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REDESIGNING NAIRA: Southern Experts hail FG; Northern Gurus say ‘Nay’



Cash crunch: Catfish farmers lament low patronage
…. Northern Group calls CBN Governor’s sack!***

Federal Government’s move to redesign the Naira may have unwittingly enjoyed the support of the Southern Experts, even as financial gurus from the North, thumbs it down, saying redesigning the Naira denominations will inflict more harm to its value.

Commending the Central Bank of Nigeria (CBN) for the gesture, the experts specifically said redesigning the naira, would have a positive effect on the economy, including tackling the ‘black money’ challenges, preceding the looming elections.

Both the experts and gurus spoke separately, on Thursday; against the backdrop of the announcement by the CBN that new designs of the N200, N500 and N1,000 denominations would be produced and circulated on Dec. 15.

Prof. Umhe Uwaleke, a financial economist and professor of capital market at the Nasarawa State University, Keffi, stated that the decision will be positive for the economy in the medium to long term.

Uwaleke said the measure would go a long way to ensure that the naira in circulation outside the banking system was brought into the banking system.

He also said the measure would also provide enough liquidity for banks, and more money for the banks to lend.

“The measure does not amount to demonetisation of big currency notes often carried out by Central Bank to curb black money and corruption.

“But it will go a long way in ensuring that a lot of naira notes circulating outside the banks are crowded in.

“If it leads to large deposits in banks, it means the banks will have more money to lend which may reduce interest rates.

“Perhaps more importantly, with increased currency in circulation now in the vault of banks, I expect to see improvement in monetary policy transmission,” he said.

Uwaleke said it might also have the effect of reducing speculative attacks on the naira in the parallel market in the medium term.

“I expect that the Financial Intelligence Unit will be on the lookout for huge deposits as a way of monitoring illegitimate transactions.

“Despite the huge cost involved in changing currency notes, I think it’s time to sanitise the system, especially now that electioneering activities have kicked off,” he said.

He, however, said the deadline of Jan. 31, 2023, was too short, considering the number of naira denominations involved, urging the CBN to consider extending it.

Speaking in the same vein, a revered economist, Dr. Tope Fasua, said the measure would have significant effect on the economy, adding that it was essentially about “black money.”

He suggested that the CBN should take such measures more frequently.

“When Central Bank do this, they try to pull in monies people are hiding; illegal money, corruption money, kidnapping money. Nigeria has managed to become a hub for these kinds of illegalities.

“I will even suggest that the CBN does this more often, maybe every 10 years. You will see a scenario where the banks are awash with liquidity.

“There are many people sitting on billions in naira, and even in dollars. The CBN should also see how it can pull in the dollars,” he said.

Fasua advised that the idea of individuals operating personal domiciliary bank accounts should be banned, adding that nobody needed it.

“People are speculating against their own currency in their own country. That is not allowed in any economy.

“They should pull in illegal, black naira and then see how they can pull in illegal dollars. The CBN can control these things through the Deposit Money Banks,” he said.

However, Mr. Okechukwu Unegbu, a financial expert, and past President of the Chattered Institute of Bankers of Nigeria (CIBN) said redesigning the naira was not the most important problem facing the economy.

Unegbu said the apex bank should have simply ensured that the scarce lower naira denominations, like N100 and N200, were readily available by printing more.

“It will be resisted by us in collaboration with other concerned civil society organisations from within and outside our region,”

In the meantime, a group, Concerned Northern Forum, has called for the suspension of redesigning of the N200, N500 and N1000 notes, saying the measure would be detrimental to the nation’s economy.

The group’s spokesman, Mr. Abdulsalam Kazeem, made the call in a statement on Thursday in Kaduna.

According to Kazeem, redesigning the Naira denominations will inflict more harm to its value.

He explained that this was because the current exchange rate of the Naira to the dollar or pounds, had made the naira lose its value.

He called for serious economic policies that would strengthen the naira against dollar and pound.

The group’s spokesman said Nigeria’s economy was down and the naira had depreciated to a minimal value, hence redesigning the notes would only cost the nation huge sums of money at the expense of taxpayers.

“This is coming at a period when we are borrowing to fund significant parts of our annual budget and another significant part of the borrowing goes to debt servicing.

“Yet the only solution the apex bank could offer is to redesign our currency,” he said.

Kazeem wondered if redesigning the notes would make Nigeria’s currency to gain value at the exchange rate market or add value to the standard of living of the citizenry.

“These are some questions begging for immediate answers, if no satisfactory answers are provided, the apex bank should immediately stop the process of the new design.

“Or else, it will be resisted by us in collaboration with other concerned civil society organisations from within and outside our region,” he said.

He alleged that the decision to redesign the naira was to empower individuals, consultants, or contractors, who were desperate to make something before the end of the current administration.

“This idea should be rejected by all and sundry, it is not in the interest of the nation and it will add no value to the current multiple economic challenges the nation is facing.

“Failure to meet our demands to suspend redesigning of the notes will lead us to massive protest across the Northern region and the Federal Capital Territory.

“Those behind the idea should also be checked and questioned, while the CBN governor should be sacked,” Kazeem said.

Banking & Finance

NGX: Investors Lose N622bn, as NCR Nigeria, Unity Bank lead Losers’ chart



NGX: Investors Lose N622bn, as NCR Nigeria, Unity Bank lead Losers’ chart

The domestic stock market on Nigeria Exchange Ltd. (NGX) continued on a negative note as the market capitalisation on Monday dropped by N622 billion amid sustained profit-taking activities.

Accordingly, investors lost N622 billion in value as market capitalisation declined to  N29.281 trillion from N29.903 trillion recorded at the previous session.

The All-Share Index (ASI) fell by 1,141.76 points, representing a decline of 2.08 percent, to close at 53,750.77 points as against the 54,892.53 posted on Friday.

Consequently, the ASI’s year-to-date (YTD) return fell to 4.88 percent.

The downturn was impacted by losses recorded in large and medium capitalised stocks, amongst which are; Airtel Africa, Seplat Energy, MTN Nigeria Communications (MTNN), Nigerian Breweries and Lafarge Africa.

“We expect risk-on sentiments to be sustained in the equities markets even as the depressed interest rate environment will continue to favour the local bourse in line with our expectations for Q1, 2023.

“Taking positions in stocks with solid valuations and dividend yields ahead of the dividend-paying season remains the choice strategy.

“However, we see room for extended profit-taking activities,” Analysts at United Capital Plc said.

The market breadth was negative as 21 stocks lost relative to five gainers.

Courteville Business Solutions recorded the highest price gain of 6.67 percent to close at 48k per share.

NPF Microfinance Bank followed with a gain of 2.7 percent to close at N1.90 and AIICO Insurance up by 1.75 percent to close at 58k per share.

FBN Holdings (FBNH) rose by 0.92 percent to close at N11, while Zenith Bank gained 0. 2 percent to close at N25 per share.

Conversely, NCR Nigeria led the losers’ chart by 9.79 percent to close at N2.12, per share.

Unity Bank followed with a decline of 9.43 percent to close at 48k, while Prestige Assurance declined by 8.89 percent to close at 41k, per share.

SUNU Assurance declined 8.33 percent to close at 44k, while Multiverse Mining and Exploration and Airtel Africa shed 8.31 percent each to close at N2.98 and N1,420 respectively per share.

Also, the total volume traded decreased by 26.66 percent to 100.883 million units, valued at N4.342 billion and exchanged in 3,279 deals.

Transactions in the shares of Guaranty Trust Holding Company (GTCO) topped the activity chart with 12.836 million shares valued at N318.513 million.

Zenith Bank followed with 11.920 million shares worth N297.982 million, while United Bank for Africa (UBA) traded 10.038 million shares valued at N80.242 million.

MTNN traded 8.264 million shares valued at N1.927 billion, while FBNH transacted 7.719 million shares worth N84.577.

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Banking & Finance

Emefiele: CBN disbursed N12.65bn as agriculture intervention since January; N1.09 trillion since 2015



Emefiele: CBN disbursed N12.65bn as agriculture intervention since January; N1.09 trillion since 2015

The Central Bank of Nigeria (CBN), has disbursed N12.65 billion to the Anchor Borrowers Programme (ABP), its flagship agriculture intervention scheme from January till date, despite the soaring cost of food.

The CBN Governor, Mr. Godwin Emefiele said this on Tuesday in Abuja, when he read the communique issued at the end of the 290th meeting of the apex bank’s Monetary Policy Committee (MPC).

According to Emefiele, the total sum that has been disbursed under the ABP since inception in 2015 is N1.09 trillion.

“Between January and February 2023, the bank disbursed N12.65 billion to three agricultural projects under the ABP.

“It brings the cumulative disbursement under the programme to N1.09 trillion to more than 4.6 million smallholder farmers cultivating or rearing 21 agricultural commodities on an approved 6.02 million hectares of farmland,” Emefiele said.

He said that the CBN had also disbursed huge sums as intervention to various other sectors of the economy.

“The CBN also released the sum of N23.70 billion under the N1.0 trillion Real Sector Facility to eight new real sector projects in agriculture, manufacturing, and services.

“Cumulative disbursements under the Real Sector Facility currently stands at N2.43 trillion disbursed to 462 projects across the country, comprising 257 manufacturing, 95 agriculture, 97 services and 13 mining sector projects,” he said.

He said that the apex bank also released N3.01 billion under the Nigerian Electricity Market Stabilisation Facility (NEMSF-2) for capital and operational expenditure of electricity distribution companies

He said that the facility was aimed at improving liquidity status of the Discos and aiding their recovery of legacy debt.

“This brings the cumulative disbursement under the facility to N254.39 billion,” he said.

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Banking & Finance

NGX: Investors Lose N16bn, Ikeja Hotel, Wapic Insurance lead Losers’ Chart 



NGX: Investors Lose N622bn, as NCR Nigeria, Unity Bank lead Losers’ chart

 Investors at the stock market of the Nigerian Exchange Ltd. (NGX) on Monday lost N16 billion due to sell-offs in medium and large capitalised stocks.

The NGX All Share Index (ASI) decreased by 29.35 basis points or 0.05 percent to close at 54,886.04 basis points from 54,915.39 recorded on Friday.

Similarly, the market capitalisation lost N16 billion to close at N29.899 trillion from N29.915 trillion posted in the previous trading.

Analysing by sectors, the NGX Banking Index added 1.3 percent, and NGX Industrial Goods appreciated by 0.1 percent.

Also, the Insurance Index was down by 0.5 percent and NGX Consumer Goods Index depreciated by 0.4 percent, while the NGX Oil & Gas index closed flat.

Meanwhile, market breadth, which is measured by market sentiment was positive, as 19 stocks gained relative to 14 losers.

Access Holdings recorded the highest price gain of 7.14 percent to close at N9.00, per share.

Cutix followed with a gain of 5.69 percent to close at N2.23, while University Press appreciated by 5.53 percent to close at N2.10, per share.

Custodian Investment went up by 5.17 percent to close at N6.10, while Chams Holding Company appreciated by 4.17 percent to close at 25k,  per share.

Conversely, Ikeja Hotel led the losers’ chart by 9.52 percent to close at N1.14, per share.

Wapic Insurance followed with a decline of 9.52 percent to close at 38k, while Stanbic IBTC Holdings went down by 8.52 to close at N36.50, per share.

Multiverse Mining and Exploration lost 5.80 percent to close at N3.25, while Livestock Feeds shed 5.50 percent to close at N1.03, per share.

The total volume traded went up by 646.50 percent to 1.172 billion units, valued at N2.877 billion, and exchanged in 3,066 deals.

Transactions in the shares of Neimeth Pharmaceutical topped the activity chart with 1.069 billion shares valued at N1.581 billion.

United Bank for Africa (UBA) followed with 15.964 million shares worth N128.784 million, while Access Holdings traded 13.033 million shares valued at N114.365 million.

Transnational Corporation (Transcorp) traded 11.770 million shares valued at N15.257 million, while Zenith Bank transacted 9.861 million shares worth N243.759 million.

Analysts at InvestmentOne Research said, “The equities market recorded a negative performance today due to the slumping prices printed in the Consumer Goods sector.

“Going forward, we expect investor’s sentiments to be swayed by the search for real positive returns and developments in the interest rate space.” 

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