaries with operations across the financial services industry ranging from pension custodian, asset management, investment banking, insurance, and microfinance banking entities. The bank also holds investments in companies with international presence in the United Kingdom and France through its subsidiary FBN Bank (UK) Limited, in addition to representative offices in South Africa, China and Abu Dhabi, making it one of the most diversified financial services groups in Nigeria

  • FBN Capital backs CBN’s credit ban on debtors

    FBN Capital backs CBN’s credit ban on debtors

    The decision taken by Central Bank of Nigeria (CBN) to restrain debtors owing Asset Management Corporation of Nigeria (AMCON) from further access to credit is plausible, FBN Capital, an investment and research firm has said.

    The CBN had in a circular issued last on September 17, barred banks from extending credit to more than 100 companies, which owed the AMCON. This, FBN Capital said, was relevant because the full list, published in the local media, includes some members of successful consortia bidding for power plants.

    The investment firm said that AMCON, which acquired the debts under its bond exchanges, has suggested that the power sector bids will not be derailed as a result.

    It said that the National Council on Privatisation (NCP) has already indicated that the preferred bidders for five power generation companies (GENCOs) for sale offered a total of N110 billion.

    According to the report, a cursory look at the lists of successful bidding consortia reveals household names in the Nigerian banking, oil and gas, and conglomerate sectors as well as one state government and a state owned Chinese electricity utility.

    However, it observed that the preferred bids are still subject to due diligence by five public bodies and a final go-ahead by the NCP. They then have 15 business days after signing the appropriate concession agreement to pay 25 per cent of the total consideration.

    It recalled the unsuccessful privatisation of NITEL where one approved bidder paid the deposit but failed to produce the balance while another failed to make any payments and so forfeited its bid. However, the firm insisted that the strength and reputation of the consortia bidding for the GENCOs suggest this is an unlikely outcome.

    “There have already been delays in the sale of the GENCOs and more may follow. That said, we would stress that the process has attracted bids from consortia with technical expertise and financial clout. The exercise was never fiscal in nature but was designed to deliver power to the population,” it said.

    On the Excess Crude Account (ECA), it said the accounting treatment may still be affected by the dispute between the state governors and the Federal Government over ECA and the Sovereign Wealth Fund (SWF).

    It said the governors are now arguing that signature bonuses and dividends from Nigeria Liquefied Natural Gas (NLNG) should be paid into the federation account, adding that the governors may also broaden their demands as negotiations unfold.

    Besides, the research firm noted that analysis of the draft 2013 budget has shown that only N10 billion earnings are targeted from asset sales.

    The firm said that although the Bureau of Public Enterprises (BPE) suggested a figure of N200 billion in June, the N10 billion appears more plausible, given that bids for the electricity distribution companies (DISCOs) will not be opened until 16 October.

  • Insurance penetration low in Nigeria, says FBN Life boss

    Insurance penetration in Nigeria is low with Life Insurance below 0.3 per cent and non-life slightly above 0.5 per cent, Managing Director, FBN Life Assurance Company Plc, Val Ojuma, has said.

    Speaking during an interview in Lagos, he said the National Insurance Commission (NAICOM)
    and industry operators were working together to increase insurance education and awareness among the public. Also, the regulator is encouraging operators to redesign the various products offerings to make them more consumer friendly.

    “ The challenge of distribution remains daunting with poor state of infrastructure for premium collection. Overall, most operators have become aware that the size of the uninsured public offer great potentials for premium growth and will therefore increase penetration,” he said.
    He said FBN Life Assurance Company Plc, a subsidiary of FirstBank of Nigeria Plc, strategy right from inception is to offer customised products to customers at the least cost.

    He listed some of the company’s retail products to include Flexi Savings Plan, Flexi Cash flow, Flexi Education Plan, Extended Family Support Plan.

    Ojuma said the firm’s approach would attract more insurance consumers, build confidence, increase market penetration, enhance industry contribution to overall economy, and position the sector for global competitiveness.

    “The company, which is the latest arrival in the insurance industry, having got its licence in 2010, is excited about the reception of its products by insurance consumers, stating that its impetus has awakened old and complacent players in its line of business,” he said.

    He said the firm had always met and sometimes exceeded its standard in claims payment, making claims payment within 24 hours.
    Ojuma said the company’s products have received very wide acceptance, much to its surprise and delight, pointing out that all have been designed with the consumers in mind, and to address specific gaps in existing product offerings in the market.

    According to him, the company is taking advantage of its Financial Advisers and the extensive network of FirstBank of Nigeria to reach potential customers.  “We are now able to bring insurance closer to potential customers. We have held several seminars in Lagos and are extending various educational programmes to schools and associations across Nigeria, to enhance the public understanding of insurance,” he said.

    He said the company is not yet where it wants to be in terms of service delivery, as there is always need for improvement. However, he said that the firm’s service delivery will improve significantly before the end of the year.

    He said the firm’s products have been well received and we have brought some new excitement into the industry. “The old operators, whom seem to have been complacent, have been awakened by our impetus. Our shareholders have shown a lot of understanding and our directors have supported our strategies,” he said.