₦airaland Forum

Indicative Rate as at yesterday 27/06/2019 as stated by Afrinvest Securities Limited ;

Investment Opportunities in Commercial Papers :

You can read more from this link below;

https://www.proshareng.com/news/%20BONDS%20&%20FIXED%20INCOME/Investment-Opportunities-in-Commercial-Papers/41448

You can also check the link below;

https://www.nairaland.com/5268211/commercial-papers-cps-how-too#79712664

Deknight45:
Frequently Asked Questions (FAQs) on Commercial Papers


What are Commercial Papers?

Commercial Papers (“CPs”) are unsecured short-term debt instruments issued by corporates to get funds from the public (private individuals, institutional investors, non-governmental organisations, religious bodies etc.) to meet short-term debt obligations such as working capital needs.



How do Commercial Papers work?

CPs are similar to Treasury bills (“T-Bills”) because they are issued at discount rates, which may be paid upfront or capitalized.

For instance, an investor could choose to receive N1m in the future (maturity amount/face value), which would require an ‘upfront’ investment below that face value (for instance N980,000 for a 90-day instrument at 8.0%), or could choose to invest N1m today to receive a ‘capitalized’ return above the investment amount (for instance N1.02m for a 90-day instrument at 8.0%).



What is a True Yield?

The ‘true yield’ is the effective return on investment (ROI). Using a simplified example, if an investor wants to receive N100,000 after a one-year period (365-days) and chooses to invest in a discounted instrument which is offered at a rate of 10%, the investor will pay a discounted value of N90,000 to receive N100,000 at maturity.



The true yield on that investment is not 10.0%. It is in fact 11.1%, calculated as return received as against the initial investment (N10,000/N90,000). This represents the return to the investor if the instrument is held to maturity.



The discount rate is used to calculate the present value of an investment, which differs from the yield on an investment.



Primary and Secondary Market for Commercial Papers

A CP can be purchased either in a primary or secondary market. The primary market is where investors buy financial instruments at issuance, while in the secondary market, investors trade (i.e. buy and sell) instruments purchased at primary market issuances.



The minimum purchase amount in the primary market may vary depending on the issue size. However, the minimum limit is typically set at N5m, while in the secondary market there are no standard lot sizes, but a minimum of N100m should be prepared for any purchase.



The major limitation for the secondary market trading of commercial papers is the illiquidity within the market, given that purchasers of these instruments typically only sell instruments in large volume sizes. Consequently, purchasing CPs is easier in the primary market.



What is the Tenor?

CPs are issued for time periods which match the issuer’s needs, with minimum and maximum tenors of 15 days and 270 days respectively.



What is a Commercial Paper Auction?

In the primary market, the issuer through an Issuing House sells to the market, through a fixed price subscription. Here, market participants signal interest in the issue and commit to purchasing volume sizes over an ‘offer period’ – which typically lasts only a few days.



This process is so because the rate on the issuance is fixed prior to offer to the market. This is unlike the T-Bills primary market issuances which are held in an auction format and investors are allowed to state the yields at which they would be willing to invest.



What do I Benefit from Investing in Commercial Papers?

While CPs in Nigeria are typically issued by blue-chip corporates with impressive track records of financial performance, this does not eliminate credit risk.



The discount rate on the CP is usually reflective of the credit rating of the issuer, which may be gleaned from the magnitude of the difference between the discount rate on a T-Bill with similar maturity and the CP being issued.



Consequently, CPs offer investors the opportunity to purchase better yielding instruments than available on risk-free instruments, if they are willing to take the calculated risk.



How are Commercial Papers different from Treasury Bills?

CPs have similar characteristics to T-Bills, relating to the mode of pricing. However, that is where the similarities end. T-Bills are usually issued by the government through the CBN at auctions which are typically held fortnightly, for fixed tenors of 91-days, 182-days, and 364-days.



Also, the minimum volume to participate in the T-Bills primary market auctions is N50,001,000.0, while secondary markets are very active and flexible relative to lot sizes.



Can I sell before Maturity?

Yes, you can sell CPs before maturity. A major constraint of selling CPs, however, is illiquidity and size of the minimum tradeable volume. Also, the price at which you sell depends on the prevailing interest rate at the time.



Can I rollover my CP Investment?

Usually, the answer is no. This is because a CP issuance is not a periodic auction which provides certainty of another CP investment opportunity. This, however, does not rule out the possibility of a CP investment opportunity at maturity. Nevertheless, when a CP investment matures, it can be rolled over into another money market or fixed income investment such as T-Bills and Bonds.



What are the Other Benefits of Commercial Paper?

Interest earned is tax-exempt
Since certificates are issued for CP investments, they can be used as collateral or as evidence of investment for visa application.


How Can I Buy Commercial Papers?

To purchase Commercial Papers, you can contact your account officer or send an email to brokerageteam@afrinvest.com

Lagos: Adedoyin: +234 809 778 3100

Port Harcourt: Taiwo: +234 808 718 4771

Abuja: Bola: +234 909 504 1827

Frequently Asked Questions (FAQs) on Commercial Papers

What are Commercial Papers?
Commercial Papers (“CPs”) are unsecured short-term debt instruments issued by corporates to get funds from the public (private individuals, institutional investors, non-governmental organisations, religious bodies etc.) to meet short-term debt obligations such as working capital needs.

How do Commercial Papers work?
CPs are similar to Treasury bills (“T-Bills”) because they are issued at discount rates, which may be paid upfront or capitalized.
For instance, an investor could choose to receive N1m in the future (maturity amount/face value), which would require an ‘upfront’ investment below that face value (for instance N980,000 for a 90-day instrument at 8.0%), or could choose to invest N1m today to receive a ‘capitalized’ return above the investment amount (for instance N1.02m for a 90-day instrument at 8.0%).

What is a True Yield?
The ‘true yield’ is the effective return on investment (ROI). Using a simplified example, if an investor wants to receive N100,000 after a one-year period (365-days) and chooses to invest in a discounted instrument which is offered at a rate of 10%, the investor will pay a discounted value of N90,000 to receive N100,000 at maturity.

The true yield on that investment is not 10.0%. It is in fact 11.1%, calculated as return received as against the initial investment (N10,000/N90,000). This represents the return to the investor if the instrument is held to maturity.

The discount rate is used to calculate the present value of an investment, which differs from the yield on an investment.

Primary and Secondary Market for Commercial Papers
A CP can be purchased either in a primary or secondary market. The primary market is where investors buy financial instruments at issuance, while in the secondary market, investors trade (i.e. buy and sell) instruments purchased at primary market issuances.

The minimum purchase amount in the primary market may vary depending on the issue size. However, the minimum limit is typically set at N5m, while in the secondary market there are no standard lot sizes, but a minimum of N100m should be prepared for any purchase.

The major limitation for the secondary market trading of commercial papers is the illiquidity within the market, given that purchasers of these instruments typically only sell instruments in large volume sizes. Consequently, purchasing CPs is easier in the primary market.

What is the Tenor?
CPs are issued for time periods which match the issuer’s needs, with minimum and maximum tenors of 15 days and 270 days respectively.

What is a Commercial Paper Auction?
In the primary market, the issuer through an Issuing House sells to the market, through a fixed price subscription. Here, market participants signal interest in the issue and commit to purchasing volume sizes over an ‘offer period’ – which typically lasts only a few days.

This process is so because the rate on the issuance is fixed prior to offer to the market. This is unlike the T-Bills primary market issuances which are held in an auction format and investors are allowed to state the yields at which they would be willing to invest.

What do I Benefit from Investing in Commercial Papers?
While CPs in Nigeria are typically issued by blue-chip corporates with impressive track records of financial performance, this does not eliminate credit risk.

The discount rate on the CP is usually reflective of the credit rating of the issuer, which may be gleaned from the magnitude of the difference between the discount rate on a T-Bill with similar maturity and the CP being issued.

Consequently, CPs offer investors the opportunity to purchase better yielding instruments than available on risk-free instruments, if they are willing to take the calculated risk.

How are Commercial Papers different from Treasury Bills?
CPs have similar characteristics to T-Bills, relating to the mode of pricing. However, that is where the similarities end. T-Bills are usually issued by the government through the CBN at auctions which are typically held fortnightly, for fixed tenors of 91-days, 182-days, and 364-days.

Also, the minimum volume to participate in the T-Bills primary market auctions is N50,001,000.0, while secondary markets are very active and flexible relative to lot sizes.

Can I sell before Maturity?
Yes, you can sell CPs before maturity. A major constraint of selling CPs, however, is illiquidity and size of the minimum tradeable volume. Also, the price at which you sell depends on the prevailing interest rate at the time.

Can I rollover my CP Investment?
Usually, the answer is no. This is because a CP issuance is not a periodic auction which provides certainty of another CP investment opportunity. This, however, does not rule out the possibility of a CP investment opportunity at maturity. Nevertheless, when a CP investment matures, it can be rolled over into another money market or fixed income investment such as T-Bills and Bonds.

What are the Other Benefits of Commercial Paper?
• Interest earned is tax-exempt
• Since certificates are issued for CP investments, they can be used as collateral or as evidence of investment for visa application.

How Can I Buy Commercial Papers?
To purchase Commercial Papers, you can contact your account officer or send an email to brokerageteam@afrinvest.com
Lagos: Adedoyin: +234 809 778 3100
Port Harcourt: Taiwo: +234 808 718 4771
Abuja: Bola: +234 909 504 1827

Frequently Asked Questions (FAQs) on Commercial Papers


What are Commercial Papers?

Commercial Papers (“CPs”) are unsecured short-term debt instruments issued by corporates to get funds from the public (private individuals, institutional investors, non-governmental organisations, religious bodies etc.) to meet short-term debt obligations such as working capital needs.



How do Commercial Papers work?

CPs are similar to Treasury bills (“T-Bills”) because they are issued at discount rates, which may be paid upfront or capitalized.

For instance, an investor could choose to receive N1m in the future (maturity amount/face value), which would require an ‘upfront’ investment below that face value (for instance N980,000 for a 90-day instrument at 8.0%), or could choose to invest N1m today to receive a ‘capitalized’ return above the investment amount (for instance N1.02m for a 90-day instrument at 8.0%).



What is a True Yield?

The ‘true yield’ is the effective return on investment (ROI). Using a simplified example, if an investor wants to receive N100,000 after a one-year period (365-days) and chooses to invest in a discounted instrument which is offered at a rate of 10%, the investor will pay a discounted value of N90,000 to receive N100,000 at maturity.



The true yield on that investment is not 10.0%. It is in fact 11.1%, calculated as return received as against the initial investment (N10,000/N90,000). This represents the return to the investor if the instrument is held to maturity.



The discount rate is used to calculate the present value of an investment, which differs from the yield on an investment.



Primary and Secondary Market for Commercial Papers

A CP can be purchased either in a primary or secondary market. The primary market is where investors buy financial instruments at issuance, while in the secondary market, investors trade (i.e. buy and sell) instruments purchased at primary market issuances.



The minimum purchase amount in the primary market may vary depending on the issue size. However, the minimum limit is typically set at N5m, while in the secondary market there are no standard lot sizes, but a minimum of N100m should be prepared for any purchase.



The major limitation for the secondary market trading of commercial papers is the illiquidity within the market, given that purchasers of these instruments typically only sell instruments in large volume sizes. Consequently, purchasing CPs is easier in the primary market.



What is the Tenor?

CPs are issued for time periods which match the issuer’s needs, with minimum and maximum tenors of 15 days and 270 days respectively.



What is a Commercial Paper Auction?

In the primary market, the issuer through an Issuing House sells to the market, through a fixed price subscription. Here, market participants signal interest in the issue and commit to purchasing volume sizes over an ‘offer period’ – which typically lasts only a few days.



This process is so because the rate on the issuance is fixed prior to offer to the market. This is unlike the T-Bills primary market issuances which are held in an auction format and investors are allowed to state the yields at which they would be willing to invest.



What do I Benefit from Investing in Commercial Papers?

While CPs in Nigeria are typically issued by blue-chip corporates with impressive track records of financial performance, this does not eliminate credit risk.



The discount rate on the CP is usually reflective of the credit rating of the issuer, which may be gleaned from the magnitude of the difference between the discount rate on a T-Bill with similar maturity and the CP being issued.



Consequently, CPs offer investors the opportunity to purchase better yielding instruments than available on risk-free instruments, if they are willing to take the calculated risk.



How are Commercial Papers different from Treasury Bills?

CPs have similar characteristics to T-Bills, relating to the mode of pricing. However, that is where the similarities end. T-Bills are usually issued by the government through the CBN at auctions which are typically held fortnightly, for fixed tenors of 91-days, 182-days, and 364-days.



Also, the minimum volume to participate in the T-Bills primary market auctions is N50,001,000.0, while secondary markets are very active and flexible relative to lot sizes.



Can I sell before Maturity?

Yes, you can sell CPs before maturity. A major constraint of selling CPs, however, is illiquidity and size of the minimum tradeable volume. Also, the price at which you sell depends on the prevailing interest rate at the time.



Can I rollover my CP Investment?

Usually, the answer is no. This is because a CP issuance is not a periodic auction which provides certainty of another CP investment opportunity. This, however, does not rule out the possibility of a CP investment opportunity at maturity. Nevertheless, when a CP investment matures, it can be rolled over into another money market or fixed income investment such as T-Bills and Bonds.



What are the Other Benefits of Commercial Paper?

Interest earned is tax-exempt
Since certificates are issued for CP investments, they can be used as collateral or as evidence of investment for visa application.


How Can I Buy Commercial Papers?

To purchase Commercial Papers, you can contact your account officer or send an email to brokerageteam@afrinvest.com

Lagos: Adedoyin: +234 809 778 3100

Port Harcourt: Taiwo: +234 808 718 4771

Abuja: Bola: +234 909 504 1827

Jobac:
Please sir, is there any thread we can read about commercial paper?

This is to inform you of Commercial Paper issuances for Nigerian Breweries PLC.

Please find below details of the CP;

Good day All,

I have successfully opened an account with IBTC MMF. The interest started generating on Monday though the account was credited on Thursday last week.

Many thanks.

cooldudeng:
It means that the last primary auction date was June 20th and the next one will be July 4th.

However, your funds needs to get to your back by Monday/Tuesday for you to partake in the bidding stated for Thursday. Would advise you work with Monday latest to avoid story that touch

Also, on July 4th, FGN will be rolling over all it’s maturing Bills. The bills that would be rollover are broken into 91, 182 and 364 tenor with their corresponding amounts highlighted under each columns

Hope that helps

Can somebody interprete this table for me please ?

Good afternoon good people. Please I need stanbic IBTC treasury bills website.

For your perusal.......

From the leter given to you...You did NOT have constant salary ans most importantly the amount in your account could not be justified.
My wife applied for the first time for visit visa to visit her sister and without any stress and with all documents genuinely genuine and all sense of sincerity. under three weeks she was give six months visa. This guys are professionals they know how to pick faults in the documents.

ssgi4in1:
Thanks for for this thread. Here is my story:

I applied for a UK visa for myself and my wife. We needed 6 months and we paid for priority and equally paid TLS around 108k for prime time appointment. I contacted one guy that has an experience with UK visa and paid him 100k. I wanted to take my wife on a honeymoon. (I didnt want to go to Dubai since I have visited in 2014 and 2016). I work as a clearing agent and my salary is not a fixed amount ( i am paid by commission at any time of the amount, sometimes I can receive my commission up to 10 times in a month). Most times I easily make 500K a month and even higher when I have more clients. I work with a firm where I am the manager and I am equally allowed to have my own clients who I make profits from. I use my personal savings to run most of my transactions.

In my applications I added properties for a valuation report on my properties in Aba and my Village totaling about N23 Million naira. My savings account have a sitting balance of 600K + with a turnoever of over 50M and the other account I use for savings (Diamond Hida) has a balance of 6M( I hardly use this account except to save). I added documents of my two SUVS and Certificate i used to donate 1k USD to Rotary. I equally added my School fees receipt ( I was doing a master degree in IMSU. As the boss, I could easily go to lectures on Thursdays & Fridays) I added our Traditional wedding pics and our wedding invitationcard.

I have a 2 bedroom flat where I collect 200k annually. I mentioned it. DHL brought their response and I was denied.

My wife was equally denied because I was denied. I angrily went to dubai. Pls why was I denied?

FzanyAjibs:
Incredibly clean shot

Do you have XXL sizes ?
Can you deliver in Ewekoro, Ogun State.

Stories like this should be encouraged in our society. It looks like a wonderful act but actually it should be the normal way of life. I also sometimes last year mistakenly sent money (₦260,000) to an account which was giving to me with a particular wrong digit. Few hours after the transaction, the intended person called to notify me he has not receive the money, we both decided to reconfirm the account number only for me to make this discovery. I called my bank Access Bank to inform them about the error and they promise to investigate. At exactly 8:19pm same day, I received an alert of ₦260,000. Next day I called my bank to thank them for their swift action, but the customer care representative that attended to me request that I should call a number which belong to the account owner which I did. My findings...... the person was a male Nigerian from the Eastern part of the country, married with kids (I am a Yoruba man), he told me that he was jobless and was sleeping when the alert entered his phone. A s a God fearing christian, after confirming from all his family and friends that they were not the ones that sent the money to him, he decided to transfer back the money to the account that sent it.....................I was troubled after the transfer error but later my spirit experienced peace as I had done similar thing to someone while I worked in Sagamu, Ogun state. I only told God to now reward me with my then good will and He did.

If properly taken care of, she will still walk again. Mine was equally as bad as this, but left leg.
It was amputated and a prosthetics leg was given to me. Over ten years ago now, I'm still kicking and living fine.

Sirheny007:
She hasnt grabbed the implication just yet.
She'd never walk again.

Good day,

Please what is the price range for hand rail of like 4metres. My project is at Abeokuta.

adekunle6105:
Our recently commissioned 10 tons/ day Palm kernel oil expeller at Abeokuta Ogun state for more enquiries call Engr. Adediran on 08037181034
Thanks

Good day,

Do you deal with the oil or the machine please.

alezzy13:
I'm torn between investment one and stanbic. Investment one because I've been with their parent company, GTB, for over a decade now and have been very impressed with their services, and stanbic because it seems to be a the most popular.....

Please what is InvestmentOne MMF Effective Yield.

Good morning fellow investors,

For me, AXA Mansard has been good for me though I have MMF investment with IBTC.
My objective is to build up something to fall back to after my retirement apart from my pension.
So far so good.............I can recommend them for people who can take low risk like me.

For daily mutual funds prices you can visit fman.com.ng

Hamthablow:
Where can I check daily trading for Stanbic IBTC MMF and other financial institutions.
Thanks bro.
Hamthablow007@yahoo.com

Go to Funds managers association of Nigeria fman.com.ng