Economy
Decision to Move Accounts to CBN Won’t Hinder Operations—NNPC
By Adedapo Adesanya
The Nigerian National Petroleum Company (NNPC) Limited has said the latest decision to move a substantial part of its accounts to the Central Bank of Nigeria (CBN) won’t create any hindrances to its operations.
Speaking when the CBN Governor, Mr Olayemi Cardoso visited him in his office, the NNPC’s Group Chief Executive Officer, Mr Mele Kyari, said contrary to beliefs, the national oil company was not compelled by political actors to take the decision.
Many Nigerians, including former Vice President, Mr Atiku Abubakar, had recently raised issues as to the propriety of ‘compelling’ the NNPC to compulsorily move its accounts to the CBN by the Bola Tinubu-led administration.
Mr Kyari stated that part of the reason was to maintain a “safe obligor limit” with the commercial banks.
The NNPC is the largest company in Nigeria and Mr Kyari said that since the firm maintains very high liquidity and transaction levels, it was important to work closely with the apex bank.
He lauded the CBN for creating a special department solely to ensure that the newfound relationship is seamless, explaining that it is ultimately in the interest of the NNPC and the nation at large.
“We made that decision in line with the directives of our board of directors to maintain safe obligor limits with commercial banks.
“For us to do this, we do need additional support from the central bank to achieve this. We are a very huge company and our transactions and liquidity levels are very high and perhaps, we are the largest business in this country.
“We are also happy that the CBN has created a very robust digital platform for our transactions and also, created a department that will deal with NNPC issues, and thus this will create no hindrance to our operations.
“We will continue to collaborate with the CBN to ensure that further improvements are recorded and to ensure that this relationship will serve the best interest of our company and our country in general,” he stated.
On his part, Mr Cardoso confirmed that to ensure seamless operations, a new platform has been created, expressing confidence that the new collaboration will work in the interest of the country.
“We have come to this particular stage where the NNPC has decided to move a respectable part of its business to the Central Bank of Nigeria. I also want to say that we have restructured and strengthened internal processes such that we are very capable of taking on this enormous responsibility that will be placed on the central bank.
“We are looking forward to further collaboration with the NNPC. And I have absolutely no doubt in my mind that this effective collaboration will work in the best interests of NNPC and Nigeria in general,” he said.
According to a joint statement by the spokespersons of the NNPC, Mr Olufemi Soneye, and the CBN, Mrs Hakama Sidi Ali, the duo noted that there now exists an improved platform for managing NNPC’s cash holding obligor limits in commercial banks set by the board of directors.
“The GCEO NNPC Ltd., Mallam Mele Kyari, and the Governor of the CBN, Mr. Olayemi Cardoso, have reviewed the decision of the NNPC Ltd. to domicile a significant portion of its revenues and other banking services with the CBN.
“Following their meeting in Abuja on Thursday, February 8, 2024, the NNPC Ltd. and CBN chiefs noted the value created by the decision for all parties, especially in providing the NNPC Ltd. with an improved platform for managing its cash holding obligor limits in commercial banks set by the board of directors.
“The CBN has provided enhanced digital platforms for all transactions and has established specific limits to manage NNPC Ltd. transactions.
“Both parties have also committed to further strengthening the collaboration to ensure seamless operations of the commercial NNPC Limited and noted that NNPC Ltd. continues to have banking transactions with commercial banks as required,” the statement seen by Business Post added.
By Dipo Olowookere
The local stock market firmed up by 1.13 per cent on Friday as appetite for Nigerian stocks remained strong.
Investors reacted well to the 2026 budget presentation of President Bola Tinubu to the National Assembly yesterday, especially because of the more realistic crude oil benchmark of $64 per barrel compared with the ambitious $75 per barrel for 2025. This year, prices have been between $60 and $65 per barrel.
Business Post observed profit-taking in the commodity and energy sectors as they respectively shed 0.14 per cent and 0.03 per cent.
But, bargain-hunting in the others sustained the positive run, with the consumer goods index up by 3.82 per cent.
Further, the industrial goods space appreciated by 1.46 per cent, the banking counter improved by 0.08 per cent, and the insurance industry gained 0.04 per cent.
As a result, the All-Share Index (ASI) increased by 1,694.33 points to 152,057.38 points from 150,363.05 points and the market capitalisation chalked up N1.080 trillion to finish at N96.937 trillion compared with Thursday’s closing value of N95.857 trillion.
A total of 34 shares ended on the advancers’ chart, while 24 were on the laggards’ log, representing a positive market breadth index and bullish investor sentiment.
Austin Laz gained 10.00 per cent to close at N2.42, Union Dicon also jumped 10.00 per cent to N6.60, Tantalizers increased by 9.80 per cent to N2.69, Aluminium Extrusion improved by 9.78 per cent to N12.35, and Champion Breweries grew by 9.71 per cent to N16.95.
Conversely, Sovereign Trust Insurance dipped by 7.42 per cent to N3.87, Royal Exchange lost 6.84 per cent to trade at N1.77, Omatek slipped by 6.84 per cent to N1.09, Eunisell depreciated by 5.88 per cent to N80.00, and Eterna dropped 5.63 per cent to close at N28.50.
Yesterday, traders transacted 1.5 billion units worth N21.8 billion in 25,667 deals compared with the 839.8 million units sold for N32.8 billion in 23,211 deals in the preceding session, showing a surge in the trading volume by 76.61 per cent, an uptick in the number of deals by 10.58 per cent, and a shrink in the trading value by 33.54 per cent.
By Adedapo Adesanya
Three stocks stretched the bearish run of the NASD Over-the-Counter (OTC) Securities Exchange by 1.21 per cent on Friday, December 19, with the market capitalisation giving up N26.01 billion to close at N2.121 billion compared with the N2.147 trillion it ended a day earlier, and the NASD Unlisted Security Index (NSI) dropping 43.47 points to 3,546.41 points from 3,589.88 points.
The trio of FrieslandCampina Wamco Nigeria Plc, Central Securities Clearing System (CSCS) Plc, and NASD Plc overpowered the gains printed by four other securities.
FrieslandCampina Wamco Nigeria Plc lost N6.00 to sell at N54.00 per unit versus N60.00 per unit, NASD Plc shrank by N3.50 to N58.50 per share from N55.00 per share, and CSCS Plc depleted by N2.91 to N33.87 per unit from N36.78 per unit.
On the flip side, Air Liquide Plc gained N1.01 to close at N13.00 per share versus N11.99 per share, Golden Capital Plc appreciated by 70 Kobo to N7.68 per unit from N6.98 per unit, Geo-Fluids Plc added 39 Kobo to sell at N5.50 per share versus N5.11 per share, and IPWA Plc rose by 8 Kobo to 85 Kobo per unit from 77 Kobo per unit.
During the trading day, market participants traded 1.9 million securities versus the previous day’s 30.5 million securities showing a decline of 49.3 per cent. The value of trades went down by 64.3 per cent to N80.3 million from N225.1 million, but the number of deals jumped by 32.1 per cent to 37 deals from 28 deals.
Infrastructure Credit Guarantee Company (InfraCredit) Plc finished the session as the most active stock by value on a year-to-date basis with 5.8 billion units valued at N16.4 billion, followed by Okitipupa Plc with 178.9 million units transacted for N9.5 billion, and MRS Oil Plc with 36.1 million units traded for N4.9 billion.
The most active stock by volume on a year-to-date basis was still InfraCredit Plc with 5.8 billion units worth N16.4 billion, trailed by Industrial and General Insurance (IGI) Plc with 1.2 billion units sold for N420.7 million, and Impresit Bakolori Plc with 536.9 million units traded for N524.9 million.
By Adedapo Adesanya
It was not a good day for the Nigerian Naira at the two major foreign exchange (FX) market on Friday as it suffered a heavy loss against the United States Dollar at the close of transactions.
In the black market segment, the Naira weakened against its American counterpart yesterday by N10 to quote at N1,485/$1, in contrast to the N1,475/$1 it was traded a day earlier, and at the GTBank forex counter, it depreciated by N2 to settle at N1,467/$1 versus Thursday’s closing price of N1,465/$1.
In the Nigerian Autonomous Foreign Exchange Market (NAFEX) window, which is also the official market, the nation’s legal tender crashed against the greenback by N6.65 or 0.46 per cent to close at N1,464.49/$1 compared with the preceding session’s rate of N1,457.84/$1.
In the same vein, the local currency tumbled against the Euro in the spot market by N2.25 to sell for N1,714.63/€1 compared with the previous day’s N1,712.38/€1, but appreciated against the Pound Sterling by 73 Kobo to finish at N1,957.30/£1 compared with the N1,958.03/£1 it was traded in the preceding session.
The market continues to face seasonal pressure even as the Central Bank of Nigeria (CBN) is still conducting FX intervention sales, which have significantly reduced but not remove pressure from the Naira. Also, there seems to be reduced supply from exporters, foreign portfolio investors and non-bank corporate inflows.
President Bola Tinubu on Friday presented the government’s N58.47 trillion budget plan aimed at consolidating economic reforms and boosting growth.
The budget is based on a projected crude oil price of $64.85 a barrel and includes a target oil output of 1.84 million barrels a day. It also projects an exchange rate of N1,400 to the Dollar.
President Tinubu said inflation had plunged to an annual rate of 14.45 per cent in November from 24.23 per cent in March, while foreign reserves had surged to a seven-year high of $47 billion.
Meanwhile, the cryptocurrency market was dominated by the bulls but it continues to face increased pressure after million in liquidations in previous session over accelerating declines, with Dogecoin (DOGE) recovering 4.2 per cent to trade at $0.1309.
Further, Ripple (XRP) appreciated by 3.9 per cent to $1.90, Cardano (ADA) rose by 3.5 per cent to $0.3728, Solana (SOL) jumped by 3.4 per cent to $126.23, Ethereum (ETH) climbed by 2.9 per cent to $2,982.42, Binance Coin (BNB) gained 2.0 per cent to sell for $853.06, Bitcoin (BTC) improved by 1.7 per cent to $88,281.21, and Litecoin (LTC) soared by 1.2 per cent to $76.50, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) traded flat at $1.00 each.
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