capital market

NGX Banking Index emerges best performing index during the week, gains, 9.82%

Published

10 months ago

July 10, 2023

The banking index closed the week on a positive note to emerge as the best-performing sectorial index with a gain of 9.82 per cent.

On a general note, the NGX All-Share Index and Market Capitalization appreciated by 3.40 per cent to close the week at 63,040.41 and N34.326 trillion respectively.

Similarly, all other indices finished higher except NGX Consumer Goods Index which depreciated by 0.22 per cent while the NGX ASeM and NGX Sovereign Bond Indices closed flat.

In terms of market value, the market recorded a gain of N556 billion in market capitalisation during the year, as investors increased their buying pressure, especially on blue-chip stocks.

According to data from the Nigerian Exchange Limited, the banking index grew by 9.825 per cent or 63.35 basis points to close at 708.77 index points, as against the opening index of 645.42 index points at the beginning of the week.

The banking sector recorded a positive year-to-date performance of 69.77 per cent according to data obtained from the NGX.

The NGX Banking Index had increased from 417.50 index points to 645.42 index points as of June 30th, 2023 (The half year of 2023), as against what it closed on Dec 30, 2022, which was 417.5 index points.

The MPC on its 291st meeting increased the Monetary Policy Rate (MPR) by 50 basis points, from 18 per cent to 18.50 per cent.

This hawkish trend has positively affected Deposit Money Banks (DMBs) as they get to reprice their risk assets following the new MPR, in turn, this increased their net interest income as seen in the Q1 results of most of the banks.

The Managing Director, of Cowry Asset Management Limited, Mr. Johnson Chukwu speaking on the outlook of the sector for the second half of the year said that rising interest rates on loans can enhance banks’ profitability through higher net interest income and attract more deposits from savers looking for better returns.

Chukwu noted that improved financial performance and profitability can also facilitate the growth and expansion of banks.

According to him, banks holding significant foreign currency assets are likely to revalue their assets to align with the current exchange rate.

“As a result, we anticipate an upturn in profitability as a direct outcome of this foreign exchange revaluation gain,” he said./ Chukwu explained that the shakeup in Central Bank management has instilled confidence in investors, leading to expectations of improved performance in the sector.

“During Emefiele’s tenure, the sector faced challenges due to restrictive policies that impacted the earnings of industry participants.”

An outcome of subsidy removal is increased FAAC allocation. This increased liquidity would allow banks to provide more loans, at a lesser cost of funds, thereby increasing their net interest income and profitability.

“Overall, the removal of fuel subsidy would foster a stable economic environment, benefiting the growth and expansion of banks,” he said.

capital market

FG lists N4.214bn April savings bonds on NGX

Published

2 days ago

May 16, 2024

NewsDirect

The Federal Government has listed its April 2024 Savings Bonds worth N4.214 billion on the Nigerian Exchange Limited platform.

This was disclosed in the market bulletin signed by Godstime Iwenekhai, Head, Issuers Regulation Department of NGX.

According to the bulletin, “Trading License Holders are hereby notified that the April 2024 Issue of the Federal Government of Nigeria (FGN) Savings Bonds was listed on Nigerian Exchange Limited (NGX) on May 13, 2024.”

Details of the Bonds include FGS April 2026, 1.228 million units valued at N1.228 billion at a coupon rate of 17.046 percent, while FGS April 2027, 2.986 million units amounted to N2.986 billion at a coupon rate of 18.046 percent.

The bonds are backed by the full faith and credit of the Federal Government of Nigeria and charged upon the general assets of Nigeria, according to the debt office.

FGN Savings Bond is issued monthly in tenors of two and three years with quarterly payment of coupons (interest) at a rate predetermined and published by the DMO every month.

The retail savings bond product was introduced by the Debt Management Office (DMO) on behalf of the Federal Government in 2017 to democratise its activities in the bond market by making it easily accessible to Nigerians to ensure continuous development of the domestic market and bridge infrastructure deficit which has been a constraint to economic growth.

capital market

LCFE inducts 23 commodities brokers

Published

2 days ago

May 16, 2024

NewsDirect

As part of its capacity building functions, Lagos Commodities and Futures Exchange (LCFE), has onboarded and inducted another 23 Commodities Brokers, the fourth edition in the series, to increase the number of professionals to specialise in various asset classes in the Nigerian commodities ecosystem.

On the list of those inducted last week were the Managing Director, Dynamic Portfolio Limited, Mr Remi Lasaki and many Chief Executive Officers of stockbroking companies in Nigeria.

In his welcome address, LCFE’s Managing Director and Chief Executive Officer, Mr Akin Akeredolu-Ale, urged the inductees join hands with The Exchange to build a virile commodities market that shall be beneficial to all.

“LCFE is working hard to build a market that will benefit the entire Capital Market and its brokers. Each broker can select a commodity and dedicate their focus on it, thereby enhancing your company’s wealth, your individual skill set and contributing to the growth of the Nigerian Economy.

“Together, let us seize this opportunity to build a vibrant and dynamic marketplace that unlocks new possibilities for investors, enhances economic prosperity, and positions Nigeria as a leader in commodities trading.

“The Exchange is actively engaging with the Securities and Exchange Commission to obtain approval for more products like Lithium, diamond and Oil and Gas commodities. Just yesterday, we signed an MOU with a Global Certification Agent Bureau Veritas to certify lithium and other Solid Mineral commodities to be traded on LCFE. Additionally, we have made significant strides in the Cashew ecosystem, signing an MOU with the Cashew Association of Nigeria (CAN), aggregators, and a major cashew processor.

“Eko Gold also represents a pioneering investment opportunity within our commodities ecosystem, leveraging stability and transparency to diversify options, attract capital, and create value across the value chain. LCFE is fully committed to supporting its growth and providing brokers with the tools and guidance needed for effective promotion of the asset classes,” said Akeredolu-Ale.

Corroborating him, the Chairman, Securities Dealing Houses of Nigeria (ASHON), Mr Sam Onukwue, noted LCFE was established for total transformation of commodities exchanges in Nigeria and boost the country’s Gross Domestic Product (GDP).

“The underpinning drive for establishing the exchange was the need to transform and reposition the commodities market and harness opportunities in the commodities ecosystem. This drive will enhance and crate value for all stakeholders in the ecosystem,” he said.

The newly elected President of Chartered Institute of Stockbrokers (CIS), Mr Oluropo Dada, congratulated the inductees and advised them to uphold the ethical standard of the profession and operate with skills and integrity.

Akeredolu-Ale also congratulated the new board and management of Securities and Exchange Commission (SEC), under the new Director General, Dr Emomotimi Agada.

In July last year, the Pan African Exchange inducted 33 commodities brokers, including the first female office holder at Chartered Institute of Stockbrokers (CIS), Mrs Fiona Ahimie.

capital market

Tinubu asks Senate to confirm four board members of SEC

Published

2 days ago

May 16, 2024

NewsDirect

President Bola Tinubu has asked the Senate to screen and confirm four persons appointed as board members of the Securities and Exchange Commission (SEC), the apex regulator of Nigeria’s Capital Market.

The President’s request was contained in a letter read by the Senate President, Godswill Akpabio during the plenary on Wednesday.

The appointed members of the SEC are Emomotimi Agama, Frana Chukwuogor, Bola Ajomale and Samiya Hassan-Usman.

While Agama was appointed as Director-General, Mr Chukwuogor will serve as Executive Commissioner (Legal and Enforcement) of the Security and Exchange Commission. Ajomale was appointed as Executive Commissioner (Operations) while Hassan-Usman was appointed as Executive Commissioner (Corporate Services).

In April, President Tinubu approved the appointment of seven persons as members of the SEC pending their confirmations by the Senate. But, only four names were transmitted to the Senate for confirmation and Tinubu did not give reasons for not including the names of the other three professionals.

In the letter, the President explained that the appointment complied with the provisions of section (1) of the Investment and Security Act of 2007.

“Confirmation of appointment of the Director-General and Commissioners of the Securities and Exchange Commission.

“By the provision of sections 3 and 5 (1) of theInvestment and Securities Act 2007. I am pleased to present for confirmation by the Senate the under-listed four nominees as Director-General and Commissioners of Securities and Exchange Commission,” he said.

The president urged the lawmakers to expedite the screening and confirmation process.

The Senate President thereafter referred the request to the Senate Committee on Capital Markets to report back to the Senate within two weeks.