Economy
SEC Sees Huge Untapped Investment Opportunity in Nigeria’s N59.5bn Housing Deficit
By Aduragbemi Omiyale
The Director-General of the Securities and Exchange Commission (SEC), Mr Lamido Yuguda, has said the N159.5 billion investment needed to address the 20 million housing deficit in Nigeria, according to a study by the World Bank Group, provides a huge untapped investment opportunity.
He said this issue could be addressed through the non-interest segment of the capital market, calling on stakeholders to join hands together to bridge the gap.
The SEC chief, who was at the webinar themed the Non-Interest Capital Market as Panacea to Mortgage Financing in Nigeria, said the focus of the programme was timely and relevant.
“I have observed with delight the attention this webinar has generated and come to the conclusion that it is a clear indication of the keen interest in the potential that the non-interest finance segment holds in furthering the development of the Capital Market and the growth of our economy.
“According to a World Bank study, Nigeria’s housing sector requires an investment of about N59.5 trillion to bridge the 20 million housing deficit that is increasing yearly. Undoubtedly, this shows a huge untapped investment opportunity in the Nation’s real estate sector,” he said.
Mr Yuguda stated that governments at both federal and state levels and businesses in Nigeria have been tapping various available sources of financing, including capital market products, for funding real estate developments. The methods of finance have various associated costs, some of which are deemed to be high.
He emphasised that the Nigerian capital market provides a platform for mobilizing long-term funds for real estate investments to complement the mortgage funding sources by commercial banks, primary mortgage institutions, non-governmental organizations, cooperative societies and international finance institutions.
“The capital market creates investment opportunities to enhance the flow of low-cost, long-term funds to the real estate sector through investment vehicles such as Real Estate Investment Trust Schemes (REITs) and mortgage-backed securities. These instruments are usually traded on recognised exchanges.
“I am delighted to inform you that some corporate entities have started taking advantage of the non-interest capital market.
In 2021, Family Homes Funds Limited, a social housing initiative promoted by the federal government, issued a N10 billion Sukuk to finance residential houses across the six geopolitical zones of the country, and it was oversubscribed by over 200 per cent.
“The company also recently raised another N10 billion from the market. This development was a strong indication of the readiness of the capital market and the corresponding investors’ appetite for non-interest mortgage instruments.
“We strongly believe that the operationalization of the non-interest pension fund (Fund VI) and the recent amendment of the pension act to facilitate withdrawals from RSA for down payments of equity contributions for a mortgage will increase the quantum of low-cost, long-term investible funds to the mortgage industry by unlocking the untapped capital in the economy.”
The webinar, he said, therefore, aims to create awareness of the non-interest capital market instruments as a new source of financing for mortgage institutions as well as to facilitate the active participation of the private sector towards positioning the sector to perform optimally and contribute to the overall economy.
Mr Yuguda expressed confidence that the non-interest finance experts at the webinar would evoke the interest and attention of participants and enhance their knowledge on the subject to eventually lead to the birth of promoters and off-takers of new non-interest products in the capital market.
Speaking at the event, the Managing Director CEO of the Federal Mortgage Bank of Nigeria, Mr Madu Hamman, stated that the non-interest financial products have gained a lot of interest from investors in Nigeria and globally and could aid housing finance sources and expand the frontiers of home ownerships through non-interest finance sources.
He stated that the engagement would go a long way in giving the capital market the needed boost to unbundle funds that were hitherto not accessible to Nigerians, adding that it is obvious that the Nigerian economy is on the verge of experiencing a tremendous transformation in this regard.
Mr Hamman said that sourcing non-interest funds from the capital were very necessary for seamless operations as funds sourced from interest-based facilities cannot be leveraged to deliver on non-interest mortgage transactions.
“We are committed to linking the mortgage market with the Nigerian capital market and thereby ensure sustainable long-term funding for the housing and mortgage sector. The non-interest capital market is, therefore, one area for such sustainable long-term funds that can be assured,” he said.
In his remarks, the Managing Director of the Nigerian Mortgage Refinancing Company, Mr Kehinde Ogundimu, said there is no way the nation can meet the housing deficit without having the non-interest services sector actively participating in it and commended the SEC on the initiative.
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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