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Investors lobby FG to Access N5.96tn Pension Funds



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  • Investors lobby FG to Access N5.96tn Pension Funds

Some investors, who have been unable to access part of the growing pension funds through operators of the Contributory Pension Scheme, are now lobbying the Federal Government to get guarantees for the funds.

As of the end of September, the industry had total pension funds of N5.96tn, currently the largest available pool of capital in the country.

It was found that the investors who could not access these funds due to the stringent measures introduced in the investment guidelines by the National Pension Commission have been seeking the Federal Government’s backing to get the pension operators to invest part of the funds in their projects.

According to the operators, the funds are safer for investments fully backed by the Federal Government securities.

In an interview with our correspondent, the Chairman, Pension Fund Operators Association of Nigeria, Mr. Eguarekhide Longe, noted that the operators had to comply with PenCom’s regulations on investment of pension funds.

While explaining the reason why some investors who approached the operators had not been able to gain access to the funds, he said that the operators needed to get certain clarifications on the status of the projects before pension funds could be invested in them.

“The promoters of the project have approached the pension industry and they also tried to get guarantees from the government and based on those guarantees, there is a better than before possibility that we can participate in a project,” he said.

He explained that this was necessary so that if anything should go wrong with the project, the government could intervene and give it its full support.

According to him, as long as the investors are able to get the government’s backing and come up with a disciplined business case, there is no reason why the operators should not participate in their projects.

He said that the PenCom’s regulations on investment of pension assets provided that the investment strategy committee, in addition to other functions specified in the Pension Act, would formulate internal investment strategies to enable compliance with the regulations, taking into cognisance the macro-economic environment as well as the investment objectives.

The internal investment strategies, he added, should be approved by the PFA in a formal board meeting at least once every year or as frequently as changes occurred in the macro-economic environment that might affect the pension fund assets.

The Head, Investment Supervision Department, PenCom, Ehimeme Ohioma, said the investment of the pension funds could be done through ownership (equity/shareholding) in the infrastructure company developing the project as well as co-investment with other institutional investors and project development firms.

According to him, where the investment is to be executed through a Public Private Partnership, it should have the due process requirements and endorsement and that the bid process for selection of concessionaire and other relevant parties in the project should be open and transparent.

“The project should a have well-structured financing model – infrastructure bonds, infrastructure funds or a combination of both,” he added.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and, with over a decade long experience in the global financial market. Contact Samed on Twitter: @sameolukoya

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DSS Arrests EFCC, Acting Chairman, Magu



Dss Arrests Ibrahim Magu

DSS Arrested Magu, the Acting Chairman of EFCC

The Department of State Services (DSS) has arrested the acting chairman of the Economic and Financial Crimes Commission (EFCC), Ibrahim Magu, on allegation bordering on financial misappropriation, abuse of power and embesslement.

The Acting Chairman was accused of siphoning part of the money recovered from looters, a Punch reported stated.

The report stated “It was learnt that the security details to Magu put up a stiff resistance during the arrest of their principal, as they objected to the DSS move.

But he is now undergoing interrogation at the DSS Headquarters In Aso Drive.

This is happening barely two weeks after the Attorney-General of the Federation, Abubakar Malami (SAN) reportedly complained to the President, Major General Muhammadu Buhari (retd.) about Magu’s conduct and advised that he should be relieved of his appointment.

The AGF was said to have accused Magu of insubordination and discrepancies in the figures of funds recovered by the EFCC.

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Again CBN Debits Banks N118 Billion for Failing to Meet CRR Target




CBN Debits Deposit Money Banks N118bn for Not Meeting CRR Target

The Central Bank of Nigeria (CBN) on Friday debited the nation’s deposit money banks a total sum of N118 billion for failing to meet 27.5 percent Cash Reserve Ratio (CRR) target.

This is the fourth of such action, bringing the total amount debited so far this year to N2.2 trillion.

According to Tunde Abidoye, an analyst at Lagos-based FBN Quest, the move brings “further downward pressure on banks liquidity ratios and earnings.”

“Based on the total sum that each bank has been debited this year, and our NIM assumptions for each bank, we estimate an aggregate opportunity cost of funds of N86bn for our universe of banks coverage,” Abidoye stated in a note to clients.

The central bank continues to debit banks to force them to loan more into the real sector and also reduce their forex purchasing power to better manage the nation’s weak foreign reserves and curb capital outflow. A series of recent reports have pointed to a possible foreign exchange devaluation to ease pressure on the nation’s reserves.

The report shows that the Stanbic IBTC and Guaranty Trust Bank were debited N15 billion each.

Details later…

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Debt Market: Dangote Cement Raises N250 Billion in H1, 2020



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Dangote Cement Raises N250 Billion From Debt Market in H1 2020

Dangote Cement raised a total sum of N250 billion from the nation’s debt market in the first half of the year, according to the FMDQ Securities Exchange Limited.

In the statement published on the FMDQ website, the N250 billion debt includes the N100 billion Series 1 Bond raised under Dangote Cement’s N300 billion Bond Programme and the N150 billion Commercial Paper (Series 13-16 Domestic CP Issuance Programme) offered earlier in the year and now listed and quoted on FMDQ Securities.

Mr Michel Puchercos, the Chief Executive Officer, Dangote Cement, was quoted as saying, “This landmark transaction is the largest-ever bond issuance by a corporate issuer in Nigeria.

“It allows us to further broaden our sources of funding by accessing long-term debt at competitive costs from the capital market and builds further on the success of our domestic commercial paper programme.

“The success of these transactions, in the current challenging environment, illustrates investors’ continuous confidence in Dangote Cement’s strategy, strong cash generation and solid credit profile.”

Mr Kobby Bentsi-Enchill, the Executive Director and Head of Debt Capital Markets, Stanbic IBTC Capital Limited, said, “Stanbic IBTC Capital Limited has a long history of partnering with Dangote Cement Plc, and are delighted to have advised on this landmark corporate bond issuance, which reflects the depth and diversity of the Nigerian debt capital markets.”

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