Money market
FG can raise $500bn from Capital Market — 13th CIS President, Dada
Newly sworn-in President, Oluropo Dada, as the 13th President and Chairman of Governing Council of Chartered Institute of Stockbrokers (CIS), says the Federal Government can raise $500 billion from the Capital Market.
The investiture ceremony, at the weekend in Lagos, marked the commencement of Dada’s two-year tenure as the Institute’s President and send-off for Oluwole Adeosun, the immediate past president.
In his acceptance speech, Dada assured that his administration would advance inclusive participation of all stakeholders in the financial market.
“My vision is to build a Nigerian capital market in which securities professionals get the attention and patronage that they deserve. We want a market that is all-inclusive, with all stakeholders working as partners. My team and I will work assiduously towards upgrading capacity building in our community, while at the same time ensuring that there is a symbiotic relationship between securities dealers and all trading platforms in the country.
“The Federal Government of Nigeria under the leadership of President Bola Ahmed Tinubu, has articulated the vision of attaining a $1trillion economy during its tenure. To do this, the economy must attain a double-digit growth in Gross Domestic Product (GDP).It is therefore my conviction that the capital market alone can generate up to at least half of the envisaged $1trillion.
“It is therefore imperative that the size of the informal sector in Nigeria be substantially reduced, if we are to attain the objectives of accelerated GDP growth. Appropriate policies should be crafted to encourage all public limited liability companies in Nigeria to obtain listing and public quotation on any of the SEC-registered securities exchanges in the country.
“Our Institute aligns with the ongoing recapitalisation programme in the banking sector. We have made a 10-point recommendation to the Government and Capital Market Regulators on how the new capital injection in the banking industry can be implemented seamlessly,” explained Dada.
The immediate past president, Mr Oluwole Adeosun, presented some of the major achievements during his tenure and commended Dada for his sterling contributions as the 1st Vice President during the period.
The Special Guest of Honour, and Nigeria’s Vice President, Kashim Shettima, urged the Institute to partner with the Federal Government in order to transform the economy. Shettima, who was represented by his Special Adviser on Economic Matters, Dr Tope Fasua.
He explained that the economy would experience significant growth once the country overcomes the ongoing reforms.
Governor Abiodun Oyebanji of Ekiti State, commended the Institute and assured it of support for Dada’s Administration through partnership with the Institute for market development. He showered encomiums on Dada as a man of integrity with track records of performance.
After the swearing-in of Dada as the President, in line with the tradition of the Institute, Dada, swore-in Mrs Fiona Ahimie and Dr Akeem Oyewale as the 1st and 2nd Vice President respectively.
Goodwill messages were presented to the new president by the Lagos State Governor, Director General, Securities and Exchange Commission (SEC), Nigerian Exchange Group PLC, Chartered Institute of Bankers of Nigeria (CIBN), Association of Securities Dealing Houses of Nigeria (ASHON) and Founding Partner, Wole Olanipekun & Co, Chief Wole Olanipekun amongst others, while a Keynote Address was delivered by the Chairman, Chapel Hill Denham, Mr Bolaji Balogun.
The ceremony was attended by many captains of industries and seasoned finance experts, including the former Director General of The Nigerian Stock Exchange ( now NGX, Professor Ndi Okereke-Onyuike.
By Opeyemi Abdulsalam
The Central Bank of Nigeria (CBN) Governor, Yemi Cardoso, has expressed concern over the growing transaction volumes of Non-Bank Financial Institutions (NBFIs) and Other Financial Institutions (OFIs).
He warned that this trend poses a significant risk to the stability of the financial system.
According to Cardoso, the increasing activities of NBFIs and OFIs have the potential to disrupt the entire financial system, and therefore, require close monitoring and regulation to mitigate this risk.
The CBN Governor’s warning highlighted the need for vigilance in the financial sector to ensure that the growing activities of these institutions do not compromise the stability of the financial system.
Cardoso, who was represented by Abayomi Arogundade, the Acting Director of the Other Financial Institutions Department at the CBN, gave the warning at the 10th Meeting of the College of Supervisors for Non-Bank Financial Institutions (CSNBFI) in Abuja on Monday.
“We must continue to push forward the agenda of strengthening the anti-money laundering practices; deepening supervisory capacity on cybersecurity and fintech regulation; and the implementation of risk-based supervisory approach,” Cardoso warned the gathering of West African central bankers.
The CBN Governor noted the rapid growth in fintech lending as a particular area of concern, noting that while the overall size of these loans may still be small compared to traditional banking, some jurisdictions have observed a worrying trend of increasing volumes.
“In many cases, fintech credit is provided via electronic platforms that connect lenders to borrowers – in which case the platform takes the role of a financial auxiliary,” Cardoso explained.
“In some cases, however, loans are taken on the balance sheet of these platforms (even if it is short-term), in which case the platforms are akin to new types of financial intermediaries.”
These fintech firms, which offer a range of applications, software, and other technologies to streamline mobile and online banking, are often regulated either as banking entities or as fintech payment service providers, depending on the jurisdiction.
Cardoso also highlighted the emergence of innovations linked to crypto or stablecoin assets as another area of concern that supervisors must closely monitor.
The concerns raised by the CBN Governor come at a time when the non-bank financial sector is playing an increasingly pivotal role in enhancing access to credit, offering cost-effective and reliable payment services, and supporting economic growth across the WAMZ region.
The Director General of the West African Monetary Institute (WAMI), Dr. Olorunsola Olowofeso, echoed the need to strengthen the resilience of the financial sector, particularly in the face of emerging risks such as climate-related issues, internet disruption, cyber threats, and social media-driven instability.
“To strengthen the resilience of the financial sector, Member States should develop an adequate national cybersecurity strategy and appropriate regulatory and supervisory frameworks,” Olowofeso said.
The technical sessions of the CSNBFI meeting this week are expected to focus on climate risk regulation, underscoring the importance of addressing these emerging threats to the stability of the financial system.
As the NBFI sector continues to grow in influence and importance, the central bank governors of the WAMZ region have a critical responsibility to ensure that regulatory requirements are tailored to foster compliance with international standards and mitigate the risks posed by the rapid digitalisation of financial services.
Foreign investment inflows to Nigeria grew to $3.38 billion in the first quarter of 2024, a 210.16 percent increase from $1.09 billion in the fourth quarter of 2023, according to the latest capital importation report on the National Bureau of Statistics (NBS).
On the flip side, capital importation into Nigeria recorded 198 percent year-on-year growth from $1.13 billion in the first quarter of 2023.
“Portfolio investment ranked top with $2,075.59 million, accounting for 61.48 percent, followed by Other investment with U$1,181.25 million, accounting for 34.99 percent. Foreign direct investment recorded the least with $119.18 million (3.53 percent) of total capital importation in Q1 2024,” the NBS report stated.
The banking sector recorded the highest inflow with $2,067.44 million, representing 61.24 percent of total capital imported in Q1 2024, followed by the trading sector, valued at $494.93 million (14.66 percent), and production/manufacturing sector with $191.92 million (5.68 percent).
NBS stated that “capital importation during the reference period originated largely from the United Kingdom with $1,805.83 million, showing 53.49 percent of the total capital imported. This was followed by the Republic of South Africa with $582.34 million (17.25 percent) and the Cayman Islands with $186.21 million (5.52 percent).
“Out of the three states that recorded capital importation during the quarter, Lagos state remained the top destination with $2,782.41 million, accounting for 82.42 percent of the total capital imported. Abuja (FCT) followed with $593.58 million (17.58 percent), and Ekiti state with $0.01 million.
“Stanbic IBTC Bank Plc received the highest capital importation into Nigeria in Q1 2024 with $1,257.38 million (37.24 percent), followed by Citibank Nigeria Limited with $547.71 million (16.22 percent) and Rand Merchant Bank Plc with $528.73 (15.66 percent),” NBS said.
The naira earned its first gain in more than 10 days against the United States dollar on Friday.
Data from the Nigerian Autonomous Foreign Exchange Market (NAFEM) showed that the Nigerian currency gained N5 to trade at N1,505/$1 at the official market today.
The currency traded at N1,510/$1 on Thursday.
The intra-day high and low recorded during the day were N1,540/$1 and N1,430/$1 respectively, representing a lean spread of N110\$1.
However, the naira gained against the dollar at the parallel section of the market to trade at N1,525/$1, as against N1,520/$1 it traded the previous day.
The naira also shed N20 against the British Pound to trade at N1,920\£1 as against the previous trading day’s N1,900\£1.
The Canadian dollar continues to close flat against the naira to trade at N1,200| CA$1.
The naira lost N10 against the Euro to trade at N1,600/€1 as against the previous N1,590/€1
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