Capital Market

SEC Calls For Use of Technology to Deepen Financial Inclusion

Published

2 years ago

December 6, 2021

The Securities and Exchange Commission (SEC) called on policymakers and capital market stakeholders to leverage technology to increase access to financial services and deepen financial inclusion in the country.

The Director-General of the SEC, Lamido Yuguda made these comments at the 2021 Capital Market Correspondents Association of Nigeria workshop which was held in Lagos during the weekend.

He said there were over 191 million active mobile subscribers and 140 million active data subscribers in Nigeria as of the 3rd of October 2021 and that presented a cost-effective means of providing financial services to the untapped market, especially in the rural areas.

His full statement was “Leveraging technology to offer financial services has advantages over traditional means because it breaks down geographical constraints, It also simplifies the means of serving existing customers, for example through the use of mobile banking agents to perform banking transactions”.

Financial institutions in Nigeria are increasingly using electronic channels to onboard clients and address customer queries and bring financial product offerings to prospective users.

When he was asked what steps the SEC is taking to boost financial inclusion, he said the SEC has taken steps such as working with the Fund Managers Association of Nigeria to accelerate financial inclusion to collective investment schemes.

The SEC is also proposing a hackathon challenge to help develop a comprehensive suite of mobile internet-based services targeted at having an end-to-end process of the entire capital market.

The Deputy Director, Securities offerings at SEC, Abdulkadir Abbas also spoke during the event and said there was a need for active collaboration of all capital market shareholders to help drive the initiative. He said the adoption of technology can help open up the capital market and bridge the gap of the unbanked. He also said the average age of participants in the capital market is 53 years and that youths need to be motivated to come and trade on the capital market.

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Capital Market

Stanbic IBTC Holdings to Raise N550bn Through Debt Issuance, Rights Issue

Published

11 hours ago

April 25, 2024

Samed Olukoya

Stanbic IBTC Holdings, one of Nigeria’s leading financial institutions, is set to raise a total of N550 billion through a combination of debt issuance and a rights issue.

This ambitious move comes amidst the backdrop of regulatory changes and the need for financial institutions to bolster their capital bases to meet new requirements set by the Central Bank of Nigeria (CBN).

The announcement was made in a notice of the company’s annual general meeting filed with the Nigerian Exchange Limited.

According to the disclosure, Stanbic IBTC Holdings plans to establish a debt issuance program with a capacity of up to N400 billion.

This program will enable the company to issue various forms of debt securities, including senior unsecured or secured, subordinated, convertible, preferred, equity-linked, or other forms of debt obligations.

Also, the board of Stanbic IBTC Holdings is seeking shareholder approval to raise additional equity capital of up to N150 billion through a rights issue or offer for subscription.

Shareholders will also vote on increasing the company’s issued and paid-up share capital to accommodate the proposed capital raise.

Stanbic IBTC Holdings has been a key player in Nigeria’s financial landscape, with a strong track record of performance and a diverse range of financial services.

The proposed capital raise is expected to provide the company with the necessary resources to pursue growth opportunities, enhance its market position, and continue delivering value to shareholders and stakeholders alike.

Capital Market

Nigerian Breweries to Raise N600 Billion to Tackle Foreign Exchange Debt

Published

3 days ago

April 22, 2024

Samed Olukoya

Nigerian Breweries Plc, the largest brewery in Nigeria, has announced plans to N600 billion through a rights issue, with the primary objective of clearing its N500 billion foreign exchange debt burden.

This initiative was unveiled by Uaboi Agbebaku, the company’s secretary and legal director, during a pre-annual general meeting press conference held in Lagos.

Agbebaku stated that Nigerian Breweries is committed to implementing a comprehensive company-wide reorganization strategy to ensure a resilient and sustainable future for all stakeholders.

“The additional capital raised via rights issue will be utilized to settle all overdue foreign exchange debts and payables, effectively eliminating foreign exchange exposure,” Agbebaku explained.

He further highlighted the importance of strengthening the company’s balance sheet and liquidity position to restore profitability in the shortest possible time frame.

Hans Essaadi, the managing director and CEO of Nigerian Breweries, echoed Agbebaku’s sentiments, acknowledging the challenging operating environment characterized by factors such as double-digit inflation rates, currency devaluation, and foreign exchange challenges.

Essaadi emphasized the urgency of addressing these issues to mitigate their adverse impact on the company’s financial performance.

To achieve its objectives, Nigerian Breweries intends to leverage the support of its majority shareholder, Heineken Plc, which has committed to contributing over 50 percent of the N600 billion fundraising target.

This partnership underscores the strategic importance of the rights issue in revitalizing Nigerian Breweries’ financial health and positioning it for sustainable growth.

As part of its broader business restructuring efforts, Nigerian Breweries had previously announced plans to temporarily suspend operations at two of its nine breweries.

Sade Morgan, the director of corporate affairs at Nigerian Breweries, explained that the company is committed to executing its 2024 business recovery plan, which comprises cost management, operational optimization, and portfolio innovation.

“Our strategy for success in 2024 revolves around strong cost management, operational efficiency, and the introduction of exciting innovations to delight our customers,” Morgan stated.

“We remain dedicated to our employees, communities, and stakeholders as we navigate through these challenging times.”

With the proposed rights issue, Nigerian Breweries aims to not only alleviate its foreign exchange debt burden but also to fortify its financial resilience and drive sustainable growth in the dynamic Nigerian market.

Capital Market

Royal Exchange Plc Rights Issue Falls Short, Closes at 75.83%”

Published

1 week ago

April 15, 2024

Samed Olukoya

Royal Exchange Plc, a leading player in life assurance, health insurance, and credit financing, recently concluded its rights issue with a subscription rate of 75.83%, indicating a shortfall in investor uptake.

The rights issue aimed at raising capital through the issuance of additional ordinary shares saw only a portion of the offered shares subscribed by existing shareholders.

According to the weekly report of the Nigerian Exchange Limited, an additional 3,121,328,866 ordinary shares of 50 kobo each were listed on the market, resulting from the completion of Royal Exchange’s rights issue.

This falls short of the total intended issuance of 4,116,296,059 ordinary shares at a price of N0.50 per share.

Despite the lower-than-expected subscription rate, Royal Exchange remains optimistic about its future prospects.

The company’s unaudited 2023 report revealed significant growth in earned income, soaring by 253% to N882.32 million compared to the previous year.

This boost in earnings was attributed to increases in net interest income and profits from investments in associates, totaling N591.55 million.

Also, Royal Exchange reported a profit of N46.09 million for the year 2023, a stark turnaround from the loss of N150.47 million recorded in 2022.

The company’s restructuring efforts, with a focus on asset management, have contributed to its improved financial performance.

Despite the shortfall in its rights issue, Royal Exchange Plc remains committed to its growth trajectory, leveraging its strengthened financial position to capitalize on emerging opportunities in the insurance and financial services sectors.