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Investors Stake N54.8tn in Five Months

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FMDQ
  • Investors Stake N54.8tn in Five Months

Investors have traded a total of N54.75 trillion in the fixed income and currency market between January and May 2017. Of the transactions, N9.49 trillion was exchanged in the month of May alone, which was 7.9 per cent higher than the N8.79trillion traded in April.

According to the FMDQ OTC Securities Exchange, the month-on-month growth was primarily driven by increased trading activities experienced in the FX (Spot) and Repurchase Agreements (Repos)/Buy-Backs product categories.

However, a minimal growth of 4.00 per cent was experienced in the Treasury bills (T.bills) product category. T.bills recorded the largest share of the overall turnover, accounting for 47.22 per cent of the market.

Repos/Buy-back transactions recorded the second largest share of total turnover, accounting for 22.32 per cent, while FX market transactions accounted for 21.01 per cent and Bonds, 8.43 per cent. Unsecured Placement & Takings, Money Market Derivatives and Commercial Papers represent 1.00 per cent of the overall market turnover.

In absolute terms, T.Bills accounted for N25.9trillion, while repos/buy-backs recorded 12.22 trillion.

The analysis of the transactions for the month of May only showed that activities in the FX market accounted for 24.88 per cent (27.71 per cent in April while Money Market (Repurchase Agreements (Repos)/Buy-Backs & Unsecured Placements/Takings)accounted for 29.13 per cent (22.85 per cent in April) of total turnover for the reporting period.

A further breakdown of the transactions in the FX market showed that $6.56 billion was recorded in May, a decrease of 15.03 per cent when compared with $7.72 billion in April.

The Central Bank of Nigeria (CBN) sold a total of $0.985 billion through various interventions conducted during the period under review, a 49.5 per cent decrease from the previous month.

The apex bank also maintained its marginal rate for the Secondary Market Intervention Sales (SMIS)–Wholesale Forwards intervention at $/N320; and $/N357 for Small and medium-sized enterprises(SMEs)and Invisibles.

Inter-Member trades stood at $0.56 billion in the month of May, an increase of 0.51 per cent from the trades recorded in April, while member-client trades stood at $4.19 billion, showing a decrease of 12.17 per cent previous month.

Turnover in the fixed income market in the month under review settled at N4.36 trillion, with transactions in the T.bills market accounting for 88.67 per cent of the fixed income market up from 85.46 per cent in the previous month.

Outstanding T.bills at the end of the month stood at N8.87trn, a decrease of 0.13 per cent compared with N8.88 trillion in April, while whilst FGN bonds’ outstanding value increased by 1.62 per cent to close at N6.93 trillion.

Activities in the Secured Money Market (Repos/Buy-Backs) settled at N2.61 trillion in May, 38.13 per cent more than the value recorded in April. Unsecured Placements/Takings also increased by 28.19 per cent to close the month with turnover of N0.14trillion.

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.

Banking Sector

CBN to Extend Credit Risk Management System to OFIs

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In an effort to curb growing bad debt, the Central Bank of Nigeria has said it will extend its Credit Risk Management System to Other Financial Institutions (OFIs) operating in Nigeria to protect them from bad debtors.

According to the apex bank, this is important following the successful implementation of the credit risk system in other lending institutions operating in Nigeria.

The bank disclosed this in a circular titled ‘Credit Risk Management System: Commencement of enrolment of all Development Finance Institutions, Microfinance Banks, Primary Mortgage Banks and Finance Companies’ and signed by Kelvin Amugo, the Director, Financial Policy and Regulation Department, on Monday.

In part, the circular read, “As part of efforts to promote a safe and sound financial system in Nigeria, the CBN introduced the CRMS to improve credit risk management in commercial, merchant and non-interest banks as well as to prevent predatory borrowers from undermining the banking system.

“With the successful implementation of the CRMS in deposit money banks, it has become expedient to commence the enrolment of Other Financial Institutions on the CTMS platform.

“Accordingly, all DFIs, MfBs, PMBs and FCs are required to report all credit facilities (principal and interest) to the CRMs and to update same on monthly basis.

“OFIs shall note the Bank Verification Numbers and Tax Identification Numbers are the only basis for regulatory renditions”.

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Banking Sector

BoI Grows Assets by 78.8% to N1.86 Trillion

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boi

The Bank of Industry Group concluded the 2020 financial year with a 78.8 per cent growth of assets from N1.04tn to N1.86tn between 2019 and 2020.

A statement by the bank on Monday said the increase was driven to a large extent by the successful debt syndication of €1bn and $1bn that were concluded in March and December 2020 respectively.

BoI stated that the group’s financial statement demonstrated resilience and strength, noting that the period had significant challenges in the operating environment on account of the impact of COVID-19 pandemic on the economy.

“It also indicates synergy with the various interventions developed by the Federal Government, the Central Bank as well as other strategic partners towards ameliorating the impact of the pandemic on Nigerian enterprises,” the statement said.

The group’s total equity increased by 14.8 per cent from N293.08bn in the previous year to N336.48bn in 2020.

It added that as a reflection of the adverse impact of the challenging operating environment on growth of new facilities, loans and advances grew marginally in 2020 by 1.3 per cent to N749.84bn from the 2019 position.

The bank explained that this was largely due to the economic slowdown in the year as well as the various interventions and support initiated by the bank for its customers.

“The bank reviewed and restructured all its managed projects under the CBN intervention programme with interest rate reduction from nine to five per cent per annum for a period of one year and moratorium extension of three months (with a possible extension up to 12 months),” it said.

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Banking Sector

TAJBank Deploys NQR Solution To Ease Customer Transactions

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TAJBank, Nigeria’s non-interest bank, has announced the deployment of the NQR Payment solution, an indigenous Quick Response Code (QRC) by the Nigeria Interbank Settlement Scheme (NIBSS), for merchants and customers as the newest addition to its innovative e-business channels.

The NQR Payment solution is a secure QR-code-based payments and collections platform developed for merchants and customers to receive and make payments for goods and services in a quick, easy, contactless and secure manner.

A statement signed by the Founder/Chief Operating Officer of the bank, Mr. Hamid Joda, indicated that the ingenious solution would further drive TAJBank’s culture of innovation and create a seamless payment experience for its rapidly growing individual and corporate customers in their banking transactions.

“We are excited to have this payment channel introduced into the nation’s financial system as an addition to other innovative solutions we have deployed over the past few months.

This is a proof that, as we have said in our communications signature line, TAJBank’s interest is always in our customers”, Joda enthused.

In his remarks, the non-interest lender’s Chief Marketing Officer/Co-Founder, Mr. Sherif Idi, also maintained that the deployment of the NQR payment solution would revolutionize the e-payment experience and open new frontiers for small, medium and large scale businesses who are major stakeholders of the bank.

Since it commenced operations in the non-interest banking segment of the financial services industry, TAJBank is noted for its impeccable track record of growth and innovation, rendering exceptional quality services to customers.

The lender’s NQR solution is open to all customers of the bank, both merchants and individuals, across all its branches and digital channels globally.

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