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
Nigeria added 150,000 barrels per day to its crude production in November 2024 as it continues to pursue an ambitious 2 million barrels per day target.
According to the Organisation of the Petroleum Exporting Countries (OPEC), Nigeria’s oil production rose to 1.48 million barrels per day in November, up from 1.33 million barrels per day the previous month.
In its Monthly Oil Market Report (MOMR), OPEC revealed that at 1.48 million barrels per day, it is the continent’s leading oil producer, surpassing Algeria’s 908,000 barrels per day and Congo’s 268,000 barrels per day.
Business Post reports that OPEC doesn’t account for condensates, which Nigeria’s accounts for in its broader 2 million barrels per day target.
Despite the surge in production levels, Nigeria is still under producing its 1.5 million barrels per day output quota under a deal involving OPEC and 10 other producers known as OPEC+.
OPEC said it relied on primary data gotten through direct communication, noting that secondary sources reported 1.417 million barrels per day as Nigeria’s crude production in November — up from 1.4 million barrels per day in October.
The data also shows that OPEC’s total oil production among its 12 members rose by 104,000 barrels per day in the month under review.
According to secondary sources, the total of the 12 OPEC countries’ crude oil production averaged 26.66 million barrels per day in November 2024.
“Crude oil output increased mainly in Libya, Iran, and Nigeria, while production in Iraq, Venezuela, and Kuwait decreased”, OPEC said.
“At the same time, total non-OPEC DoC crude oil production averaged 14.01 mb/d in November 2024, which is 219 tb/d higher, m-o-m. Crude oil output increased mainly in Kazakhstan and Malaysia,” the organisation added.
In a related development, OPEC trimmed its 2024 and 2025 oil demand growth forecasts for the fifth time this year.
Now, the cartel expects the world’s oil demand growth at 1.61 million barrels per day from the previously 1.82 million barrels per day.
For 2025, OPEC says the world oil demand growth forecast is now at 1.45 million barrels per day, a 900,000 barrels per day cut from the previously expected 1.54 million barrels per day.
On the changes, OPEC says that the downgrade for this year owes to more bearish data received in the third quarter of 2024 while the projections for next year relate to the potential impact that will arise from US tariffs.
By Adedapo Adesanya
The duo of Afriland Properties Plc and Geo-Fluids Plc crashed the NASD Over-the-Counter (OTC) Securities Exchange by a marginal 0.06 per cent on Wednesday, December 11 due to profit-taking activities.
The OTC securities exchange experienced a downfall at midweek despite UBN Property Plc posting a price appreciation of 17 Kobo to close at N1.96 per share, in contrast to Tuesday’s closing price of N1.79.
Business Post reports that Afriland Properties Plc slid by N1.14 to finish at N15.80 per unit versus the preceding day’s N16.94 per unit, and Geo-Fluids Plc declined by 1 Kobo to trade at N3.92 per share compared with the N3.93 it ended a day earlier.
At the close of transactions, the market capitalisation of the bourse, which measures the total value of securities on the platform, shrank by N650 million to finish at N1.055 trillion compared with the previous day’s N1.056 trillion and the NASD Unlisted Security Index (NSI) went down by 1.86 points to wrap the session at 3,012.50 points compared with 3,014.36 points recorded in the previous session.
The alternative stock market was busy yesterday as the volume of securities traded by investors soared by 146.9 per cent to 5.9 million units from 2.4 million units, as the value of shares transacted by the market participants jumped by 360.9 per cent to N22.5 million from N4.9 million, and the number of deals increased by 50 per cent to 21 deals from 14 deals.
When the bourse closed for the day, Geo-Fluids Plc remained the most active stock by volume (year-to-date) with 1.7 billion units valued at N3.9 billion, followed by Okitipupa Plc with 752.2 million units worth N7.8 billion, and Afriland Properties Plc 297.5 million units sold for N5.3 million.
Also, Aradel Holdings Plc, which is now listed on the Nigerian Exchange (NGX) Limited after its exit from NASD, remained the most active stock by value (year-to-date) with 108.7 million units sold for N89.2 billion, trailed by Okitipupa Plc with 752.2 million units valued at N7.8 billion, and Afriland Properties Plc with 297.5 million units worth N5.3 billion.
By Adedapo Adesanya
The euphoria around the recent appreciation of the Naira eased on Wednesday, December 11 after its value shrank against the US Dollar at the Nigerian Autonomous Foreign Exchange Market (NAFEM) by N5.23 or 0.3 per cent to N1,547.50/$1 from the N1,542.27/$1 it was valued on Tuesday.
It was observed that spectators’ activities may have triggered the weakening of the local currency in the official market at midweek as they tried to fight back and ensure the value of funds in foreign currencies strengthened.
The domestic currency was regaining its footing after the Central Bank of Nigeria (CBN) launched an Electronic Foreign Exchange Matching System (EFEMS) platform to tackle speculation and improve transparency in Nigeria’s FX market.
At midweek, the Nigerian currency depreciated against the Pound Sterling by N3.56 to close at N1,958.68/£1 compared with the preceding day’s N1,955.12/£1 and against the Euro, it slumped by 34 Kobo to trade at N1,612.66/€1, in contrast to the previous session’s N1,613.00/€1.
As for the black market segment, the Naira lost N45 against the American currency during the session to quote at N1,670/$1 compared with the N1,625/$1 it was traded a day earlier.
A look at the cryptocurrency market showed a recovery following profit-taking as the US Consumer Price Index report matched economist forecasts.
The news was enough to convince traders that the Federal Reserve is certain to trim its benchmark fed funds rate another 25 basis points at its meeting next week.
The move also saw Bitcoin (BTC), the most valued coin, return to the $100,000 mark as it added a 2.9 per cent gain and sold for $100,566.12.
The biggest gainer was Cardano (ADA), which jumped by 15.00 per cent to trade at $1.16, as Litecoin (LTC) appreciated by 10.4 per cent to sell for $121.76, and Ethereum (ETH) surged by 7.0 per cent to $3,929.30, while Dogecoin (DOGE) recorded a 6.7 per cent growth to finish at $0.4181.
Further, Binance Coin (BNB) went up by 5.2 per cent to $716.72, Solana (SOL) expanded by 4.6 per cent to $229.77, and Ripple (XRP) increased by 4.2 per cent to $2.43, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) closed flat at $1.00 apiece.
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