The Nation Newspaper

Tag: operations

  • New Exchanges to begin operations in Q2

    Two new trading platforms for securities may start operations in the second quarter of the year. They will provide alternative platforms for investors to buy non-listed securities and for unquoted securities to stimulate access to capital.

    The Nation gathered that the National Association of Securities Dealers (NASD) and the Financial Market Dealers Association (FMDA) would launch their over-the-counter (OTC) trading platforms in the second quarter.

    Already, the Securities and Exchange Commission (SEC) has approved the NASD while FMDA has started initial operational arrangements after securing provisional approval from the SEC.

    Market sources said both NASD and FMDA have stepped up arrangements for their trading platforms in time for them to launch within the second quarter.

    Director-General, SEC, Ms Arunma Oteh, said the newly constituted board of SEC would sit on and consider granting final approval to the FMDA before the end of this month.

    She hinted that NASD could possibly launch its operations in May.

    According to her, the significance of the registration of the two OTC platforms for the capital market was to enhance transparency and liquidity in the trading activities of unlisted companies.

    “Hitherto, trading activities of unlisted companies were never captured, thus distorting the picture of the depth of the market. The listings will assist in capturing activities on the platforms and also prepare unlisted companies for listing on the exchange,” Oteh said.

    An investor and a major dealer on the NASD said the commencement of operations by the OTC platform would create significant momentum for the securities market.

    The source said NASD would strive to put in place resources and technologies that would enable it to compete effectively and enhance its integrity.

    On its modus operandi, NASD stated that it would seek to ease secondary market trading of all non-quoted securities in the West African region, thereby stimulating growth through more efficient capital raising processes.

    A public limited liability company, NASD brings together issuers, individual and institutional investors, accredited dealers, stockbrokers, banks, central clearing systems, private equity and venture capital firms and depositories with a view to increasing liquidity in the non-quoted segment of the long term funding market.

    There will be two points of entry to the NASD markets-leased trading platform and web-based bulletin board.

    The leased trading platform is the structured end of the market loaded onto tested trading platform. Deals in non-quoted large cap securities will be matched automatically in this market – under conditions similar to a formal stock exchange. Trades will essentially be bilateral.

    Access to trade on leased trading platform is restricted to accredited broker firms who are duly licensed by SEC. The Central Securities Clearing System will provide clearing services while settlement will be done through some select banks in West Africa.

    The web-based bulletin board is the less structured end of the market that will stimulate liquidity in less liquid assets and channel capital to the more efficient issuers. Investors can identify opportunities that are not covered in mainstream investor information coverage and see trend performance of fast rising or specific interest non-quoted companies. Also, issuers can increase shareholder liquidity, manage complex capital raising exercises, identify strategic coalitions and highlight previously understated great performance. Access to this segment of the market is granted through registration and accreditation.

  • Plant to begin operations

    The Chairman of Geometrics Power Plant, Aba, Abia State, Prof Bath Nnaji, has confirmed that the multi-billion naira plant will begin operations next month.

    However, the distribution of the energy generated would begin in three months.

    Nnaji said the plant would generate 47 megawatts to be used in Aba.

    “The reason we are not test running is because what we will be giving out is the real thing.

    “Aba will be the main beneficiary, because the city is our main target since there are many potential customers here.

    “There are two companies at the plant, the Geometrics Aba Ltd, which owns the plant and the Aba Power Company Electric, which is in charge of distribution.”

  • Anchor mulls agency system to boost operations

    Anchor Insurance Company Limited has said it will re-invent the agency distribution system to deliver sales targets, improve efficiency and service delivery.

    Its Managing Director, Ademayowa Adeduro, who spoke at the agency’s retreat in Uyo, the Akwa Ibom State capital, said the strategy would afford the company the opportunity to reflect on its activities and consolidate on certain areas.

    He said the re-invention would further help the company to develop and publicise its service charter in line with the ongoing reforms.

    Adeduro promised that the company would continue to render world-class services to meet public expectations and also contribute towards the up-liftment of the quality of risks mitigation in the country.

    The company’s Head, Brand Management and Corporate Communication, Mr Kehinde Olaniyi, stressed the relevance of e-business in the industry, saying only about six per cent of the country’s population was insured.

    He said the firm is targeting the uninsured youths who are technology inclined through e-insurance.

    A Technical Consultant to National Insurance Commission (NAICOM), Yemi Soladoye, said the agency aspect of insurance in the country, is not developed, and that it is only the brokering channel that has taken root. The brokers focus on the wholesale market, the government’s and the corporate accounts, he added.

    He said the retail market is hardly touched, warning that it is this market that holds the key in Nigeria and that when all chips are down, any insurance company that is not quickly expanding into the retail marketing, would find itself centuries behind because the wholesale market is very small and volatile.

  • STI adopts risk framework to drive operations

    Sovereign Trust Insurance Plc is embracing enterprise risk management framework to drive its operations.

    The Managing Director/Chief Executive Officer, Mr Wale Onaolapo, said the framework is designed to assist the Board and Management to align the company’s risks to its business strategy, enhance risk response decisions, reduce operational surprises and losses, identify and manage interdepartmental risks, allow for more informed risk decisions and improve capital management.

    He said the regulatory environment has evolved with regulators seeking assurance as to the robustness of the risk management capacity and the financial viability of financial institutions in a stressed environment.

    He addded that part of the company’s policy is to maintain a strong capital base to support the growth and the development of its business and to also be able to meet regulatory capital requirements at all times through its corporate governance, processes and procedures.

    Its spokesperson, Segun Bankole, said the move became necessary to ensure that operations of the organisation are carried out on sound business principles to protect shareholders and other stakeholders’ interest.

    Head of Risk Management and Control of of the firm, Mr Sanni Oladimeji, said it has become imperative to apply sound risk management principles to ensure that organisations are safeguarded against unforeseen risks.

    He further said the company’s management is committed to the execution of the framework in the years ahead.

    He noted that the creation of a Risk Management and Control Department in the organisation has given a voice to staff. He said employees have been trained to make decisions on risks.

  • Banks may review Ghana, Zambia operations

    banks operating in Ghana and Zambia are contemplating closing down these subsidiaries as the deadline for their recapitalisation ended on Monday.

    Findings showed that the banks have not complied with the recapitalisation order by local banks.

    Ghana and Zambia central banks had raised banks’minimum capital requirement, on the ground that the measure would help mobilise additional resources for their economies.

    The Bank of Ghana raised banks capital from $5.28 million to GH¢60 million ($31.7 million). It set the end of last year as deadline.

    Zambian hiked its minimum capital requirements for foreign banks to K520 billion ($98.52 million), from $2.27 million; that of local commercial banks was raised to $19.69 million.

    Central Bank of Nigeria (CBN) Director, Banking Supervisions, Mrs. Agnes Martins, said the increases reflect efforts to strengthen the banking sectors in those countries, adding that global banks have also been seeking ways to boost capital adequacy ratios in their home countries to meet increased capital requirements under Basel III, and one option they have explored has been the disposal of international subsidiaries.

    He said these capital demands are not in tandem with the level of growth in business activities in these lenders.

    She added that it would not allow banks to continue funding their subsidiaries from parent companies but would encourage them to consider mergers and acquisitions with other local or foreign banks in host country.

    “The CBN shall not permit any further capital outlay from parent banks to augment the capital needs of foreign subsidiaries but would rather encourage banks to consider mergers and acquisition arrangements with other local and or foreign banks in the host country. Under no circumstances are parent banks allowed to guarantee the deposit of their foreign subsidiaries,” Martins said in a statement.

    Head, Market Risk, Greenwich Trust Limited, Babatunde Obaniyi, said the CBN is being proactive to ensure that the funds that would have been used to develop Nigeria’s economy are not channelled to other economies.

    He said for a bank to operate offshore, it has to raise its capital base to the required N100 billion ($635.72 million) in the country. This means that a bank such as United Bank for Africa (UBA), which has 18 offshore branches may see its funds depleted trying to recapitalise its branches abroad, where such cases arise.

    He explained that although there are some African countries, especially The Gambia where investors cannot bring in hot money to fund banks, polices in many African countries point to the fact that more countries want foreign banks to recapitalise their subsidiaries with funds from home countries.

    Besides, he said some of the banks have learnt to share risks with local banks to reduce the economic burden that come with foray into new markets.

    “The level of aggression most Nigerian banks exhibit in venturing into new markets, if not checked, will raise their operational risk level. Besides, I do not see the restriction of these banks into foreign countries as having the capacity to deplete their group performance because some of these markets are smaller than Nigeria’s,” he said.

    He said most of these banks are expected to develop their own products and services to meet the needs of the people.

    Speaking on the development, Deputy Governor, Operations, CBN, Tunde Lemo, explained that there is no justification for the level of capital requirement imposed by the central banks of those countries hence banks will decide on their own if they can continue with those subsidiaries.

    The policy became exigent after report showed that Nigerian banks have recently witnessed reduced credit lines from their international partners because of the growing need for liquidity of major European banks following mounting sovereign default risks.

    However, Lemo said these developments would not have a debilitating impact of the health of the sector. But he did not rule out the impact on the liquidity of finance from lenders.

    Martins explained that the policy is expected to affect UBA and Access Bank because they have the highest number of offshore operations in the sector.

    Others are Guaranty Trust Bank Plc, has five subsidiaries; Skye Bank Plc – four; Keystone Bank Limited- four ; Diamond Bank Plc, and Zenith Bank Plc – three each.

    Managing Director, UBA, Phillips Oduoza, said he expects the subsidiaries to contribute 25 per cent of its profit this year to the bank.

    He said his bank operating in Zambia would seek a local banking license, which requires a lower capital base of $20 million, to meet the requirements.

    He said the rule may instead make local lenders acquisition targets as the companies have to keep cash in Nigeria.

    Access Bank Plc will cut to 49 per cent its stake in its Zambian unit after the southern African country raised capital requirements, Chief Executive Officer Aigboje Aig- Imoukhuede said.

    He admitted that the requirement to increase funding for foreign units has exerted pressure on the capital base of most parent banks.

     

  • We’ll resume operations soon, says Capital Oil

    We’ll resume operations soon, says Capital Oil

    Capital Oil and Gas Industries Limited yesterday said its fuel depots in Lagos and across the country would soon be re-opened.

    A statement issued in Abuja by the spokesperson of the Chief Executive Officer (CEO) of the oil marketing company, Mr. Nick Hayes, said: “The depot was shut in the early hours of Friday, November 16, 2012, in obedience to a court order granted to Assets Management Company of Nigeria (AMCON) by Justice A. Abdul-Kafarati of the Federal High Court Abuja, to temporarily take over the assets of the company.”

    He said the CEO of the company, Chief Ifeanyi Ubah, embraced the dialogue option as he was becoming worried and touched by the hassles Nigerian masses were going through.

    The statement reads: “Before the development, fuel supply situation has been epileptic with the attendant long queues at the fuel stations occasioned by persistent scarcity of the product in the country. It was therefore, not surprising that the situation worsened when Capital Oil depot was shut as over 224 trucks with about 8,151,270 liters of PMS belonging to the NNPC, were trapped in the premises of Capital Oil and Gas Ltd.

    “That singular development impacted negatively to the economy of the nation by adding to the difficulties faced by transporters , commuters and other users of PMS in the country.

    “Capital Oil and its CEO, Chief Ifeany Ubah are comfortable with the responsible and mature steps AMCON is currently taking rather than the antagonistic and devious approach of the Access Bank PLC and one of it’s directors, Cosmas Maduka in the matter. It is hoped that the federal government will back AMCON in this latest development, as that to a large extent will ensure steady supply of the much needed PMS to end users and restore confidence in the current government.”

    Explaining why the company decided to re-open the shut depot, Hayes said some well-meaning Nigerians held several mediatory talks with top management of the company aimed at considering the plight of motorists who suffer the effects of the closure of the facility directly. He also disclosed that AMCON has also soft-pedalled and has now chosen to accept a negotiated settlement of the issues at stake.

    Human rights activist and member of the Coalition of Human Rights Groups, South South, Joseph Udoh, has urged President Goodluck Jonathan to ensure Capital Oil comes back on stream.

    Udoh, in a statement, said: “This illustrious business should not be taken over by force and handed over to greedy corporations who will return Nigerian downstream sector to the dark ages of fuel scarcity. We urge the President to take a closer look at the development and like his U.S counterpart, President Barrack Obama, who in his recent election debate stated clearly that he believes in the drive and ingenuity of American entrepreneurs, President Jonathan should call a truce and rather, encourage Ifeanyi Uba and indeed other genuine entrepreneurs like him.

    That way, we will be growing our private sector and creating the much needed jobs for our teeming unemployed youths.”

  • Shell’s operations getting more injurious in Delta

    Shell’s operations getting more injurious in Delta

    SIR: Shell has been operating in Nigeria for more than 50 years now, and the Nigerian people have nothing to show for their operations. Crude Oil is being produced, refined and sold at the expense of the Nigerian people. Shell, being a very large Multinational Oil and Gas Company has infiltrated the very corrupt Nigerian Government officials and held them hostage. For instance, the Petroleum Industry Bill has not been passed because Shell and other oil companies are opposing the Tax Regime, whereas, they pay more taxes in other places like UK and Holland where they operate. Shell allegedly a means of engaging, bribing and infiltrating government officials and regulatorsso that favourable policies are passed. These they do through alleged award of contracts to influential community members. Most of Shell’s Surveillance Contracts are allegedly given to the kings or leaders of the host communities to silence them.

    In UK, Oman, Russia and such other countries, there are strict Corporate Governance Guidelines and Codes which Shell adhere strictly to. But in Nigeria, it is the direct opposite. In Nigeria, they do whatever they want and get away with it because they have willing accomplices in the corrupt government officials and regulators who are on their payroll. Shell is flaring millions of cubic feet of gas into the Nigerian atmosphere daily (SCF/d) irrespective of all the cries and noticeable effects about Global Warming and Ozone Layer Depletion.

    These things are currently being experienced in Nigeria that we didn’t used to experience: Acid rain, sea-level rise (as is being experienced where villages have been sacked), ecosystem imbalance, extreme weather like hurricanes, and extinction of plants and animals.

    However, Shell is not bothered and still smiling to the bank. Instead of having Gas Gathering Facilities to gather, compress and use the gas for useful purposes, Shell is more comfortable flaring it, thereby, wilfully sabotaging the Nigerian economy of the millions of dollars accruable from the sale of gas to Nigerian users, African users and to the rest of the world. Terrible things will happen in the future if Shell does not stop gas flaring immediately.

    Responsible companies consider the environment and social wellbeing, in addition to profit. But Shell considers only profit and doesn’t care about the environment (evidenced by the continuous gas flaring, crude oil spillages, improper remediation activities, etc) or People (malicious sack of employees in the name of Divestment, sack of uncooperating Union workers, etc).

    We are appealing to international bodies to call Shell to order before they destroy our country and leave for elsewhere. We have borne it enough. Crude oil is more of a curse to we the Niger Deltans than blessing. They have polluted our environment, destroyed our ecosystem, rendered our youths, farmers and fishermen jobless and sacked the few they managed to employ.

     

    • Delta Rights Group,

    Delta State.