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Investors lobby FG to Access N5.96tn Pension Funds

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  • Investors lobby FG to Access N5.96tn Pension Funds

Some investors, who have been unable to access part of the growing pension funds through operators of the Contributory Pension Scheme, are now lobbying the Federal Government to get guarantees for the funds.

As of the end of September, the industry had total pension funds of N5.96tn, currently the largest available pool of capital in the country.

It was found that the investors who could not access these funds due to the stringent measures introduced in the investment guidelines by the National Pension Commission have been seeking the Federal Government’s backing to get the pension operators to invest part of the funds in their projects.

According to the operators, the funds are safer for investments fully backed by the Federal Government securities.

In an interview with our correspondent, the Chairman, Pension Fund Operators Association of Nigeria, Mr. Eguarekhide Longe, noted that the operators had to comply with PenCom’s regulations on investment of pension funds.

While explaining the reason why some investors who approached the operators had not been able to gain access to the funds, he said that the operators needed to get certain clarifications on the status of the projects before pension funds could be invested in them.

“The promoters of the project have approached the pension industry and they also tried to get guarantees from the government and based on those guarantees, there is a better than before possibility that we can participate in a project,” he said.

He explained that this was necessary so that if anything should go wrong with the project, the government could intervene and give it its full support.

According to him, as long as the investors are able to get the government’s backing and come up with a disciplined business case, there is no reason why the operators should not participate in their projects.

He said that the PenCom’s regulations on investment of pension assets provided that the investment strategy committee, in addition to other functions specified in the Pension Act, would formulate internal investment strategies to enable compliance with the regulations, taking into cognisance the macro-economic environment as well as the investment objectives.

The internal investment strategies, he added, should be approved by the PFA in a formal board meeting at least once every year or as frequently as changes occurred in the macro-economic environment that might affect the pension fund assets.

The Head, Investment Supervision Department, PenCom, Ehimeme Ohioma, said the investment of the pension funds could be done through ownership (equity/shareholding) in the infrastructure company developing the project as well as co-investment with other institutional investors and project development firms.

According to him, where the investment is to be executed through a Public Private Partnership, it should have the due process requirements and endorsement and that the bid process for selection of concessionaire and other relevant parties in the project should be open and transparent.

“The project should a have well-structured financing model – infrastructure bonds, infrastructure funds or a combination of both,” he added.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Finance

MTN Nigeria Generates N1.35 Trillion in Revenue in 2020

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MTN Nigeria Grows Revenue by 15.1 Percent from N1.169 Trillion in 2019 to N1.35 Trillion in 2020

Despite the COVID-19 pandemic and challenging business environment, MTN Nigeria realised N1.346 trillion in revenue in the financial year ended December 31, 2020.

The leading telecommunications giant grew revenue by 15.1 percent from N1.169 trillion posted in the same period of 2019.

Operating profit surprisingly jumped by 8.5 percent from N393.225 billion in 2019 to N426.713 billion in 2020.

This, the telecom giant attributed to the surge in finance costs due to increased borrowings from N413 billion in 2019 to N521 billion in 2020.

MTN Nigeria further stated that the increase in finance costs was the reason for the decline in growth of profit before tax to 2.6 percent.

MTN Nigeria grew profit before tax by 2.6 percent to N298.874 billion, up from N291.277 billion filed in the corresponding period of 2019.

The company posted N205.214 billion profit for the year, a 0.9 percent increase from N203.283 billion recorded in the 2019 financial year.

Share capital remained unchanged at N407 million. While Total equity increased by 22.3 percent from N145.857 billion in 2019 to N178.386 billion in 2020.

MTN Nigeria’s market price per share increased by 61.8 percent from N105 to N169.90.

While market capitalisation as at year-end also expanded by 61.8 percent to N3.458 trillion, up from N2.137 trillion.

The number of shares issued and fully paid as at year-end stood at 20.354 million.

MTN Nigeria margins were affected by Naira devaluations and capital expenditure due to the new 4G network coverage roll-out.

Margins were adversely affected by the effect of naira devaluation and expenses associated with new sites’ roll-out to boost 4G network coverage in FY’20.

“On the former, we note that MTNN expanded the scope of its service agreement with IHS Holding Limited and changed the reference rate for converting USD tower expenses to NAFEX (vs CBN’s official rate previously). Thus, over the full-year period, the company’s operating margin contracted by 1.9 ppts YoY to 31.7%,” CardinalStone stated in its latest report.

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Finance

Nestle Nigeria Approves Final Dividend of N35.50k per 50 Kobo Ordinary Share for 2020

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Nestle Nigeria Approves Final Dividend of N35.50k per 50 Kobo Ordinary Share for 2020

Nestle Nigeria, a leading food and beverage company, has declared a final dividend of N35.50k per 50 kobo ordinary share for the year ended December 31, 2020.

The beverage company said N24.50k of the amount declared was from the after-tax profit of 2020 and N5 and N6 were from the after-tax retained earnings of the years ended December 2019 and 2018, respectively.

Nestle Nigeria stated that the amount declared is subject to appropriate withholding tax and approval at the Annual General Meeting of shareholders.

It also noted that payment will be made only to shareholders whose names appear in the Register of Members as at the close of business on 21 May 2021.

Dividends will be paid electronically to shareholders whose names appear on the Register of Members as at 21 May 2021, and who have completed the e-dividend registration and mandated the Registrar to pay their dividends directly into their Bank accounts.

Shareholders who are yet to complete the e-dividend registration are advised to download the Registrar’s E-Dividend Mandate Activation Form, which is also available on their website: www.gtlregistrars.com, complete and submit to the Registrar or their respective Banks.

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Banking Sector

Dennis Olisa Invests N53.6 Million in Zenith Bank

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Executive Director of Zenith Bank Plc Buys 2 Million Shares of Zenith Bank at N53.6 Million

Executive Director of Zenith Bank Plc, Dennis Olisa, has invested a combined N53.58 million in shares of Zenith Bank.

The leading financial institution stated in a disclosure statement filed with the Nigerian Stock Exchange (NSE) on Monday.

Olisa carried out the purchase in two different transactions on February 24, 2021 at the Nigerian Stock Exchange in Lagos, Nigeria.

He purchased 1 million units of Zenith Bank at N26.60 each and another 1 million shares at N26.50 per share.

On aggregate, Olisa purchased 2 million shares of Zenith Bank at N26.79 per share or N53.58 million. See the details below.

Dennis Olisa was appointed as Zenith Bank’s executive director three years ago.

Prior to his appointment, Mr. Olisa was the Chief Inspector at Zenith Bank Plc and served as its Director from March 3, 2017 until March 16, 2017.

He also served as General Manager and Heads of the Energy Oil & Gas Group at Zenith Bank Plc and served as its Deputy General Manager. He served as Head of Internal Control & Audit Group at Zenith Bank Plc

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