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Market Gains N35bn as Financial Equities Enjoy More Patronage

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Financial Equities

By Dipo Olowookere

Transactions on the floor of the Nigerian Stock Exchange (NSE) closed bullish on Friday by 0.17 per cent on the back of more demand for financial equities.

While the banking sector appreciated by 0.41 per cent, the insurance index improved by 0.15 per cent, with the industrial goods space closing flat as the energy and consumer goods counters lost 0.33 per cent and 0.15 per cent respectively.

At the close of business, the All-Share Index (ASI) increased 66.56 points to 38,866.39 points from 38,799.83 points, while the market capitalisation rose by N35 billion to N20.335 trillion from N20.300 trillion.

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During the session, the last for the week, investors exchanged 160.6 million stocks worth N1.3 billion in 3,507 deals compared with the 145.3 million shares worth N1.6 billion traded in 3,525 deals the previous day, indicating a 10.54 per cent rise in the trading volume, 18.72 per cent decline in the trading value and 0.51 per cent drop in the number of deals.

The most traded stock for the day was Mutual Benefits Assurance as it transacted 22.9 million units valued at N9.0 million and was trailed by Access Bank, which traded 18.8 million units worth N150.8 million.

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Japaul sold 14.9 million equities valued at N8.6 million, GTBank exchanged 9.2 million stocks for N266.9 million, while Transcorp sold 8.3 million shares for N6.5 million.

Business Post reports that the market breadth closed at equilibrium yesterday with 14 price gainers and 14 price losers.

Honeywell Flour topped the gainers’ chart after its value rose by 8.85 per cent to N1.23, with Sovereign Trust Insurance rising by 8.70 per cent to 25 kobo.

Japaul gained 8.62 per cent to close at 63 kobo, Livestock Feeds appreciated by 7.22 per cent to N1.93, while FCMB went up by 6.57 per cent to N2.92.

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On the losers’ table, Guinness Nigeria occupied the zenith position after its equity price went down by 10.00 per cent to trade at N29.70.

Unity Bank declined by 9.86 per cent to 64 kobo, ABC Transport dropped 9.09 per cent to 30 kobo, Mutual Benefits Assurance lost 7.14 per cent to end at 39 kobo, while UAC Property declined by 6.25 per cent to 75 kobo.

Dipo Olowookere is a journalist based in Nigeria that has passion for reporting business news stories. At his leisure time, he watches football and supports 3SC of Ibadan. Mr Olowookere can be reached via dipo.olowookere@businesspost.ng

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Economy

SEC Introduces Regulatory Incubation Program for Fintechs

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fintechs

By Modupe Gbadeyanka

A regulatory incubation (RI) program for financial technology (fintech) companies operating or seeking to operate in Nigeria has been introduced by the Securities and Exchange Commission (SEC).

A circular issued by SEC disclosed that this framework would be officially launched in the third quarter of 2021 and will operate by admitting identified Fintech business models and processes in cohorts for a one-year period.

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Participation in the RI program will encompass an Initial Assessment Phase and the Regulatory Incubation Phase.

The categories to be admitted into each cohort will be determined based on submissions received through the Fintech Assessment Form and communicated ahead of each take-off date.

SEC explained that the scheme was designed to address the needs of new business models and processes that require regulatory authorisation to continue carrying out full or ancillary technology-driven capital market activities.

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The RI Program has thus been conceived as an interim measure to aid the evolution of effective regulation which accommodates the innovation by fintechs without compromising market integrity and within limits that ensure investor protection.

It was disclosed that review of completed Fintech Assessment Forms will continue on an ongoing basis and those who consider that there is no specific regulation governing their business models or who require clarity on the appropriate regulatory regime for seeking the authorisation of the commission, are encouraged to complete the Fintech Assessment Form.

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Economy

NGX Suspends Trading on GTBank Shares Ahead of Delisting

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GTBank Branch

By Dipo Olowookere

In preparation for the eventual delisting of shares of Guaranty Trust Bank (GTBank) Plc from its trading platform, the Nigerian Exchange (NGX) Limited on Friday, June 18, 2021, placed the banking stock on a full suspension.

GTBank, a tier-one lender trading its equities on the exchange, intends to transform into a financial holding company (Holdco) so as to offer a wide range of services it is restricted to do.

Some years ago, the Central Bank of Nigeria (CBN) directed banks in the country to offload their subsidiaries not performing core lending services.

This was after many deposit money banks (DMBs) were delving into different business ventures, including insurance, stockbroking, asset management, amongst others.

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For the CBN, which regulates the banking industry in Nigeria, most of these banks were losing focus and were not supporting businesses that need funds to grow and then stimulate the economy in the process.

To address this issue, the apex bank asked banks to sell off their non-banking assets and this forced many of them to offload their companies not offering core banking services.

However, there was an opening for banks to still delve into other sectors within the financial and capital markets and this was by operating as a Holdco.

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A few of them towed this path, including FBN Holdings, Stanbic IBTC Holdings and FCMB Group.

Not wanting to be left out, GTBank is joining the party and to achieve this, it is delisting its banking arm, which is the popular GTBank from the stock exchange.

GTBank will now operate as a private company, while the new Holdco, Guaranty Trust Holding Company Plc, will now be a public company. The shares of this new firm will be listed on the NGX after the delisting of GTBank.

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Last Friday, the stock exchange informed the investing community of the latest development, announcing the suspension of trading on GTBank shares.

In the circular sighted by Business Post, the NGX explained that the rationale behind placing GTBank stocks on full suspension is to “prevent trading in the shares of the bank” in preparation of its “eventual delisting”

Before trading on its stocks was suspended on Friday, GTBank closed at N28.55 on Thursday after appreciating by 50 kobo or 1.78 per cent.

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Economy

DLM Capital Remains Best Structured Finance & Securitization Team in West Africa

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DLM Capital

A prominent developmental investment bank, DLM Capital Group, has emerged winner at the Capital Finance International (CFI) 2021 awards as the best-structured finance and securitization team in West Africa.

This award has been won consecutively in three years and affirms the group’s strong performance as a leading investment institution and asset manager.

CFI awards seek to identify the contributions of individuals and organizations that contribute significantly to the advancement of economies and truly add value for all stakeholders.

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DLM Capital Group creates bespoke business solutions for alternative financing and harnessing funds for growth.

The group focuses on four key sectors — consumer credit, agriculture, microfinance, and education with a mandate to reduce poverty and improve living conditions for Africans while mobilizing resources for the continent’s economic and social development.

“In the past three years, our portfolio management team’s performance has remained consistent, and our clients have benefited immensely from exposure to our solutions, including the NMRC securitization deal and the DLM Primero BRT Securitization,” said Head of Corporate Communications and Marketing, DLM Capital Group, Ms Chinwendu Ohakpougwu.

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“We are positioned to provide services to an expansive client base of retail, high net-worth and institutional customers.

“DLM Capital Group remains committed to constantly providing financial solutions that will enable our clients to make a difference, and we are honoured to be recognized once again as a reflection of the quality of support offered to our clients,” she added.

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DLM has won recognition in West African capital markets, acting as a sole arranger to over 80 per cent of structured finance transactions in Nigeria — and all the securitization transactions. It provides deal structuring, advisory execution and capital raising services across the Nigerian capital market.

The institution recently launched an asset financing scheme and is preparing a venture into digital banking under its subsidiary, Sofri.

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