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Only Lagos, Rivers, Anambra can survive on IGR, VAT – Report



Only three states in Nigeria    can survive without        support from the  Federal Government.

This was disclosed in BudgIT’s report ‘State of States, 2021 edition: Fiscal Options for Building Back Better’ released on Tuesday.

According to BudgIT, these three states are Lagos, Rivers, and Anambra.

The report said, “Only three states in the country can meet their operating expenses obligations with a combination of their IGR and Value Added Tax as measured in our ‘Index A’ ranking; these states are Lagos, Rivers, and Anambra and they appear at the top of the ‘Index A’ ranking.”

According to the organisation, states that rank high on its index A have comparatively limited dependence on federally distributed revenue for their operations and are more viable with the capacity to exist as independent entities.

While Lagos, Rivers, and Anambra occupy the top three spots, Benue, Taraba, and Bayelsa states are the bottom three states.

BudgIT said, “These states at the bottom of ‘Index A’ ranking include Jigawa, Delta, Benue, Taraba and Bayelsa.

“Nevertheless, all Nigerian states still need to work hard to build economic prosperity and create more jobs in their states to ensure that there is more money in circulation and economic activities that can be taxed to improve their IGR.”

The organisation added that all 36 states saw a 3.43 per cent decline in their 2020 IGRs (N1.21tn) from (N1.26tn) in 2019.

It said that 18 states saw a decline in their year-on-year revenues, while the remaining 18 states grew their revenues – in some cases by as high as 87.02 per cent.

According to BudgIT, the total debt burden of the states increased by N472.63bn (or 8.78 per cent) from N5.39tn in 2019 to N5.86tn in 2020.

IT said the increase in total subnational debt was as a result of exchange rate volatility, with the value of the naira jumping from 305.9/$1 in 2019 to 380/$1 as of December 31, 2020.

The organisation said that the states with the highest foreign debt were Lagos, Kaduna, Edo, Cross River and Bauchi.

It added that Lagos, Kaduna, Anambra, Benue and Zamfara accounted for more than half (63.63 per cent or N300.7bn) of the net year-on-year subnational debt increase of N472.63bn.

According to BudgIT, only seven states in Nigeria have functioning Treasury Single Accounts, and about 24 states and 27 states respectively have introduced ‘biometric use in payroll management’ and ‘bank verification number use in payroll management.’

It added that only 16 states published details of their contracts online for public scrutiny, while 20 states do not.

According to the organisation, only five states (Ebonyi, Rivers, Anambra, Cross River, and Kaduna) prioritised investment in infrastructure by spending more on capital expenditure than operating expenses.

On the other hand, Benue, Kogi, and Taraba have higher operating expenses than their respective investments in capital expenditure.

capital market

Ecobank declares N182.92bn PAT in Q3 2023



Ecobank Transnational Incorporated, has recorded a profit of N182.92 billion in its third quarter 2023 results.

According to the results posted on the Nigerian Exchange Limited (NGX) website, the Bank announced a 59 percent gross earnings growth in Q3 2023 Results.

The Gross earnings also grew by 59 percent from N761.30 billion to N1.211 trillion.

According to the results, profit before tax stood at N262.17 billion.

Meanwhile in its second quarter results Pre-tax profit increased to N92.52 billion from N56.89 billion profit in Q2 2022.

The increase in second-quarter profits helped its half-year profit before tax to rise by 38 percent to N150.31 billion compared to N108.96 billion in the same period last year.

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capital market

Market capitalisation gains N44.16bn as NGX ASI advances by 0.11%



Since the recent announcement of recapitalisation by the Central Bank of Nigeria Governor, the market had continued to see a rise in investment moves amongst banks thereby boosting the market capitalisation of the NGX.

As at yesterday’s trading, the NGX Market CAP recorded a gain of N44.16billion in Naira terms while the NGX All-Share Index (ASI) advanced by 0.11 percent.

Compared to the previous day’s gain of 0.34 percent, which closed at 71,284.56 basis points, the NGXASI now stands at 39.25 percent.

The total volume of stocks traded also advanced by 49.77 percent to close at N540.09 million, valued at N10.24 billion and traded in 6,516 deals. GTCO was the most traded stock by volume and value, with N67.23 million and N2.60 billion units traded.

At the close of trading, the market recorded 25 gainers, 31 losers, and 55 unchanged. NNFM topped the gainers list, while NSLTECH topped the list of losers.

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capital market

Naira hits N831.47/$1 in official market



The Nigerian naira appreciated against the dollar on Wednesday, 29th November 2023, closing at N831.47/$1 at the official market.

The positive trajectory aligns with expectations among experts, who anticipated that the Central Bank of Nigeria’s (CBN) recent initiative to clear a portion of its FX backlog would boost confidence in the currency.

The domestic currency appreciated 6.06 percent to close at N831.47 to a dollar at the close of business on Wednesday, data from the NAFEM where forex is officially traded, showed.

This represents an N50.41 gain or a 6.06 percent increase in the local currency compared to the N841.14 it closed on Tuesday.

The intraday high recorded was N1159/$1, while the intraday low was N700/$1, representing a wide spread of N459/$1.

According to data obtained from the official NAFEM window, forex turnover at the close of the trading was $140.35 million, representing a 18.88 percent growth compared to the previous day.

However, the naira weakened at the parallel forex market where forex is sold unofficially, the exchange rate depreciated by 0.26 percent, quoted at N1160/$1, while peer-to-peer traders quoted around N1159.47/$1.

The Central Bank of Nigeria (CBN) has said it has made tranche payments to 31 banks to clear the backlog of foreign exchange forward obligations.

The apex bank also disclosed that it has set up foreign exchange frameworks to address the FX issues.

Governor of the CBN, Yemi Cardoso, disclosed this on Friday at the bankers’ dinner in Lagos.

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