…As NCDMB, BoI relax conditions for $200m NCI fund applications***
Equity transactions on the Nigerian Stock Exchange (NSE) resumed for the week on Monday on a negative note as major blue chips continue to drop price.
The News Agency of Nigeria (NAN) reports that the market capitalisation shed N32 billion or 0.31 per cent to close lower at N11.847 trillion against N11.879 trillion posted on Friday.
Also, the All-Share Index, which opened at 2,540.17 lost 100 points or 0.31 per cent to close lower at 32,440.17 amid price losses.
An analysis of price movement indicated that Okomu Oi led the price losers’ table with a loss N6.9 to close at N70.1 per share.
Nigerian Breweries trailed with a loss of N3 to close at N90, while Forte Oil dropped N1.45 to close at N20.05 per share.
CAP declined by 1.15 to close at N27.2, while UBN dipped by 55k to close at N5.25 per share.
Conversely, Unilever led the price gainers’ table, gaining N2 to close at N45 per share.
GTBank came second with a gain of 55k to close at N35.25, while Zenith Bank appreciated by 2k to close at N21 per share.
PZ Cussons also lost 15k to close at N13.5, while UBA decreased by 1k to close at N8.1 per share.
Similarly, the volume of traded shares decreased by 63.59 per cent with 190.568 million shares worth N3.31 billion transacted by investors in 2,942 deals.
This was in contrast to the 523.444 million shares worth N3.59 billion exchanged in 2,778 deals on Friday.
NAN reports that Access Bank emerged the investors’ delight with 46.154 million shares valued at N22.41 million.
FBN Holdings traded 18.604 million shares valued at N1.07 billion, while Transcorp followed with 16.67 million shares worth N897.18 million.
Dangote Cement sold 12.70 million shares valued at N279.11 million, while Zenith Bank trailed with 10.01 million shares worth N388.71 million.
In the meantime, following complaints in some quarters over tough conditions for accessing the $200 million Nigerian Content Intervention Fund (NCI Fund) by qualified oil and gas service companies, the Nigerian Content Development and Monitoring Board (NCDMB) and the Bank of Industry (BoI) have moved to relax some of the requirements.
The NCDMB and BoI convened a stakeholders’ forum in Lagos recently to address the major challenges applicants face in processing their loan applications. The forum was chaired by the Executive Secretary of NCDMB, Simbi Wabote and the Managing Director of BoI, Olukayode Pitan, and it drew the participation of 84 delegates from different companies.
Rising from the engagement, the NCDMB and BoI agreed that: “The Bank of Industry may consider the inclusion of insurance bonds as collateral for accessing the fund, provided the bonds are issued by competent and major insurance companies qualified by the Bank.”
There was consensus that BoI should accept other forms of collateral outside of bank guarantees, which are listed against each loan type and applicants that have unencumbered collateral acceptable to the BoI can access the NCI Fund loan without recourse to bank guarantee.
A key resolution is that an applicant can access loans for two different categories or product types, subject to the applicable single obligor limit under the scheme. The NCDMB said it will also consider increasing the single obligor limit for refinancing from $2m to between $5m and $10m, particularly because many companies that attended the forum have such needs.
It was also agreed that there would be no discrimination between international oil companies and national oil companies, rather the history and performance of the Nigerian oil companies will be considered by the BoI when taking a decision.
The BoI also committed to standardising the conditions for obtaining bank guarantees from each commercial bank and this shall be issued to each applicant at the point of application to guide and speed up their pursuit of the document.
As part of efforts to ease access to the NCI Fund, the BoI would no longer insist on appointing a director on the board of borrowers; but would rather place an officer to monitor the project financed by the loan.
The NCI Fund is a portion of the Nigerian Content Development Fund (NCDF) set aside by the NCDMB for BoI to manage and lend directly to indigenous manufacturers, service providers and other key players in the oil and gas industry, to meet their funding needs.
The available types of funding under the NCI Fund include: loans for manufacturing, asset acquisition, contract finance, community contractor finance and loan re-financing.
One percent of all contracts, subcontracts, projects and activities in the upstream sector of the Nigerian oil and gas industry is statutorily to be deducted and remitted to the NCDF, as stipulated by Section 104 of the Nigerian Oil and Gas Industry Content Development (NOGICD) Act of 2010.
Additional report from Guardian NG
