I beg, where is FATHERof2 , wetin be ehm wify number make I call am, to release him.
please Sir the bulls don dey wake up, and your boys don dey confuse where to chop first, the leg abi na the Head!!

I beg, where is FATHERof2 , wetin be ehm wify number make I call am, to release him.
please Sir the bulls don dey wake up, and your boys don dey confuse where to chop first, the leg abi na the Head!!

He is yet to recover from comma.

Hello Fellownlanders,

Us stock brokers are still in the building oh. Sorry some of us were locked in a cage with bears, some of us travelled for training all year long and just got back 

I work in a very efficient stock broking firm, if you are interested in opening a stock account, verifying your certificates and buying/selling shares with timely and accurate financial advice, I ask you to take a look at our website www.citiinvestmentcap.com

Please dont hesitate to post or contact me if you are interested.


Take care.

Hello Fellownlanders,

Us stock brokers are still in the building oh. Sorry some of us were locked in a cage with bears, some of us travelled for training all year long and just got back
I work in a very efficient stock broking firm, if you are interested in opening a stock account, verifying your certificates and buying/selling shares with timely and accurate financial advice, I ask you to take a look at our website www.citiinvestmentcap.com

Please dont hesitate to post or contact me if you are interested.


Take care.

Ok. U are welcome back.

Volume and all share index closed today on higher notes,slowly but surely,the train is moving

rasputinn:

Volume and all share index closed today on higher notes,slowly but surely,the train is moving

@rasputin,longest time! these bears don dey enter small small.

rasputinn:

Volume and all share index closed today on higher notes,slowly but surely,the train is moving

You're correct, thru the daily emails im gettin from Investor Delight, i can see the figures movin from red to green . . . hope it picks up soon oooo

hi;
dont blame the laundry guy, the bear hit him so hard he started imagining laundry any time he saw stocks.

@viewus. eternal oil seems to be a bit stronger than afroil though not something i would have recommended though. they were initially partly dead until they had a change in their management. they have just had their offer  in the market. well you can keep your fingers crossed and pray hard that the management can turn things around.

all you doubting Thomases, have faith. Nigeria stock market is one of the best in the world and though the market was hit terribly by the bear, it simply created a golden opportunity which many people could not see. however foreign investors grabbed the opportunity with both hands and flew in,its possible some are part of the profit takers that are causing the market to slow down.
jump in while you still can, you can make money in either the bull market or the bear market.just get knowledgeable.

ACCESS BANK PLC
FULL-YEAR AUDITED RESULTS FOR THE YEAR ENDED 31
MARCH 2009

ACCESS BANK PLC REPORTS 43% INCREASE IN NET PROFIT FOR THE YEAR
ENDED 31 MARCH 2009 TO N22.9 BILLION

LAGOS, NIGERIA – 16 June 2009 – Access Bank Plc, (Bloomberg: ACCESS NL)
(“Access Bank” or the “Bank”), the full service commercial bank with headquarters in
Nigeria and with operations across nine African countries and in the United Kingdom
announces its audited results for the year ended 31 March 2009.
Speaking from the Bank’s headquarters in Lagos, Aigboje Aig-Imoukhuede, CEO of
Access Bank, said: “Through this prolonged period of global uncertainty only those
banks which accurately forecast the changing environment and adapt to the realities of
the time will continue to prosper. I am especially proud to report these excellent results
achieved across all of our business lines and in the face of extremely challenging market
conditions. This year as we mark our 20th Anniversary of business operations we will
continue to entrench the spirit of excellence in our businesses across Africa and the
United Kingdom and everything we do will remain rooted in prudent risk management
and our uncompromising commitment to excellent client service.
Commenting on margin loans and the bank’s financial strength Mr Aig-Imoukhuede
added: “since September 2008 we have commenced steps to derisk and deleverage our
balance sheet thereby insulating ourselves from the systemic risks emerging within our domestic market.
Between December 2008 and March 31st 2009, we have paid down $1.1 Billion of our foreign currency
trade facilities through internally generated liquidityfrom our regular deposit generation activities.
This proactive action has ensured that we are able to record a strong financial performance, whilst still maintaining the conservative
risk management practices associated with first class financial Institutions. Indeed
throughout last year and up till today, we have had no cause to approach the CBN
expanded discount window nor have we resorted to rescheduling our margin loan
exposures without recognising impairments on them as required by prudential
guidelines”.
The Bank’s Group Deputy Managing Director, Mr. Herbert Wigwe added that “as result
of the equity market downturn we discontinued underwriting and receiving bank activities
and this has led to a contraction in the ‘other liabilities’ balance sheet line.”

Financial Highlights
• Gross Earnings of N104.5 billion, an increase of 81%, compared with prior year
(N57.6 billion March 2008)
• Profit Before Tax of N28.1 billion, an increase of 48% (N19.0 billion March 2008)
• Profit After Tax of N22.9 billion, an increase of 43% (N16.1 billion March 2008) and
ahead of N21.6bn forecast
• Total Assets of N675 billion, down 35% (N1,032 billion March 2008)
• Loans & Advances up 60% to N391.7 billion (N244.6 billion March 2008)
• Deposits and other accounts up 15% N405.7 billion (N351.8 billion March 2008) Shareholders’ Funds up 7% to N184.9 billion (N172.0 billion March 2008) amongst top five Nigerian banks
• Strong capital adequacy ratio of 35%
• Cost/income ratio steady at 53.4%, (52.2% March 2008)
• ROA 14.2% (11.0% March 2008)
• ROA 3.2% (1.6% March 2008)
• EPS 141 kobo (131 kobo projected March 2009)
• Proposed DPS of 70 kobo (65 kobo March 2008) subject to shareholder approval at
AGM scheduled on 14 July 2009

Sustained growth levels across all 3 main divisions
• Institutional banking profit before tax N11.9 billion (N8.2 billion March 2008).
Commenting on performance, Okey Nwuke, ED of Institutional Banking, said:
“Institutional banking grew its market share despite the increasingly challenging
operating conditions throughout the year. We achieved a 45% year on year profit
growth through a combination of product depth, understanding of customers’ needs
and good distribution strength hinged on a value chain model that is second to none
in the industry. During the year we executed a number of landmark loan syndications
for clients such as Dangote Group and Mobil Nigeria.”
• Commercial banking profit before tax up 43% to N7.0 billion (N4.9 billion March
2008). “New products and our renowned value-chain model led to vigorous account
sign-on during the year,” said Obeahon Ohiweri, ED Commercial Banking.
“Our Project Five Star 5* Service delivery initiative has significantly improved relationship
management while branches opened last year are now operating at full capacity and
gathering much more momentum in terms of business development. This trend has
continued even in the new financial year. Meanwhile, the division also successfully
harnessed FX opportunities that arose from recent turbulent markets.”
• Investment banking profit before tax up to N6.0 billion (N5.0 billion March 2008)
representing 19% growth. “In October and November last year during the period of
extreme currency volatility, we actively engaged with our customers to fully optimize
their working capital, manage their foreign currency exposures and help mitigate their
risk exposures. Our pro-active approach to FX trading in turbulent markets helped
boost the division’s performance and cushion the slowdown in capital market related
activity. We also maintained our leadership in domestic fixed income trading with a
total of 16,000 transactions valued at N1.6 trillion over the year. We expect trading to
continue to drive core performance in the short-term. From an operational
perspective this year marked the establishment of our new Asset Management
subsidiary and the full integration of our Share Registration and Data Management
Company – United Securities Limited” said Ebenezer Olufowose, ED Investment
Banking.
•Retail banking profit before tax grew by 63% to N1.2 billion (N0.7 billion March 2008).
“Profit growth from the retail banking unit in the past year demonstrates our ability to
match innovative products with profitable customers in the retail space and has
vindicated our investments in cutting edge product management infrastructure.
Moving forward we see growth in the e-payment market space and will continue to
build strong partnerships and alliances in order to optimize emerging opportunities in
this area” said Victor Etoukwu, Division Head Retail Banking.

Operational Highlights
• Commencement of banking operations in 8 countries including the UK
• Increased headcount to over 1,434 (1,067 at March 2008)
• Steady operational efficiency performance as measured by the cost/income ratio
• Reduction of the non-performing loan ratio to 2.1% (3.7% at March 2008)
• Full adoption of the International Financial Reporting Standards (IFRS)
Investor Relations Developments
• First Nigerian Bank with post January 2009 year end to publish audited financial statements
• Notice of AGM and publication of audited financial statements scheduled for release
Wednesday 17 June – just ten weeks following year end
• Financial Statements in line with Nigerian GAAP for 2009 and financial statements in line with
IFRS for 2006, 2007, 2008 now available on the bank’s website (2009 IFRS financial
statements to be published shortly following conclusion of external audit review).

SIGNED
AUSTIN EDOJA-PETERS
HEAD, PUBLIC RELATIONS

http://www.proshareng.com/trainingGallery.php

Stock Market Loses as CBN Audits Margin Loans
By Ayodele Aminu and Goddy Egene, 06.25.2009

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The Nigerian stock market shrunk by 6.9 per cent within three days following pressure by banks to minimise margin loan losses as well as panic sale by other investors who are said to have reacted to the decision of the Central Bank of Nigeria (CBN) to audit the loans.
The market, which witnessed significant recovery from last April till the beginning of this month, had opened trading last Monday with a fall of 0.9 per cent.
By last Tuesday, the decline was 2.5 per cent before a heavy fall of 3.5 per cent yesterday.
The Nigerian Stock Exchange (NSE) All-Share Index, which is the major barometer for the performance of the market, closed at 26,927.65, down from the opening value of 28,910.19.
Also, the NSE capitalisation, which measures the value of equities, closed at N6.141 trillion, indicating a fall of N452 billion in three days.
Indications also emerged yesterday that three of the big banks have withdrawn their funds from the inter-bank market – where banks borrow from one another to cover their positions – for investments in Treasury Bills and government bonds and Open Buy Back, with a view to shoring up their liquidity for the December 31 common year end for all banks in the country.
Market operators said the sudden bearishness of the market resulted from a combination of many factors including selling-down by some banks to reduce losses in their margin loans - in reaction to three issues raised by the Central Bank of Nigeria (CBN) governor, Sanusi Lamido Sanusi, in an interview with the Financial Times of London.
These issues are: 100 per cent provisioning for margin loans; possibility of another round of consolidation and removal of CEOs that cook their books.
But the governor, who noted that the market had been on the decline before his statements, told THISDAY yesterday that he was undeterred by these developments – because his primary responsibility is to have safe and sound financial institutions.
He said: “If the market marks down bank shares because of reforms, I cannot really help it.
“I am not going to compromise on the altar of the share prices. I think [my] comments should be viewed as positive from the investor perspective because it would institute improved regulation and banking operations in the country.
“It is sad if there are investors who are not happy that the regulator is trying to institute reforms. However, that would not deter me from instituting improved transparency and regulation in the banking system.”
Commenting on these developments, a senior stockbroker said: “Given the fact that the CBN Governor has said banks should disclose their margin loan exposure with the view to making provisions for them, some of the banks are taking advantage of price growth witnessed in the market recently to reduce their losses. That move by the banks at the same time is putting the market under pressure.”
Another broker said that the comments by the World Bank that the Nigerian banking system was under stress, as well as Sanusi’s comments, are sending panic to some investors.
“When the CBN governor makes a statement, it is taken very seriously, considering the relationship between the money and capital markets and given the fact that the banks constitute over 60 per cent of the market capitalisation. Investors are bound to react to such comments by the CBN boss,” another operator said.
The Managing Director of Crane Securities Limited, Mr. Mike Ezeh, said: “Apart from the usual profit-taking, since the market is information driven, any comments that affect listed companies, whether banks or manufacturing firms, are supposed to reflect in the stock market.”
However, the Managing Director of Partnership Investment Company Limited, Mr. Victor Ogiemwonyi, said a bear market was not unexpected given the fact that some banks are preparing for their half year results, while others are trying to align with the December 31 uniform year end stipulated for all banks.
He said: “June 30 is around the corner and companies who have that date as their second quarter or year end are coming together. Apart from the usual month end expenditure pattern that brings in only seller, June is particularly difficult as most institutional investors and banks adjust their books in anticipation of year end.
“The market was not helped by the recent reports that our banks may be weaker than we anticipated. There is also the suggestion that the pent-up sale orders that were held back in the last few days may also have impacted the market yesterday after the limit order was lifted. What investors need to know is that the worst is over for the market. We will need a few more months for the market to stabilise.”
However, a source in the stockbroking arm of one of the banks linked the bearish trend in the past few days to cautious approach by market speculators who are trying to guide against losing the capital appreciation recorded in the past two months.
The source explained that such speculators are not sure of the sustainability of the bull run witnessed recently.
“They want to make sure that what they have gained is not lost. That is why some of them are selling and when there is more supply than demand, prices tend to fall. That is what is happening,” the source said.
About 20 banks recorded price losses yesterday, indicating that banking shares, which constitute more than 60 per cent of the market capitalisation, are being dumped.
Some of the banks had recorded capital appreciation of over 30 per cent since the market began to recover last April.
On the movement of funds from inter-bank market, Sanusi told THISDAY: “This had been on for a while and was not as a result of any statement attributed to me. The CBN has been aware of the decline in inter-bank lending and will introduce the necessary measures to restore confidence in the inter-bank market.”


In the words of Alariwo,yawa go gasss,breeze wan blow and we go soon see plety fowl nyash

Coincidentally,I was chilling with some banker freinds of mine on Sunday evening and they were saying how Sanusi was really going to ask some CEOs to provide for bad facilities extended to some companies some years ago in the then STB as well as all bank CEOs to provide fully for all sundry margin loans

Also heard a particular MD was already doing a sort of "cabinet reschuffle" to displace members of his staff percieved to have any iota of loyalty to Sanusi,at least to ensure a lot of things that" happened in Vegas stay in Vegas" if you know what I mean

It will get more interesting as we approach the Nov/Dec

This can mean just one thing; prices going down.

otokx:

This can mean just one thing; prices going down.

The prices r already taking a nose-dive, only 7 shares gained on wednesday, only 8 shares gained on thursday. . . Something is seriously wrong - so wrong that my broker called for a mandate to sell off my access bank shares with immediate effect.

THANKS ADUNOLA,

PART OF THE MAJOR BROBLEM SOME OF US WHO CALL OURSELVES INVESTORS IS WHAT U HAVE MENTIONED.I AM NOT CASTIGATE ANYBODY'S OPINION ON ANY HOT SHARES REVELATION.AM ADVISING PEOPLE TO LOOK B4 U LEAP.

WHAT U CONSIDER A HOT TIPS MAY END UP IN DEATH TIPS.DO YR OWN HOMEWORK VERY WELL B4 INVESTING.

MY GENERAL QUESTION IS THIS,HOW DO U PICK YR WINNING STOCK ? WHAT DO U CONSIDER B4 PICKING YR STOCK ?

GOOD LUCK.

otokx:

This can mean just one thing; prices going down.

Dy-no-mite PING

whitelexi:

The prices r already taking a nose-dive, .

Just wait for the approach of the year end,I'm really chilling and watching very closely so I can make some entries few weeks to a few months after their uniform year-end(once it's implemented,I'm not putting it beyond the egg-heads at the CBN to announce a postponment)

Stockbrokers have called on the governor of the Central Bank of Nigeria (CBN), Sanusi Lamido to always make complimentary policies that would grow the nation’s financial sector.
This observation is coming on the heels of the recent freefall in stock prices at the nation’s capital market which operators say may not be in connected with the recent directive from the apex bank on the audit of the universal banks aimed to ascertaining their level of exposure to the capital market and other key sectors.
BusininessDay had reported authoritatively that banks were directing their subsidiaries to offload stocks held in quoted companies to shore up their books and beef up their assets.
Meanwhile, market operators recall that the downturn witnessed in the capital market last year stemmed from some policy pronouncements by the regulators which caused destabilisation in the system.
According to the chief executive officer of a stockbroking firm, who spoke to BusinessDay on condition of anonymity, “the CBN governor should always “make complementary policies; he should know that we are in the same financial system; he is in the money market while we are in the capital market”.
An investor said that the CBN governor’s statement on the likely reduction in the number of existing banks to 15 have prompted investors to have a rethink on banks stocks. He observed that there was heavy offloading of bank stocks; an indication that investors perceived them as high risks. Operators suggest the need for consultation between the two regulators of the money and capital markets when policy are to be made; noting that if there is consultation between them in terms of policy pronouncements, it would help a lot of things in the financial system and the economy as a whole.
Investors were seen to be in panic disposal of their bank stocks last week which caused significant contraction in market indicators. Market capitalization had closed at N5.9 trillion from N6.6 trillion in the previous week; indicating a loss of N700 billion in one week.
Similarly, the all share index was down to close at 25,813.55 points from 28,910.19 in the same review period, having dropped 3,096.64 points. Overall, the market declined by 10.71 percent last week. Trading activities recorded a turnover volume of 2.64 billion shares valued at N20.64 billion as against 2.75 billion shares worth N25.34 billion.
All NSE sectoral indices slumped except the oil and gas index. Banking sub-sector trading volume show consistent reduction over the period, this culminated in a huge loss. Banking sub-sector which recorded a turnover volume of 341.1 million shares valued at N3.6 billion to open the week on Monday June 22, 2009 by Tuesday the volume reduced to N328.8 million shares worth N3.6 billion. Wednesday the figure slumped further to 221.2 million shares worth N2.6 billion.
Similarly, 129.8 million shares valued at N1.4 billion were traded on Thursday while the week ended with an increase to 231.3 million shares valued at N2.6 billion. As a result, all the bank stocks declined in value during the period under review.
Moreover, the sector as usual was still the most active with a traded volume of 1.25 billion shares worth N13.8 billion.
NSE banking index dropped by 13.73 percent to close at 433.46; the NSE insurance index also declined by 7.53 percent to close at 369.91 while the NSE food and beverages index lost 7.0 percent to close at 491.03 points. Only the NSE oil and gas index recorded a marginal gain of 0.28 percent to close at 399.33 points.
With pressure exerted on stocks, trading produced a total of 102 stocks which depreciated in value compared with only 12 stocks that appreciated during the week.



http://www.businessdayonline.com/index.php?option=com_content&view=article&id=3522:operators-look-to-cbn-for-support&catid=58:investor&Itemid=304

husu:

@rasputin,longest time! these bears don dey enter small small.

This one pass small small entrance,it's actually going to be an invasion,but the interesting thing is there are profit takers who entered around May and they are smiling all the way to the banks

So whether[i] small small[/i] entrance or invasion,there's always a silver lining somewhere,it all boils down to what I'll call opportunity

[size=14pt] INTERVIEW: We’ve got to open up sources of capital to banks [/size]


LAMIDO SANUSI, the new governor of the Central Bank of Nigeria , lays out his agenda to restore confidence in Nigeria ’s banking sector, in an interview with MATTHEW GREEN, the FT’s West Africa correspondent. He spoke about his plans to open Nigeria ’s banks to foreign takeovers, tackle an overhang of bad debt from banks’ losses on the local stock market and tighten disclosure requirements. He also gave insights into his approach to monetary policy and delivering lower interest rates. Here are excerpts from the interview.

Sanusi
Q:There’s a huge crisis of credibility in the Nigerian banking sector, in the opinion of many analysts. It seems to many of the people I speak to that your fundamental task is to restore that credibility. How are you going to that?
A:In addition to the standard central bank duties of monetary policy and financial stability, I’ve set myself two primary tasks. The first one is restoring confidence in the financial system. The second one is slightly less conventional but it is actually playing an important role as an agent for development.
I think the governor of the central bank cannot be the governor of the Bank of England, and just talk about money supply and interest rates and inflation. The financial system plays such a pivotal role in the economy that the governor of the central bank has to see himself, even though not as a politician, as an important part of the government with a responsibility for delivering economic growth.
The financial system suffers from a number of sources. First there is a clear fact, which we’ve always known, that banks do have margin loan exposures (Ed: exposure to losses on the local stock market). Now, some of those banks have margin loan exposures that are not in any way fatal. Their profits this year may be less than their profits last year. Maybe some will make minor losses.
There are others that I think people believe will need help in terms of recapitalisation, or maybe some encouragement to merge and consolidate into stronger banks. The credibility deficit comes not so much from the fact that the risks have been taken, but from the fact that there has been a seeming failure to acknowledge that there are problems.
I think the market would understand if you acknowledged that there were some problems, if you disclose the extent of the problem, and if you are seen to be working professionally and diligently towards resolving those problems.
In my view the number of banks that need serious help is relatively small. Unfortunately a few of them might be systemically important, and therefore how it is handled in terms of communication, how it is handled in terms of prioritisation at this stage is extremely important so that in addressing the problem you don’t create a bigger one.

From what you are saying then it seems like there are several banks that you are concerned may be at risk of going under?
Not going under. I don’t have all the details, but before I came in here, for instance, there was a general sense that you had about Naira 800bn to N1trn in margin loan exposure. If those numbers are true and the market has crashed by 70 per cent, you would expect that, to be optimistic, maybe 50 per cent of that is non-performing: another 500bn. What you would then expect to see is something close to that to show up as additional non-performing loans in the books of banks. And if it is not showing up then we have got to find out where it is. Now whether or not a bank is at risk of going under depends on the distribution of that 500bn. It also depends on the amount of capital that the bank has. So if the bank has a lot of capital and has a large margin loan exposure, it may make a loss, but it will go on. If, on the other hand, its capital base is small and its got huge leverage and huge concentrations then, like other banks, it is at risk.
We have to go through a proper diagnostic phase and we have already started that.

FT: There’s a huge clamour in the market for more clarity on the size and shape of this (margin loan) problem. You mentioned that a diagnosis needs to be done. Could you expand on what kind of procedure you would envisage carrying out to do that?
It’s extremely important that whatever we do does not cause a panic in the system. We’re dealing with two different participants with completely different profiles and mindsets….You’ve got on the one hand the investors, and while many shareholders might just be retail shareholders a substantial part of the investments in banks is in the hands of institutional investors…These are generally educated, they understand finance and they would be extremely happy to have the full picture blown up in the newspapers so that everybody knows. But on the other hand you’ve got the millions of retail depositors who would easily just panic if you send out signals that this particular bank has a problem without putting in place the mechanism and the structures for resolving them. I suppose the communication strategy is extremely important as we go through.

FT: Are you saying that you are planning to launch an audit exercise under the aegis of the central bank to diagnose the scale of the margin loan problem?
Yes I am.

FT: How long would that take do, you think?
If we start immediately you could cover the 24 banks in six to eight weeks max.

FT: When are you planning to launch the exercise?
I have launched it.

FT: So in six to eight weeks you feel you’ll be in a much more confident position to really understand the scale of the margin loan problem?
Yes I think so. I will. In the interim we’ll be looking at the various options of how to handle them.

FT: But it sounds like you are not planning to make those figures public immediately upon completing the exercise?
I may actually. It depends on what communication strategy is adopted. I certainly would expect that long before December we begin to apply prudential accounting standards and we will continue to increase the disclosure requirements for banks.

FT: It sounds like you are planning to impose more stringent disclosure regulations quite soon?
Yes, we should be able to have full-blown disclosures by the time the financials end in December.

FT: When you say “full-blown” what do you mean?
We might, even before the December accounts, require certain things to be disclosed. How much is disclosed between now and December depends on how much risk we perceive to be to the system with too much information in public hands.

FT: Could you give me a sense now of what types of figures you’ll be requiring the banks to reveal at minimum?
I think at the very least, since margin loans are a problem, people should know exactly what percentage of the loan book is exposed to margin loans, they should know exactly what kind of proprietary positions the banks are holding and they should know what the value is and they should know which loans are performing and which loans are non-performing, those should form part of disclosure requirements.

FT: Are you talking about imposing mandatory IFRS on banks?
IFRS helps, as you know in First Bank we did convince the board to adopt IFRS. But it’s extremely important to understand that if the problem is the integrity of data being presented, then IFRS does not address that problem. If it is true -- and I’m not saying it’s true -- but if it is true that an institution presents significantly distorted figures….there is nothing that stops them presenting false numbers under IFRS.

FT: Will you be seeking to sanction any banks that you find have been manipulating their books?
You wouldn’t sanction a bank. You would as much as possible see what you can do about deciding whether certain individuals belong in this profession. The banks are so much bigger than individuals. It’s important, I think, for the investor to know that there are many stakeholders in financial institutions. The bank managing director is one person. These banks have millions of depositors, they’ve got millions of shareholders, they’ve got thousands of employees and they play a major role in the economy. In the event of finding out that a management team has been errant, it’s extremely important that in dealing with that problem we do not place the investors, the depositors, the employees and the economy at risk. It’s about that balance, but certainly we’re not going to ignore it.

FT: Some of the issues that we’ve been talking around in terms of transparency, in terms of separation between regulator and operator -- clearly you believe these things need to be improved. Why should we have confidence in your ability to manage it?
First of all, it’s important to note that while it doesn’t excuse what’s happened in this system, the issues of banks, and their numbers and their recklessness and regulation have been issues all over the world. The FSA has itself put up its hands and said ‘we didn’t regulate hedge funds, we didn’t regulate these products, we allowed banks to go into sub-prime mortgages’ and the British people have paid a price. Americans have faced the same situation. Nigeria is not unique in that respect in terms of the failure of regulation. What we’ve got to do is to do what everybody else has done, to put up our hands and say ‘guys we made a mistake’ and fix it.

FT: How will you ensure that the central bank as an institution can regain its credibility?
A lot depends on what we do. These problems are not going to be fixed in a week or two. You’ve got to deal with the immediate problems of liquidity and the survival of institutions. You’ve got to deal with the issues of solvency and capital adequacy.
You’ve got to deal with the toxic assets – and those are all complex issues, how do you take them out? And if there is a cost to be borne by the Nigerian people, where is that money going to come from at this time of economic meltdown. You’ve got to deal with long-term with risk management systems, risk-based supervision, how to deal with subsidiaries, cross-border transactions. It’s an ongoing process. The market begins to have confidence when it’s convinced that the regulator understands what these issues are.

FT: Would you consider bringing in an external actor such as the IMF which would help the central bank to perform these sorts of tasks in a way that would restore that credibility?
We work very closely with the IMF, and we would work closely even with private sector operators. I would work with the IMF, I would work with the World Bank, I would work with international investment banks who have experience in those areas, I would work with local investment banks and regulatory agencies, so there are a number of parties involved.
My primary responsibility at this point in time is to restore health and confidence in the system and not hasten its death -- it’s just that balance.

FT: Going back to the question of margin loans, you’ve said that you want to diagnose the problem. What are the options that you are looking at for dealing with these assets once you’ve figured out how big the problem is?
The first thing obviously is that banks have to recognise losses if they are losses. We’ve got to know how much is true capital that every bank has. We’ve got to look at the possibility of taking those assets off their books. If a bank has weak capital and it wants to raise capital, the investor might want to have clean balance sheet…That might mean sterilising those assets, holding them until the market recovers and so on.

FT: Are you considering the idea of creating an asset management company that would buy up these toxic assets?
I think it’s a very strong possibility, and it’s one of the options on the table. The only thing is that the asset management company, even if set up, would only take off assets after the owners have taken the hit. We’re not going to take on assets at cost. They’ve got to be properly written-down on the books of banks.

FT: If though there are some banks that have sustained so much of a loss that they can’t survive, what will happen to them?
My intuitive feeling is that there isn’t any bank that cannot survive in one form or the other, either in the form of getting some of the stronger banks to put in equity and merge with them or inviting foreign banks and letting them agree the conditions for them to invest capital and management and revive the bank. Fundamentally, these banks have large branch networks, they’ve got huge investments in infrastructure, they’ve got a wide and diversified customer base, they’ve got therefore access and potential for growth. Banking remains fundamentally an attractive business, and for that reason there is always the possibility of finding some solution.

FT: It sounds from what you are saying like there is a strong chance that there may be more consolidation in the sector as the extent of the losses at some banks become known?
That’s my feeling, that there will be consolidation, that’s what I think.

FT: How many banks would you like to see in Nigeria?
I don’t have a target. My sense is that we might end up with fifteen banks.

FT: This consolidation may be triggered essentially by the audit process that you’re doing. As the regulator, will you step in to encourage consolidation among certain banks if you feel that it is necessary?
I wouldn’t force any consolidation but I think it’s important to send out signals to the banks that may have difficulties that merging with stronger banks is certainly a very good possibility for saving themselves and saving their shareholders and their businesses. And we would try to create an environment that encourages that.

FT: As I understand it, under the current regulations, there is a limit on foreign ownership?
In theory, yes. The laws of Nigeria do not restrict that. The central bank obviously has the authority to approve. What we have today is that the central bank is not likely to support a foreign bank owning more than 10 per cent of a top tier Nigerian bank. That is something that in my view needs to be looked at again.

FT: Where would you like to see the upper limit?
I would not place an upper limit.

FT: So you would open the possibility that a foreign bank would acquire a Nigerian bank outright?
That’s the law, those are the laws that we have in Nigeria.

FT: Have you been approached by any foreign banks who are seeking to take a position in Nigeria?
I have not met any foreign bank.

FT: But it sounds like your vision for the sector then is perhaps, again, a different one from your predecessor . You are sounding like you would prefer to open the field very much to foreign players?
I think my vision has always been different from my predecessor’s. We’re two different people. On this particular matter, my view has always been different.
Look at this way, if you look at the register of many banks, you’ve got shares that are owned by nominees. Now I don’t know who these nominees are. And I believe under the laws in which they are set up, the nominees are not obliged to disclose the persons behind them. So if as governor of central bank I am okay to have a bank owned by nominees and I don’t know who owns them, why wouldn’t I be comfortable with a bank owned by a Barclays, or HSBC or China Construction Bank, who I know? For me it’s a no-brainer.
At the end of the day, the bank takes on the character of its owners. The greater transparency I have in the ownership of a bank, the better run that bank will be.

FT: How long do you think this system of auditing and then imposing tougher regulations and addressing the problems of the weaker banks will take before you have the sector on the sort of footing you would like to see it?
A lot depends on what kind of information we come up with. I have set myself a target of December, and the very latest March, to have concluded everything I need to do. We could just find that all that the banks need is to declare losses and they have got enough capital do that and we move on, or we could find there is capital that could be brought in either by the owners or by other people. Or we could find – and this is the reality – that some have started talking to other partners and they’ve just not disclosed it, and a time will come when they will announce that they are ready.

FT: Given that the central bank has allowed banks to reschedule their margin loans until the end of December this year, do you think that will serve to concentrate minds and make sure that these issues are tackled?
I don’t have any issues with restructuring, even beyond the end of this year. What is important is that if they are non-performing (loans) then they should be recognised as that. If they are restructured and all the income is taken in on the assumption that it’s going to come back then we are living in the dream that the markets will go back to the highs that they were at and that’s not likely to happen. We would work on the most conservative and prudential basis and see how things go.
But as a risk manager I can tell you that margin loans are not a problem they are a symptom. The real problem is weaknesses in risk management systems. You may find that a bank has serious margin loans problems but it also has other problems in other portfolios, whether its oil and gas or real estate and so on, so we don’t know.

FT: You’ve outlined measures that you want to take that will take a considerable amount of work presumably. Do you think the central bank itself actually has the institutional capacity to carry these out?
I did say that we are going to work with institutions like the IMF on capacity building. I agree totally that there are skills issues. I was a risk manager out there, and I used to tell the regulators that they never really asked me the right questions. Part of the advantage of me being here is that it is really an area where I feel pretty comfortable. I have made my own mistakes as a risk manager and I have learned from them. But I have also come from managing risk in a big financial institution therefore understanding how do you look out for the kinds of things that could place an institution at risk? I will try to pass on a lot of that to those in banking supervision and give guidelines on exactly what I want them to look out for.

FT: We’ve seen the central bank try to adopt measures in the past that have essentially been reversed under pressure from the banks themselves. What gives you confidence that you will be able to muster the political will to challenge the vested interests?
The first thing is that I am not a politically-connected person and I’m not part of any vested interests, but the fact that I was appointed by the president to this job would suggest that he is willing to have change. The personal assurances I have received from the president are that he would give me his total support in everything that I feel I need to do to sanitise the financial system. My sense is that he was concerned about the same questions you are raising, about concerns being raised about the credibility of the financial institutions, and he would like those to be addressed. At the moment I can only move on confidently with the support of the president.

FT: Could you envisage a situation where there would be government-appointed boards having to run some of these banks?
I would not like to have that. It would be a last resort. They’ve got boards. If you need to have a transition in the institution, the boards can appoint a new CEO. I don’t think there is compelling evidence that in the past having government officials managing financial institutions has worked. My preference is to get private capital.

FT: Are there steps that you might take that would encourage it?
I would send the signals that I would try to create as much as possible an environment that would make it possible -- if it means showing some flexibility, if it means giving some forbearance, if it means providing some incentives. On a net cost- benefit basis, if it is seen that those incentives, or those forbearances, would cost the Nigerian people much, much less than having to put in capital in those banks and then manage them, then I would make the recommendations. Ultimately, the decision as to how far the government will go is that of the president, and I will have to discuss with him.

FT: One could easily say that you’ve come here to clean up the system. Is that how you envisage your role?
In the short-term, that’s a role, but this is a five-year job, and the economy is a long-term issue. My role still remains the fundamental role of the central banker. I need to ensure we have price stability, I need to protect the value of the national tender, I would like to see that we push for lower interest rates and stimulate growth in the economy.

FT: We’ve got this current cap on deposits on lending at 15 and 22 per cent. Do you have plans to lift that?
I don’t think there’s a cap in the sense of the central bank saying ‘you can’t lend more than this’. The Bankers Committee met and it’s part of a discussion. I would probably use a lot of moral suasion…for banks to understand that the long-term growth and long-term survival of our banks will have to depend on stability and growth in the real economy, and that sometimes some decisions that may seem to take a hair-cut off today’s profits are not unwise if they are going to lead to long-term income streams. At the same time we’ve got to address some of the fundamental reasons for high interest rates.

FT: There is a perception in the market that these banks have had to agree to these caps on deposits and loans. Are you happy to see those limits continue in their current form or would you lean on the side of them being removed?
We will have to discuss at Banker’s Committee. What I would like to do is to see if we can have policies and ideas on how using purely market-based solutions, interest rates come down. I think 24 per cent is too high, as a lending rate.

FT: When do you think we will see the fully liberalised exchange rate regime restored?
I don’t want to say at the moment. The central bank has said three months, but I believe we should do it earlier, but I can’t say when.

FT: What is your vision going forward for the kind of monetary policy strategy you want?
I think if there is anything that central bank has done very well over the past few years it’s been monetary policy. We did have hiccups, naturally, during the meltdown, but monetary policy has been extremely good. The central bank has kept a hold on money supply. It’s grown because of the need to provide liquidity to the banking system, inflation is coming down. This is the second consecutive month it’s coming down. We will aim to see if we can bring it down to single digits by the end of the year. Obviously it’s a problem keeping inflation down, keeping interest rates down and having a strong exchange rate – the “Unholy Trinity” that economists always deal with. I would like to keep inflation down, and I would like to bring down interest rates, and then depending on what happens to the oil price, and revenues and capital flows, I would hope the Naira will hold. But long-term I think lower interest rates are far more fundamental than a very strong exchange rate.

FT: How does one move away from the current situation where the level of liquidity is very much hostage to the oil price? How can you build the institutional capacity now and policy responses that would mean in five years, or ten years, that Nigeria would be able to avoid the big shocks we’ve seen that have been driven by these fluctuations in the oil price?
Can you tell me one economy in the last eight, nine months that has not had exchange rate shocks? The United States, the dollar, the pound, the euro, the Russian rouble – none. We lived in abnormal times. What happened to the Naira happened to every major currency. It’s not an isolated incident and I would not like us to judge monetary policy by what happened to the Naira. While personally I think that some of the controls that were introduced were not totally necessary, they were nothing in terms of what Russia introduced or Ukraine. We never had capital controls in the strict sense. You know we are living in abnormal times and what we need to do is to move as quickly as possible back to normality and not to panic.

FT: Isn’t the problem that the policy has been up to now to peg the Naira to the US dollar and having this pegged currency to some extent restricts your room for manoeuvre in terms of monetary policy?
I don’t think we’ve ever had a peg. There’s been stability. It’s been a managed rate in order to manage expectations because of the large amounts of imports. There has been an attempt to have some semblance of stability. I think we had a situation in which it was very clear that the stability around the band that we had was not sustainable given where oil prices were. We are very fortunate that there seems to be a reversal, I don’t know how sustainable that is.
But we need to understand that the exchange rate in Nigeria has been a sensitive issue primarily because the elites take an interest in it.

FT: Isn’t the problem in Nigeria that the monetary policy is to a large extent hostage to fluctuations in world oil prices. What I am asking is what’s your vision for say, five years down the line, to shape monetary policy in such a way as to break that link?
I don’t think it’s hostage to world oil prices, but it’s hostage to fiscal dominance. So for example, if the government had actually implemented or continues to implement the ideas on fiscal responsibility, where you would have a budget that’s based on an assumption of an oil price, and anything over and above that price actually goes into an excess crude account, and then that is used to supplement any shortfalls, you would have greater stability in terms of money supply. But if the government chooses to spend all the money that it gets when the price goes up and then ends up with nothing when the price goes down then you get those fluctuations. It’s not so much the price of oil, but greater harmony between monetary and fiscal policy and greater fiscal discipline.

FT: Some people say that the level of coordination between the finance ministry and central bank has really withered recently. Would you agree with that?
Yes, I agree with that totally. I think the “autonomy” of central bank has been taken to an extreme where it’s almost an island on its own. My own idea is that the central bank governor is a part of government and I would work very closely with the finance minister.

FT: How big a systemic risk do you see to the banking system at the moment?
I don’t see a risk that we cannot manage. I think there are stress points, and we’re trying to dimension those stress points. We will release information to the market. Some of that information will be released by the banks themselves. We will ask the banks to release that information. We appeal for a little time. We appeal for confidence and trust. But we don’t think there’s any reason to panic.

FT: Where would you like to see the Naira?
Even after total liberalisation and de-regulation, if oil prices hold firm there’s no reason why the present official rate cannot be a good target for a liberalised rate.


http://www.businessdayonline.com/index.php?option=com_content&view=article&id=3367:interview-weve-got-to-open-up-sources-of-capital-to-banks&catid=123:special-report

Interesting times are really ahead with Sanusi holding sway @ CBN

Realy,stock maket is a sure way to weath,but with the happenings in Nigeria stock maket.please watch before you dable into it.

hello my fellow investor i think what we need before investing in stockmarket is 70 percent of phsycology, 20 percent of money management, and 10 percent of system.but how many investor know this and make use of it,because a lot of people leave all their destiny in the and of another person, my own opinion is that if you want to win or lose money inthe market you have to know who you are,what you want,and what you are willing to give in other to get what you want[color=#990000][/color]and then you need patient, i mean patient before you buy by waiting for better oppourtunity whenfund managers and other investor are selling what they are not suppose to sell for fraction of what they worth,not when you buy and the market is coming down.that is why investor need to equip himor herself by reading aquality books on investin and listen those who know the game not those who are lost so much money in stocks and still continue organise seminar on how to make money short tem in this market when they are still loosing so much moneyyyyyyyyyyy.my one of my mentor use to say if they give you 7years to cut tree then ue 6years to sharp your axe so it will be easier for youto cut the treewithing 1 year witout much stress,let invest in our self before before inves in stocks.

Mkt Operators raise alarm on declaration of dividend, but non-audited results by coys

Peter OBIORA
Proshare NI
July 01, 2009 16:09 GMT


Capital Market Operators has raised an alarm on only the declaration of dividends and bonuses but not audited results by some quoted companies on the Floor of the Nigerian Stock Exchange (NSE).

One of the Market Operator who is a Stockbroker with one of the popular Stockbroking firms’ name (withheld) confirmed to Proshare NI today in Lagos Nigeria that the issue of the NSE allowing companies to release only their dividends and bonuses without their full results calls for corporate action.

“I do not understand the reason companies would release only their proposed dividends and bonuses to the Exchange without making available their full audited results” the Stockbroker said.

He also affirmed that this calls for corporate action on the part of the Stock Exchange.

The Stockbroker asserts that it is when the Audited results are made available that investors would be able to make their investments decisions.

He cited the examples with Trans-Nationwide Express Plc (Tranex) which released its proposed dividend to investors today Wednesday July 01 2009 on the Floor of the NSE and Regency Alliance Insurance Company Plc (Regalins) that also released its proposed dividend payout and bonus to investors of the company also today on the Floor of the Exchange; without their full audited results.

This is coming on the heels of earlier reports by Proshare NI that Twenty five (25%) of listed companies on the Floor of the Stock Exchange have been reported to be non-complaint in the declaration of its Annual Reports and Accounts.

This number in the schedule of quoted firms and compliance with submission of Annual Reports to the Stock Exchange was reported by Proshare Analyst Services Unit.

The report confirmed that one of the companies that declared its dividend today on the Stock exchange Regency Alliance Insurance has not declared their results for the past one (1) year.

As earlier reported, Sola Oni, Assistant General Manager (AGM) Market Operations/Information Technology had in a telephone chat with Proshare NI affirmed that the Management of the Stock Exchange are doing everything possible to ensure that quoted companies declare their results as at when due.

He also affirmed that the schedule of quoted firms reported by Proshare that are yet to comply with post listing requirements of declaring results prompt and regularly may include list of delisted companies.

However, as at the time of filling in this report, Proshare NI is yet to clarify the issue with the authorities of the Stock Exchange.

http://www.proshareng.com/news/singlenews.php?id=6987

It baffles me o. Imagine that. This is indeed abracadabra investments.

[size=14pt]A tale of many bank ratings [/size]

By Clara Nwachukwu


July 1, 2009 05:08PMT
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Lack of transparency and non-disclosure of exposures to margin loans have subjected the Nigerian banking system to conflicting ratings by some financial rating institutions in the recent times.

The Nigerian public believes that banks' exposures could be more than the estimates of the Central Bank of Nigeria (CBN) which put it at between ₦800 billion and ₦1.2 trillion as at the end of 2008, given that the Capital Market is believed to have lost over 65% of its market value or an estimated ₦8 trillion ($54 billion) since March 2008, according to TheAfrica Report, a Paris-based publication of Groupe Jeune Afrique, reputed as France's third largest press export, which classified only four of 24 banks in Nigeria as strong.

The classification has created panic among Nigerian banks, especially those classified as "shaken" and "stressed," as reports indicate that bank customers are poised to make sudden decisions based on the strength or weakness of their banks.

Reactions to the ratings

Critics of the report say the criteria used in arriving at the ratings were not specified and therefore cannot be relied upon, adding that these should have been specified so that the report would not be seen as biased.

Bismack Rewane, the Managing Director, Financial Derivatives, a Lagos-based economic intelligence outfit, said he could not comment on the strength or otherwise of the report because he did not "know the assumptions used in arriving at the conclusions."

In his opinion, some of the ratings are at variance with other recent industry ratings, such as the one released by Fitch Ratings Ltd, a global rating agency, which says it is committed to providing the world's credit markets with independent and prospective credit opinions, research, and data. Mr. Rewane argues, "The findings should have looked at the exposures relative to the earnings and profit. I don't have a problem with the report in itself, but it is at variance with that of the Fitch rating of Nigerian banks. For me, I will place greater reliance on the Fitch rating because the criteria were specific."

He further notes that The Africa Report failed to distinguish between profitability, illiquidity and insolvency, saying, "These are different issues and in my own opinion, there are no illiquid or insolvent banks in Nigeria, because the CBN has said it would not allow any bank to fail and that their capital base are still strong."

Taking a cue from this line of argument, a top management staff of UBA Plc one of the nine banks classified as "satisfactory" notes, "To rate a bank you must use certain indices such as deposit base, loan portfolio, and profit ration. I have not heard of any bank in any branch, irrespective of the rating where customers cannot cash their cheques, no matter the value. When this starts happening, then you can begin to suspect distress."

The UBA source cautioned rating companies against random ratings without specifying the criteria so as not to cause panic in the financial services sector, adding that the banking industry was very important in economic growth.

A top official of GT Bank, one of the four rated as "strong," who refused to be quoted, also called for caution among rating agents, saying, "There have been so many bank ratings lately. There is the Fitch rating, JP Morgan, Akintola Williams Deloitte and Touché, and there with the others, and the ratings depend on the criteria used so a bank considered as strong in one rating could be judged as distressed in another."

He went further to say that the bank, irrespective of its ratings, has always prided itself on "the quality of our assets, costs to income, return on equity and efficiency ratios, which are usually positive."

Only one of the banks rated by The Africa Report as "shaken" or "stressed", Access Bank, responded to NEXT enquiries. A spokesperson for the bank said that there was no basis for the categorization. "What facts do they have from the CBN to support their claims? Nobody contacted us on any issue as such we have never had any liquidity or capital adequacy issue with the Central Bank."

Mr. Rewane noted that exposures alone could not determine the health of any bank, saying, "Certainly it would affect their profitability, but if the exposures have been provided for, when the capital market recovers, they will recover some of their values."

GT Bank on its part believes "the industry is still strong irrespective of the margin exposures, and there is no need for customers and investors confidence to be shaken."

But First Bank, also one of the four "strong" banks, thinks that such rating only goes to confirm the strength of the bank as a leader. A spokesperson for the bank, Helen Ogboh, said, "Even though we do not know what the criteria they used to arrive at their judgment, it just goes to confirm that we have maintained our lead over the years. We heard about the report yesterday [Monday] and today [Tuesday] we read it in some of the national dailies and we feel excellent that we are rated strong."


The Africa Report

Although the publishers of the report were still working out their response with regard to the criteria for the rating at the time of publication, they say on their web site: "The Africa Report covers issues closest to the hearts of Africans and international investors alike accurately, incisively and comprehensively. The Africa Report goes beyond the headlines to give you in-depth reportage and analysis from writers who know their way around Africa's fast-changing worlds of business and politics."

The report says the performance of the banks follows the fall in the prices of oil and the crash of the capital market, adding, "Some hold the CBN governor, Charles Soludo, responsible for allowing a host of bad banking practices to go unchecked. Fortunately, a growing number of banks are beginning to equate more transparency with better returns."

Below is the report's classification of Nigerian banks

STRONG BANKS

Diamond Bank
First Bank
GT Bank
Skye Bank


SATISFACTORY BANKS

Afribank
Citibank Nigeria
Equatorial Trust Bank
Fidelity Bank
Platinum Habib Bank
Stanbic IBTC
Standard Chartered Bank
United Bank for Africa
Zenith Bank


SHAKY BANKS

Access Bank
Ecobank Nigeria
First City Monument Bank
Intercontinental Bank
Oceanic Bank
Sterling Bank
Union Bank

STRESSED BANKS

First Inland Bank
Spring Bank (pending takeover appeal)
Unity Bank
Wema Bank



My BIG question is wherever did TAR get their facts from,admitted,so many of our banks are so exposed as a result margin loans,upstream/downstream petroleum financing,telecom facilities etc,but this whole report to me is a load of crap that I think the French just wrote to stir up panic in our banking and economic system.
Where were they when the Lehman brothers,Northern rock,Iceland bank,Bank of America etc either collapsed or was on the brink of doing so despite their hitherto fantastic ratings by western agencies and journals including TAR

Deleted as the issue has been resolved

the post will be 'released' shortly!

rasputinn

So posts dey hang for pipeline and will come out once one carries placard? Same way the govt is treating issues? Na wa o.

na so we see am o-spambot in control, we declare amenesty for spamless post

Dis Guy:

the post will be 'released' shortly!

rasputinn

At least in the spirit of full disclosure and provision,a la Sanusi

Market cap dips into the 5 trillion region.We got to brace hard for uniform year end

[size=14pt]     AP posts N7.15bn profit, pays N5.20k dividend [/size]




African Petroleum Plc, has returned a marginal profit rise in spite of the inclement business climate in the 2008 financial year.

The company posted N7.147bn net profit in the 2008 financial year as against N7bn in 2007, representing an increase of one per cent. Gross profit also rose from N16.96bn to N27.01bn, representing an increase of 59.30 per cent, while its operating profit increased from N8.3bn to N12.6bn.

According to a statement signed by the Company Secretary, Mrs. Elizabeth Idigbe, the results were due to sound forecasting.

The statement said this was done through AP’s reinvigorated business intelligence systems; excellent customer service delivery; and adherence to corporate governance as well as industry best practices.

The board’s proposal to pay N5.20 dividend per share has shown its commitment to the investing public inspite of the N5.5bn bank interest paid during the year.

According to the statement, the dividend pay-out is an indication that the current board of AP is determined to grow the company‘s business in order to sustain dividend payment to shareholders who endured the period of “no-dividend”, which AP went through some few years ago, before the coming of the present board and management.
Aside this, the number of shareholders that will benefit from the dividend pay-out have increased from 788,787,383 units of shares to 958,886,610, following the allotment of the last public offer and Rights Issue recently concluded.

The hybrid offer proceeds will assist in providing more working capital and pursue investments that will enable the company to deliver even better returns in future.

Proshare