Finance

Mixed Trading Seen as Investors Await More Results

Published

6 years ago

April 9, 2018

Mixed Trading Seen as Investors Await More Results

Trading at the nation’s stock market is expected to be mixed this week, as investors expect the filing of annual financial statements by companies that missed the March 31, 2018 deadline.

Some of the companies, including Presco Plc, A.G. Leventis (Nigeria) Plc, FBN Holdings Plc, Diamond Bank Plc, and Linkage Assurance Plc, gave the reasons for the delay last week.

The equities segment of the Nigerian Stock Exchange finished lower last week, as all market indices closed in negative territory.

The NSE All-Share Index and market capitalisation fell by 1.60 per cent to close the week at 40,841.14 basis points and N14.753tn respectively.

A total turnover of 1.765 billion shares worth N26.562bn in 20,265 deals were traded last week by investors on the floor of the Exchange in contrast to a total of 2.328 billion shares valued at N28.927bn that exchanged hands in 25,530 deals the previous week.

The financial services industry (measured by volume) led the activity chart with 1.468 billion shares valued at N18.707bn traded in 12,850 deals, thus contributing 83.18 per cent and 70.43 per cent to the total equity turnover volume and value respectively.

The conglomerates industry followed with 127.882 million shares worth N623.871m in 971 deals.

The third place was occupied by the consumer goods industry with a turnover of 69.868 million shares worth N6.189bn in 2,930deals.

Zenith International Bank Plc, Access Bank Plc and United Bank for Africa Plc (measured by volume) were the most traded equities for the week, accounting for 543.758 million shares worth N9.739bn in 3,533 deals.

The three stocks contributed 30.81 per cent and 36.66 per cent to the total equity turnover volume and value, respectively.

Also traded last week were a total of 125,282 units of Exchange Traded Products valued at N2.835m executed in 11 deals, compared with a total of 15,293 units valued at N254,840 that was transacted in 16 deals the previous week.

Nineteen equities appreciated in price last week, lower than 40 of the previous week. Fifty-three equities depreciated in price, higher than 40 equities of the previous week, while 99 equities remained unchanged higher than 91 equities recorded in the preceding week.

Experts at Vetiva Capital Management Limited noted that the equity market closed 421 basis points lower last month, and continued in the negative territory at the start of the second quarter.

“Notwithstanding the negative close for the week, we highlight that market sentiment was more upbeat at week close and as such we foresee further mixed trading with a mild positive tilt at week open,” they said.

Commenting on the consumer goods industry, the Vetiva experts maintained their expectation of more intense competition across the industry this year.

“Also, we expect abating cost pressures to provide a leeway for further price cutting as the companies look to support volume growth within the year.”

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Samed Olukoya

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Finance

SEC and CIMA Forge Alliance to Enhance Financial Reporting Standards

Published

6 hours ago

May 20, 2024

Samed Olukoya

In a bid to elevate financial reporting standards within Nigeria’s public institutions, the Securities and Exchange Commission (SEC) has announced a strategic partnership with the Chartered Institute of Management Accounting (CIMA).

This collaboration aims to enforce adherence to financial reporting regulations and foster a culture of transparency and accountability across various sectors.

Emomotimi Agama, the Acting Director General of the Securities and Exchange Commission, revealed this development during a recent meeting with a delegation from CIMA in Abuja.

Agama said the SEC ensures ethical financial practices and compliance with reporting standards mandated by law.

He stressed that the commission would vigilantly monitor adherence to these standards and impose penalties for any violations.

“It is a great time that you have come to Nigeria. SEC is saddled with the responsibility of making the initial decision of ensuring that what is right is done and transparency in reporting financial statements by public companies is ensured. It is now law to do so and there are consequences for breaking the law,” Agama remarked.

Sarah Ghosh, the President of CIMA, echoed Agama’s sentiments, emphasizing inclusivity, sustainability, and innovation as the association’s core priorities.

Ghosh highlighted CIMA’s commitment to engaging with regulatory authorities to promote awareness of the association’s values and its potential to enhance financial reporting practices among public firms.

“CIMA is approaching more regulatory bodies to ensure that everyone is allowed to understand what the association stands for and its contribution to enhancing reporting on financial statements of public companies,” Ghosh declared.

The collaboration between SEC and CIMA signifies a proactive approach towards strengthening financial governance and fostering investor confidence in Nigeria’s capital market.

By leveraging CIMA’s expertise and SEC’s regulatory authority, the partnership aims to instill a culture of integrity and accountability in financial reporting processes, ultimately contributing to the country’s economic development.

Banking Sector

Financial Institutions Racked Up N678m in Fines Last Year

Published

7 hours ago

May 20, 2024

Samed Olukoya

Financial institutions in Nigeria paid a total of N678 million in fines in the 2023 financial year, according to analysis of their various financial statements.

The analysis examined the annual reports of nine prominent financial groups, including FBN Holdings, Access Holdings, Guaranty Trust Holding Company, Zenith Bank Plc, United Bank for Africa Plc, Fidelity Bank, Wema Bank, Stanbic IBTC Holdings, and FCMB Group.

These reports provided insights into the fines imposed by various regulatory authorities, including the Central Bank of Nigeria (CBN), the Securities and Exchange Commission (SEC), the National Insurance Commission, and others.

Compared to the previous year, the total amount of fines paid by these institutions decreased significantly by 89.25% from N6.31 billion in 2022 to N678 million in 2023.

This decline reflects improved regulatory compliance among financial institutions and signals a positive trend toward greater adherence to established guidelines and standards.

Among the financial groups analyzed, Zenith Bank stood out for its increase in penalties compared to the previous year. While the bank had incurred no fines in 2022, it paid N21 million in penalties in 2023.

The penalties levied against Zenith Bank included fines for late rendition of CBN returns, unauthorized employment practices, outstanding auditor recommendations, and compliance checks on politically exposed persons.

Similarly, FBN Holdings reported a decrease in fines paid during the period, totaling N17.26 million compared to N26 million in the previous year.

The fines imposed on FBN Holdings were related to late submission of audited financial statements and non-compliance with regulatory reporting requirements.

Access Holdings also experienced a significant reduction in penalties, with fines decreasing from approximately N604 million in 2022 to N81.60 million in 2023.

Despite the decrease, Access Holdings incurred fines from various regulatory bodies, including the CBN, PenCom, and NGX RegCo, for infractions such as unauthorized advertising, data recapture sanctions, and late filing of financial statements.

Other financial institutions, such as GTCO, UBA Group, Fidelity Bank, Wema Bank, Stanbic IBTC Holdings, and FCMB Group, also reported fines for various regulatory violations, including breaches of transaction rules, late submission of reports, and non-compliance with industry regulations.

The significant decrease in fines paid by financial institutions in 2023 reflects the industry’s commitment to improving regulatory compliance and upholding best practices.

Finance

Presidential Committee to Exempt 95% of Informal Sector from Taxes

Published

6 days ago

May 14, 2024

Samed Olukoya

The Presidential Fiscal Policy and Tax Reforms Committee (PFPTRC) has unveiled plans to exempt a significant portion of the informal sector from taxation.

Chaired by Taiwo Oyedele, the committee aims to alleviate the burden of multiple taxation on small businesses and low-income individuals while fostering economic growth.

The announcement came following the close-out retreat of the PFPTRC in Abuja, where Oyedele addressed reporters over the weekend.

He said the committee is committed to easing the tax burden, particularly for those operating within the informal sector that constitutes a substantial portion of Nigeria’s economy.

Under the proposed reforms, approximately 95% of the informal sector would be granted tax exemptions, sparing them from obligations such as income tax and value-added tax (VAT).

Oyedele stressed the importance of supporting individuals in the informal sector and recognizing their efforts to earn a legitimate living and their contribution to economic development.

The decision was informed by extensive deliberations and data analysis with the committee advocating for a fairer and more equitable tax system.

Oyedele highlighted that individuals earning up to N25 million annually would be exempted from various taxes, aligning with the committee’s commitment to relieving financial pressure on small businesses and low-income earners.

Moreover, the committee emphasized the need for tax reforms to address the prevailing issue of multiple taxation, which disproportionately affects small businesses and the vulnerable population.

By exempting the majority of the informal sector from taxation, the committee aims to stimulate economic growth and promote entrepreneurship.

The proposal for tax reforms is expected to be submitted to the National Assembly by the third quarter of this year, following consultations with the private sector and internal approvals.

The reforms encompass a broad range of measures, including executive orders, regulations, and constitutional amendments, aimed at creating a more conducive environment for business and investment.

In addition to tax exemptions, the committee plans to introduce executive orders and regulations to streamline tax processes and enhance compliance. This includes a new withholding tax regulation exempting small businesses from certain tax obligations, pending ministerial approval.