Post Merger: Access Bank Reports Significant Increase In Q3 Profit

Access-bank-new-logo
Access-bank-new-logo

Access Bank Plc has released its unaudited financial statements for the period ended September 30, 2019, which clearly show positive figures across most financial indicators.

The breakdown indicates that Access Bank generated N210.21 billion in net interest income as at the period ended September 2019. This represents a 70.98% increase compared to the nine months period of 2018 when the lender recorded N122.94 billion.

It also recorded Profit before Tax of N103.10 billion as profit before tax, up from N70.26 billion, which represents an increase of 46.74%.

The lender recorded a profit after tax of N90.73 billion for the nine-month period of 2019, compared to N62.91 billion recorded in the corresponding  period for 2018. This represents a 42.22% increase in profit.

The bank’s Earnings Per Share of N2.18 as at the end of the third quarter of 2018 moved  up to N2.79 as at the end of the third quarter of 2019.

Also, non-interest income grew by 3.3% y/y to NGN97.74 billion, driven by fees and commissions income (+49.5% y/y to NGN56.01 billion). Consequent, on the increased income from both funded and non-funded sources, operating income settled 42.1% higher year-on-year.

In the same vein Operating Expenses grew significantly by 39.8% y/y, pressured by increased costs related to the merger. Regulatory costs increased significantly due to the expansion in assets from the merger – AMCON levy (+29.5% y/y to NGN22.66 billion); NDIC premium (+39.9% y/y to NGN8.99 billion –, while personnel costs (32.0% y/y to NGN54.70 billion), among others, also spiked during the period.  Nonetheless, given the expansion of operating income relative to operating expenses, the bank’s cost-to-income ratio (ex-LLE) settled lower at 65.3% relative to 66.4% in the prior year. This was enough to drive a substantial increase in profitability, with profit-before-tax and profit-after-tax growth settling higher by 46.7% y/y and 44.2% y/y respectively.

According to analysts  the bank’s macro-prudential ratios are above par, with only the non-performing loans ratio settling above the regulatory limit (6.3% relative to 5.0% statutory limit). While NPLs declined from 6.4% as at H1-19, this could be adduced to the 4.0% growth in total loans over the quarter. All other ratios are settled well above regulatory minimums; Liquidity ratio (48.5% relative to 30.0%), Capital Adequacy (20.3% relative to 16.0%). Also, we note that the bank’s current reported loans to deposit ratio (67.4%) is above the new minimum LDR of 65.0%.

 

 

NSE Hosts 7th Capital Market Information Security Forum

Nigerian-Stock-Exchange-
Nigerian-Stock-Exchange-

By  Andy Nssien

The Nigerian Stock Exchange (“NSE) is to host the 7th edition of its  Nigerian Capital Market Information Security Forum (NCMISF), themed, “The Nigeria Data Protection Regulation: Achieving Compliance.” The bi-annual event is slated for  Thursday, October 31, 2019, at the NSE Event Center, 2-4 Customs Street, Lagos.

A statement from The NSE said the one day free event would bring together leading industry data privacy and security experts and capital market stakeholders to share actionable information on the prevailing data protection regulation which is aimed at achieving privacy by default and privacy by design. The forum will also highlight how organizations can comply with these regulation on an ongoing basis, as a means of protecting client data and boosting investor confidence.

Chief Risk Officer NSE, Rasaq Ozemede said, “the event will provide participants a perfect opportunity to get deeper understanding of present and developing trends in Information Security through case studies on topics ranging from how industry is redefining their Data Protection Regulation practice to developments in protecting Personally Identifiable Information (PII), data protection regimes and share effective strategies and best practices in ensuring information privacy is in compliance with the Nigeria Data Protection Regulation (NDPR) and the international General Data Protection Regulation”.

“This year, we have received sponsorship boost from Zenith Bank Plc and Axa Mansard. We look forward to welcoming more sponsors”, Mr. Ozemede added.

The 7th edition of NCMISF will feature presentations and panel discussions by National Information Technology Development Agency (NITDA) licensed Data Protection Compliance Organisations (DPCO) such as Michael Ango, Associate Director, Andersen Tax; Akin Oyegoke, Managing Consultant, Johan Consults; John Anyanwu, Partner, Technology Advisory, KPMG Advisory Services and Linus Osita Okeke, Partner, Ernst & Young. Mrs. Oluyemi Obadare, Business Continuity Manager, NSE will also be speaking at the forum.

NSE Flags Off  Inaugural ‘Ring The Bell For Financial Literacy’

Oscar Onyema
Oscar Onyema

The Nigerian Stock Exchange (NSE) has flagged off its inaugural “Ring the Bell for Financial Literacy”  as part of the  The World Federation of Exchanges (“WFE”) and International Organization of Securities Commissions (“IOSCO”) initiative using its Closing Gong ceremony to further draw attention to the importance of financial literacy.

The Closing Gong ceremony which held on Friday, October 4, 2019, at the Exchange in Lagos, was part of World Investor Week (WIW), which took place from Monday 30 September to Friday 4 October 2019.The World Investor Week (WIW) is a week-long, global campaign promoted by IOSCO to raise awareness about the importance of investor education and protection, and to highlight the various initiatives implemented by securities regulators in these two critical areas.

Speaking during the Closing Gong ceremony, Mr. Jude Chiemeka, Divisional Head, Trading Business, NSE, said, “The Exchange has been intentional about promoting financial literacy in the capital market and we are glad to have added another awareness initiative to our agenda by joining over thirty exchanges around the world to ring the bell for financial literacy. At the NSE, we continue to match our innovative products and services with significant investment in resources to advance investor education through various platforms such as product specific trainings and workshops including dedicated investor education programs facilitated by the NSE X-Academy, the NSE’s capacity development platform. In addition, we implement initiatives targeted at children and youths aimed at building a financially savvy generation such as the commemoration of Global Money Week, excursions to the Exchange under our X-Tours programme and the annual NSE Essay Completion. We are currently receiving entries for the 2019 edition of the NSE Essay Competition”.

The NSE will continue to create product offerings that promote diversity in investment, manage risk and make the investment knowledge readily available to consumers to make adequate investment decisions

 

Checklist Review Will Promote Efficiency And Reduce Time To Market- SEC

SEC-Nigeria
SEC-Nigeria

The Securities and Exchange Commission (SEC) has said that the introduction of checklist review process for the capital market will make the system more competitive, reduce cost, promote efficiency, transparency and accountability.Acting Executive Commissioner Operations, SEC, Mr. Isyaku Tilde stated this at the engagement session with Association of Issuing Houses, Trustees and Solicitors on the commencement of checklist review.
Tilde noted that whilst this process would drastically reduce time-to-market, it places a huge responsibility on Issuing Houses to ensure that its documentation and filing is flawless, that is that all relevant disclosures are made and all necessary documents filed as there would be no prior review for completeness or deficiency.
“Hence both the Issuing Houses and Solicitors who sign up on such filing take up all attendant liability should the documentation be thereafter found to be incomplete or deficient.
“These procedural changes which are being implemented in stages commenced with the Checklist Review on July 1, 2019 and is expected to run for six months to enable the Commission assess both the capacity and preparedness of Financial Advisers and Solicitors in Particular, whilst the ‘Deemed Approval’ regime is expected to commence in January 2, 2020,” he said.
He noted that the capital market has in recent times faced a number of challenges which has militated against its rapid growth and impacted not just on the economy at large but on the work of the operators.
“The need for a market that lives up to its role of catalysing economic growth by facilitating development cannot be over emphasised, and this informs the various initiatives being pursued under the Capital Market 10 years master plan as well as other ancillary initiatives which seeks to amongst others increase the depth and breadth of the market; make for a more competitive market, reduce cost, promote efficiency, transparency and accountability – all under a collaborative regulatory and oversight regime.
“These vision, coupled with the Federal Government’s drive on ease of doing business led to engagements with your good selves and other key stakeholders which has resulted in the change of pre-existing review processes and procedures for debt issuances, to deal with issues of application processing turn-around-time and ensure a highly efficient time-to-market regime,” Tilde said.
Also in his remarks, the Head of Department (HOD) Securities and Investment Services Mr. Abdulkadir Abbas said, “If we open up the market and are able to attract more capital into the system, most of the vices in the society will be reduced because people will be engaged in developmental activities, let’s think out of the box and improve the system to make our market more competitive. Reducing time to market will enable us move forward, fast track our processes and make the system more user friendly”.

58th AGM: NSE Announces 8% Total Revenue Decline with Surplus of N 2.70bn

The logo of the Nigerian Stock Exchange is pictured in Lagos, Nigeria November 9, 2016.   REUTERS/Afolabi Sotunde
The logo of the Nigerian Stock Exchange is pictured in Lagos, Nigeria November 9, 2016. REUTERS/Afolabi Sotunde

The Nigerian Stock Exchange (“NSE” or “The Exchange”) on Monday, September 30, 2019 released results of its Audited Financial Statements for the period ended as at December 31, 2018 and the presentation of reports of National Council and Auditors to the members as part of the Ordinary Business of the day.

Chief Executive Officer of NSE, Mr. Oscar N. Onyema, OON, on the occasion stated that the NSE demonstrated resilience in the face of a challenging operating environment closing the year with surplus of N2.70bn.

According to him, “Total revenue declined to 8% that is N7.67bn as investors sought towards more guaranteed investment asset classes in the face of uncertainty. Our listings revenue stream was the most impacted, as it fell by 21% to N1.4bn. Influenced by the capital market trends within the period, transaction fees also declined to N3.3bn, a 13% drop from last year. The balance sheet remained strong with a 9% growth in total assets as the Group closed 2018 with total assets of N29.1bn, with approximately N4.1bn (14%) held in liquid assets and an accumulated fund of N25.9bn to close the year with a sound liquidity position and strong balance sheet”.​

Speaking at the AGM, the President of the National Council of the NSE, Otunba Abimbola Ogunbanjo said, “In line with global markets, our equities market experienced a decline in 2018. This trend, however, was counterbalanced by the NSE’s delivery of key initiatives for the development of the Nigerian capital market. We witnessed the Debt Management Office (DMO) list the pioneer N10.69bn Federal Government of Nigeria (FGN) Sovereign Green Bond, and a N100bn FGN Ijarah Sukuk Bond. This further asserted our aspiration as the platform for both the public and private sector to raise and access capital, encourage financial inclusion and create sustainable value. We also expanded our focus on retail investment, positioning the Exchange to deploy innovative and agile smart products and services. We made significant progress with the Demutualization process, with the bill now signed into law and assented to by the President. The successful completion of this project will ultimately strengthen our market as a significant driver of socio-economic development”.

The NSE will continue to capitalize on new opportunities, take advantage of recent technological disruptions and seek corporate partnerships, to maintain a fair and orderly market while delivering sustainable values to its customers and stakeholders.

Meanwhile, Members of the Exchange re-elected Mrs. Catherine Nwakaego Echeozo who retired by rotation, as a member of the National Council. Members also re-elected Katsina State Investment & Property Development Co. Limited (Represented by Mrs. Fatimah Bintah Bello–Ismail); Fortress Capital Limited (Represented by Mr. Yomi Adeyemi) and Pilot Securities Limited (Represented by Mr. Seyi Osunkeye).

Suspicious Transactions Will Be Investigated – SEC

Mary-Uduk-Actng-DG-SEC-
Mary-Uduk-Actng-DG-SEC-

The Securities and Exchange Commission, SEC has assured investors that the Commission is committed to ensuring that suspicious transactions are not allowed in the capital market.

Acting Director General of the SEC, Ms. Mary Uduk has therefore urged market operators to make use of the Commission’s whistle blowing policy and report any such infractions for immediate actions.

Uduk, who was reacting to questions during the two-day international capital market conference, organized by the commission, in collaboration with the Department of Finance, University of Lagos, lamented that the private placement bubble happened with the connivance of many market operators who encouraged issuers to take advantage of loopholes in the relevant investment laws at the time.

Uduk recalled several efforts and appeals to such issuers, to list their shares without success, stressing that “market operators encouraged private placements knowing that the law did not allow the SEC to regulate private companies.”

“Insider trading is what we have to prove. A lot of us are in the market and we have whistle blowing mechanism. It is the operators who will be in a better position to know and report such infractions. For those that have been reported to us, we have been carrying out investigations and once we have evidence we will invite them and also refer them to the relevant authorities

“With the whistle blowing provision, we have always asked operators in the market to come to our aid if they find any unwholesome activity going on. It is our market and so we all have to do our bit. The market should not be left to us alone; you need to provide information for us to take the necessary actions.

“Anyone that is caught engaging in any activity that is against the laid down rules, be rest assured that such an operator will be made to face the full wrath of the law”.

She lamented a situation where many private companies took advantage of gaps in Nigerian laws, especially between 2007 and 2008 to defraud many investors, by embarking on private placements, with promises to list the shares for trading on the Nigerian Stock Exchange (NSE), when in reality they had no such intention.

She urged operators to cooperate with the commission for the good of the market and the economy, realizing that “it is our market, please let us join hands and revive this market.

“Let us come together and sanitise this market,” she stressed, urging them to bring incidences of market abuse to the attention to the commission and enjoy protection under the law.

Uduk said the SEC has been doing its best to ensure that offenders are not left off the hook, hence the Commission is collaborating with EFCC and office of attorney general to be able to do much.

The Acting DG said the Commission also has the complaints management framework that enables investors to know where to complain to and how long it takes for such complaints to be resolved and for those of the investors that are averse to risks, they are advised to get their financial advisers to tell them where to invest.

“In doing all these, we advise retail investors to invest in Collective Investment Schemes and Mutual Funds because those are managed independently by professionals and they are diversified thereby reducing risks. We also implore investors to take ownership of their investments. They have to be able to monitor their investments, attend annual general meetings as well as read the annual reports sent out to them.

“We are committed to protecting investors in the work we do. We will keep working on our rules and the possibility of amending them when the need arises, we want more transparency in the market so that investors will feel comfortable and the market can be better” she added.

FMDQ Commences Series II of Derivatives Market Training for Stakeholders

FMDQ
FMDQ

FMDQ Securities Exchange PLC (FMDQ Exchange or the Exchange) activated the FMDQ Exchange Derivatives Market Development Project (the “Project”) in 2018 to set the tone for and facilitate the launch of a standardised derivatives market in Nigeria by the Exchange.

Critical to the success of this launch is education and capacity building for all market stakeholders on how a derivatives market works and how other countries/climes have used this very important market to leapfrog their financial markets and support economic development in the long run. Having successfully run Series I of the Derivatives Market Training for Stakeholders, FMDQ Exchange has commenced Series II of these training sessions through its learning and development initiative – FMDQ Academy – which seeks to address financial markets capacity building requirements for participants and other stakeholders in the FMDQ Exchange markets; allowing them to maximise the potential of these markets towards positively impacting development of the Nigerian financial markets.

To flag off Series II, FMDQ Exchange hosted the media through the umbrella body of the Capital Markets Correspondents Association of Nigeria (CAMCAN) – strategic partners to the reportage of FMDQ Exchange markets and the frontline ambassadors to the Nigerian financial markets to a 2-day training session as a means of providing a holistic understanding of Exchange-traded derivatives and associated products.

From discussions on how the pioneer product championed by the Central Bank of Nigeria in close collaboration with FMDQ Exchange, the Naira-settled OTC FX Futures product works; participants were exposed to various concepts to aid their appreciation of the derivatives market and also build their capacity for onward communication and reporting purposes. Other stakeholder categories, including financial market Regulators, FMDQ Exchange Dealing Member (Banks), Corporate Treasurers of non-bank financial institutions, amongst others, have also been scheduled to undergo requisite training in this regard, to ensure all participants are knowledgeable and ready to use the offerings of the derivatives market to improve business planning and appropriately manage foreign exchange exposures using hedging products available in the FMDQ Exchange derivatives market.

FMDQ Exchange and its subsidiaries, FMDQ Clear Limited and FMDQ Depository Limited, in availing the market with an end-to-end platform to list, trade, clear and settle financial market transactions, shall continue to foster economically impacting initiatives, in order to deliver on the mandate of making the Nigerian financial markets globally competitive, operationally excellent, liquid and diverse.

SEC, FCCPCC To Collaborate On Mergers

SEC
SEC

The Securities and Exchnage Commission, SEC and the Federal Competition and Consumer Protection Commission (FCCPCC), have agreed to continue to work together in a bid to simplify the processes of Mergers of companies in Nigeria.

Acting Director General of the SEC, Ms. Mary Uduk revealed this during the signing of a  memorandum of understanding between the SEC and FCCPCC in Abuja, recently.

Uduk emphasized the need for collaboration between both organisations to ensure that there is no vacuum  in a bid to ensuring that the collaboration would lead to a more stronger economy for the country.

“We are happy with the work the FCCPCC has done so far and on our part as the SEC, we are willing to provide you with any relevant assistance you would need to hit the ground running and improve our nation’s economy” she said.

The Acting DG disclosed that the Commission presently has capacity in the area of mergers and would be willing to share knowledge with the new organisation.

In his remarks, the Director General of  FCCPCC, Mr. Babatunde Irukera Commended the DG for the leadership the SEC has provided and for the friendship and collaboration that has helped to bring both organisations this far.

According to him, “We would like to commend the way you have approached your work, especially the merger review, I think it has become examplenary to everyone and the rest of the country and both internationally and domestically, and your mode of leadership made it possible.

“The work between the two organizations has created a master stroke and without your leadership it would not have been possible.“Not only has that helped this new institution to begin to get its bearing correctly it has also helped the investment community to see what the real possibilities are available in Nigeria”.

SEC holds Q2 2019 CMC Meeting

SEC holds Q2 2019 CMC Meeting
SEC holds Q2 2019 CMC Meeting

The Securities and Exchange Commission (SEC) has announced that the Second Capital Market Committee (CMC) meeting in 2019 has been scheduled to hold on Thursday August 22 to Friday August 23, 2019 at the Eko Hotels and Suites, Victoria Island, Lagos.

While the key stakeholders in the capital market will meet on August 22, members of the media would be briefed on August 23 on the outcome of the CMC meeting.

However, the SEC has advised that admission into the venue would be upon presentation of the CMC Identity Card and strictly by invitation.

According to the SEC, “Attendance to both events is strictly by invitation. Invited participants are expected to come with their identity cards to be admitted into the venue and all invited participants are expected to be seated by 9.45am,”

The CMC was mainly established to serve as a medium for exchange of ideas among market stakeholders as well as for feedback to SEC on how to continuously improve the market activities and regulation.

It is an industry-wide committee comprising members of the commission, representatives of capital market operators and trade groups and other stakeholders. The CMC meets every quarter to deliberate on various issues affecting the market and other policy matters.

During the meeting, issues bordering on implementation of the Ten Year Capital Market Master Plan as well as others relating to the capital market, Fintech Roadmap and the economy would be discussed and the outcome made known to the media.

The ten-year master plan for the Nigerian capital market which is expected to refocus the market and help double its size over time and grow the economy was unveiled November 2014.

Recall that the Commission has vigorously implemented some initiatives in the Master Plan with the aim of attracting more investors to the market.

Some of the initiatives, include direct cash settlement, regularisation of multiple subscription, dematerialization and e-Dividend Registration, as they promote transparency, protect and enhance investors’ confidence in the capital market.

The SEC therefore enjoins all shareholders to take advantage of the initiatives introduced in the capital market aimed, primarily, at strengthening the market and accelerating economic development.

This, SEC said is in consonance with the present administration’s economic strategy focused on deepening the capital market as a vehicle for encouraging a private sector-led economy with enhanced productivity.

Those who have been invited to attend the expanded session are Chief Executive Officers (CEOs) of all registered capital market firms (i.e Broker Dealer, Capital Market Solicitors, Custodians, Fund Managers, Issuing Houses, Rating Agencies, Registrars, Reporting Accountants, Trustees, and Consultants, etc.);

Others are Chief Executive Officers of The Nigerian Stock Exchange (NSE), National Association of Securities Dealers (NASD), The Financial Markets Dealers Quotations (FMDQ), Africa Exchange Holdings (AFEX), Nigeria Commodity Exchange (NCX), Central Securities Clearing System (CSCS), Chartered Institute of Stockbrokers (CIS); as well as representatives of relevant Financial Services’ Agencies, among others.

 

Again NSE Market Indicator Drops, Losses N33 Billion

 

Activities on the Nigerian Stock Exchange (NSE) sustained negative trend on Thursday with the market indicators dropping further by 0.26 per cent.

Specifically, the All Share Index, which opened at 29,375.25, lost 75.16 points or 0.26 per cent to close at 29,300.09.

Also, the market capitalisation of listed equities shed N33 billion or 0.26 per cent to close at N12.914 trillion against N12.947 trillion reported on Wednesday.

Analysts at Afrinvest Limited said they expected the bearish streak to be sustained in the absence of catalysts to stimulate investors’ sentiment.

Also, analyst at Imperial Asset Managers Limited also expected the market to continue within the existing range today amid bargain hunting on low priced stocks.

An analysis of the price movement chart shows that NASCON led the gainers’ table, appreciating by 70k to close at N15 per share.

Cement Company of Northern Nigeria Plc followed with a gain of 50k to close at N15; also, the Dangote Sugar Refinery owned by one of the richest people in Nigeria gained 45k to close at N11.45 per share.

Custodian and Investment also garnered close a N6.25, while Ecobank Transnational Incorporated increased by 40k to close at N10.40 per share.

Conversely, Presco led the losers’ chart declining by N5.20 to close at N46.80 per share.

Guaranty Trust Bank Plc trailed with a loss of 50k to close at N29.50, while Guinness shed 30k to close at N47.50 per share.

Dangote Flour was down by 25k to close at N17.25, while Oando dipped 10k to close at N3.85 per share.