Economy
SEC Seeks Innovative Financial Products for Pension Industry
By Aduragbemi Omiyale
The Director-General of the Securities and Exchange Commission (SEC), Mr Lamido Yuguda, has called for more innovative financial products to meet the needs of the pension industry in Nigeria so as to deepen the capital market and sustain the growth in the sector, especially in the non-interest segment.
Mr Yuguda made this call at a one-day seminar organised by the agency themed The Imperative of Non-Interest Capital Market for Pension Industry.
According to him, the non-interest finance segment holds great potentials in furthering the development of the capital market and the growth of the nation’s economy as it is one of the most appropriate for the funding of long-term infrastructure.
He described the pension industry as one of the fastest-growing in the nation’s economy with assets under management of N13 trillion as at the end of September 2021 adding that of this impressive amount, less than N80 billion is invested in Sukuk, representing a little less than one per cent of total pension assets under management.
“This calls for more innovative financial products to deepen our market and sustain the growth in the industry, especially in the non-interest segment.
“We strongly believe that the capital market has a leading role to play in this regard by providing a variety of long-term investable products to service the needs of the pension industry as well as other investors with a similar focus.
“It is encouraging that the national pension commission has taken concrete steps to improve the regulatory framework for the investment of pension funds in the non-interest capital market by the introduction of an operational framework for the non-interest fund.
“This will no doubt provide an additional opportunity for retirement savings account holders and retirees to invest their savings in financial instruments that are aligned with their lite goals and objectives.
“Indeed, the operationalization of the funds definitely accelerates the national financial inclusion agenda while increasing the quantum of investible funds by unlocking the untapped capital,” he said.
Mr Yuguda stated that as of September 2021, the total assets stood at N7.79 billion constituting about 0.059 per cent of total pension assets under management expressing the hope that the fund assets will grow with robust public awareness, education programs and capacity building of stakeholders through seminars, workshops and programs such as this.
“The SEC in the realisation of the potential of the noninterest segment of the capital market has a veritable avenue for providing long-term capital launched its 10-year capital market masterplan with a very strong focus on the development of the non-interest capital market segment through awareness creation, capacity building, review of regulatory framework and development of non-interest projects and services.
“I am happy to report that a significant number of its strategic initiatives have been achieved as several sharia/ethical funds have been registered by the SEC.
“In addition, the SEC collaborated with the MO towards providing a framework for the issuance of the first FGN Sukuk in 2017 and two other issuances of Sukuk have followed.
“However, we believe that more work still needs to be directed towards achieving other critical initiatives of non-interest in our capital market plan.
‘At SEC, we have been approached by a number of potential corporate issuers of scope and we have registered the first issuer of scope, we are aware that a number of corporate issuers are interested in issuing Sukuk, but some of them have noted that they will like clarity on the neutrality of the Sukuk vis-a-vis corporate bonds.
“The increased supply of scope will hasten the development of the non-interest capital market because I am confident that the non-interest finance experts gathered here today will invoke the interest and attention of participants and enhance their knowledge of the subject to eventually lead to the birth of promoters and on takers of non-interest products of the capital market,” he added.
In a goodwill message, the Director-General of the National Pensions Commission (PenCom) Ms Aisha Dabir Umar, commended the SEC for organising this webinar.
The PenCom chief, represented by the Commissioner Administration, Mr Umar Farouk Aminu, acknowledged the collaborative efforts of the two agencies which have over the years laid acceptable values and good governance standards in their investments of pension funds in the Nigerian capital market.
“As you may be aware, PenCom recently released a list of operational guidelines for non-interest funds. It is our belief that this singular act will promote financial inclusion in Nigeria, and particularly drive enrolment in the macro pension fund. It is my call that industry practitioners gathered here will come up with practical measures to facilitate the issuance of non-interest instruments in the market.”
She stated that PenCom remains resolute in ensuring that all instruments meet this requirement before pension investment and commended the collaboration between PenCom and SEC towards deepening the capital market to sustainably introduce non-interest products.
In his remarks, the Secretary-General of the Islamic Financial Services Board, Dr Bello Danbatta, said Islamic finance is a complementary system adding that no system would be able to develop without integrating it into its financial system.
“Sustainable finance is not complete without integrative finance and integrative finance is only possible when you have non-interest and interest-based finance,” he stated.
By Adedapo Adesanya
Food Concepts Plc neutralized the gains recorded by three securities, returning the NASD Over-the-Counter (OTC) Securities Exchange into the negative territory with a 0.27 per cent loss on Thursday, December 4.
Yesterday, the share price of the parent company of Chicken Republic and PieXpress declined by 34 Kobo to sell at N3.15 per unit compared with the previous day’s N3.49 per unit.
This shrank the market capitalisation of the OTC bourse by N5.72 billion to N2.136 billion from N2.142 trillion and weakened the NASD Unlisted Security Index (NSI) by 9.57 points to 3,571.53 points from 3,581.10 points.
Business Post reports that Central Securities Clearing System (CSCS) Plc went down by 50 Kobo to N38.50 per share from N38.00 per share, FrieslandCampina Wamco Nigeria Plc gained 29 Kobo to sell at N55.79 per unit versus N55.50 per unit, and Geo-Fluids Plc added 5 Kobo to close at N4.60 per share compared with Wednesday’s closing price of N4.55 per share.
Trading data indicated that the volume of securities recorded at the session surged by 6,885.3 per cent to 4.3 million units from the 61,570 units posted a day earlier, the value of securities increased by 10,301.7 per cent to N947.2 million from N3.3 million, and the number of deals went up by 146.7 per cent to 37 deals from the 15 deals achieved in the previous trading session.
At the close of business, Infrastructure Credit Guarantee Company (InfraCredit) Plc was the most traded stock by value on a year-to-date basis with the sale of 5.8 billion units for N16.4 billion, trailed by Okitipupa Plc with 170.4 million units worth N8.0 billion, and Air Liquide Plc with 507.5 million units valued at N4.2 billion.
InfraCredit Plc also finished the session as the most traded stock by volume on a year-to-date basis with 5.8 billion units transacted for N16.4 billion, followed by Industrial and General Insurance (IGI) Plc with 1.2 billion units sold for N420.2 million, and Impresit Bakolori Plc with 536.9 million units traded for N524.9 million.
By Dipo Olowookere
The upward trend witnessed at the Nigerian Exchange (NGX) Limited in recent sessions continued on Thursday as it further improved by 0.10 per cent.
This was despite investor sentiment turning bearish after the local equity market ended with 23 price gainers and 28 price gainers, indicating a negative market breadth index.
UAC Nigeria gained 10.00 per cent to finish at N88.00, Morison Industries appreciated by 9.94 per cent to N3.54, Ecobank rose by 8.53 per cent to N36.90, and Coronation Insurance grew by 8.47 per cent to N2.56.
On the flip side, Ellah Lakes depreciated by 10.00 per cent to N13.14, Eunisell Nigeria also shed 10.00 per cent to finish at N72.90, Transcorp Hotels slipped by 9.95 per cent to N157.50, Omatek shrank by 9.23 per cent to N1.18, and Guinea Insurance dipped by 8.46 per cent to N1.19.
Yesterday, the All-Share Index (ASI) went up by 152.28 points to 145,476.15 points from 145,323.87 points and the market capitalisation chalked up N97 billion to finish at N92.726 trillion compared with the previous day’s N92.629 trillion.
Customs Street was bubbling with activities on Thursday, though the trading volume and value slightly went down, according to data.
A total of 1.9 billion stocks worth N19.2 billion exchanged hands in 23,369 deals during the session versus the N2.3 billion valued at N21.0 billion traded in 21,513 deals a day earlier.
This showed that the number of deals increased by 8.63 per cent, the volume of transactions depleted by 17.39 per cent, and the value of trades decreased by 8.57 per cent.
For another trading day, eTranzact led the activity chart with 1.6 billion units sold for N6.4 billion, Fidelity Bank traded 31.0 million units worth N589.3 million, GTCO exchanged 28.3 million units valued at N2.5 billion, Zenith Bank transacted 27.1 million units for N1.6 billion, and Ecobank traded 21.9 million units worth N744.3 million.
By Adedapo Adesanya
The Naira marginally depreciated against the United States Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEM) on Thursday, December 4 amid renewed forex pressure associated with December.
At the official market yesterday, the Nigerian currency lost 0.01 per cent or 18 Kobo against the Dollar to close at N1,447.83/$1 compared with the previous day’s N1,447.65/$1.
It was not a different scenario with the local currency in the same market segment against the Pound Sterling as it further shed N15.43 to sell for N1,930.97/£1 versus Wednesday’s closing price of N1,925.08/£1 and declined against the Euro by 20 Kobo to finish at N1,688.74/€1 compared with the preceding session’s N1,688.54/€1.
Similarly, the Nigerian Naira lost N5 against the greenback in the black market to quote at N1,465/$1 compared with the previous day’s value of N1,460/$1 but closed flat against the Dollar at the GTBank FX counter at N1,453/$1.
Fluctuations in trading range is expected to continue during the festive season as traders expect the Nigerian currency to be stable, supported by intervention s by to the Central Bank of Nigeria (CBN)in the face of steady dollar demand.
Support is also expected in coming weeks as seasonal activities, particularly the stylised “Detty December” festivities, will see inflows that will give the Naira a boost after it depreciated mildly last month, according to a new report.
“As the festive Detty December season intensifies, inbound travel, tourism spending, and diaspora inflows are expected to provide moderate support for FX liquidity,” analysts at the research unit of FMDA said in its latest monthly report for November.
Traders cited by Reuters expect that the Naira will trade within a band of N1,443-N1,450 next week, buoyed by improved FX interventions by the apex bank.
Meanwhile, the crypto market was down as the US Federal Reserve’s preferred inflation gauge, core PCE, likely rose in September—moving in the wrong direction. However, volatility indices show no signs of major turbulence.
If the actual figure matches estimates, it would mark 55 straight months of inflation above the US central bank’s 2 per cent target. The sticky inflation would strengthen the hawkish policymakers, who are in favour of slower rate cuts.
Ripple (XRP) depreciated by 4.5 per cent to $2.08, Solana (SOL) went down by 3.8 per cent to $138.11, Litecoin (LTC) shrank by 3.1 per cent to $83.23, Dogecoin (DOGE) slid by 2.5 per cent to $0.1463, Cardano (ADA) declined by 2.1 per cent to $0.4368, Bitcoin (BTC) fell by 0.9 per cent to $91,975.45, Binance Coin (BNB) crumbled by 0.9 per cent to $899.41, and Ethereum (ETH) dropped by 0.7 per cent to $3,156.44, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) closed flat at $1.00 apiece.
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