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Stocks Fall Further, NSE Reviews Market Indices’ Composition

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Egypt Stocks
  • Stocks Fall Further, NSE Reviews Market Indices’ Composition

The market capitalisation of equities listed on the Nigerian Stock Exchange continued its downward trend last week, falling by 2.74 per cent at the end of trading.

The NSE All-Share Index declined to 37,862.53 basis points from 38,928.02 at the close of trading the previous week while the market capitalisation dipped to N13.716tn from N14.101tn week-on-week.

Similarly, all other indices finished lower with the exception of the NSE Insurance Index that appreciated by 3.55 per cent, while the NSE ASeM Index closed flat.

A total turnover of 1.097 billion shares worth N15.471bn in 16,288 deals were traded last week by investors on the floor of the Exchange in contrast to a total of 1.738 billion shares valued at N18.462bn that exchanged hands in 14,790 deals the previous week.

The financial services industry (measured by volume) led the activity chart with 816.547 million shares valued at N9.425bn traded in 9,263 deals, thus contributing 74.44 per cent and 60.92 per cent to the total equity turnover volume and value respectively.

The consumer goods industry followed with 76.361 million shares worth N2.992bn in 2,545 deals, while the third place was occupied by the oil and gas industry with a turnover of 51.600 million shares worth N594.590m in 1,744 deals.

Trading in the top three equities namely – United Bank for Africa Plc, Zenith International Bank Plc and FBN Holdings Plc (measured by volume) – accounted for 325.580 million shares worth N4.854bn in 3,381 deals, contributing 29.68 per cent and 31.37 per cent to the total equity turnover volume and value respectively.

Meanwhile, the NSE has announced a review of the NSE 30, and the six sectoral indices of the Exchange, namely NSE Consumer Goods, NSE Banking, NSE Insurance, NSE Industrial, NSE Oil & Gas and NSE Lotus Islamic Indices.

It said the composition of the indices after the review would be effective on July 1, 2018, adding, “With the review, we will witness the entry/re-entry as well as exit of some major companies.”

The bourse began publishing the NSE 30 Index in February 2009 with index values available from January 1, 2007.

According to a statement, on July 1, 2008, the NSE developed four sectoral indices with a base value of 1,000 points, designed to provide investable benchmarks to capture the performance of specific sectors.

It said, “The sectoral indices comprise the top 15 most capitalised and liquid companies in the insurance and consumer goods sectors, top 10 most capitalised and liquid companies in the banking and industrial goods sector and the top seven most capitalised and liquid companies in the oil and gas sector.

“In July 2012, the Nigerian bourse launched the NSE Lotus Islamic index, which consists of companies whose business practices are in conformity with Shari’ah investment principles, with the aim of increasing the breadth of the market and creating an important benchmark for investments as the alternative ethical and non-interest investment space widened.”

The NSE said the companies on the Islamic Index had been thoroughly screened by Lotus Capital Halal Investment, in accordance with a methodology approved by an internationally recognised Shari’ah Advisory Board, comprising of renowned Islamic scholars.

The price indices, which were developed using the market capitalisation methodology, are reviewed and rebalanced on a bi-annual basis – on the first business day in January and in July, according to the statement.

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

Federal Government Clears $120m Debt to Gas Companies Amid Nigeria’s Power Crisis

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Gas-Pipeline

Amidst Nigeria’s persistent power crisis, the Federal Government has taken a pivotal step forward by clearing a significant portion of its debt to gas companies.

A sum of $120 million has been paid out of the country’s $1.3 billion indebtedness to gas suppliers, offering a glimmer of hope for improved energy stability across the nation.

The Minister of Power, Chief Adebayo Adelabu, underscored the critical role of gas in power generation and highlighted how the mounting debts had severely hampered gas supply to electricity-generating companies, exacerbating the country’s electricity shortfall.

Nigeria heavily relies on thermal power plants fueled by gas for over 70% of its electricity needs, making the timely settlement of gas debts paramount for enhancing power generation capacity and addressing the nation’s energy deficit.

Addressing delegates at the 7th Nigeria International Energy Summit in Abuja, the Director of the Decade of Gas Secretariat, Ed Ubong, expressed optimism about the government’s progress in offsetting its financial obligations to gas producers.

He emphasized the importance of aligning gas and power sectors to foster sustainable energy solutions.

As Nigeria grapples with the multifaceted challenges plaguing its energy landscape, the government’s commitment to settling outstanding gas debts marks a pivotal stride towards revitalizing the country’s power infrastructure and ensuring reliable electricity access for its citizens.

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Nigeria Insurance Corporation Reimburses Depositors of 179 Closed Microfinance and Four Mortgage Banks

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The Nigeria Insurance Corporation (NDIC) has announced the successful reimbursement of depositors affected by the closure of 179 microfinance banks and four mortgage banks across the country.

The reassuring news came during the 45th Kaduna International Trade Fair, where NDIC’s Managing Director, Dr. Bello Hassan, explained the corporation’s unwavering commitment to safeguarding depositors’ funds amidst financial uncertainties.

Dr. Hassan, represented by Hauwa Gambo, the NDIC’s Deputy Director of Communication, highlighted the corporation’s proactive measures in protecting the interests of depositors.

The introduction of the Single Customer View framework has expedited the process of reimbursing depositors of liquidated banks, ensuring swift and transparent transactions.

The corporation’s collaboration with the judiciary has yielded positive results, facilitating the speedy prosecution of failed insured banks and resolving long-standing cases of bank liquidations like Fortune and Triumph Banks.

This concerted effort has significantly enhanced the debt recovery rate, enabling NDIC to declare full liquidation dividends to uninsured depositors of over 20 deposit money banks.

Furthermore, NDIC has embraced digital remote payment strategies, streamlining electronic funds transfers to verified depositors’ alternate bank accounts.

The introduction of the ‘Deposit Tracer’ initiative in partnership with mobile operators aims to address apathy among depositors with small balances, providing accessible avenues for claiming funds trapped in closed banks.

The initiatives underscore NDIC’s proactive stance in safeguarding depositors’ interests and ensuring financial stability in Nigeria’s banking sector.

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Banking Sector

85.51 Million Nigerian Bank Customers Face Withdrawal Freeze Over NIN, BVN Deadline

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First Bank

As the March 1 deadline looms, an estimated 85.51 million Nigerian bank customers are facing the possibility of frozen accounts due to their failure to link their National Identification Numbers (NINs) and/or Bank Verification Numbers (BVNs) to their accounts.

Recent findings reveal the potential scale of the impending banking crisis.

Data from the Nigeria Inter-Bank Settlement System (NIBSS) indicates that Nigeria had approximately 146 million active individual bank customers as of December 2022.

However, by January 26, 2024, only 60.49 million BVNs were recorded on the NIBSS portal, leaving a significant portion unlinked.

Meanwhile, about 104 million NINs had been issued by December 2023, highlighting the disparity between NIN issuance and BVN linkage.

The Central Bank of Nigeria (CBN) had earlier issued directives to banks, mandating them to restrict transactions on accounts lacking linked NINs and BVNs, with effect from March 1, 2024.

Any accounts found non-compliant risk being designated as ‘Post no Debit,’ rendering them unable to process further transactions.

Responding to the impending crisis, the Director-General of the National Identification Management Commission (NIMC), Abisoye Coker-Odusote, emphasized the need for the revalidation of Front-End Partners (FEPs) to ensure the integrity of the identity database.

She underscored the importance of NIN registration and urged collaboration with various stakeholders to expedite the process.

The Executive Vice Chairman/CEO of the Nigerian Communications Commission (NCC), Dr. Aminu Maida, reiterated the significance of linking NINs to SIM cards to enhance national security.

Telecom subscribers were urged to comply with the NIN-SIM linkage directive to avoid service disruptions.

Meanwhile, financial service providers like Opay have issued reminders of the impending restrictions, urging customers to comply with the linkage requirements.

Amidst concerns, some customers contemplate transferring funds to compliant accounts to avoid potential financial setbacks.

As the deadline approaches, stakeholders are intensifying efforts to mitigate the impact of the impending banking crisis on millions of Nigerians.

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