Economy
SEC Mulls e-Dividend Fee in Bank Charges
By Adedapo Adesanya
The Securities and Exchange Commission (SEC) has urged the Central Bank of Nigeria (CBN) to include electronic Dividend Mandate Management System (e-DMMS) charges in its Guideline for Bank Charges.
The Acting Director-General of the SEC, Ms Mary Uduk, made this disclosure at the end of the Second Quarter Capital Market Committee Meeting (CMC) in Lagos during the weekend.
She explained that the CBN has published charges for the banks, which means that any transactions carried out by any bank has an established charge.
The agency also announced that considerable progress has been made in the implementation of its consolidation of multiple shareholder accounts and e-DMMS as so far about 3.4 billion shares have been consolidated.
According to her, “The e-dividend charge is not part of the charges from the CBN and so because of that investors, are having issues with banks where for instance, they are charged for so much e-transaction that is not listed as bank charges which they do not know.
“They complained to us and so we decided that we will engage CBN to actually make this part of their charges and so any e-dividend carried out will be charged by the CBN.
“This came up as a result of us stopping the payment of the e-dividend mandate as we were underwriting the cost for the initiative before we mandated investors to pay a token of N150 per mandate.
“We believe the capital market of our dreams can only be achieved through the collaboration of all stakeholders,” Ms Uduk said.
Speaking on considerable progress that has been made in the implementation of its consolidation of multiple shareholder accounts and e-DMMS, she said: “Both measures were introduced as part of checking the growth and possibly eliminating the unclaimed dividend menace in the nation’s capital market.
Ms Uduk revealed that a total of 2.7 million share accounts have so far been captured under the e-DMMS, expressing satisfaction with the regularization of multiple shareholders accounts since it was launched last year, describing investor response as very impressive.
Ms Uduk added that with the help of the Multiple Subscription Committee, 3.4 billion shares have so far been effectively consolidated. The committee, “informed the meeting that the Committee of Heads of Banking Operations had agreed to collaborate with the commission to display banners in (their) banking halls all over the country, sensitizing the public on the regularization of multiple subscriptions of shares.”
Similarly, stockbrokers and registrars are requested “to make available to the Committee on Multiple Subscription Account, on a periodic basis, the number of regularized accounts.”
Company Secretaries of listed companies, she continued, “have also agreed to display similar information on their website and offices.”
The meeting climaxed with a resolve that the SEC should engage relevant stakeholders on the e-Dividend and Multiple Subscription Accounts so as to ensure “that complete investor data are transferred among operators such as Brokers, registrars and the Central Securities Clearing System (CSCS).
SEC was also charge to help discourage unclaimed dividends from building up from securities of newly-listed companies, just as modalities should be developed for validating shareholders’ registers, such that “registrars are furnished with incomplete information such as missing account numbers.”
Speaking further, the Acting DG noted that the issue of unclaimed dividend was dynamic, given that as the old heap is being cleared by the registrars, new ones are mounting by the day.
Furthermore, Ms Uduk said the CMC’s Identity Management Committee gave updates of its meeting with National Information Technology Development Agency (NITDA) on the implications of the Nigerian Data Protection Regulation on capital market operations.
There are plans, the committee announced, “to develop a standardized data form, which seeks to consolidate registration and access to processes in the capital market by investors.”
After discussions on the issue, the CMC resolved that the SEC invites NITDA to make a presentation on the impact of the Nigerian Data Protection Regulation on the capital market at the 2019 Q3 CMC meeting.
By Dipo Olowookere
A 0.31 per cent gain was recorded by the Nigerian Exchange (NGX) Limited on Tuesday, helped by renewed bargain-hunting by investors, with the year-to-date return extending to 6.61 per cent.
It was observed that the growth achieved by Customs Street yesterday was supported by the banking and the industrial goods indices, which went up by 1.32 per cent and 0.69 per cent apiece.
They offset the losses recorded by the three other sectors, with the insurance counter down by 1.32 per cent, the consumer goods segment down by 0.23 per cent, and the energy space down by 0.17 per cent.
At the close of business, the All-Share Index (ASI) increased by 516.94 points to 165,901.57 points from 165,384.63 points and the market capitalization appreciated by N333 billion to N106.495 trillion from N106.162 trillion.
The market breadth index was positive yesterday after the bourse ended with 35 price gainers and 34 price losers, representing bullish investor sentiment.
The quartet of Industrial and Medical Gases (IMG), Union Dicon, Zichis, and Austin Laz chalked up 10.00 per cent each to sell for N34.65, N9.90, N5.06, and N4.07, respectively, while RT Briscoe appreciated by 9.95 per cent to N9.50.
On the flip side, Omatek lost 10.00 per cent to trade at N2.43, Cutix also fell by 10.00 per cent to N3.15, Union Homes shrank by 9.95 per cent to N76.90, Sunu Assurances declined by 9.94 per cent to N4.62, and Deap Capital crashed by 9.93 per cent to N7.62.
During the trading day, 736.4 million stocks worth N24.7 billion exchanged hands in 46,026 deals compared with the 762.8 million stocks valued at N18.4 billion traded in 55,374 deals a day earlier, indicating a rise in the trading value by 34.24 per cent, and a slip in the trading volume and number of deals by 3.46 per cent and 16.88 per cent apiece.
The activity chart was led by volume on the second trading session of the week by GTCO with 65.9 million equities valued at N6.5 billion, Chams transacted 55.7 million shares worth N249.8 million, Custodian Investment traded 49.8 million stocks for N2.2 billion, Universal Insurance sold 36.1 million equities valued at N51.5 million, and Zenith Bank exchanged 35.4 million shares worth N2.6 billion.
By Adedapo Adesanya
The oil market was up by nearly 2 per cent on Tuesday after the United States shot down an Iranian drone approaching an aircraft carrier and armed boats in the Strait of Hormuz, stoking concerns talks aimed at de-escalating US-Iran tensions could be disrupted.
This action caused the Brent futures to rise by $1.03 or 1.6 per cent to $67.33 per barrel, as the US West Texas Intermediate (WTI) futures jumped by $1.07 or 1.7 per cent to $63.21 a barrel.
Both crude benchmarks dropped more than 4 per cent on Monday after President Donald Trump said Iran was seriously talking with America.
However, the US military shot down an Iranian drone that “aggressively” approached the Abraham Lincoln aircraft carrier in the Arabian Sea on Tuesday.
In the Strait of Hormuz between the Persian Gulf and the Gulf of Oman, Iranian gunboats approached a US-flagged oil tanker in what US and British maritime security sources describe as a failed attempt to interfere with the vessel’s transit.
Members of the Organisation of the Petroleum Exporting Countries (OPEC) including Saudi Arabia, Iran, the United Arab Emirates, Kuwait and Iraq export most of their crude via the strait, mainly to Asia. The Strait of Hormuz, through which roughly a fifth of the world’s oil supply passes, remains Iran’s most obvious pressure point.
Despite the latest development, the UAE urged Iran and the US on Tuesday to use the resumption of nuclear talks this week to resolve a standoff that has led to mutual threats of air strikes. Iran, meanwhile, is demanding that talks be held in Oman not Turkey.
In Ukraine, President Volodymyr Zelenskiy accused Russia on Tuesday of exploiting a US-backed energy truce to stockpile munitions, and using them to attack Ukraine a day before peace talks. This boosted worries that Russia’s oil would remain sanctioned for longer.
On Monday, President Trump announced a trade deal with India, one of the world’s biggest economies and oil importers, on Monday to cut tariffs to 18 per cent from 50 per cent in exchange for the country halting Russian oil purchases and lowering trade barriers.
The American Petroleum Institute (API) estimated that crude oil inventories in the US decreased by 11.1 million barrels in the week ending January 30. Crude oil inventories decreased by 247,000 barrels in the week prior.
Official data from the US Energy Information Administration (EIA) will be published later on Wednesday.
By Adedapo Adesanya
The Africa Finance Corporation (AFC), the continent’s leading infrastructure solutions provider, has reiterated its commitment to playing a pivotal role to support transformative reforms in Nigeria’s power sector.
This is as it act as co-Financial Adviser to the Nigerian government on the successful issuance of the recent N501 billion inaugural tranche under the Presidential Power Sector Financial Reforms Programme (PPSFRP), as part of the N4 trillion Power Sector Bond Programme, aimed at resolving over a decade of legacy debt obligations in Nigeria’s electricity supply industry and restoring financial stability across the sector.
AFC provided comprehensive financial advisory services to the federal government, including the design of the Programme’s negotiation strategy framework, support in negotiating and executing Settlement Agreements with Power Generation Companies (GenCos), and structuring the bond issuance. Working in partnership with CardinalStone Partners as co-Financial Advisers, AFC deployed its deep sector expertise and strong local market knowledge to deliver the landmark transaction.
The programme was overseen by the Presidential Power Sector Debt Reduction Committee (PPSDRC), with technical leadership from the Office of the Special Adviser to the President on Energy, and implemented through NBET Finance Company Plc, a special purpose vehicle of Nigerian Bulk Electricity Trading Plc (NBET). Proceeds from the issuance will be used to settle verified, overdue receivables owed to GenCos for electricity supplied between February 2015 and March 2025, injecting liquidity into the power sector and extinguishing long-standing claims.
Commenting on AFC’s involvement, Mr Banji Fehintola, Executive Board Member and Head, Financial Services at Africa Finance Corporation, said: “The successful issuance of the inaugural tranche under the Power Sector Bond Programme underscores AFC’s commitment to supporting transformative reforms in Nigeria’s power sector. By resolving long-standing liquidity challenges and restoring confidence among investors and operators, this transaction lays the foundation for sustainable growth and improved electricity supply across the country.”
When fully implemented, the programme is expected to impact approximately 5,398MW of electricity generation capacity by Nigerian GenCos and finalise settlement for 290,644.84GWh of electricity billed since 2015. It will also strengthen companies serving about 12 million active registered customers, creating a solid platform for new investments in capacity enhancement and expansion.
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