Economy
FMDQ to Begin Exchange-Traded Derivatives Market July 12
By Adedapo Adesanya
The MDQ Securities Exchange Limited has announced plans to introduce its dynamic Exchange-Traded Derivatives market on July 12, 2023.
The new market will offer three products – the Federal Government of Nigeria Bond Futures, Treasury Bills Futures, and Open Market Operation Bills Futures, at the commencement of its operations.
The exchange, in a statement, said these products would deliver the dividends of the derivatives market by serving as useful risk management tools, supporting price discovery, competitiveness, and market efficiency, which in turn will help attract capital flows, reduce the cost of capital, promote secondary market liquidity, and ultimately deepen the Nigerian financial markets.
It noted that financial markets are plagued with heightened price volatility, fluctuating market prices/rates, and the constant uncertainty of macroeconomic indicators, with the Nigerian financial markets not faring any better.
Hence, the new ETD market is its response to the counter and assuage these adverse effects; robust and efficient risk management tools, such as derivatives, are typically employed.
“Whilst model markets have been able to harness the potential of the derivatives markets to mitigate risk efficiently, diversify investment portfolios, and allow businesses to pursue expansion with a higher risk in a safe manner, the reverse is the case in emerging and frontier markets, such as Nigeria, as derivatives markets are non-existent or small – with a dearth of derivatives products – at best, and hedging costs are high, making it uninteresting for market participants,” it said.
FMDQ noted that it conducted a feasibility study in 2015 to launch Nigeria’s most dynamic ETD market in collaboration with market stakeholders, thereby introducing exchange-traded risk hedging products to the Nigerian financial markets as is obtainable in other developing and developed financial markets globally.
The project, according to the firm, has recorded many milestones and implemented several initiatives including, but not limited to, the development of the FMDQ ETD Market Framework, SEC-approved Rules, and membership requirements; deployment of fit-for-purpose and optimised ETD trading and clearing modules on the FMDQ Q-ex System; development of Risk Management and Operational Framework across the financial market infrastructure (FMI) value chain; development of SEC-registered derivatives products; and execution of various stakeholder engagements and training sessions.
It was disclosed that it has impacted over 2,600 market stakeholders across the financial markets value chain, ranging from regulators, financial and non-bank financial institutions, corporate treasurers, accountants, legal practitioners, journalists and individuals, to sensitise and promote readiness for the imminent launch of the FMDQ ETD market.
As market participants position themselves to take advantage of the emerging novel segment of the financial markets, FMDQ Exchange is working with its 21 dealing members (DMs), three DMs with full licences and 18 DMs with Approval-in-Principle – to participate in the FMDQ ETD market as its pioneer Derivatives Trading Members (DTMs).
The DTMs will receive support from FMDQ Clear through six (6) Deposit Money Banks (DMBs) who will share mutualised responsibility, as Members of the CCP, in its mandate of ‘de-risking’ the Nigerian financial markets either as General Clearing Members (GCMs) – capable of clearing transactions for their proprietary positions and those of other DTMs and clients; or as Direct Clearing Members (DCMs) – capable of clearing their proprietary positions and those of their clients only.
It said of the six DMBs, there are five GCMs, three of which have full licences (Access Bank Plc, Stanbic IBTC Bank Plc, and Zenith Bank Plc), whilst the other two have Approval-in-Principle, pending the completion of their SEC registration (First City Monument Bank Limited and United Bank for Africa PLC). The sixth DMB (Fidelity Bank PLC) is a DCM with an Approval-in-Principle, also pending the completion of its SEC registration.
In support of the launch of an active and thriving ETD market, FMDQ Exchange introduced the first of its kind Derivates-focused Podcast in Nigeria, Q-Dialogue, an FMDQ-framed colloquy, which is aimed at providing valuable, accurate, and objective information and insight on the FMDQ ETD market.
To further its business development mandate to implement initiatives that promote awareness and drive participation in the FMDQ derivatives market, FMDQ Exchange developed the Q-Estimator, an automated calculator that avails market participants the opportunity to estimate the cost of hedges and potential profit/loss in derivatives transactions or positions in the Nigerian financial markets, thereby equipping market participants to make strategic and informed investment decision-making in the FMDQ derivatives market.
By Adedapo Adesanya
Central Securities Clearing System (CSCS) Plc bested four price decliners on the NASD Over-the-Counter (OTC) Securities Exchange on Monday, April 27. The alternative stock market opened the week bullish during the session with a 0.03 per cent uptick.
According to data, the security depository company added N2.61 to its share price to close at N76.26 per unit compared with the preceding session’s N78.87 per unit.
As a result, the market capitalisation of the platform increased by N820 million to N2.425 trillion from N2.424 trillion, and the NASD Unlisted Security Index (NSI) gained 1.38 points to finish at 4,053.97 points compared with the 4,052.58 points it ended last Friday.
The four price losers were led by NASD Plc, which slumped by N3.80 to sell at N34.70 per share versus N38.50 per share. FrieslandCampina Wamco Nigeria Plc fell by N1.45 to N98.10 per unit from N99.55 per unit, Food Concepts Plc slid by 27 Kobo to N2.43 per share from N2.70 per share, and Geo-Fluids Plc dipped by 9 Kobo to N2.91 per unit from N3.00 per unit.
The value of securities transacted by market participants went down by 82.0 per cent to N7.4 million from N41.3 million units, the volume of securities declined by 28.5 per cent to 319,831 units from 447,403 units, and the number of deals dropped by 34.1 per cent to 29 deals from 44 deals.
Great Nigeria Insurance (GNI) Plc was the most active stock by value on a year-to-date basis with 3.4 billion units worth N8.4 billion, followed by CSCS Plc with 59.6 million units sold for N4.0 billion, and Okitipupa Plc with 27.8 million units exchanged for N1.9 billion.
Also, GNI Plc was the most traded stock by volume on a year-to-date basis with 3.4 billion units valued at N8.4 billion, followed by Resourcery Plc with 1.1 billion units traded for N415.7 million, and Infrastructure Guarantee Credit Plc with a turnover of 400 million units worth N1.2 billion.
By Adedapo Adesanya
The first trading day of the week in the currency market was bearish for the Naira in the Nigerian Autonomous Foreign Exchange Market (NAFEX) on Monday, April 27.
Yesterday, it lost N5.80 or 0.43 per cent against the United States Dollar to trade at N1,364.24/$1, in contrast to the N1,358.44/$1 it was traded last Friday.
In the same vein, the Nigerian currency depreciated against the Pound Sterling in the official market by N13.70 to close at N1,847.72/£1 versus the preceding session’s N1,834.02/£1, and slumped against the Euro by N11.56 to sell at N1,602.29/€1 versus N1,590.73/€1.
Also, the Nigerian Naira tumbled against the greenback during the trading day by N5 to quote at N1,385/$1 compared with the previous rate of N1,380/$1, and at the GTBank FX desk, it traded flat at N1,370/$1.
The poor performance of the domestic currency could be attributed to liquidity shortage at the official currency market on Monday, which came amid surging demand for international payments. At $76.50 million, interbank liquidity printed higher across 79 deals, up from the $43.572 million reported on Friday.
Nigeria’s gross external reserves declined to $48.45 billion amid a month-long decline in inflows, amid uncertainties in the global commodity market. The depletion of foreign reserves could be partly attributed to the Central Bank of Nigeria’s intervention in the FX market.
The market remains perturbed by persistent concerns over liquidity constraints, policy transparency, and weakening confidence in Nigeria’s FX market, while boosters, including oil prices, continue to look rocky due to stalled discussions and unclear ceasefire negotiations between the US and Iran.
A look at the cryptocurrency market, Bitcoin (BTC) has been rejected near $79,000 three times in eight sessions, leaving the level as the de facto ceiling of its current trading range even as major cryptocurrencies trade lower over the past day. It lost 0.9 per cent to sell at $77,003.61.
Analysts say that upcoming US Federal Reserve policy decisions and top tech firms’ earnings this week could provide the catalyst to push bitcoin decisively above $80,000.
The market also continued to weigh Iran’s interim deal proposal to reopen the Strait of Hormuz, which failed to advance over the weekend. The White House said US officials were discussing the latest Iranian proposal but maintained “red lines” on any deal to end the eight-week war.
Solana (SOL) dropped 1.8 per cent to $84.25, Ripple (XRP) went down by 1.6 per cent to $1.39, Ethereum (ETH) depreciated by 1.3 per cent to $2,290.00, Binance Coin (BNB) declined by 0.5 per cent to $625.18, and Cardano (ADA) fell by 0.2 per cent to $0.2480.
However, Dogecoin (DOGE) rose by 2.0 per cent to $0.1002, and TRON (TRX) appreciated by 0.2 per cent to $0.3242, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 apiece.
By Aduragbemi Omiyale
One of the leading salt makers in Nigeria, NASCON Allied Industries Plc, has set its eyes on some strategies aimed to deliver more value to shareholders.
The chief executive of the company, Mrs Aderemi Saka, said efforts are being made to surpass the performance of last year.
In the 2025 financial year, the organisation recorded a 27 per cent growth in revenue, while post-tax profit grew by over 100 per cent to N33.5 billion, with the earnings per share (EPS) expanding by 115 per cent to N12.41 from N5.77 Kobo in the previous year.
The impressive performance, attributed to a clear strategic vision, disciplined execution and sustained focus on cost-saving initiatives across production, logistics and fleet management, resulted in a 200 per cent increase in dividend payout to shareholders to N6 per share.
Mrs Saka, at the firm’s Annual General Meeting (AGM) in Lagos, said the strategic priorities for the coming year include deeper cost optimisation, expanded market penetration, strengthened energy diversification and sustainability initiatives, as well as accelerated digital transformation and process automation.
Earlier, the chairman of NASCON, Mr Olakunle Alake, informed shareholders that the achievements for last year were due to improved operational efficiency, strict cost management and the dedication of the company’s workforce.
“The operating environment in 2025 was characterised by economic volatility, persistent inflation and structural changes across key sectors. Yet, NASCON remained resilient and strategically focused, delivering outstanding value to shareholders,” Mr Alake said.
He noted that operational sustainability remains a core pillar of the organisation’s strategy, stressing that during the year, NASCON introduced Compressed Natural Gas (CNG) trucks into its logistics fleet to reduce fuel costs and minimise exposure to diesel price volatility.
In addition, the company’s state-of-the-art salt refinery, its largest production facility, now runs entirely on natural gas, significantly boosting efficiency while reinforcing NASCON’s commitment to environmental sustainability.
A director in the organisation, Mrs Tonya Lawani, emphasised that the firm remains firmly committed to the principles that have driven its excellent performance, noting that NASCON approaches the new financial year from a position of strength, with further opportunities for growth and improvement.
Speaking on behalf of shareholders, Mr Faruk Umar expressed strong confidence in the company’s trajectory, citing NASCON’s rising share price, which recently crossed the N100 mark, and projecting further appreciation.
He commended the quality of the Board and management team, noting that strong leadership and recent executive appointments have positioned the entity to deliver even greater value to all stakeholders.
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