The Nation Newspaper

Tag: mulls

  • Nigeria mulls no bank account, no stock trading policy

    Capital market authorities are considering major amendments to the securities market trading rules in a shift that will disallow trading on shares and other securities of investors that did not provide bank account for direct payment of the net proceeds from their transactions.

    A draft on amendments to new rules under consideration obtained at the weekend indicated that Nigeria’s apex capital market regulator, Securities and Exchange Commission (SEC), has further amended proposed rules on direct cash settlement (DCS) to include additional review by the Commission’s rules committee and other stakeholders.

    Under the direct cash settlement, the stock market will transit from the current dealer-mediated payment system under which proceeds of shares sales are remitted to the dealer for onward remittance to the investor to a new system under which payment will be made directly to the investor’s account.

    The new payment system will become the mandatory payment process for the securities market as against the current dealer-mediated payment system. While the previously exposed rules allowed any investor to apply for specific or continuing remittance of his net proceeds to his stockbroker, the amended provisions disallows trading without bank account.

    According to the draft, all dealing members shall provide their clients’ bank account details, including Bank Verification Number (BVN) to an approved clearing and settlement entity for purpose of direct cash settlement.

    “Where a client does not provide account details, the dealing member shall not execute any sell trade on behalf of the client. Where a dealing member execute a sale trade without account details of the client, the clearing and settlement entity shall ensure that such trade is cancelled prior to the settlement day,” the draft stated.

    The rules indicated that settlement of all sale exchange-traded securities shall be made by direct payment into the client’s account within the clearing and settlement entity’s stipulated settlement cycle.

    The draft stipulated that settlement of exchange-traded securities carried out on a securities exchange shall be done by direct payment into the client’s account by an approved clearing and settlement entity. Where a client seeks to opt out, the client will write a letter and the dealing member shall notify the clearing and settlement entity of such letter not less than three business days prior to executing any sale trade on behalf of the client.

    All clearing and settlement entities and the dealing members of registered exchanges are mandated to ensure compliance with the rules.

    Where any clearing and settlement entity violates the provisions of the rules, such entity shall be liable to a penalty of not less than N10 million in addition to any other sanction which the Commission may impose.

    Also, where a dealing member violates the provisions of the rules, it shall be liable to a penalty of not less than N1 million and a fine of not less than three times the value of the amount settled, in addition to any other sanction the Commission may impose.

    The proposed rules are expected to further strengthen capital market’s campaign against identity theft and shares fraud. The rules are also expected to forestall the use of securities market for money laundering and other illicit financial transactions.

    While infraction rate has reduced drastically, fraudulent sale of client’s shares remains a major concern at the securities market.

    Authorities at the Nigerian capital market and law enforcement agencies have stepped up efforts to tackle the problem of shares fraud and identity theft, otherwise known as 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 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 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 authorized 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.

  • Ladol mulls listing on NSE

    Ladol, a logistics hub for the offshore oil industry in Lagos, Nigeria, is mulling a stock-market listing and corporate bonds to expand its facilities and get more business from major production companies.

    Family-owned Ladol, where Samsung Heavy Industries Co. Ltd. is completing the construction of one of the world’s largest floating oil platforms for Total SA, will look to raise capital over the next two years, its Managing Director said yesterday.

    “We are very open” to tapping public equity and debt markets, Amy Jadesimi said in an interview without disclosing how much she wanted to issue. “The Nigerian Stock Exchange has done a lot to restructure in the last few years to make themselves attractive to a company like ours, so we will definitely consider that. We will consider listing on the bond market too,” she said.

    Ladol aims to build more infrastructure on its roughly 100-hectare (247-acre) free trade zone on an island across from Apapa, Lagos’s main port. That include roads, quay walls and fabrication equipment, according to Jadesimi, a trained doctor and Stanford graduate who used to work on mergers and acquisitions at Goldman Sachs Group Inc. The company wants to attract manufacturers outside of oil and gas, including in the railway and aviation sectors, she said.

    Total’s $4 billion Egina floating production, storage and offloading vessel is docked at Ladol. Construction of the FPSO, which is designed to hold 2.3 million barrels of oil, began in South Korea, before it was shipped to Ladol in January for the final stages. It is scheduled to set sail in July for the Egina deepwater field, which is about 80 miles off the Niger River delta coastline and will produce 200,000 barrels a day.

  • SEC mulls stiffer sanction for fund diversion

    Nigeria’s apex capital market regulator-Securities and Exchange Commission (SEC) yesterday indicated that it has started the process of amending its rules and regulations to impose additional monetary sanctions on companies and governments that divert or misapply funds raised from the capital market.

    Under the proposed amendment, any company or government that diverts or misapplies funds raised from the capital market will pay additional penalty equivalent to two per cent above the subsisting monetary policy rate (MPR). The MPR is currently at 14 per cent, implying a proposed penalty of 16 per cent at the current rate.

    In a circular issued yesterday, SEC noted that it had received reports on instances of misapplication of issue proceeds, referring to the practice by some issuers to use funds raised for a specific purpose for another purpose without recourse to the Commission for a variation of the use of the net proceeds.

    “To curtail such diversion and misapplication of issue proceeds, it became necessary to propose a stiffer penalty,” SEC stated.

    Also, the Commission is considering amending its rules on publication of interim financial statement to provide exception to companies listed on the Alternative Securities Market (ASeM) of the Nigerian Stock Exchange (NSE) from mandatory publication of their reports in a newspaper.

    Under the existing rules, all public companies are required to publish their “signed” quarterly balance sheet, income statement and cash flow statements in at least one national daily newspaper. However, the accounting policies, notes and other relevant information shall be posted on the company’s website which address shall be disclosed in the newspaper publication.

    The amendment will exclude companies on ASeM from the requirement to publish in a national daily. The amendment provides that “public companies listed on the AseM may publish their “signed” quarterly balance sheet, income statement and cash flow statements, accounting policies, notes and other relevant information on the company’s website only”.

    According to SEC, the proposed rule will reduce the cost of publication for small companies listed on the AseM.

    The Commission also plans to amend the rule on shelf registration. “A shelf Prospectus shall be effective for a period of three years from the date of its issue and shall be subject to renewal as may be approved by the Commission. Provided, that the Shelf Prospectus of supranational agencies shall be effective for an indefinite period until determined by the Commission,” the proposed amendment stated.

    Also, in the case of a shelf prospectus which is effective for an indefinite period, information in the shelf prospectus shall be updated prior to the issuance of any tranche or series, the shelf prospectus shall be updated by the filing of an addendum to the shelf prospectus with the Commission while the addendum may include an information statement and any other relevant information and shall be incorporated by reference in any tranche or series to be issued.

    SEC explained that the shelf life of a shelf programme by Supranational Agencies was made effective and valid indefinitely by a 2013 Rule amendment, to allow supranational agencies unfettered and quick access to the capital market in view of the fact that their status made for little change in their material information.

    However a 2015 amendment which sought to extend the shelf life of the shelf programmes of other issuers from two years to three years –in line with international best practice, inadvertently substituted the word ‘Supranational Agencies’ with ‘Sub-nationals’.

    “It is necessary to urgently correct this error to avoid perpetuating an irregularity since the regular changes in the material information of sub-nationals should make it imperative that their shelf programme have a fixed life as material information of Sub-nationals quickly becomes stale or of no effect,” SEC stated.

  • MainOne mulls IT stakeholders’ summit

    MainOne mulls IT stakeholders’ summit

    MainOne will for the third time host ICT stakeholders at its annual flagship event, Nerds Unite. With a focus on digital disruption with the theme: “Radical Digital Transformation”, the 2018 edition will feature a keynote address from the author of Disrupting Africa: The Rise & Rise of African Innovation, Nnamdi Oranye, supported by speakers from companies including Avanti, SAP Africa, Wema Bank, Andela and Microsoft, among many others.

    The event, which will hold in Lagos on February 23, is expected to bring together over 500 mid to senior ICT executives across multiple industries for intense innovation sessions, featuring latest best practices and emerging trends in data center, collaboration, enterprise networking and cybersecurity, among  hot topics.  Nerds Unite is also expected to provide unparalleled networking opportunities with all these professionals under one roof.

    The radical digital transformation being witnessed globally in recent times is the key focus of the event. The event will have four predominant discussion tracks: “Disrupting the Nigerian ICT industry”, “Radical Digital Transformation: Perspectives across industry players”, “Digitalisation and Business” and “The future of mobile content delivery in Nigeria”, with discussions led by executives from leading companies exploring various industries and the digital transformation altering industry verticals. Participants will also be empowered with technical insights on the latest trends as it relates to the realities of the Nigerian environment and how these can be adopted for improved efficiencies for their respective organisations.

    Created by leading provider of network and data center solutions, MainOne and its partners for ICT Executives, Nerds Unite is an annual technology conference hosted by MainOne, which brings ICT professionals across sectors together for impactful technical knowledge sharing sessions and social networking. Last year, the event featured the first ever showcase in Nigeria of Microsoft HoloLens, the world’s first self-contained holographic computer running Windows 10, in addition to representation by the Internet Society and a keynote by Microsoft.

  • Fed Govt mulls more investment in Transcorp

    Fed Govt mulls more investment in Transcorp

    Despite selling off some public assets, the Federal Government is considering additional investment in Transcorp Hilton Hotel Plc.

    The Director-General, Bureau for Public Enterprises (BPE), Benjamin Diki made this known at the public presentation of the Transcorp Hilton Hotel’s Initial Public Offer (IPO) in Abuja.

    He said government is considering making further investments in this company because Transcorp has been paying dividend for the past five years consistently and the federal government, being a shareholder has been enjoying this dividend, and that is why the federal government can recommend to Nigerians to buy this stock.

    Government’s interest in boosting its investment in Transcorp Hilton he said “is to tell you the level of profitability of this company and we recommend Transcorp to every Nigerian, even if it is 10 shares buy it, we will see what will happen in the future, we are supporting a good deal for Nigerians.”

    The BPE boss noted that “government’s 49 per cent share holding is now being diluted because government has not yet taken up its rights issue, and government has enjoyed high dividend from this stock.”

    He said the federal government has not brought other shares to the Nigerian public “because we are not confident of their fundamentals, they have not been making profit, they have not been paying dividends on a regular basis. We don’t want to come and sell shares to Nigerians, then they will wait one, three, or five years without dividend.”

    Speaking to journalists at the event, the Managing Director, Transcorp Hilton Plc, Valentine Ozigbo, said Transcorp Hilton is Nigeria’s best example of Public Private Partnership (PPP) because Transcorp is a very serious investor.

    Ozigbo said over the next five years, the company will take a phased approach in developing high-end hotels in Ikoyi, Port Harcourt, Ikeja and Warri, as well as a Convention Centre and Apartment complex in Abuja, in addition to paying even higher dividends than it is currently doing.

    He said the company is raising up to N8 billion through the IPO offering of 800million ordinary shares of 50 kobo each at N10 per share to capitalise the development of new projects.

    He said the company will utilise the proceeds from the IPO to develop two high end hotels in Lagos and Port Harcourt and major commercial centres, in order to capitalise on the increasing demand for world class amenities, while Hilton Worldwide will serve as the Operator/Manager of all the proposed new developments which will become part of the international Hilton Hotels chain across Nigeria.

    Ozigbo explained that the Transcorp Hilton Ikoyi Hotel will be an upscale hotel on a 5,868 square metre site at 39, Glover Road, Ikoyi having 300 rooms and suites, with conference and leisure facilities, gym and spa and a swimming pool.

    The project is expected to be supported by a growing population of young and wealthy Nigerians and business travellers, and it will be jointly owned by Transcorp Hotels and Heirs Holdings.

    The estimated cost of the project is put at $140 million (N22.68 billion), with the cost of land going for $15 million or N2.43 billion. Construction cost is said to cost $125 million, or N20.25 billion, and the projected commencement date is the fourth quarter of 2014, with three years construction period if the Lagos State government issues the permit on time.

    Transcorp Hilton Port Harcourt on the other hand, will be a 250 room hotel facility with conference and leisure facilities located in the Ero Road, Port Harcourt, GRA.

    The project will be built on 10,141 square metres of land at an estimated project cost of $105 million, or N17.01 billion. The cost of land is put at $5.86 million, or N950 million, with construction cost put at $100 million, or N16.20 billion. The projected commencement date is the fourth quarter of 2014, with three years construction period.

    The company has also commenced the renovation of the Transcorp Hilton Abuja. The renovation involves the modernization of core facilities of the hotel, for which Transcorp  plans to spend approximately $57.5 million, or N9.2 billion over the next three years.

    The funding for this renovation will be sourced from the company’s cash flows from operations.

  • GTBank mulls interim dividend as directors meet

    GTBank mulls interim dividend as directors meet

    The board of directors of Guaranty Trust Bank (GTBank) Plc would meet next week to consider the quantum of interim dividend to be distributed to shareholders.

    Regulatory filing obtained yesterday indicated that the interim dividend would be declared on the audited accounts of the bank for the six-month period ended June 30, 2014.

    The board of the bank is expected to deliberate on the operational reports and financial statements for the six-month period, after which the accounts would be forwarded to the Central Bank of Nigeria (CBN) for the apex bank’s review and approval. The accounts would then be sent to the Nigerian Stock Exchange (NSE).

    GTBank had paid an interim dividend of N7.36 billion, implying a dividend per share of 25 kobo in 2013. It later followed this with final dividend of N42.67 billion, representing a dividend per share of N1.45. The total dividend for 2013 thus stood at N50 billion, representing N1.70 per share.

    There are credible indications that the bank might not go below the interim level in 2013. While the market awaits the second quarter earnings, the bank had recorded modest growth in gross earnings in the first quarter, though its bottom-line was suppressed by relatively higher interest and operating expenses.

    First quarter report of GTBank for the period ended March 31, 2014 showed that while gross earnings rose by 6.0 per cent, profit before tax slipped marginally by 2.0 per cent. Net profit after tax however inched up by 2.0 per cent.

    The performance of the bank across the profit and loss accounts and the balance sheet was tight with slight increases in key balance sheet items. Deposits rose by 3.0 per cent while loans and advances inched up by one per cent. Net assets rose by 6.0 per cent.

    Gross earnings stood at N67.58 billion in first quarter 2014 as against N63.86 billion in comparable period of 2013. Profit before tax dipped from N28.49 billion to N28.01 billion. Profit after tax inched up from N22.56 billion to N23.11 billion. Earnings per share thus increased by similar ratio from 80 kobo to 81 kobo.

    Customer deposits rose from N1.44 trillion in first quarter 2013 to N1.49 trillion in first quarter 2014. Loans and advances increased marginally from N1.01 trillion to N1.02 trillion. Net assets rose by 6.0 per cent from N332.35 billion to N352.89 billion.

  • Senate mulls Local Content Bill for aviation

    Senate mulls Local Content Bill for aviation

    THE National Assembly is considering a revolutionary local content regulation for Nigeria’s aviation industry.

    When passed into law, the bill will make it mandatory for domestic and foreign airlines operating in the country to employ a certain number of indigenous pilots and engineers.

    The proposed bill, according to Senate President David Mark, is part of efforts to deepen local participation in the Aviation sector, where there is an influx of expatriates as pilots, aircraft engineers and other professionals.

    Mark spoke in Lagos at the weekend at the unveiling of 127 pilots and aircraft maintenance engineers.

    They were trained by the Office of the Special Adviser to the President on Niger Delta, which oversees the Presidential Amnesty Programme for former agitators in the Niger Delta.

    The pilots and aircraft engineers were trained at the Afrika Union Aviation Academy, Mafikeng, and Flight Training Services, Midrand, both in South Africa; Lufthansa Flight Training Network, Germany; Fujairah Aviation Academy, United Arab Emirates; Jetstream Aviation Academy, Greece and Royal Jordanian Air Academy, Amman, Jordan.

    The Senate President, who was represented by Senate Deputy Leader Abdul Ningi, said the National Assembly would always support the Presidential Amnesty Programme to train youths and close the gaps in the manpower needs in the Aviation industry.

    He said the proposed bill would create an avenue for Nigerian aviation professionals to get jobs easily, instead of the currently situation where expatriates dominate the sector.

    Mark said: “The amnesty programme is working. It is one of the programmes initiated by the government that is adding value. The National Assembly will continue to support it. It is for this reason the National Assembly is going to create legislation for local content regulation in the Aviation sector. The legislation would make it mandatory for airlines, whether local or foreign, to employ a certain number of Nigerian professionals as pilots and aircraft engineers. This, we will pursue, as long as it does not conflict with international regulations.”

  • NCAA mulls third party passengers’ liability cover

    NCAA mulls third party passengers’ liability cover

    The Nigeria Civil Aviation Authority (NCAA) is planning to provide third party passengers’ liability cover, The Nation has learnt.

    This is coming on the heels of accusations by insurance operators of encroachment on their business by government agencies in the aviation sector.

    The operators said NCAA is planning to provide insurance protection to aviation passengers.

    NCAA spokesman, Mr. Sam Adurogboye told The Nation that the agency is championing the course to provide the third party cover.

    He said: “On the additional third party passengers’ liability cover claim, the NCAA is championing it and it is still at the formative stage.

    NCAA has, through the ministry of aviation, gone through the due process and gotten the necessary approval. Also, private Nigerian insurance firm has been selected to participate in the project.

    “It is pertinent to point out here that the National Insurance Commission (NAICOM) is an ally of NCAA on insurance matters as they provide the necessary guide to the authority on the credible and accredited insurance firms that are qualified to operate in the country.

    “At present, Nigerian airlines are in compliant of the local content law and NCAA ensures that the operators abide by this law before going to place their insurance abroad. This is upon satisfaction that the full content or cover cannot be fully provided locally”.

    Adurogboye added that one of the key elements an airline must put in place before NCAA allows it to operate is insurance.

    If the insurance of any aircraft has expired, it’s required that the plane must not fly. Violation is viewed seriously and it is,s in fact, a criminal case.

  • Keshi mulls over draw

    Keshi mulls over draw

    Head coach of the Nigerian national team, Stephen Keshi is still contemplating what might have been after his wards threw away a one-goal lead to draw 1-1 in their second successive game at the ongoing 2013 African Cup of Nations in South Africa against Zambia on Friday.

    Emmanuel Emenike’s excellent second half strike against the reigning champions, Zambia was cancelled out five minutes from time by Kennedy Mweene who dispatched a highly controversial penalty with consummate ease as the two giants shared the spoils at the Mbombela Stadium in Nelspruit.

    Nigerian midfielder, Ogenyi Onazi appeared to make minimal contact with Zambia’s Emmanuel Mayuka but Egyptian referee, Gehad Grisha pointed to the penalty spot with Mweene accepting the challenge and sending goalkeeper, Vincent Enyeama the wrong way.

    Keshi was less than convinced with the decision and has now given his thoughts on the incident.

    “I’m not sure the Zambian penalty was a penalty. In a big game like this, you have to be clear on such a decision,” he said.

    Onazi has also criticised the referee’s decision that led to Zambia claiming a potentially precious point against the two-time African champions.

    “I was shocked when the referee gave the penalty because I did not touch (Mayuka). However what is done is done and we must now prepare for the game against Ethiopia,” the SS Lazio midfielder enthused.