Finance

Capital Bancorp rates economy, stocks high this year

Published

6 years ago

January 31, 2018

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Capital Bancorp Plc has predicted a bullish year for the Nigerian stock market and the economy at large, given the current positive indicators in the macroeconomic environment.

The frontline capital market operator with about 30-year presence in the market space, gave the insight in its special 70-page report dubbed, ‘Economic Review and Outlook for 2018’. The report has been formally released to the financial press.

 The company also highlighted some headwinds that could moderate the economy as well as market performance in the year if not managed.

The company’s Managing Director, Mr. Higo Aigboje, while addressing the media in Lagos on Tuesday, said the current price of oil and volume currently being produced in the economy as well as efforts of the current government targeted at diversifying the economy’s revenue base via improved taxation and massive agricultural development, were strong economic impetus.

He also said the performance boosters of The Exchange for the year were: stability of oil prices; effective management and improved liquidity of the foreign exchange market; improvement on corporate earnings; significant focus on the non-oil sector to increase output and lower interest rate regime.

Aigboje said, “This will be driven by effective synergy in the use of fiscal and monetary policies, government’s focus on the real sector of the economy, improved market participation by local investors and domestic institutional investors, efficient regulation of the market by the Securities and Exchange Commission and the Nigerian Stock Exchange.

“Others are passage of the Petroleum Industry Bill, unbundling of the Nigerian National Petroleum Corporation and listing of resultant companies and deliberate efforts aimed at encouraging more listings on the Exchange by companies in the telecoms, power generation and distribution spaces, among others.”

Aigboje, however, explained that issues such as sudden rise in insecurity as a result of the planned general elections, could cause some sort of political instability, thus triggering the exit of the Foreign Portfolio Investors, adding that, “Sudden reversal in oil prices, an upturn in the yields of fixed income securities and failure in the banking sector may trigger a sell-off and cause further damage to the entire stock market.”

According to him, the company’s review of the global and Nigerian financial markets was designed to serve as a compass for both indigenous and foreign investors as is as potential investors.

By the review’s executive summary which was presented by the company’s Chief Analyst, Mr. Victor Chiazor, Capital Bancorp forecast that the global economic growth would hit 3.5 per cent this year as against 3.1 per cent last year.

“ With ample opportunities in some stocks in the banking sector and the consumer goods sector of the equities market , we have projected a 25 per cent return for the Nigerian stock market in 2018, though downward risks to achieving this target remain visible,”Chiazor said.

Speaking on Bancorp e-Trade, Aigboje noted that it was a high-technological innovation aimed at promoting financial inclusion in Nigeria.

According to him, the product allows an investor to trade online in the stock market and it is being upgraded for additional uses.

Finance

AfDB Secures $15.6bn for Lagos-Abidjan Highway Corridor

Published

2 years ago

March 18, 2022

Onyebuchi Aniekeyi

AfDB Secures $15.6bn for Lagos-Abidjan Highway Corridor

Author: Eunice Johnson, Abuja

President of the African Development bank, Dr. Akinwumi Adesina, has announced that the bank has secured 15.6bn dollars for the construction of the Lagos-Abidjan highway corridor, which would ease transportation across West Africa.

Adesina made this announcement during the 2021 Africa Investment Forum’s virtual boardroom closing session on Thursday.

The AFDB President said the 15.6bn dollar deal which is the biggest deal for the boardroom is a 46-lane highway corridor which will connect Lagos, Cotonou, Lome, Accra and Abidjan.

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According to him, the project would support trade in West Africa, impacting the lives of over 500 million people, reducing transport costs and increasing intra-regional trade volume.

The bank will also be establishing a 1m dollars AFAWA women advisory facility to support women with advisory services.

Finance

Nigeria Borrowed N6.64tn, Serviced Debt with N2.93tn in 2021 – DMO

Published

2 years ago

March 18, 2022

Onyebuchi Aniekeyi

Author: Gift Wada, Abuja

THE Debt Management Office on Thursday said Nigeria’s total public debt stock increased to N39.56tn in 2021 from N32.92tn in 2020.
The Director-General, DMO, Patience Oniha, said this at a media briefing in Abuja.
According to her, the total debt includes new borrowings by the Federal Government and the sub-nationals.
She also said that the amount helped in financing the budget deficit, capital projects and support economic recovery.
Oniha said, “Nigeria’s total public debt as at December 31, 2021, was N39.56tn or $95.78bn. The amount represents the total external and domestic debts of the Federal Government of Nigeria, 36 state governments and the federal capital territory.
“The comparable figure for December 31, 2020, was N32.92tn or $86.39bn. The public debt stock for December 31, 2021, includes new borrowings by the FGN and the sub-nationals. For the FGN, it would be recalled that the 2021 appropriation and supplementary acts, included total new borrowings (from domestic and external sources) of N5.49tn to part-finance the deficit.
“Borrowings for this purpose and disbursements by the multilateral and bilateral creditors account for a significant portion of the increase in the debt stock. Increases were also recorded in the debt stock of the states and the FCT.”
She further said that despite the debt increase, the country is still within the total public debt stock to the Gross Domestic Product limit of 55 per cent set by the World Bank and 70 per cent set by the Economic Community of West African States.
Oniha also said that the Federal Government was “mindful of the relatively high debt-to-revenue ratio” and has established certain measures to increase revenues through the strategic revenue growth initiative and the introduction of Finance Acts since 2019.
She said, “The new borrowings were raised from diverse sources, primarily through the issuances of the Eurobonds, sovereign Sukuk, and the FGN bonds. These capital raisings were utilised to finance capital projects and support economic recovery.

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“With the total public debt stock to GDP as at December 31, 2021, of 22.47 per cent, the debt-to-GDP ratio still remains within Nigeria’s self-imposed limit of 40 per cent. This ratio is prudent when compared to the 55 per cent limit advised by the World Bank and the International Monetary Fund for countries in Nigeria’s peer group, as well as, the ECOWAS convergence ratio of 70 per cent.”
However, findings showed that Nigeria spent N2.93tn on debt servicing payments in 2021, according to the data obtained from the DMO.
Between January and March 2021, Nigeria spent N612.71bn on domestic debt servicing, while it spent $1bn (N415.92bn) on external debt servicing, giving a total of N1.03tn.
From April to June 2021, the country spent N322.7bn on domestic debt servicing and $299m (N124.36bn) on external debt servicing, showing a total of N447.06bn.
From July to September 2021, Nigeria spent N808.49bn on domestic debt servicing and $520.78m (N216.6bn) on external debt servicing, giving a total of N1.03tn.
Between October and December 2021, Nigeria spent N310.5bn on domestic debt servicing, while it spent $286.35m (N119.1bn) on external debt servicing, giving a total of N429.6bn.
The official exchange rate of the Central Bank of Nigeria, which showed $1 =N415.92 as of March 17, was used for the external debt servicing.

Finance

Nigeria Emerges First in Africa to Access ICM, Raises $1.25bn Eurobonds

Published

2 years ago

March 18, 2022

Gift Wada

Nigeria Emerges First in Africa to Access ICM, Raises $1.25bn Eurobonds

Nigeria has officially raised 1.25 Billion dollars through the issuance of a seven-year Eurobonds in the International Capital Market (ICM).
The Director-General of the Debt Management Office (DMO), Patience Oniha made this known in a statement on Thursday.

Oniha said that with this feat, Nigeria has become the first African country to access the ICM in 2022.

According to her, the country’s ability to access the Eurobonds at this time was a confirmation of her established presence with the ICM and engagement with investors on a continuous basis.
She said that the proceeds of the bonds would be used to finance the budget and bridge infrastructural deficits.
“The offer was launched at an initial price thought of 8.75 per cent per annum and on the back of strong investor demand, Nigeria was able to reverse the price guidance to 8.5 per cent per annum.

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“The order book continued to grow, reaching a peak of four billion dollars,” she said.
She said that the order book included many quality investors in the U.S., Europe and Asia.

“With this strong investor interest the price was tightened at 8.37 per cent per annum, the order book still remained high at 3.67 billion dollars and still retained quality investors,” she said.
She said that Nigerian investors also participated in the offer with a total subscription of 60 million dollars.

She added that the Eurobonds would also strengthen economic recovery and contribute directly and in full to the level of Nigeria’s External Reserves.
Reports Show that the DMO had earlier on Thursday revealed that Nigeria ’s ’total debt stock as at December 2021 was N39.55 trillion.