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Stock Market Loses N438bn in one Year

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The Nigerian stock market (equity category) depreciated by N438bn between August 24, 2015 and August 24 this year.

The Nigerian Stock Exchange All-Share Index also slid from 29,214.13 basis points to 27,880.46 basis points within the same period.

Data compiled by our correspondent also showed that the volume of transactions, value of transactions and number of deals for 2015 were 257.73 million, N2.775bn and 4,247, respectively; while those for 2016 were 230.29 million, N2.955bn and 3,002, respectively.

Between January and March this year, the equities market depreciated by 10.79 per cent – as of the first day of trading this year (January 4), the NSE market capitalisation stood at N9.757tn, while the ASI was 28,370.32 basis points.

But on the last day of trading in March, the market capitalisation and the ASI crashed to N8.704tn and 25,306.22 basis points, respectively.

Equity investors had in the first seven trading days of the year lost N804bn of their investment value.

A few weeks into the year, the downward trend in the Nigerian stock market prevailed with 10 out of the 12 indices of the NSE turning out negative.

The market capitalisation of the NSE fell by N811bn in the first 10 weeks of the year.

Market capitalisation is the total market value of the shares outstanding of all traded companies on the floor of the Exchange.

It dropped from N9.75tn on January 4, 2016 to N8.939tn 10 weeks into the year, while the ASI also closed at 25,988.40 basis points in the same period from the 28,643.67 basis points recorded on the first trading day of the year.

Meanwhile, as the ongoing economic recession continues to affect the financial market with dire consequences on the income streams of the capital market operators, stockbrokers have set agenda on their options to remain in the business.

Stockbrokers have consistently expressed deep concern that the current operating environment characterised by high interest rate, weak purchasing power, poor corporate earnings, unstable exchange rate, high inflation rate and investor apathy, among others, is fast eroding their dwindling income, fueling speculation that many of them may be pushed completely out of business .

The Managing Director and Chief Executive Officer, Standard Union Securities, Mr. Sehinde Adenagbe, said it would be difficult for stockbrokers to break even under the current climate.

“Overhead cost is rising steadily yet workers are clamouring for higher pay to cope with the high cost of living. Office rent, epileptic power supply and transport costs are of great concern to us and there are other contending issues that are eating into the income of stockbrokers,” he said.

Speaking on the survival strategy, the President and Chairman of Governing Council, Chartered Institute of Stockbrokers, Mr. Oluwaseyi Abe, advocated personal development on the part of the stockbrokers in order to expand their income streams.

“Recession is a time to take a breath. Invest on knowledge this time and be moderate. Stockbrokers should be multitasking to be relevant on all platforms and Exchanges,” he said.

In the same vein, the Registrar and Chief Executive Officer, CIS, Mr. Adedeji Ajadi, advised stockbrokers to be more creative and ready for diversification in order to remain in business, adding, “This is not the time to limit business opportunities to trading listed securities. What about bonds, unlisted equities and foreign exchange?

“Stockbrokers are also investment advisers. This is the right time to work with governments at various levels as consultants and advisers on how to create alternative sources of revenue, and better manage scarce resources to ride through the challenges of the economy at this time.”

The Managing Director and Chief Executive Officer, Network Capital Limited, Mr. Oluropo Dada, stressed the need for stockbrokers to leverage their wide professional latitude to peep into money market instruments by way of portfolio switching in favour of money market instruments such as Treasury bills

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

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Banks’ Credit to Economy Hits N19.33 Trillion in August

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Godwin Emefile

Deposit Money Banks Credit to Economy Rose to N19.33 Trillion in August

The total credit facility to the economy rose to N19.33 trillion in the month of August.

The Central Bank of Nigeria-led monetary committee disclosed on Tuesday after the nation’s monetary policy committee meeting.

The committee attributed the improvement to the 65 percent loan-to-deposit ratio policy implemented to compel the nation’s deposit money banks to join central bank efforts at growing the real sector of the economy.

Godwin Emefiele, the Governor of the Central Bank of Nigeria, who spoke during the meeting said “The bank’s policy on Loan to Deposit ratio also resulted in a significant growth in credit to various sectors from N15.57tn to N19.33tn between end-May 2019 and end-August 2020, an increase of N3.77tn.

“This growth in credit was mainly to manufacturing (N866.27bn), consumer credit (N527.65bn), oil and gas (N477.65bn), agriculture (N287.11bn) and construction (N270.97bn).”

On monetary aggregates, broad money supply (M3) rose to 6.93 per cent (year-to-date) in August 2020 from 5.23 per cent in July 2020, reflecting the increase in both Net Foreign Assets and Net Domestic Assets.

He said total domestic credit grew by 6.94 percent in August 2020, lower than the 9.43 percent recorded in July 2020.

The committee reduced the nation’s benchmark interest rate by 100 basis points to 11.5 percent, down from the previous 12.5 percent.

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Emerging Cities Take on Established Hubs for Graduates Seeking a Career in Finance

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Graduates Seeking a Career in Finance Prefer Dubai to Start Their Career

Dubai is the number one global destination for graduates who successfully complete the flagship graduate programme at one of the world’s largest independent financial advisory organisations.

On passing the intensive scheme, deVere Group routinely asks graduates in which location within the Group’s global network of offices they would like to start their international financial services career. This year, 36% have responded with Dubai.

The second most popular is London (25%); Hong Kong is third (14 %); Mexico City is fourth (13%) and Moscow is fifth (6%).

The remaining 6% is made up of other destinations including Shanghai, Geneva, Paris, and Abu Dhabi.

deVere Group CEO and founder Nigel Green comments: “This survey highlights that the next generation of financial services professionals are open to look beyond the traditional and more established global financial hubs.

“The order of the top destinations changes with each group of grads we take on, but Dubai, London, and Hong Kong are typically in the top five somewhere.

“This is because, quite understandably, these global hubs of finance, commerce and technology represent centres of enormous possibilities for ambitious individuals about to embark on careers as international wealth-advisory and fintech professionals.

“There are some common traits amongst these cities, including that English is commonly spoken, they are politically and economically stable, there is a high level of internationally-minded high net worth individuals, and by relocating to these places one can usually expect comparatively high financial rewards.”

He continues: “What is different this year is that for the first time emerging financial hub cities are making the top five. Mexico City and Moscow are now actively competing for top talent with well-established international financial centres like Shanghai, Geneva and Tokyo.

“All these global destinations are unique and differ from each other in terms of the lifestyle they offer and in terms of clients’ expectations, economic environments and regulatory conditions.

“With each of the top five cities offering unique opportunities and challenges, each one attracts grads who have often quite markedly different strengths and weaknesses, skill sets and aspirations,” notes Mr Green.

“The results of this survey suggest that despite the pandemic, talented young people seeking a rewarding career are keen to look for opportunities internationally.”

The deVere CEO concludes: “With a globally-focused outlook from the wealth advisers and fintech professionals of the future, we can expect this trend of emerging hub cities to take on stalwart destinations to continue for the foreseeable future.”

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Adesina, Godwin Emefiele, Others to Deliver Keynote Address at ASA 2020

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Akinwumi Adesina

Adesina and Godwin Emefiele to Deliver Keynote Speech at Agriculture Summit Africa (ASA) 2020

The President of the African Development Bank (AfDB), President Dr. Akinwunmi Adesina, is expected to deliver the keynote address at the 2020 Agriculture Summit Africa (ASA) holding this week.

The yearly summit organised by Sterling Bank is titled ‘Fast forward agriculture: Exploiting the Next Revolution’ this year.

According to the organisers, participants were expected to log in online while a few others would be in Lagos and Abuja studios.

In a statement released on Tuesday, Yemi Odubiyi, the Executive Director of Corporate and Investment Banking, Sterling Bank said other dignitaries were expected to deliver goodwill messages at the summit.

Some of the names mentioned were the governor of the Central Bank of Nigeria (CBN), Mr. Godwin Emefiele; Minister of Agriculture and Rural Development, Alhaji Muhammad Sabo Nanono; Cross River State Governor, Prof. Ben Ayade; his Kebbi counterpart, Senator Atiku Bagudu; and the Oniru of Iru Kingdom, Oba Abdulwasiu Omogbolahan Lawal.

Director, Advocacy and Country Alignment Function (ACAF), Director-General’s Office, International Institute of Tropical Agriculture (IITA), Dr. Kwasi Attah-Krah, is expected to deliver another keynote address on the second day.

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