Economy
Fidelity Bank, Skye Bank, Unity Bank, Others Risk Sanctions
By Modupe Gbadeyanka
Not less than 28 companies trading their shares on the Nigerian Stock Exchange (NSE) risk being sanctioned by the regulator for failing to meet post-listing requirements, timely release of operational reports and financial statements.
According to The Nation, the firms include three commercial banks, a microfinance bank, three mortgage bankers, five insurance companies, one investment management firm and 15 other firms in various non-financial sectors.
The defaulting firms include Unity Bank Plc, Skye Bank Plc, Fidelity Bank Plc, Fortis Microfinance Bank Plc, Staco Insurance Plc, African Alliance Insurance Plc, Goldlink Insurance Plc, UNIC Insurance Plc, International Energy Insurance, Aso Savings & Loans Plc, Resort Savings & Loans, Union Homes Savings & Loans Plc, and Deap Capital Management & Trust Plc.
Others include R.T Briscoe Plc, Smart Products Nigeria Plc, Afromedia Plc, Roads Nigeria Plc, Nigerian German Chemical Plc, Thomas Wyatt Nigeria Plc, Golden Guinea Breweries Plc, Anino International Plc, Juli Plc, Ekocorp Plc, Union Dicon Salt Plc, FTN Cocoa Processors Plc, Evans Medical Plc, Omatek Ventures Plc and Dn Tyre & Rubber Plc.
The companies failed to submit their interim report and accounts for the period ended June 30, 2018. Such default is marked out by the Exchange as a corporate governance failure, which attracts monetary fines, “naming and shaming” tag, suspension of shares from trading and delisting in incurable cases of default.
It was gathered that 20 of the firms missed the regulatory deadline of July 30, while Fidelity Bank, which audits its half-year results, missed the August 29 deadline.
Under the rules, a late submission attracts a fine of N100,000 daily for the first 90 calendar days of non-compliance, another N200,000 per day for the next 90 calendar days and a fine of N400,000 per day thereafter until the date of submission.
With these, late submission under the first instance of 90 days could attract N9 million, the additional 90 days will attract N18 million while such delay beyond the first 180 days to the next 180 days could attract as much as N72 million, bringing fines payable by a defaulting company within a year to N99 million.
The list of sanctions shows fines ranging from a low of N0.1 million to as high as N51.4 million. Companies had been fined more than N400 million and N500 million in 2016 and 2017 respectively for failure to submit accounts within scheduled periods.
There are 15 companies currently under suspension for failure to meet scheduled submission of financial statements. Forty one monetary fines have so far been placed on companies in 2018, more than 38 monetary fines slammed on companies in 2017.
The monetary fines become almost automatic after the expiration of the deadline. According to the rules, notwithstanding that a company takes the required steps during the cure periods or later complies with the provisions of the rules, any company that defaults in filing its accounts within the stipulated periods shall be liable to pay the applicable penalties, except the affected company had received waiver or extension of time by the Exchange.
Under the rules, quoted companies are required to file their unaudited quarterly accounts with the NSE not later than 30 calendar days after the relevant quarter. Where the company chooses to audit its quarterly accounts, it is required to file such accounts not later than 60 calendar days after the relevant quarter. For annual audited accounts, companies are required to file their audited annual report and accounts with the Exchange not later than 90 calendar days after the relevant year end.
In addition to the monetary fines, a defaulting company will be tagged with the “Below Listing Standard” (BLS) or any other sign or expression to indicate that the company has failed to submit its accounts within the stipulated period and this tag shall remain for as long as the company fails to file its accounts.
Where a company fails to file its accounts after the expiration of the first 90 days, the NSE will send such a company a “second filing deficiency notification” within two business days after the end of the first 90 days.
In addition, the Exchange will suspend trading in the company’s shares and notify the Securities and Exchange Commission (SEC) and the market within 24 hours of the suspension.
Where a company fails to also file its accounts after the second additional period of 90 days, bringing the default days to 180, days, the Exchange may take further appropriate actions including cautioning shareholders that the company’s listing is under threat of delisting and eventual delisting.
The rules also empower the Exchange to delist a company within the first 90 days where the NSE determines that granting extended period is not necessary, especially where there are proven issues of financial fraud, gross corporate governance abuses and other illegalities.
In a more rigorous naming and shaming practice, a defaulting company is expected to within three business days of receipt of the second filing deficiency notification and suspension of trading in its securities, to inform the Exchange in writing of the status of the accounts, and issue a press release, of not less than half a page, in at least two national daily newspapers, with the company’s web address indicated in the newspaper publication, and posted on the company’s website disclosing the status of the relevant accounts, reason for the delay in submission, and the anticipated filing date. An electronic copy of the publication shall be filed with the Exchange on the same day as the publication. The suspension of trading in the company’s shares shall only be lifted upon submission of the relevant accounts in line with the requirements of the NSE.
According to the report, the stock market regulatory agency plans to “apply relevant rules” in dealing with the defaulters.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange extended rallied by 1.18 per cent on Friday, May 8, its fifth in a row for this week.
During the session, the market capitalisation increased by N28.96 billion to N2.488 trillion from N2.459 trillion, and the NASD Unlisted Security Index (NSI) jumped by 48.39 points to 4,158.77 points from the 4,110.38 points recorded a day earlier.
The growth witnessed yesterday was spurred by the gains recorded by six securities, led by 11 Plc, which chalked up N11.00 to sell at 221.10 per unit versus Thursday’s closing price of N210.10 per unit. FrislandCampina Wamco Nigeria Plc added N10.26 to close at N132.98 per share compared with the previous day’s N127.06 per share, and Central Securities Clearing System (CSCS) Plc rose by N2.82 to N75.90 per unit from N73.08 per unit.
In addition, Lighthouse Financial Services Plc appreciated by 7 Kobo to 86 Kobo per share from 81 Kobo per share, UBN Property Plc climbed higher by 5 Kobo to N2.25 per unit from N2.20 per unit, and First Trust Mortgage Bank Plc gained 2 Kobo to close at N2.32 per share, in contrast to the previous session’s N2.30 per share.
Conversely, Geo-Fluids Plc went down by 20 Kobo to N2.90 per unit from N3.10 per unit, and Afriland Properties Plc lost 5 Kobo to end at N16.95 per share versus N17.00 per share.
The volume of transactions for the session surged by 41.8 per cent to 528,891 units from 372,916 units, and the value grew by 11.4 per cent to N34.0 million from N30.4 million, while the number of deals slid by 7.4 per cent to 25 deals from 27 deals.
The most traded stock by volume on a year-to-date basis was Great Nigeria Insurance (GNI) Plc, with 3.4 billion units worth N8.4 billion. Resourcery Plc occupied the second spot after trading 1.1 billion units valued at N415.7 million, and the third position was occupied by Infrastructure Guarantee Credit Plc with 400 million units sold for N1.2 billion.
The most traded stock by value on a year-to-date basis was GNI Plc with 3.4 billion units transacted for N8.4 billion, followed by CSCS Plc with 60.5 million units exchanged for N4.1 billion, and Okitipupa Plc with 27.8 million units traded for N1.9 billion.
By Dipo Olowookere
The local stock exchange reversed the previous day’s loss, with a 2.10 per cent surge on Friday as a result of demand for large-cap equities like Dangote Cement, First Holdco and others.
It was observed that apart from the insurance counter, which shed 0.37 per cent, every other sector closed higher yesterday.
The industrial goods index expanded by 7.26 per cent, the banking segment increased by 3.35 per cent, the consumer goods industry rose by 0.21 per cent, and the energy sector soared by 0.14 per cent.
Consequently, the All-Share Index (ASI) of the Nigerian Exchange (NGX) Limited improved by 5,041.22 points to 244,775.83 points from 239,734.61 points, and the market capitalisation added N3.235 trillion to settle at N157.094 trillion compared with the preceding session’s N153.859 trillion.
The quintet of Neimeth, Cadbury Nigeria, LivingTrust Mortgage Bank, Mecure, and Dangote Cement led the advancers’ table on Friday, with 10.00 per cent growth each to quote at N9.90, N72.60, N3.52, N72.60, and N1,088.00, respectively.
On the flip side, the duo of UAC Nigeria and Industrial and Medical Gases lost 10.00 per cent each to sell for N171.00 and N42.30, respectively, as Eterna declined by 9.93 per cent to N33.55, Learn Africa slipped by 9.89 per cent to N8.20, and Deap Capital tripped by 9.69 per cent to N5.50.
The most active stock for the day was VFD Group, with a turnover of 102.9 million units valued at N1.1 billion. FCMB transacted 99.4 million units worth N1.1 billion, UBA traded 94.5 million units for N3.8 billion, Access Holdings exchanged 85.4 million units worth N2.0 billion, and Zenith Bank sold 46.5 million units valued at N5.8 billion.
At the close of trades, market participants traded 1.1 billion units worth N55.0 billion in 69,996 deals, in contrast to the 1.8 billion units valued at N72.2 billion transacted in 81,131 deals a day earlier, showing a crash in the trading volume, value, and number of deals by 38.89 per cent, 23.82 per cent, and 13.73 per cent, respectively.
By Adedapo Adesanya
The Naira fell against the US Dollar by N5.54 or 0.41 per cent to N1,361.39/$1 from N1,355.85/$1 in the Nigerian Autonomous Foreign Exchange Market (NAFEX) on Friday, May 8.
The domestic currency also depreciated against the Pound Sterling in the official market during the session by N8.50 to trade at N1,853.68/£1 compared with the previous day’s N1,845.18/£1, and against the Euro, it lost N9.37 to sell for N1,602.63/€1 versus N1,593.26/€1.
However, at the GTBank FX desk, the Nigerian Naira appreciated against the US Dollar yesterday by N3 to quote at N1,372/$1 compared with Thursday’s closing value of N1,375/$1, and at the parallel market, it traded flat at N1,380/$1.
Despite the volatile outcome of the local currency, it remained within the expected trading range, reflecting sustained FX stabilisation efforts by the Central Bank of Nigeria (CBN), supported by improved liquidity, stronger autonomous inflows, and better price discovery.
Traders point to further gains for the Naira into the coming week, thanks to Dollar supply from foreign investors, exporters and oil companies, while demand is moderate. Nigerian yields are still attractive for foreign investors, serving as a basis for more (FX) flows coming to Nigeria.
Meanwhile, the country’s external reserves dropped by 3.4 per cent to $48.32 billion, from a 2009 high of $50.02 billion recorded on March 11.
In the cryptocurrency market, prices rallied after worries eased, following fresh US airstrikes in Iran that initially sparked a surge in oil prices and a broader risk-off move across crypto markets.
Bitcoin (BTC) added 0.8 per cent to sell at $80,212.54, Solana (SOL) gained 6.5 per cent to sell at $93.76, Cardano (ADA) appreciated by 5.1 per cent to $0.2749, Dogecoin (DOGE) grew by 3.7 per cent to $0.1102, and Ripple (XRP) rose by 3.1 per cent to $1.42.
Further, Binance Coin (BNB) jumped 2.3 per cent to $650.16, Ethereum (ETH) expanded by 1.6 per cent to $2,315.48, and TRON (TRX) increased by 0.1 per cent to $0.3515, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 apiece.
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