NGX Group earns N6.96bn from transaction fees, treasury investment income

Nigerian Exchange Group Plc realised N6.959 billion from transaction fees and treasury investment income in the 2023 financial year ended 31 December 2023.

This/ was contained/ in the group’s 2023 annual financial report.

The amount represents a 34.19 percent growth over N5.187 billion reported in 2022 by the group and also cumulatively accounts for 83.85 percent of the total revenue/ of/ N8.299 billion.

Further checks show that the/ key/ driver of the group’s revenue in the 2023 financial year emanated from the transaction fees, accounting for N4.818 billion as against N3.157 reported in 2022/ representing/ a growth of 52.6 percent. The segment contributed to 58 percent of the total revenue of N8.299 billion./

Also, treasury investment income includes income from Bonds, Treasury bills, and fixed/ deposits/ followed by N2.141/ billion/ an increase of 5.47 percent compared to the N2.030 billion generated the previous year, 2022. The income from the investment also contributed 25.79 percent of the total revenue achieved by the group./

Transaction fees or charges represent/ a basic/ cost of investing/ and/ they/ are typically charged anytime your bid or offer goes through. All charges are a percentage of the purchase or sales consideration. /

Treasury investment income includes income from bonds, treasury bills, and fixed deposits with banks.

The decision of the Central Bank of Nigeria (CBN) to increase the interest rate by 24.75 percent,/ is expected that the NGX and other investment institutions will continue to reap more income from treasury investment.

The CBN’s Monetary Policy Committee (MPC)/ increased the benchmark interest rate by 200 basis points from 22.75 percent to 24.75 percent.

This/ was disclosed/ by the Governor of the CBN/ who/ doubles as the Chairman of the MPC/ at/ the end of the 294th MPC meeting held in Abuja.

Furthermore, the ‘apex bank retained the Cash Reserve Ratio (CRR) at 45 percent- unchanged from its last meeting but increased the CRR of merchant banks from 10 percent to 14 percent while retaining the liquidity ratio at 30 percent.

/ The present Monetary Policy Rate (MPR) of 24.75 percent is unusually high, reflecting the bank’s strong commitment to tackling inflation and exchange rate fluctuations.

While this 200-basis points hike is steep, it still doesn’t surpass the substantial 400 basis points rise implemented by the bank in February.

According to investment experts, when the interest rate is low, speculators tend to move their funds from money market instruments to the stock market for higher yield, just as they move from stocks to other asset classes, especially money market instruments/ when/ the interest rate is high.

NGX Group Plc’s full-year 2023 financial result showed a profit after tax of N5.250 billion amidst economic headwinds./

The disclosure/ was made/ in the group’s financial report,/ which was/ officially released to the Nigerian Exchange Limited and made available to the investing public.

The group’s profit after tax experienced a substantial surge, marking an impressive 788 percent increase from N591.509 million recorded in the previous year of 2022.

Additionally, NGX reported a pre-tax profit of N5.271 billion, indicating a remarkable 636 percent/ rise./

The group’s total income rose to N11.803 billion, representing a 57.39 percent increase from the N7.499 billion posted in FY 2022.