- FG Can’t Borrow Any More
Against the backdrop of the nation’s rising debt profile, the Minister of Finance, Mrs. Kemi Adeosun, has said the Federal Government must not borrow more to fund its budget.
Adeosun said the government should instead raise the money needed by other means, calling into question planned foreign loans of $2bn from lenders like the World Bank, according to Reuters.
The government had planned to borrow extensively from overseas to fund a record budget aimed at helping the country spend its way out of its first recession in 25 years.
But plans for lenders like the World Bank and the African Development Bank to loan at least $2bn to Nigeria have been stalled for over a year as international organisations’ frustrations mounted at the country’s refusal to impose key fiscal reforms such as allowing its foreign exchange rate to float freely.
The minister’s comments, made at a business forum in Abuja, suggested that the government would no longer seek such loans, or an additional $1.5bn it had planned to raise from international debt markets.
“We cannot borrow any more, we just have to generate funds domestically enough to fund our budget and mobilise revenue to fund the necessary budget increase,” she said.
In May, the head of Nigeria’s budget office said the country had a shortfall of $7.5bn for the 2017 budget expenditure, and added that would be addressed with $3.5bn from the aforementioned loans and debt.
The government also planned to raise $4bn from the local debt market, he said at the time.
The Presidency signed off on its record N7.44tn budget for 2017 in June, after numerous delays.
The plan projects a deficit of N2.21tn, implying a deficit equivalent to 2.18 per cent of the country’s Gross Domestic Product.
GTBank Reports 8 Percent Decline in Profit Before Tax to N53.7 Billion in Q1 2021
Guaranty Trust Bank on Wednesday reported a 7.8 percent decline in profit before tax from N58.2 billion in the first quarter of 2020 to N53.7 billion in the first quarter of 2021.
The lender disclosed in its unaudited results titled ‘GTBank releases Q1 2021 unaudited results’.
Deposit liabilities rose by 3 percent to N3.717 trillion in the first quarter of 2021, up from N3.61 trillion in December 2020. The bank’s loan book declined by 1.4 percent to N1.639 trillion, down from N1.66 trillion posted in December 2020.
Speaking on the financial results, the Managing Director/Chief Executive Officer, Guaranty Trust Bank Plc, Mr Segun Agbaje, said, “We have started off the 2021 financial year on a fair footing, and our first-quarter results demonstrate our ability to continue delivering strong and sustainable returns, despite the macroeconomic uncertainties that persist in our business environment.
“This is a reflection of the resilience of our franchise, our prudent approach to risk management and the efficacy of our digital-first customer-centric business strategy.”
Unity Bank Posts N2.09 Billion Profit Despite N4 Billion Revaluation Loss in 2020
Unity Bank Plc, one of Nigeria’s leading financial institutions, grew profit after tax to N2.09 billion in the financial year ended December 31, 2020.
The lender profit before tax stood at N2.22 billion in the year under review while assets rose by astonishing 67.90 percent from N293.05 billion in 2019 to N492.02 billion in 2020.
In the audited financial statements released on Monday, Unity Bank grew its gross loan portfolio by 92.9 percent from N106.9 billion recorded in December 2019 to N206.2 billion in December 2020.
The almost 100 percent jumped in credit provision highlighted the bank’s strategy at deepening support for farmers, improving food security and enhancing new job creation for thousands of youths and entrepreneurs.
During the bank’s earnings call on Monday, Mr. Kolawole Ebenezer, the Executive Director and Chief Financial Officer, Unity Bank Plc, explained that the bank has been able to cut down on its Non-performing loan to near-zero percent by adopting a strategy that allows the lender to focus on farmers and at the same time implement strategy that mitigates security challenges.
Unity Bank grew its net operating income by 9.71 percent to N25.46 billion in 2020, up from N23.21 billion in the corresponding period of 2019. Similarly, net interest income rose by 7.60 percent to N17.75 billion in 2020 from N16.49 billion in 2019 while earnings per share stood at 17.85 kobo.
In spite of COVID-19 disruption, Unity Bank grew customers’ deposit portfolio by 38.4 percent to N356.62 billion, up from N257.69 billion filed in 2019. This indicates market acceptance of the bank’s product offerings and series of technological integration launched during the year under review to ease banking challenges, especially as the world struggles with the COVID-19 pandemic.
Bismarck J. Rewane, the Managing Director and Chief Executive Officer of Financial Derivatives Company Limited, who spoke during the earnings call on Monday, said Unity Bank is operating like a tier I bank despite its obvious limitations and highlighted the broad-based growth the bank has recorded in recent years.
The economic think tank further explained that if the bank’s N4 billion revaluation loss is added to profit after tax declared, the bank would have declared N6 billion. This does not include the adjustments made by the Central Bank of Nigeria to the interest rate charged on agric loans that eroded interest income on loans by over 30 percent.
Nasdaq Set To Launch Options Trading For Coinbase Global
Less than a week after the largest crypto exchange in the U.S. Coinbase was listed, Nasdaq is set to start trading options for Coinbase Global.
According to Reuters, a representative for Coinbase stated that the COIN.O options will start trading on Nasdaq on Tuesday, April 20.
The launch of equity options will offer a new way for investors to bet on the fortunes of Coinbase. Equity options represent the right, but not the obligation, to buy or sell a stock at a certain price, known as the strike price, on or before an expiration date.
The news follows Coinbase’s direct listing, which saw the firm’s stock fluctuate between a valuation of $429.54 and $310 on its first day of trading.
It was reported that the Chief Executive Officer of Coinbase, Brian Armstrong sold less than 2% of his holdings which worth about $292 million in shares on COIN’s first day of trading. According to filings made with the U.S. Securities and Exchange Commission, Armstrong sold 749,999 shares in three batches at prices ranging from $381 to $410.40 per share for total proceeds of $291.8 million.
It was also reported that insiders dumped nearly $5 billion in COIN stock shortly after it was listed. Filings on the Coinbase Investor Relations website showed a total of 12,965,079 shares were sold by insiders, worth over $4.6 billion at COIN’s $344 share price at close on Friday.
Yahoo Finance reported the stock has slumped 22.5% from a high of $429.54 on April 14 to a current after-hours trading price of $332.75 where it appears to have settled after Monday’s trading session.
On April 20, Coinbase Pro announced that will add support for new trading pairs for Basic Attention Token (BAT), Cardano (ADA), Decentraland (MANA), and USDC from April 20. The four assets will be paired with three fiat currencies (USD, EUR, GBP), BTC, and ETH, with limited trading functionality to be made available while market liquidity is assessed at launch.
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