By Dipo Olowookere
The Association of Bureaux de Change Operators of Nigeria (ABCON) has taken a swipe at the Central Bank of Nigeria (CBN) over the depreciating value of the local currency.
The President of ABCON, Mr Aminu Gwadabe, in an interview with The Punch, said some of the regulatory policies of the apex bank are affecting the Naira value in the foreign exchange (FX) market.
He said, for example, the running of more than one forex regime in Nigeria was decreasing the inflow of foreign currencies as the gap between the official exchange rate at N416/$1 and the black market at N600/$1 was too wide.
Mr Gwadabe also said the amount needed to obtain a licence to operate as an International Money Transfer Operator (IMTO) is not the same for local and foreign operators.
“There are a lot of inhibitive regulatory policies. In Nigeria now, for you to say you have a licence to operate as International Money Transfer Operator, the capitalisation is N2 billion for a local company.
“A foreign company comes in and gets a licence at $1 million. How much is $1 million compared to N2 billion or N600 million?
“This is for a foreign company that wants a licence of IMTO, but for a citizen, you have to cough out N2 billion? So, it is not encouraging small players,” he said.
Speaking further, he said, “The foreign exchange market is like any other market determined by market forces, demand and supply. Investors’ inflows; both the direct and the portfolio investors are not coming. Why? This is because of the existence of official and flexible exchange rates.
“No investor will want to come and say I want to give my money because I am patriotic. When Nigerians are not selling their money at the official rate, do you expect a foreigner to sell his/her money at the official rate? The same thing is applicable to diaspora remittances.
“Recently, the World Bank did repeat that Nigeria has the largest chunk of diaspora remittances out of $49 billion that came last year. Bloomberg statistics says ours is about N34 billion. So, where are all these monies?
“When you ask, they will say the money is coming in cars, clothes, and all that. That is not true. The money the NGOs are bringing into the local economy is far less than the money they are taking abroad. We want to help our people anywhere we are. Go abroad, Nigerians still send money to Nigeria but because of the multiplicity of exchange rates, you cannot see that money officially.”
As for the solutions to these issues, the ABCON leader advised the central bank to lift the ban on the sale of forex to bureaux de change (DBC) operators, saying the “overwhelming regulation and the overwhelming criminalisation are not the best.”
According to him, the group has automated its operations to reduce “unwanted behaviour because everything is transparent and accurate.”
“As an association, we have embraced technology. We have transformed our operations. We have four different platforms to automate our system, and we are calling for the urgency for allocation of diaspora remittances,” he added.
Mr Gwadabe said his members want to be “involved in the foreign remittances channel because the market is huge. Because of the monopoly, it has been an exclusive preserve of banks. They should break that monopoly. We are not even saying stop the banks, but out of the 100 per cent they are doing, even if we have 25 per cent for a start, the automation that we have in place has taken care of the security and structure needed.
“Our process has been automated and we are easily accessible to the public. In other climes, banks don’t really do some transactions. If you want to send $200 to your family, they will show you the BDC to go to. But now, banks run after a $200 customer.
“The association of the BDCs is no longer where people think we are mallams. We are a group of professionals. We can collaborate, we can give advice, and most of us are even coming from the banking industry. We are lawyers, we are engineers. The BDCs should be allowed to access dollars or diaspora remittances through the autonomous forex windows that enable operators to receive IMTO proceeds, among others.
“This is the time to break the current industry monopoly that puts the remittances market in the hands of few players depriving others of tapping into the plan,” adding that, “There is an urgent need to enhance dollar liquidity in the market and ensure the stability of prices in the economy.”
Unlisted Securities Investors Gain N10bn in One Week
By Adedapo Adesanya
The 25th week of trading at the National Association of Securities Dealers (NASD) Over-the-Counter (OTC) Securities Exchange ended on a positive note last Friday.
In the five-day trading week, investors saw an expansion in their investment portfolios by 0.5 per cent or N10 billion as the market capitalisation closed at N1.011 trillion compared with the preceding week’s N1.010 trillion as the NASD Unlisted Securities Index (NSI) increased by 3.86 points to 768.27 points from 764.41 points.
Business Post reports that three stocks on the bourse contributed to the gains reported by unlisted securities investors last week as they overpowered the losses printed by two equities.
Niger Delta Exploration and Production Plc appreciated in the week by 10 per cent to close at N198.00 per share in contrast to the preceding week’s N180 per share, Citi Trust Plc grew by 9.6 per cent to N6.85 per unit from N6.25 per unit, while Central Securities Clearing System (CSCS) Plc appreciated by 2.5 per cent to N14.80 per share from N14.44 per share.
Conversely, NASD Plc lost 8.7 per cent to settle at N13.68 per unit compared with the previous N15.00 per unit, while Nipco Plc depreciated by 5.2 per cent to N58.85 per share from N62.10 per share.
There was a 352.8 per cent increase in the total value of transactions in the week to N324.4 million from N69.9 million, while the volume of trades went down by 57.0 per cent to 6.0 million units from 2.6 million units just as the number of deals decreased by 8.1 per cent to 57 trades from 62 trades of the previous week.
At the close of the week, VFD Group Plc was the most traded security by volume with 1.2 million units, CSCS Plc traded 703,377 units, NASD Plc exchanged 350,935 units, CitiTrust Holdings Plc traded 214,800 units, while NDEP Plc sold 65,300 units.
In terms of the value of trades in the week, VFD Group Plc also topped with N293.5 million, NDEP Plc recorded N12.5 million, CSCS Plc traded N10.4 million, NASD Plc posted N5.3 million, while CSCS Plc had N1.5 million.
On a year-to-date basis, investors have transacted 3.2 billion units worth N21.3 billion in 1,428 deals, with the year-to-date gain at 3.4 per cent.
Trading in Greif Nigeria Shares Halted for Smooth Winding up Process
By Dipo Olowookere
Holders of Greif Nigeria Plc shares have been prevented from trading the security on the floor of the Nigerian Exchange (NGX) Limited for now.
The embargo on the trading of the company’s stocks was placed on Monday, June 20, 2022, to ensure the process of winding up the organisation goes seamlessly.
Greif Nigeria, formerly known as Van Leer Containers Nigeria Plc, is in the business of making steel drums in the country. It also manufactures plastic containers and sheet metal products.
The company, which is a subsidiary of Greif International Holding BV, also offers services for steel punching and aluminium welding.
But lately, things have not been going on smoothly and it is in the process of winding up.
At its Annual General Meeting (AGM) held on January 31, 2022, the shareholders of the firm authorised the board to begin the voluntary winding up of the company.
In accordance with Section 622 of the Companies and Allied Matters Act (CAMA) 2020 which states that a voluntary winding-up shall be deemed to commence at the time of the passing of the resolution for voluntary winding-up, the NGX Regulation (NGX RegCo) Limited, has notified “all trading license holders and the investing public that it has suspended trading in the shares of Greif Nigeria Plc effective on Monday, June 20, 2022, to ensure a smooth winding-up process.”
In a notice filed last week, the agency explained that this action was also in line with Section 624 of CAMA 2020 which provides that a transfer of shares, not being a transfer made to or with the sanction of the liquidator, and any alteration in the status of the members of the company, made after the commencement of a voluntary winding-up, shall be void.
Business Post reports that Greif Nigeria, which uses the ticker Vanleer on the NGX trading platform, has shares outstanding of 42.640 million units and a market capitalisation of N232.4 million as it last traded at N5.45 per unit.
Stock Prices of CWG, 55 Others Shed Weight in One Week
By Dipo Olowookere
Transactions on the floor of the Nigerian Exchange (NGX) Limited last week closed bearish with a week-on-week decline of 0.14 per cent, with the All-Share Index (ASI) and the market capitalisation closing at 51,705.61 points and N27.875 trillion respectively.
Similarly, all other indices finished lower with the exception of the CG, premium, banking, pension, NGX Afr bank value, energy and lotus indices, which appreciated by 0.86 per cent, 1.50 per cent, 0.33 per cent, 0.40 per cent, 0.16 per cent, 0.32 per cent and 0.55 per cent respectively, while the Asem and growth indices closed flat.
In the week, 16 equities gained points compared with the 13 equities of the previous week, while 56 stocks shed weight in contrast to the 51 stocks of the preceding week, with 84 shares closing flat as against the 92 shares of the earlier week.
Data from the exchange showed that CWG was the worst-performing stock as it fell by 14.89 per cent to 80 kobo, RT Briscoe dropped 14.29 per cent to 48 kobo, GlaxoSmithKline depreciated by 13.28 per cent to N6.10, John Holt lost 11.27 per cent to 63 kobo, while Academy Press went down by 10.00 per cent to N1.17.
On the flip side, NAHCO finished the five-day trading week as the best-performing stock as it gained 10.53 per cent to settle at N8.40, Champion Breweries appreciated by 10.00 per cent to N3.74, MRS Oil Nigeria rose by 9.80 per cent to N16.25, FBN Holdings improved by 8.76 per cent to N10.55, while Royal Exchange climbed higher by 6.59 per cent to 97 kobo.
Last week, investors bought and sold 1.121 billion shares worth N13.703 billion in 22,350 deals versus the 940.892 million shares valued at N11.494 billion transacted a week earlier in 20,077 deals.
FCMB, UBA and Oando accounted for 407.770 million shares worth N2.009 billion in 2,181 deals, contributing 36.39 per cent and 14.66 per cent to the total trading volume and value respectively.
A further breakdown showed that financial stocks led the activity chart with the sale of 806.824 million equities worth N6.075 billion in 11,071 deals, accounting for 71.99 per cent and 44.33 per cent of the total equity turnover volume and value respectively.
Energy shares recorded a turnover of 95.031 million units valued at N1.449 billion in 1,849 deals, while conglomerates goods equities traded 66.716 million units valued at N169.517 million in 733 deals.
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