Connect with us

Banking & Finance

NSE: Market capitalisation loses N260bn, activities result in 2.24% loss

Published

on

Investors Lose N132bn As Dangote Sugar, PZ Cussons Nigeria lead Losers table

… As IMF warns of looming recession in 2020, due to coronavirus***

Market capitalisation on Monday lost N260 billion to close at N11.308 trillion, at the Nigerian Stock Exchange (NSE) as activities shrink 2.24 per cent, following share price depreciation in blue chips.

The All-Share Index (ASI) which opened for the week at 22,198.43 shed 497.45 or 2.24 per cent to close at 21,700.98.

Specifically, market capitalisation lost N260 billion to close at N11.308 trillion compared with N11.568 trillion recorded on Friday.

The downturn was impacted by losses recorded in medium and large capitalised stocks, amongst which are; Nigerian Breweries, Stanbic IBTC Holdings, Guaranty Trust Bank, Zenith Bank and Unilever Nigeria.

Analysts at Afinvest Limited said: “We expect the bearish trend to persist as the pandemic continues.

“We, however, note that current prices present opportunities for bargain hunting,” they said.

Market breadth closed negative with nine gainers against 25 losers.

Dangote Sugar Refinery, Nigerian Breweries, Stanbic IBTC Holdings, United Bank for Africa and Wema Bank led the losers’ chart in percentage terms by 10 per cent each, to close at N9, N27, N23.85, N4.50 and 45k respectively per share.

United Capital came second with 9.96 per cent to close at N2.17, while Guaranty Trust Bank dropped 9.95 per cent to close at N16.75, per share.

Lafarge Africa went down by 9.90 to close at N9.10, while Unilever Nigeria shed 9.87 per cent to close at N10.50, per share.

Conversely, Neimeth dominated the gainers’ chart in percentage terms with 10 per cent to close at 44k per share.

May and Baker Nigeria followed with a gain 8.94 per cent to close at N1.95, while Custodian Investment rose by 8.65 per cent, to close N5.65, per share.

Flour Mills improved by 7.77 per cent to close at N20.80, while Chemical and Allied Products rose by 7.69 per cent to close at N21 per share.

However, the total volume of trades rose by 22.37 per cent with an exchange of 464.36 million valued at N3.87 billion in 5,883 deals.

This was in contrast with 379.48 million shares worth N3.42 billion achieved in 4,669 deals on Friday.

Transactions in the shares of Zenith Bank topped the activity chart with 120.46 million shares worth N1.30 billion.

Guaranty Trust Bank trailed with 63.27 million shares valued at N1.06 billion, while FBN Holdings traded 46.68 million shares worth N176.06 million.

Access Bank traded 31.009 million shares valued at N173.18 million, while UBA transacted 29.16 million shares worth N136.02 million.

Meanwhile, the International Monetary Fund is warning that 2020 could see a severe recession “at least as bad during the global financial crisis or worse,’’ even as recovery would be expected in 2021.

IMF Managing Director Kristalina Georgieva made the comments after a phone call of G20 finance ministers and central bank governors on Monday.

“The economic impact is and will be severe, but the faster the virus stops, the quicker and stronger the recovery will be.

Advanced economies are generally in a better position to respond to the crisis,’’ she said in a statement.

Georgieva, however, warned that many emerging markets and low-income countries face “significant challenges,” noting there are already capital outflows from poorer nations.

The IMF said it will step up aid to countries in need, while calling on central banks to create additional swap lines, to prevent a liquidity crisis in emerging markets and poorer nations.

Many of the world’s wealthiest nations have already established swap lines, including with the U.S. Federal Reserve.

Banking & Finance

Revocation Of Heritage Bank’s Licence Will Stabilise Financial System – Experts

Published

on

Revocation Of Heritage Bank’s Licence Will Stabilise Financial System – Experts

 ….Uwaleke, Ekechukwu opine it’s a step in the right direction 

 Some finance experts have commended the Central Bank of Nigeria (CBN) for revocating the operating licence of Heritage Bank Plc, describing it as a proactive gesture, made to save depositors’ funds.

The CBN announced on Monday, the revocation of the licence of the bank with immediate effect.

The experts, who spoke on Monday in Abuja, said the action was in the overall interest of the financial system.

According to Uche Uwaleke, a Professor of Finance and Capital Market, and the president of Capital Market Academics of Nigeria, the revocation is a step in the right direction.

Uwaleke said that the proactive step taken by the CBN was in the overall interest of financial system stability.

He, however, said that efforts should be made to protect the depositors and employees of the liquidated bank.

“With the Nigeria Deposit Insurance Corporation (NDIC) taking over the liquidation process, efforts should be made to protect the depositors as well as the interests of employees using liquidation dividends,” he said.

An economist, Dr Chijioke Ekechukwu, said that Heritage Bank had been struggling over the years to remain afloat, adding that the situation must have become irredeemable for the apex bank to revoke its licence.

According to Ekechukwu, a past president of the  Abuja  Chamber of  Commerce and  Industry, some years ago, some of us in the finance sector knew that the bank was struggling to remain afloat.

“For the CBN to revoke its licence, it means that it was irredeemable and probably not marketable to investors,” he said.

He said that there would be an initial setback to all the bank’s customers because it would take a while to verify them for the purpose of compensation and refund of their monies by the NDIC.

“It is, however, better to sanitise the financial system than to allow a sick and weak bank to continue to open its doors to customers,” he said.

Mr Gregory Mmaduakolam, also an economist, said that the action by the CBN was rash and capable of eroding the much-needed confidence in the banking system.

Mmaduakolam said that the action would also result in avoidable job loss of staff of the bank, thereby, further exacerbating the country’s unemployment challenge.

“I would have preferred a situation where the CBN supports ailing banks and prevents them from failing than simply withdrawing their licences.

“Such an action does not encourage confidence in the banking system, ” he said.

The CBN had on Monday, announced the revocation of the licence of the bank with immediate effect.

It said that the action was in accordance with the apex bank’s mandate to promote a sound financial system in Nigeria and in the exercise of its powers under Section 12 of the Banks and Other Financial Act (BOFIA).

It said that the board and management of the bank had not been able to improve the bank’s financial performance, a situation which constituted a threat to financial stability.

Continue Reading

Banking & Finance

NDIC Begins Liquidation Of Heritage Bank

Published

on

Revocation Of Heritage Bank’s Licence Will Stabilise Financial System – Experts

The Nigeria Deposit Insurance Corporation (NDIC) says it has started the liquidation process of Heritage Bank with immediate verification and payment of insured deposits to bank depositors.

The CBN revoked Heritage Bank’s license on Monday.

Mr Bashir Nuhu, Director of Communications and Public Affairs, NDIC, in a statement, said that relevant laws necessitated immediate actions to safeguard depositors’ funds.

“Following the revocation of the banking license of Heritage Bank Plc by the Central Bank of Nigeria (CBN) today, June 3, 2024, and the appointment of the Nigeria Deposit Insurance Corporation (NDIC) as the liquidator, under Section 12(2) of BOFIA, 2020,

“The corporation wishes to announce to depositors of the bank in particular and the banking public in general, as follows:

“The NDIC has commenced the Liquidation of Heritage Bank Plc under Section 55 sub-section 1 & 2 of the NDIC Act 2023

“The corporation has also commenced the liquidation process of the failed bank with immediate verification and payment of insured deposits to the bank depositors.”

He explained the payment options to various categories of the bank’s depositors.

“Depositors of the bank that have alternate accounts within the industry will be paid up to the insured amount of N5 million per depositor using their Bank Verification Number (BVN) to locate their alternate account.

“While depositors with funds over N5 million will be paid liquidation dividend upon realisation of the bank’s assets and recovery of debts owed to the bank,” he said.

Nuhu advised all depositors of the defunct bank without alternate bank accounts in the industry to visit the nearest branch of the bank with proof of account ownership, and verifiable means of identification.

He listed the required documents to include a driver’s license, permanent voter’s card, and National Identity Card, together with an alternate account and BVN for the verification of deposits and subsequent payment of insured sums.

He added that depositors could also file online claims by visiting the NDIC website claims page at www.ndic.gov.ng/claims/claims, download and fill the claims forms and upload the required documentation.

He advised creditors to visit the nearest branch of the bank to file their claims or via the online platform.

“Please note that the process of payment of creditors will commence immediately after all depositors have been paid,” Nuhu said.

He advised debtors who had not completed repayment of loans to contact the Corporation’s Asset Management Department (AMD).

“Visit the NDIC website for more details. The NDIC wishes to assure the entire banking public of its commitment to the continued safety of depositors’ funds in all licensed banks.

“As such, depositors are urged to continue their banking businesses without fear as banks whose licenses have not been revoked remain safe and sound,” he said.

Continue Reading

Banking & Finance

NGX: Foreign Investor Transactions Increase To $90.83m In April

Published

on

NGX: Foreign Investor Transactions Increase To $90.83m In April

 The total transactions by foreign investors on the Nigerian Exchange Ltd. (NGX) increased by 28.19 per cent between March and April.

The NGX revealed this in its Domestic and Foreign Portfolio Investment Report, which was made available to newsmen in Lagos.

The Exchange polls trading figures from market operators on their domestic and foreign portfolio investment (FPI) flows monthly.

NGX said that the figure rose from N94.26 billion, which is about 70.83 million dollars in March to N120.83 billion, which is about 90.83 million dollars in April.

The Exchange stated that the total domestic and foreign portfolio transactions in Nigeria’s equity market amounted to N346.23 billion in April.

However, as of April 30, 2024, the NGX said the total transactions at the nation’s bourse decreased by 35.71 per cent.

The figure dropped from N538.54 billion, which was about 404.69 million dollars in March to N346.23 billion, which was about 260.24 million dollars in April.

The regulator said the performance in April of the current year when compared to April 2023 which stood at N191.21billion, revealed that the total transactions increased significantly by 81.07 per cent year-on-year.

NGX mentioned that in April, the total value of transactions executed by Domestic Investors outperformed transactions executed by Foreign Investors by circa 30 per cent.

“A further analysis of the total transactions executed between March and April revealed that total domestic transactions decreased by 49.27 per cent from N444.28 billion in March to N225.40 billion in April.

“Also, Institutional Investors outperformed Retail Investors by 10 per cent.

“A comparison of domestic transactions in March and April revealed that retail transactions decreased by 54.89 per cent from N223.37 billion in March to N100.77 billion in April 2024,” it said.

According to the Exchange, the institutional composition of the domestic market decreased by 43.58 per cent from N220.91 billion in March to N124.63 billion in April.

Continue Reading

Advertisement

Editor’s Pick

Politics