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Raising Funds From the Capital Market

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capital market - Investors King
  • Raising Funds From the Capital Market

In the last ten years, Nigeria has made remarkable progress in capital market development. The menu of available asset classes has been expanded to include Exchange Traded Funds, while market infrastructure has been modernised and strengthened with the Platforms for Over-the-Counter trading namely the National Association of Securities Dealers and the Financial Market Dealers Exchange now established.

Improved regulation and confidence- building measures by the regulators have contributed in no small measure to lift the market.

Specifically, the Securities and Exchange Commission, has undertaken a number of initiatives to boost investors’ confidence notable among which are the establishment of the National Investors Protection Fund meant to cushion the adverse effect of losses suffered in the capital market, and the e-dividend policy designed to minimise cases of unclaimed dividend.

There is also the Direct Cash Settlement scheme which ensures that investors receive their money directly whenever securities are sold, the Corporate Governance scorecard for companies listed on the Nigerian Stock Exchange and the recapitalisation of capital market operators which has gone a long way in curbing sharp practices in the market.

As a complement, the NSE implemented minimum operating standards for market operators as well as launched the Premium Board which offers issuers the benefits of greater visibility and opportunities to raise capital.

Undoubtedly, these measures have sent the right signals to the investing public with regard to rules enforcement and market discipline.

While these are encouraging developments, experts say many businesses have yet to take advantage of the opportunities which the capital market provides in raising the needed funds for business expansion. They say going public and offering stock in an initial public offering represents a milestone for most privately owned companies.

According to them, the main reason companies decide to go public, however, is to raise money and spread the risk of ownership among a large group of shareholders. Spreading the risk of ownership is especially important when a company grows, with the original shareholders wanting to cash in some of their profits while still retaining a percentage of the company.

Experts say one of the biggest advantages for a company to have its shares publicly traded is having their stock listed on a stock exchange.

In addition to the prestige a company gets when their stock is listed on a stock exchange, other advantages for the company include being able to raise additional funds through the issuance of more stock.

This is because companies can offer securities in the acquisition of other companies stock. Also, stock options programmes can be offered to potential employees, making the company attractive to top companies.

Experts also say that having a company’s stock listed on a capital market can attract the attention of mutual and hedge funds, market makers and institutional traders. But what does it take to have a company shares listed on the capital market? Experts say the company must have a proven track records backed up with profitability.

According to the Securities and Exchange Commission, for a company to have its shares listed on the capital market for the first time, such a firm would be registered as a public limited company with no restrictions on the transfer of fully paid shares.

The company must also have a minimum of three years’ operating track record with a pre-tax profit from continuing operation of not less than N300m cumulatively for the last three fiscal years and a minimum of N100m in two of these years.

Other requirements to be satisfied by the company, according to SEC is the presentation of financial statements which must be compliant with the applicable SEC rules and covering the last three fiscal years; and ensuring that a minimum of 20 per cent of the issued share capital is made available to the public and held by not less than 300 shareholders.

The company intending to list its shares on the capital market is also expected to have shareholders’ equity of not less than N3bn; and if the listing is in connection with an Initial Public Offering, the promoters and directors will hold a minimum of 50 per cent of their shares in the company for a minimum period of 12 months from the date of listing.

The company will also ensure that the directors and promoters of the company will not directly or indirectly sell or offer to sell such securities during that 12 months period.

Other requirements are that the company intending to list must ensure that the securities are fully paid-up at the time of allotment or registration in compliance with the applicable SEC rules; and it must undertake to promptly pay annual listing fees based on market capitalisation.

The Acting Director-General, SEC, Mary Uduk, says the commission is working with the Corporate Affairs Commission to encourage more companies to list on the capital market.

She says, “We are making concerted efforts in collaboration with CAC and other stakeholders to assist public companies that are yet to register their securities to do so without much difficulty.

“These initiatives continue to highlight and promote developments and trends in the Nigerian Capital Market and drive Financial Inclusion aimed at reducing adult exclusion from financial services.

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

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Forex

Nigeria’s FX Reserves Dwindle by $1.6 Billion Amid Unification Efforts, Straining Naira

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Naira Exchange Rates - Investors King

The Central Bank of Nigeria’s directive to remove the rate cap on the naira at the official Investors and Exporters’ Window has triggered a significant decline in the country’s foreign exchange reserves.

From June 14 to December 1, 2023, the reserves have plunged by $1.6 billion from $34.62 billion to $32.97 billion.

The decision aimed at fostering a free float of the national currency against global currencies has faced challenges, leading to a weakened naira by more than 40%.

The limited capacity to earn foreign exchange from both non-oil and oil exports, coupled with increasing FX demand, has contributed to the decline, raising concerns about the nation’s economic stability.

Economists, including Obadan Mike, a member of the Monetary Policy Committee, highlight the persistent pressure on foreign exchange demand amidst weak accretion to external reserves.

The fundamental issues include low productivity, inadequate export earnings, and limited foreign capital inflows.

The Economist Intelligence Unit’s Africa Outlook report questions Nigeria’s ability to support its exchange rate unification policy due to insufficient FX reserves.

It predicts ongoing instability, periodic devaluations, and foreign investors’ unease, indicating the need for robust measures.

While JP Morgan estimates Nigeria’s net FX reserves at $3.7 billion, the Central Bank Governor, Mr. Olayemi Cardoso, remains optimistic.

He anticipates positive economic impacts in the medium-term, driven by policies such as the removal of the petrol subsidy and the adoption of a floating exchange rate.

However, challenges persist, necessitating a careful balancing act to secure the nation’s financial stability.

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Forex

Black Market Dollar to Naira Exchange Rate Today 6th December 2023

What is the Dollar to Naira exchange rate at the parallel market, known as the black market (Abokifx) today? As of December 6th, 2023, the dollar to naira exchange rate is 1 USD to 1165 NGN at the black market.

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New Naira notes

What is the Dollar to Naira exchange rate at the parallel market, known as the black market (Abokifx) today? As of December 6th, 2023, the dollar to naira exchange rate is 1 USD to 1165 NGN at the black market.

This means that for every one US dollar, you can exchange it for ₦1165, Investors King reports.

This digital business news platform has obtained the official dollar to naira exchange rate in Nigeria today including the Black Market rates, Bureau De Change (BDC) rate, and CBN rates.

How Much is Dollar to Naira Today in the Black Market?

This rate is subject to change depending on a variety of factors including global economic trends, political developments, and market fluctuations. However, you can buy and sell 1 USD at ₦1165 and ₦1160 as of the time of writing today.

What is the current exchange rate of the dollar to naira in the black market today?

According to Investors King, as of the time this report was filed, a dollar can be purchased at the Lagos parallel market (black market) for ₦1165 and sold for ₦1160.

Exchange Rate of Dollar To Naira in Black Market Today?

Dollar to Naira (USD to NGN) Black Market Exchange Rate Today
Selling Rate 1160
Buying Rate 1165

Central Bank of Nigeria (CBN) Naira Exchange Rates for Banks

Investors King understands that although the dollar to naira opened at N1165 per $1 in the parallel market today, the Central Bank of Nigeria (CBN) does not acknowledge the parallel market, also referred to as the black market. The CBN has instructed individuals in need of forex to approach their bank as the I&E window is the sole recognized exchange.

On Wednesday, December 6th, 2023, individuals in the black market purchased one US dollar for N1165 and sold it for N1160. This shows that the value of the Naira improved when compared to Tuesday, December 5th, 2023 when the local currency was exchanged at N1170 to a Dollar and a Dollar was purchased at N1160.

To stay informed about the dollar to naira exchange rate, there are several reliable sources that you can turn to. Here are some tips for staying up-to-date:

  • Check the Central Bank of Nigeria’s website: The CBN is responsible for regulating the country’s monetary policy and is a reliable source for the latest exchange rates. You can check their website regularly for updates.
  • Follow financial news outlets: Financial news outlets such as Investors King, Bloomberg, Reuters, and CNBC provide regular updates on the global currency markets, including the dollar to naira exchange rate.
  • Use online currency converters: There are a number of online currency converters that allow you to quickly and easily check the exchange rate between the dollar and the naira.
  • Follow social media accounts of financial experts: Following social media accounts of financial experts such as analysts, economists, and financial advisors can give you valuable insights into the latest trends in the currency markets.

By staying informed about the dollar-to-naira exchange rate, you can make informed decisions when buying or selling foreign currencies. Whether you are a business owner looking to trade in foreign currencies or an individual looking to invest in the currency markets, knowledge of the latest exchange rates is key to success. Keep these tips in mind and stay informed about the latest trends in the global currency markets.

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Business

How Much is Dollar to Naira Today December 5th 2023 in Black Market

What is the Dollar to Naira exchange rate at the parallel market, known as the black market (Abokifx) today? As of December 5th, 2023, the dollar to naira exchange rate is 1 USD to 1170 NGN at the black market.

Published

on

New Naira Notes

What is the Dollar to Naira exchange rate at the parallel market, known as the black market (Abokifx) today? As of December 5th, 2023, the dollar to naira exchange rate is 1 USD to 1170 NGN at the black market.

This means that for every one US dollar, you can exchange it for ₦1170, Investors King reports.

This digital business news platform has obtained the official dollar to naira exchange rate in Nigeria today including the Black Market rates, Bureau De Change (BDC) rate, and CBN rates.

How Much is Dollar to Naira Today in the Black Market?

This rate is subject to change depending on a variety of factors including global economic trends, political developments, and market fluctuations. However, you can buy and sell 1 USD at ₦1170 and ₦1165 as of the time of writing today.

What is the current exchange rate of the dollar to naira in the black market today?

According to Investors King, as of the time this report was filed, a dollar can be purchased at the Lagos parallel market (black market) for ₦1170 and sold for ₦1165.

Exchange Rate of Dollar To Naira in Black Market Today?

Dollar to Naira (USD to NGN) Black Market Exchange Rate Today
Selling Rate 1165
Buying Rate 1170

Central Bank of Nigeria (CBN) Naira Exchange Rates for Banks

Investors King understands that although the dollar to naira opened at N1170 per $1 in the parallel market today, the Central Bank of Nigeria (CBN) does not acknowledge the parallel market, also referred to as the black market. The CBN has instructed individuals in need of forex to approach their bank as the I&E window is the sole recognized exchange.

On Tuesday, December 5th, 2023, individuals in the black market purchased one US dollar for N1170 and sold it for N1165. This shows that the value of the Naira declined when compared to Friday, December 1st, 2023 when the local currency was exchanged at N1155 to a Dollar and a Dollar was purchased at N1150.

To stay informed about the dollar to naira exchange rate, there are several reliable sources that you can turn to. Here are some tips for staying up-to-date:

  • Check the Central Bank of Nigeria’s website: The CBN is responsible for regulating the country’s monetary policy and is a reliable source for the latest exchange rates. You can check their website regularly for updates.
  • Follow financial news outlets: Financial news outlets such as Investors King, Bloomberg, Reuters, and CNBC provide regular updates on the global currency markets, including the dollar to naira exchange rate.
  • Use online currency converters: There are a number of online currency converters that allow you to quickly and easily check the exchange rate between the dollar and the naira.
  • Follow social media accounts of financial experts: Following social media accounts of financial experts such as analysts, economists, and financial advisors can give you valuable insights into the latest trends in the currency markets.

By staying informed about the dollar-to-naira exchange rate, you can make informed decisions when buying or selling foreign currencies. Whether you are a business owner looking to trade in foreign currencies or an individual looking to invest in the currency markets, knowledge of the latest exchange rates is key to success. Keep these tips in mind and stay informed about the latest trends in the global currency markets.

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