₦airaland Forum

Omoluabi Mortgage Bank Grows PAT by 39% in 6 Months
http://www.businesspost.ng/2017/07/14/omoluabi-mortgage-bank-grows-pat-39-6-months/

By Dipo Olowookere

Kano State Governor, Mr Abdullahi Umar Ganduje, has approved the introduction of five percent tax on goods and services consumed in the state called consumption tax.

Director of Legal Services and Enforcement at the Kano State Internal Revenue Service (KIRS), Mr Adamu Mohammed, who made this disclosure at an event in the state, explained that the consumption tax was introduced to increase the Internal Generated Revenue (IGR) of Kano State.

Mr Mohammed said emphasised that the, “Consumption tax is a 5 percent deduction payable by consumers of goods and services including hotels, restaurants, entertainment centres, shopping malls, event centres.”

Speaking further, he stressed that the new tax was different from the Value Added Tax (VAT), which 5 percent payable by the business owner to the Federal Government.

He explained that the business operators would serve as collection agents of the consumption tax on behalf of the KIRS.

It was gathered that the new consumption tax law was gazetted last week and would be applied on hotel services, event centres, supermarkets and shopping malls as well as other retail outlets across the state.

End users of goods and services in the state would be charged extra 5 percent over the original price of any services or product they purchase which would be remitted on monthly bases to state revenue services.

Implementation of the new law commenced in July 2017.

http://www.businesspost.ng/2017/07/13/ganduje-introduces-5-consumption-tax-kano/

CBN Issues N205b in Treasury Bills Next Week
www.businesspost.ng/2017/07/13/cbn-issues-n205b-in-treasury-bills-next-week/

CBN Issues N205b in Treasury Bills Next Week
www.businesspost.ng/2017/07/13/cbn-issues-n205b-in-treasury-bills-next-week/

By Modupe Gbadeyanka

The Federal Executive Council (FEC) on Wednesday, July 12, 2017, approved the sum of N2.7 trillion for payment of some debts owed by the Federal Government.

Minister of Finance, Mrs Kemi Adeosun, made this known while briefing State House correspondents after the FEC meeting held at the Presidential Villa, Abuja and presided over by the Acting President, Mr Yemi Osinbajo.

She said the approved about N2.7 trillion comprises N740 billion meant to pay pensioners, including former employees of the defunct Nigerian Airways, as well as promotional salary arrears.

“The council approved N750 billion for the payment for salary arrears and pensions as far back as 2009, including that of the former Nigerian Airways workers,” the Minister told newsmen.

Mrs Adeosun further disclosed that N1.93 trillion was approved to settle obligations including dues to federal government contractors and suppliers.

According to her, the obligations were accumulated by the government over the last 20 years, but would be paid by issuing bonds and promissory notes.

The Minister explained that this option was adopted in order to stimulate economic activity in the country.

“Some of the obligations date back as far as 1994. The resolution of this will significantly enhance liquidity in critical sectors of the economy,” the Minister said.

It was gathered that these obligations consist of dues owed to state governments, oil marketers, power generation and distribution companies, suppliers and contractors to federal government parastatals and agencies, payments due under the Export Expansion Grant, EEG, outstanding judgement balances as well as pension and other benefits to federal government employees.

“We are enhancing the government’s controls and processes to ensure we do not find ourselves in this situation again.

“Over the last two decades the federal government has built up over N2.7 trillion of obligations which were not cash backed, and remain outstanding to this day,” Mrs Adeosun said.

She said further that the Federal Government has “developed a solution that will simultaneously resolve these issues, and deliver a boost to economic performance."

“Our solution will remove the drag on economic performance these obligations cause, improve liquidity in key sectors, especially the power sector where we will resolve FG dues to the distribution and generation companies, and so boost investor confidence,” she noted.

Nigerian Airways was liquidated in 2003 by President Olusegun Obasanjo administration and the Inter-Ministerial Committee set up by the Federal Government in 2006 recommended the sum of N78 billion as the total severance package for 10 years for the workers, including pension arrears for the period after the physical verification of about 6,000 beneficiaries.

However, the Presidential Initiative on Continuous Audit (PICA) set up by President Muhammadu Buhari in its recommendation slashed the sum to just N43 billion, a 45 percent reduction, a move that did not go down well with the Minister of State for Aviation, Mr Hadi Sirika, who insisted that the earlier approved sum of N78 billion must be paid to the beneficiaries.

http://www.businesspost.ng/2017/07/13/fec-approves-n2-7tr-pay-ex-nigerian-airways-workers-contractors-others/

Zenith Bank Board Meets to Consider Audited Results, Interim Dividend
http://www.businesspost.ng/2017/07/12/zenith-bank-board-meets-consider-audited-results-interim-dividend/

Market Capitalisation Adds N53b on Sustained Buy Interest
http://www.businesspost.ng/2017/07/12/market-capitalisation-adds-n53b-on-sustained-buy-interest/

Fix Bureaucracy to Attract More Investors—Elumelu Tasks FG
**Proposes 'shared purpose' to create economic, social wealth for citizens
www.businesspost.ng/2017/07/12/fix-bureaucracy-attract-investors-elumelu-tasks-fg/

Fix Bureaucracy to Attract More Investors—Elumelu Tasks FG
**Proposes 'shared purpose' to create economic, social wealth for citizens
www.businesspost.ng/2017/07/12/fix-bureaucracy-attract-investors-elumelu-tasks-fg/

**Proposes 'shared purpose' to create economic, social wealth for citizens

By Dipo Olowookere

Federal Government has been charged to, as a matter of urgency, fix the bureaucracy in its parastatals, which frustrates the ease of doing business in Nigeria, so as to promote, attract and retain investors willing to do genuine business in the country.

This charge was made by Chairman of Heirs Holdings, Mr Tony Elumelu, during an event held in Abuja on Monday.

Mr Elumelu, who delivered a speech on ‘Nigeria Open for Business’ at the 2017 National Insurance Conference organised by the Insurance Industry Consultative Council (IICC), pointed out that bureaucracy was a major challenge that needed to be tackled with a sense of urgency to curb excessive losses.

At the forum which took place at the Transcorp Hilton, the former banker cited a personal example, when the delays in the public sector led to a negative return on investment that forced his proprietary investment company, Heirs Holdings, to suspend the pursuit of its insurance license despite meeting the eligibility requirement and capitalisation benchmark.

“This bureaucracy is a cause for concern and if not tackled, will discourage otherwise willing investors from within and outside the country,” he said.

“Heirs Insurance Limited is an example where despite focused attempts to finalise a licence, the delay in processing has cost our company significantly in terms of resources and return on investment,” he added.

Though the business mogul applauded the present administration for its efforts so far in stabilising the Nigerian economy, he said much more still needed to be done to transform Nigeria into a country capable of attracting the right investments.

Mr Elumelu proposed that Nigeria’s transformation can only be achieved when the government and private sector work together in “shared purpose,” to create the economic and social wealth for the people.

He defined shared purpose as an alignment and commitment to 3Es - employment, empowerment and economic opportunity, where the government partners with the private sector to, not only design a business climate that creates job opportunities for the youths as in the case of the Tony Elumelu Foundation, but prioritises small and medium businesses.

Mr Elumelu ended his speech by calling on the government to define policies that ease the process of doing business in Nigeria.

“Predictability and consistency of policies must be embraced by our policy makers. We need the public sector to be willing partners in establishing the right, investment-worthy business environment we need in Nigeria. This is the only way Nigeria can be truly open for business,” he concluded.

In response to the speech, representative of the Deputy Governor of the Central Bank of Nigeria (CBN), Dr Joseph Nnanna, commended Mr Elumelu on the points raised, stating that the sector would proactively address the issues raised.

Other guests present at the event included the Commissioner for Insurance, National Insurance Commission (NAICOM), Mr Mohammed Kari, and Dr Okechukwu Enelamah, Minister of Industry, Trade and Investment (MITI).

www.businesspost.ng/2017/07/12/fix-bureaucracy-attract-investors-elumelu-tasks-fg/

By Dipo Olowookere

Minister of Finance, Mrs Kemi Adeosun, has disclosed that it was time the country stopped borrowing to fund its budget.

Speaking today at the Presidential Quarterly Business Forum (PQBF) in Abuja, the Minister said instead of incurring additional debts to finance the budget, government will now make efforts to raise its revenue through taxes and others.

“We need to increase our budget size, but we can’t depend on borrowing anymore, so we have to improve revenues and block leakages,” Mrs Adeosun said at the business forum.

The Minister’s position on Tuesday suggests that the Federal Government will no longer press forward with the $2 million loan deals from the World Bank and African Development Bank (AfDB), which have stalled for almost a year.

The loans, especially from the World Bank and the International Monetary Fund (IMF), had been dragging after both bodies insisted on having blueprints of the Nigerian government on how it intends to utilise the funds and repay.

They also insisted on the FG putting in place critical fiscal policies, which have not been met.

Speaking further at the forum today, the Finance Minister said part of the efforts to raise government’s revenue was the introduction of Voluntary Assets and Income Declaration Scheme (VAIDS) by the Acting President, Mr Yemi Osinbajo, last month, precisely on June 29.

“This is why we’ve introduced VAIDSNG. A window of opportunity for Nigerians, individuals and companies, to regularize tax status,” the Minister said.

“We are reviewing tax waivers/exemptions and also reforming our revenue generating agencies. The Acting President, Prof Yemi Osinbajo has signed an Executive Order to support this,” Mrs Adeosun added.

Last month, the Acting President signed the 2017 budget pegged at N7.44 trillion. This came about a month after it was passed by the parliament.

It was disclosed then that more than 50 percent of the N2.21 trillion deficits in the 2017 budget would be funded through external borrowing.

Part of the 2017 budget, according to the government, is also to be funded with funds recovered from looters.

Business Post recalls that Minister of Budget and National Planning, Mr Udo Udoma, during the breakdown of the 2017 appropriation bill in Abuja in June 2017, said about N560 billion recovered from looters would be used to finance part of the 2017 budget.

“On recoveries, we are being extremely conservative; what is in the budget is what we know about already. So, if more comes, we will use it.

“Know that recoveries of looted funds are not the most dependable way to finance the budget because of the legal processes that have to be concluded before it can be spent.

“So, the money quoted in the budget is the one we have already recovered and in our pocket to spend as we wish,” Mr Udoma had explained.

Nigeria tripped into recession last year and has been making efforts to get out of it. There have also been promises from the government that the country would quit recession before the end of this year.

http://www.businesspost.ng/2017/07/11/nigeria-may-stop-borrowing-fund-budget-adeosun/

United Capital Declares N1.99b HY Profit
www.businesspost.ng/2017/07/11/united-capital-declares-n1-99b-hy-profit/

Nigeria May Stop Borrowing to Fund Budget—Adeosun
www.businesspost.ng/2017/07/11/nigeria-may-stop-borrowing-fund-budget-adeosun/

Okomu Oil, Dangote Cement Push Stock Market 0.65% Higher
http://www.businesspost.ng/2017/07/11/okomu-oil-dangote-cement-push-stock-market-0-65-higher/

BREAKING: NSE Lifts Trading Suspension on Sovereign Trust Insurance Shares
www.businesspost.ng/2017/07/11/nse-lifts-trading-suspension-sovereign-trust-insurance-shares/

Premier Paints Plc Declares no Dividend after N33.6m Loss
http://www.businesspost.ng/2017/07/11/premier-paints-plc-declares-no-dividend-n33-6m-loss/

By Dipo Olowookere

The management of Emerging Markets Telecommunication Services Ltd. (EMTS), trading as Etisalat Nigeria, has disclosed that it was holding discussions with Etisalat group on the use of Etisalat brand in Nigeria.

Earlier on Monday, news went viral that Etisalat Group had totally pulled out of Etisalat Nigeria, ordering an end to the use of its brand name in the country within three weeks.

But in a statement signed on Monday night by Mr Ibrahim Dikko, the Vice President, Regulatory and Corporate Affairs, at Etisalat Nigeria, and made available to Business Post, it was pointed out that discussions were still “ongoing between EMTS and Etisalat Group pertaining the continued use of the brand.”

Mr Dikko promised that when talks were over, the firm would “issue a formal statement” on the matter.

Mr Dikko further said in the statement that “EMTS has a valid and subsisting agreement with the Etisalat Group,” which entitles it to “use the Etisalat brand (in Nigeria), notwithstanding the recent changes within the company.”

He, however, assured subscribers that the final outcome on the use will not affect “operations of the business as our full range of services remains available to our customers.”

“Nigeria remains the soul of EMTS’ business and we have made the brand alluring to our teeming subscribers who see a piece of the spirit and character of Nigeria in everything we do.

“EMTS is here to stay and we wish to assure our esteemed customers that our core values of youthfulness, customer-centricity and innovation will remain the pillars on which we operate. We thank our esteemed customers for their abiding faith in us,” the statement said.

In 2008, EMTS launched in Nigeria with 0809ja to affirm the Nigerianness of its origin and sphere of influence.

In its nine years of operation, the firm has remained a prime driver and avid supporter of the Nigerian spirit of excellence, and has promised to continue to stay true to its Naijacentric identity.

According to the statement, “This notion is strongly reflected in our core messages and depicted in major projects and initiatives which we have been known to support.

“All these initiatives have their foundation embedded in supporting key aspects of the Nigerian fabric: building Nigerian businesses and empowering Nigerian’s with a focus on the youth.”

http://www.businesspost.ng/2017/07/10/emts-etisalat-group-hold-talks-on-brand-name-usage-in-nigeria/

By Modupe Gbadeyanka

Minister of Oil in Kuwait, Mr Issam Almarzooq, has disclosed that Nigeria and Libya may be asked to put a limit to their oil outputs having recorded stability in their countries lately.

The two countries were exempted from the oil cut deal reached in Austria last November by members of the Organization of the Petroleum Exporting Countries (OPEC).

The deal became effective from January 1, 2017 and by April this year, OPEC said the oil cut agreement was at 98 percent compliance level.

According to Bloomberg, Mr Almarzooq disclosed on the sidelines of an energy conference in Istanbul, Turkey, that the two African nations may be asked to cap their crude output.

Already, OPEC and non-OPEC producers have invited the two countries to a committee meeting taking place in St. Petersburg, Russia, on July 24.

At the meeting, they will discuss the stability of their production.

“We invited them to discuss the situation of their production,” Mr Almarzooq was quoted as saying by Bloomberg.

“If they are able to stabilize their production at current levels, we will ask them to cap as soon as possible.

“We don’t need to wait until the November meeting to do that,” he said, referring to the upcoming OPEC meeting scheduled for November 30.

Crude oil production in Nigeria rose slightly above 2 million per barrels per day in June 2017. This was mainly because militant activities in the oil-Niger Delta region of the country was stopped after consultations with stakeholders.

http://www.businesspost.ng/2017/07/10/opec-may-ask-nigeria-limit-oil-output/

OPEC May Ask Nigeria to Limit Oil Output
http://www.businesspost.ng/2017/07/10/opec-may-ask-nigeria-limit-oil-output/

EMTS, Etisalat Group Hold Talks on Brand Name Usage in Nigeria
http://www.businesspost.ng/2017/07/10/emts-etisalat-group-hold-talks-on-brand-name-usage-in-nigeria/

Banking Stocks Sustain NSE Upward Swing by 0.48%
http://www.businesspost.ng/2017/07/10/banking-stocks-sustain-nse-upward-swing-0-48/

By Modupe Gbadeyanka

Lagos State Law Reform Commission has disclosed that it has identified the need to review certain provisions of the existing Lagos State Tenancy Law of 2011 with a view to further ensuring fairness and reposition the law to reflect present societal values and realities.

Attorney-General and Commissioner for Justice in Lagos State, Mr Adeniji Kazeem, made this known at the stakeholders' meeting on Tenancy Law of Lagos State organised by the Law Reform Commission.

Mr Kazeem noted that the modernization of Lagos into a smart city made it imperative for its legislations to reflect modern day realities, especially in the provision of shelter.

The Commissioner added that the proposed review of the law was also part of the ease of doing business drive of the state government aimed at drastically reducing all bottlenecks capable of hampering commerce and other practices that negate global practices applicable in developed countries of the world.

Mr Kazeem said that feelers from members of the public reveals that the citizens were not pleased with the present state of the law, hence the need to consider the introduction of rules of procedure to help fast-track proceedings for recovery of possession and propose time limits for the disposal of tenancy matters, among other grey areas contained in the law.

The Attorney-General stated that “like every other piece of legislation, this law requires periodic review in line with the government's housing policies as a way of dealing with insufficient housing problem due to the fast growing population of the state.”

He reiterated that the existing Lagos Tenancy Law was a compilation of the reviewed Recovery of Premises Law Cap 118 Laws of Lagos State 2003 and the Rent Control and Recovery of Residential Premises Edict No. 6 of 1997.

The Commissioner maintained that some aspects of the law have not really been obeyed by the concerned stakeholders, noting that the section of the law on advance payment which makes it unlawful for a landlord to receive more than a year's rent in advance was still being flouted.

He expressed hopes that the Lagos State House of Assembly would ensure speedy adoption and passage into law, the resolutions that would be inserted in the proposed bill as would be presented by the Law Reform Commission upon review of the law.

On her part, the Chairman of the Lagos State House of Assembly Committee on Judiciary, Human Rights, Public Petitions and LASIEC, Mrs Funmilayo Tejuosho, promised that the Assembly would ensure fairness in the passage of the review of the law through a call for public hearing to reflect the opinion of the majority.

She urged concerned stakeholders to also consider the issue of Agreement Fee charged by landlords, adding that whatever amendment that would be made to the law should be able to stand the test of time and bring comfort to all residents of the state.

Delivering a welcome address at the event, the Chairman, Lagos Law Reforms Commission, Prof Gbolahan Elias (SAN), disclosed that the goal of the commission was to introduce revised tenancy legislation that will be sensitive but pragmatic, just and efficient.

He added that the proposed review would focus on the role of Estate Surveyors and Valuers, legal practitioners and the judiciary in tenancy matters.

Participants at the stakeholders' meeting acknowledged the fact that the law cannot absolutely favour both parties involved as either of the parties would be seeking to justify their stance at the expense of the other.

The stakeholders looked forward to a situation where individuals who run afoul of the provisions of the law will be prosecuted by the state government to serve as a deterrent and boost public confidence in the law.

www.businesspost.ng/2017/07/09/lagos-reviews-tenancy-law-may-stop-agreement-fee/

By Modupe Gbadeyanka

Authorities of the Nigeria Police Force have approved the dismissal from service of four police officers attached to Ijebu-Ode Area Command in Ogun State.

A statement issued by the police explained that the cops were fired in line with the fight against corruption and ensuring adherence to the ‘Change Begins With Me’ campaign of the Federal Government.

The dismissed policemen are Inspector Mufutau Olaosun with AP. No 122800, Sergeant Adebayo Temitope with F/No. 366127, Corporal Bakare Taiwo with F/No. 455593, and Corporal Adesoye Ayokunlehin with F/No. 455554.

They were charged, tried and found guilty in an Orderly Room conducted at the Area Command Headquarters, Ijebu-Ode for two offences against discipline as provided for in Paragraphs E (iii) Discreditable Conduct and C (ii) Corrupt Practice under the First Schedule of Police Act and Regulations Cap. P19. Laws of the Federation of Nigeria 2004.

The released by the police said on the June 12, 2017, the Public Complaint Rapid Response Unit (PCRRU) received a complaint via WhatsApp number 08057000003 which states thus;

“Good morning sir, My name is (Withheld), living in ijebu ode, on Wednesday afternoon I went to withdraw money from the bank and am been sent by my boss when going back to the office some policeman car just double cross me and collect my phone telling I stole the phone I should follow the to the station and the took me to igbeba police station here in ijebu asked me to do frog jump from outside to a room, which I did to afford being beating. After gotten there they started calling a internet fraudster which I told them am not that am an (withheld) and they started beating slapping me and forcing me to write a statement which they are the one telling me what to write and after that they collected 50,000 from me( from my boss money which I went to withdraw before ealizing me. Sir that’s my story. All this are not good and policeman are meant to protect us but this nowadays police officer have turn this to another thing by using their power to ride civilians, maltreating and harassing civilian. The officers name who headed the squad are been called which I overhead are name: one is Omo Alaja while the second is called AY but don’t know the name of the other 2 officer. Please sir you have to stop this kind of officer because they are taking this to far”

The police noted in the statement that the complaint was immediately registered, Tracking Number PCRRU451591 issued and investigation initiated. The Divisional Police Officer (DPO) Igbeba Division, Ijebu-Ode was mandated to commence an enquiry straightaway.

The policemen were identified and it was discovered that they apprehended the complainant on 7th June, 2017 without any reasonable cause and extorted the sum of Fifty Thousand Naira (N50,000) “Bail Money” despite the #BailisFree campaign before he was eventually released same day.

The extorted N50,000 was subsequently recovered from these unethical policemen who were armed in plain clothes on the day of the incident. Their action is contrary to the directives of the Inspector-General of Police and unacceptable.

Necessary disciplinary measures were initiated against the erring policemen, they were found guilty as charged in an Orderly Room trial after the presentation of witnesses and exhibits. Punishment of dismissal from service was recommended by the Adjudicating officer and proceedings reviewed by the relevant Nigeria Police Force (NPF) authorities.

The punishment of dismissal from service has been upheld with immediate effect and all NPF uniforms and accoutrements including warrant cards (ID cards) issued to the men have been retrieved with all dismissal procedures completed.

The complainant was also handed back his N50,000 with an apology a day after he lodged the complaint. The elated man after receiving his money thanked the PCRRU, he said “Great job you people are doing right there, thank you for the prompt response”.

Furthermore, the Inspector-General of Police, Mr Ibrahim Idris, while reiterating his stand on zero tolerance for corruption vows to “flush out those tarnishing police image” from the Force. The IGP also impress it upon the PCRRU to ensure that all allegations of professional misconduct against the police are promptly investigated and officers found wanting in any proven case be made to face appropriate sanctions as stipulated by relevant laws.

Meanwhile, members of the public have been advised not to resort to self-help when faced with case of police misconduct, but are enjoined to report such to the PCRRU for resolution.

PCRRU is available 24/7 via the following channels; Phone Calls Only: 08057000001, 08057000002 | SMS/WhatsApp Only: 08057000003 | BBM:58A2B5DE | Twitter: @PoliceNG_PCRRU | Facebook: www.facebook.com/PolicePCRRU | Email: complaint@npf.gov.ng OR PolicePCRRU@gmail.com.

www.businesspost.ng/2017/07/09/photo-police-dismiss-4-officers-ogun-command/

GCR Affirms Fidson Healthcare BBB(NG) Rating
http://www.businesspost.ng/2017/07/09/gcr-affirms-fidson-healthcare-bbbng-rating/

By Dipo Olowookere

The new UNCTAD Economic Development in Africa Report 2017: Tourism for Transformative and Inclusive Growth has revealed the importance of women to the growth of tourism in Africa,

The report released this week specifically said where tourism thrives, women thrive.

It noted that in Africa, more than 30 percent of tourism businesses are run by women; and 36 percent of its tourism ministers are women, which is the highest share in the world.

Creating firm links between tourism, the agriculture and infrastructure sectors, ecotourism and the medical and cultural tourism market segments can foster diversification into higher value activities and distribute incomes more broadly.

The report advised that to unlock this potential, African Governments should adopt measures that support local sourcing, encourage local entities’ participation in the tourism value chain and boost infrastructure development.

This continued investment into the tourism sector in Africa could lift millions out of poverty, while also contributing to peace and security in the region, the report said.

By collecting and comparing data from two different periods, 1995–1998 and 2011–2014, the report reveals that international tourist arrivals to Africa increased from 24 million to 56 million.

Tourism export revenues more than tripled, increasing from $14 billion to approximately $47 billion. As a result, tourism now contributes about 8.5 per cent to the continent’s gross domestic product (GDP).

The First Ten-Year Implementation Plan of the African Union’s Agenda 2063 aims at doubling the contribution of tourism to the continent’s GDP. To meet this target, tourism needs to grow at a faster and stronger pace.

“Tourism is a dynamic sector with phenomenal potential in Africa. Properly managed, it can contribute immensely to diversification and inclusion for vulnerable communities,” said Mukhisa Kituyi, the Secretary-General of UNCTAD.

The report notes that the economic impacts of political instability can be quite significant and long-lasting. For example, following political instability in Tunisia, total tourism receipts in 2009–2011 declined by 27 per cent on average, from $3.5 billion in 2009 to $2.5 billion in 2011.

Addressing safety and security concerns and swift responses to crises by African Governments and regional institutions are paramount to the growth of tourism in Africa. Promoting strategies aimed at improving Africa’s image in the global media are also critical in ensuring the sector’s recovery after conflict or political unrest.

http://www.businesspost.ng/2017/07/08/women-thrive-tourism-booms-report/

Northern Nigeria Flour Mills Declares FY N16m Loss
http://www.businesspost.ng/2017/07/08/northern-nigeria-flour-mills-declares-fy-n16m-loss/

Eterna Plc Shareholders Approve 30kobo Dividend
http://www.businesspost.ng/2017/07/07/eterna-plc-shareholders-approve-30kobo-dividend/

Niger Insurance PAT Shrinks to N139m in Q1
http://www.businesspost.ng/2017/07/07/niger-insurance-pat-shrinks-n139m-q1/

Equities Sustain Rally on Renewed Buying Interest, Index up by 0.32%
http://www.businesspost.ng/2017/07/07/equities-sustain-rally-renewed-buying-interest-index-0-32/

There are huge opportunities in the Nigerian fixed income securities market for investors to create wealth. Investment in fixed income securities presents an opportunity for investors with a preference for low risk to generate regular income and reduce the volatility of the return on their investment portfolio.

Fixed income instruments are used by governments and corporate organisations to borrow money from the investing public, to finance their activities either on a short-term or long-term basis. The issuers are the borrowers while the investors are the lenders.

The issuers of the debt instruments promise to pay interest to the investors on a predetermined basis until the maturity date. In most cases, the issuer pays the principal amount to the investor on the maturity date.

The price of a traded fixed income instrument may appreciate or depreciate between the issue date and the maturity date but the price moves to the par value on the maturity date.

Some of the risks associated with fixed income securities investment are: default risk and reinvestments risk.

Some fixed income securities don’t pay interest, as such, they are issued at a discount to the face value and are redeemed on maturity at the face value.

The Nigerian Government Treasury Bills (NTBs) are short-term debt obligations backed by the FGN with a maturity not more than one year. They are issued at a discount to the face value. This means that the amount that investors invest is lower than what they receive at maturity and they are not paid intermediate interest.

Commercial Papers (CPs) are issued by corporate organisations to finance short-term obligations of not more than 270 days and are usually issued at a discount to face value.

Some fixed income securities however pay interest, called coupon, at pre-determined time intervals such as semi-annually or quarterly.

Fixed income instruments in Nigeria include: The Federal Government of Nigeria Bonds (FGN Bonds), State Government Bonds (SG Bonds), NTBs and CPs.

The Debt Management Office (DMO) issues the FGN Bonds on behalf of the FGN and the tenor ranges from 3 to 20 years. The FGN has an obligation to pay the bondholders the principal and agreed interest as and when due. The instruments issued by the FGN (NTBs and FGN Bonds) are considered the safest of all investments in the domestic debt market because they are backed by the ‘full faith and credit’ of the FGN.

The FGN has never defaulted in the payment of interest and principal due to investors. Thus the default risk is low but the FGN Bonds face reinvestment risks because of changes in interest rate in the economy.

At the moment, the interest income earned on Bonds, CPs and NTBs are tax free.

In March 2017, the FGN introduced the FGN Savings Bond, to promote a savings culture among Nigerians, while giving retail investors the opportunity to earn income from a secure investment. The FGN Savings Bond is issued monthly in tenors of 2 and 3 years, with quarterly interest payments. The minimum subscription amount is N5,000 with additions in multiples of N1,000, subject to a maximum of N50 million. There are also mutual funds that have fixed income securities as their underlying assets. Mutual Funds are good investment vehicles that promote savings and investments.

The Net Asset Value of Fixed Income Securities Funds in Nigeria grew from N57 billion in 2014 to N165 billion as at May 2017 according to data from the Securities and Exchange Commission (SEC).

This shows the increasing interest in these instruments as investment vehicle for Nigerians and Nigerian entities to growth wealth.

The average yield on the FGN Bond as at June 29, 2017 was around 16%. The average yield on the 330-day NTB was 18%, while the average yields on some selected Non-Bank CPs and Bank CPs were 20% and 21% respectively. Most of these yields are higher than the latest inflation rate of 16.25%.

With consistent investment in fixed income securities, investors can create and grow wealth while providing the needed capital to the issuers to finance developments in the domestic economy.

http://www.businesspost.ng/2017/07/07/creating-wealth-fixed-income-securities/

Creating Wealth Through Fixed Income Securities
http://www.businesspost.ng/2017/07/07/creating-wealth-fixed-income-securities/

By Dipo Olowookere

It was a woeful year for the independent manufacturer and distributor of the well-known and widely consumed brands of soft drinks, 7up Bottling Company Plc, as the economic situation took its toll on the firm.

In its financial year ended March 31, 2017, the company suffered a loss of N10.7 billion, making the firm not to pay dividend to its shareholders this year against N1.60 per share paid to them last year.

This is the first time in five years the firm was not paying dividend to its shareholders.

Business Post observed that 7up Bottling Company Plc posted a loss after tax of N10.7 billion in 2017 versus a profit after tax of N3.34 billion declared a year ago.

However, the firm’s turnover rose to N108.2 billion in 2017 in contrast to N85.6 billion 12 months earlier.

In addition, selling and distribution expenses jumped from N11.8 billion in 2016 to N13.9 billion in the period under review, while administrative expenses increased from N6.6 billion to N6.7 billion.

Furthermore, cost of sale recorded an upward movement from N60.6 billion in 2016 to N90.5 billion in 2017, while the gross profit depleted to N12.9 billion this year from N25 billion last year, and the finance cost rose from N3.2 billion in 2016 to N4.02 billion in 2017.

http://www.businesspost.ng/2017/07/06/7up-declares-n11b-loss-shareholders-get-no-dividend/