Economy
Economic Recession Outcome of Monetary, Fiscal Policy Failure—Report
By Mike Uzor
The latest edition of Nigeria Banking & Economy 2016, a publication of Datatrust Consulting Ltd, a firm of financial analysts, has been released.
The research report, which is an x-ray of the Nigerian economy and the banking industry, found a major link between the ravaging economic recession and delayed fiscal action on the part of government.
Inability to move decisively on the path of stimulatory intervention, rather than lack of funds, is the main factor that let the slowing economy plunge into a recession in 2016.
With the long delay in approving the 2016 budget, the fiscal authorities failed to provide the critical fiscal stimulus at the same time that monetary policy remained stringent.
Datatrust economists also affirm that the policy of treasury single account hindered the ability of monetary policy to sustain the flow of goods and services within the economy.
Nigeria’s economy in 2016 experienced a macroeconomic policy lull during which neither fiscal nor monetary policy was effectively deployed to sustain the momentum of the nation’s economic activities.
Efforts to prevent economic decline requires swiftness in order to keep production and consumption functions streaming at normal speed. Nigeria missed the critical point of stimulatory intervention to avert economic recession.
Banks were hindered from helping businesses, the capital market windows remained shut and government held back the much needed stimulatory spending force.
The outcome was a financially arid economy in which both producers and consumers lacked adequate liquidity to operate optimally.
The broken capacity of the capital market as a source of new money is a major factor in the cash flow problems facing companies.
The painstaking analysis, running to over 140-pages, identified a combination of monetary and fiscal stimulus as the effective therapy to end economic recession.
The annual publication offers government and regulators policy options based on research findings for addressing critical issues in the economy and the banking sector.
The report takes a special focus on the effects of macroeconomic developments and regulatory policies on the banking sector that constitutes the nerve centre of the economy.
Datatrust study finds that the banking sector has come under much regulatory strain once again even as it was yet to recover fully from the effects of the last global financial crisis.
A sudden enforcement of government’s treasury single account policy has put banks under an unplanned liquidity pressure, which has forced them to liquidate earning assets.
The results are a major slowdown in revenue growth and decline in the size of the balance sheet. It is evidently a wrong time to run a policy that stems the growth in bank lending to an economy in decline.
The general decline in economic activity has again exposed banks to a major operating pressure – loan recovery difficulties.
Rising loan loss expenses at a time of inability to grow revenue is the explanation for declining profit margin, falling profits and losses.
These developments have warranted a cost cutting bandwagon among banks, including layoffs, which are rather reinforcing the economic recession from the angle of domestic consumption.
Assurances that Nigeria will be out of recession in 2017 need to be supported by convincing new policy actions and the authorities need to show the policy transmission mechanism that would lead to reversing these adverse economic trends in the production and consumption functions of the economy.
Money and capital market windows need to be expanded to complement the highly devalued government spending in stimulating economic activity.
Many banks have been trying to achieve full recovery and to resume growth since the downturn induced by the global financial crisis.
Those efforts have been scuttled by the present policy environment so that they are struggling for survival breathes once again.
Policymakers have, as usual, continued to give assurances of good health for the banks; they need to back up their words with policies that empower both banks and their customers.
The banking sector provides the largest meeting point of savers and investors and therefore serves as the nerve centre of the nation’s financial intermediation. It therefore needs to be saved from the type of violent regulatory policy changes to which it is continually exposed.
The report shows details of how each bank is responding to the operating and regulatory challenges and performance prospects going forward. It used a five-year track record of income statements and balance sheets of banks to establish the major operating trends.
With average industry ratio benchmarks, the report makes it clear to see how each bank’s figures compare or contrast from the general industry picture.
The general industry trends as well as individual banks conditions are provided to guide regulatory policies towards ensuring stability and healthy growth in the banking sector. They also provide a reliable guide to strategic decisions and actions on the part of the banks themselves.
The study also shows the various competitive leagues in the banking industry such as leadership by the size of the balance sheet, gross income and profit, etc. The performance charts show the ability to convert assets into revenue and revenue into profit. The analysis brings out clearly each bank’s cost to income relationship and shows how it is either helping or hitting the bottom line.
A major worrisome trend defined by the report is the rapidly growing proportion of revenue devoted to loan loss expenses. This is an unhealthy trend that needs to be checked in order to encourage new lending.
The bearish trend the stock market has taken on banking stocks is a reflection of the uncertain earnings outlook of the sector and regulators cannot afford to ignore this signal. A situation where the banking industry giants have virtually become penny stocks cannot be safely ignored.
Mike Uzor is the Chief Financial Analyst at Datatrust Consulting Ltd
By Adedapo Adesanya
The domestic supply of Premium Motor Spirit (PMS), also known as petrol, from the Dangote Refinery increased by 64.4 percent in December 2025, contributing to an enhancement in Nigeria’s overall petrol availability.
This is according to the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) in its December 2025 Factsheet Report released on Thursday.
The downstream regulatory agency revealed that the private refinery raised its domestic petrol supply from 19.47 million litres per day in November 2025 to an average of 32.012 million litres per day in December, as it quelled any probable fuel scarcity associated with the festive month.
The report attributed the improvement to more substantial capacity utilisation at the Lagos-based oil facility, which reached a peak of 71 per cent in December.
The increased output from Dangote Refinery contributed to a rise in Nigeria’s total daily domestic PMS supply to 74.2 million litres in December, up from 71.5 million litres per day recorded in November.
The authority also reported a sharp increase in petrol consumption, rising to 63.7 million litres per day in December 2025, up from 52.9 million litres per day in the previous month.
In contrast, the domestic supply of Automotive Gas Oil (AGO) known as diesel declined to 17.9 million litres per day in December from 20.4 million litres per day in November, even as daily diesel consumption increased to 16.4 million litres per day from 15.4 million litres per day.
Liquefied Petroleum Gas (LPG) supply recorded modest growth during the period, rising to 5.2 metric tonnes per day in December from 5.0 metric tonnes per day in November.
Despite the gains recorded by Dangote Refinery and modular refineries, the NMDPRA disclosed that Nigeria’s four state-owned refineries recorded zero production in December.
It said the Port Harcourt Refinery remained shut down, though evacuation of diesel produced before May 24, 2025, averaged 0.247 million litres per day. The Warri and Kaduna refineries also remained shut down throughout the period.
On modular refineries, the report said Waltersmith Refinery (Train 2 with 5,000 barrels per day) completed pre-commissioning in December, with hydrocarbon introduction expected in January 2026. The refinery recorded an average capacity utilisation of 63.24 per cent and an average AGO supply of 0.051 million litres per day
Edo Refinery posted an average capacity utilisation of 85.43 per cent with AGO supply of 0.052 million litres per day, while Aradel recorded 53.89 per cent utilisation and supplied an average of 0.289 million litres per day of AGO.
Total AGO supply from the three modular refineries averaged 0.392 million litres per day, with other products including naphtha, heavy hydrocarbon kerosene (HHK), fuel oil, and marine diesel oil (MDO).
The report listed Nigeria’s 2025 daily consumption benchmarks as 50 million litres per day for petrol, 14 million litres per day for diesel, 3 million litres per day for aviation fuel (ATK), and 3,900 metric tonnes per day for cooking gas.
Actual daily truck-out consumption in December stood at 63.7 million litres per day for petrol, 16.4 million litres per day for diesel, 2.7 million litres per day for ATK and 4,380 metric tonnes per day for cooking gas.
By Adedapo Adesanya
The Securities and Exchange Commission (SEC) has introduced a comprehensive revision of minimum capital requirements for nearly all capital market operators, marking the most significant overhaul since 2015.
The changes, outlined in a circular issued on January 16, 2026, obtained from its website on Friday, replace the previous regime. Operators have been given until June 30, 2027, to comply.
The SEC stated that the reforms aim to strengthen market resilience, enhance investor protection, discourage undercapitalised operators, and align capital adequacy with the evolving risk profile of market activities.
According to the circular, “The revised framework applies to brokers, dealers, fund managers, issuing houses, fintech firms, digital asset operators, and market infrastructure providers.”
Some of the key highlights of the new reforms include increment of minimum capital for brokers from N200 million to N600 million while for dealers, it was raised to N1 billion from N100 million.
For broker-dealers, they are to get N2 billion instead of the previous N300 million, reflecting multi-role exposure across trading, execution, and margin lending.
The agency said fund and portfolio managers with assets above N20 billion must hold N5 billion, while mid-tier managers must maintain N2 billion with private equity and venture capital firms to have N500 million and N200 million, respectively.
There was also dynamic rule as firms managing assets above N100 billion must hold at least 10 per cent of assets under management as capital.
“Digital asset firms, previously in a regulatory grey area, are now fully covered: digital exchanges and custodians must maintain N2 billion each, while tokenisation platforms and intermediaries face thresholds of N500 million to N1 billion. Robo-advisers must hold N100 million.
“Other segments are also affected: issuing houses offering full underwriting services must hold N7 billion, advisory-only firms N2 billion, registrars N2.5 billion, trustees N2 billion, underwriters N5 billion, and individual investment advisers N10 million. Market infrastructure providers carry some of the highest obligations, with composite exchanges and central counterparties required to maintain N10 billion each, and clearinghouses N5 billion,” the SEC added.
By Aduragbemi Omiyale
The founder and chief executive of Austin Laz and Company Plc, Mr Asimonye Austin Lazarus Azubuike, has sold off about 52.24 million shares of the organisation.
The stocks were offloaded in 11 tranches at an average price of N4.36 per unit, amounting to about N227.8 million.
The transactions occurred between December 2025 and January 2026, according to a notice filed by the company to the Nigerian Exchange (NGX) Limited on Friday.
Business Post reports that Austin Laz is known for producing ice block machines, aluminium roofing, thermoplastics coolers, PVC windows and doors, ice cream machines, and disposable plates.
The firm evolved from refrigeration sales to diverse manufacturing since its incorporation in 1982 in Benin City, Edo State, though facing recent operational halts.
According to the statement signed by company secretary, Ifeanyi Offor & Associates, Mr Azubuike first sold 1.5 million units of the equities at N2.42, and then offloaded 2.4 million units at N2.65, and 2.0 million units at N2.65.
In another tranche, he sold another 2.0 million units at a unit price of N2.91, and then 5.0 million units at N3.52, as well as about 4.5 million at N3.87 per share.
It was further disclosed that the owner of the company also sold 9.0 million shares at N4.25, and offloaded another 368,411 units at N4.66, then in another transaction sold about 6.9 million units at N4.67.
In the last two transactions he carried out, Mr Azubuike first traded 10.0 million units equities at N5.13, with the last being 8.5 million stocks sold at N5.64 per unit.
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