₦airaland Forum

vacanci:
it doesn't matter.

If you have UBA at N1 and you bought with N1 million. So u have 1M units.

Now if u sold at all 1M units @ N27 and all things being equal you now have say N27 Million

Use all N27 Million to buy @ N21, your total holding have moved from 1M units to 1.285M units.

The extra 285,714 units when sold even @ N21, gives you about N6 Million compared to the dividend of N2.3 Million (from the 1M units originally).

If you decide not to sell and want dividend next year, it will be on 1.285M units as against 1M units (original)

It's all about playing with number and LUCK.

NB,
If u no sabi set trap for rabbit, no try am o

I admire your excitement. Also good you recognize luck in the mix.

This is good if one understands it well and comfortable with numbers. It can be used even when dividend is not involved. Sell high, buy back more units at lower price, sometimes intra-day. Repeat.

Whilst I agree it's a winning strategy, it doesn't always work. Those that sold GT, Zee, etc in 2022 at less than N30 probably could not get back in for more units. Those that sold Zenith this year, cum-div, might have to wait some time too, if they can get that advantage.

Important to know your strategy, work with it but also recognize it's not fail-proof.

I like what BBMarket writes, Plan your trade, trade your plan (something like that).

KarlTom:
I'm just hearing this theory (the bolded) for the first time.
Kindly shed more light on it. Who is responsible for the 'drop' in price?

Has always been the practice. NGX adjusts the price before market opens by 9.30am. Marked-down price.

ositadima1:
Okay, so I want to understand this correctly. If I don't have my shares registered with the stock registrar by the qualification date, I won't receive a dividend? And even if I am registered, but I sell my shares before the ex-dividend date, I also won't get the dividend?

Double wahala for who no dey read agreement o.

Abi you wan eat your akara and have it.

The important date for you is the date you bought or sold. Being on the register should be left for the registrars to figure out (normally it's T+3days after transaction). That is why you normally see them announce period register is closed so they update it for purposes of dividend, bonus or any other corporate actions.

With UBA, if you buy tomorrow 10th May, and/or hold your shares till end of tomorrow, you will get dividend. If you sell by 13th, you will still get your dividend. But if you buy on 13th, nothing for you.

modupeshow:
Does this mean that if I sell my UBA shares for example on 10th of May, I'll be qualified to receive dividend or i have to wait till 13th before i can sell to qualify for dividend payment?

If you sell your UBA on or before 10th of May, you will not qualify to receive dividend. If you sell on 13th or thereafter, you will receive your dividend.

The key date is the Qualification Date (10th May in this instance). You would notice that on 13th, the opening price would be the closing price on 10th less N2.30 (dividend).

The closing price on 10th would be cum-dividend (cum-div) i.e. inclusive of the declared dividend. While the opening price on 13th is ex-dividend (ex-div) i.e. after dividend has been deducted (marked down for dividend).

Locotrader:
When you look at the total OS of champion which is about 7B+,1 for 7 is suppose to be around 1B plus.

So how was it calculated since the unissued shares is 500m+?
Are there some holders who will not participate in the bonus?

Naira sign should be before that 559m figure.

Unissued capital is N585m i.e. 1.17bn shares of 50k each. See Note 26 of the 2023 AFS.
1 for 7 bonus would give about 1.119billion additional shares of 50k each i.e. about N559m capital.

So post-bonus shares outstanding would be about 8.95billion shares of 50k each.

Objectivist04:
Well, Morgan is a reputable stockbroker and I can not teach them their job,

I approached them as a client with a request for a certain service, they handed their condition to me which I fulfied to the letter.
I am not the one to teach them their job and their is nothing they asked me to do that l failed to do.
A share l have been holding since 2007 and swear never to sell at loss, a perfect opportunity came and some people bungled it due to their nonchalant attitude to work.

And it appears as if it is a normal thing ? I have not been feeling ok because of this, to worsen the matter the person responsible is even feeling that l offended him , he neither picks nor reply my chats.

I would like someone to give me the phone number for Morgan customer care if any, I need to start from there.
Am hurting honestly

Sorry about your experience. Unfortunately, you are allowing it wear you out. @Emmasoft has given you the way to go. If Morgan has not satisfied you, you choose another firm that might give you better service. Thank God your stocks are still intact.

Nestle Nigeria Plc
The policy to revalue it's PPE up by ~N217bn would give a positive shareholder's fund of ~N139bn, even with a retained loss of N79bn, based on the 2023 AFS.

Nestle had healthy gross profit growth of 39% and operating profit growth of 42% in 2023. Would its Q1 2024 results continue in that trajectory? The challenge is with it's finance costs (fx revaluation loss). How it will handle it's financing after the EGM of May 22, 2024 would go a long way to reflect in its perceived value.

Would Nestle return to profit and be able to pay dividends again from 2024YE? It really needs it.

AccessCorp
Seems planning to do a rights issue of 1 for 2 at a price ~N20.50. When and details remain to be disclosed.

PS: All info contained in notices on NGX disclosure portal.

*I have shares in AccessCorp.

Locotrader:
Bro it's okay.
This is a game of do me I do you.
Champion brew is not a gamble business.i won't stake 9 million units of champions just for play.It is going to favour me and you including fellow shareholders.
People attacked champion becaus of the extent we took this sugar and Nascon merger of a thing.

From today,I will add 30% hope in stock investment.I learn by argument.Try also to learn in these series of argument.
It's well
I am off in this topic.
May God restore our investments back to green.

Mercy pls e Don do.

I like your spirit. I respect you for that. A troubleshooter. Humble too. I remember sometime back when things heated up and you apologized to the lady. While some otimkpus came out to rubbish what you did, you kept your cool.

I might not always align with your business strategy, but so far, admire your good spirit.👍🏿

222Martins:
There is no Market Maker that will intercept your TOP BID of 1,000,000 and split it when there is a corresponding TOP OFFER of 1,000,000 units at the same PRICE.......It is a demand and supply affair.

I don't understand market maker intercepting here. Again MMs serve specific purposes.

Trades on NGX follow rules. Rules on position on the queue at a particular price, the offer/bid price scale, advantage of intra-house, etc.

Given those rules, some persons can also devise strategies that favour them. While others just flow with what the market presents per time.

Like I said earlier, there are many strategies and nobody knows them all.

222Martins:
What was the opening price and closing price of Intenegins today? Maybe i am misunderstanding your statement i bolded. Did you say you brought in a N1.17 anti-dote cross-deal in Intenegins today? Or are you referencing your cross-deal comment?

I referenced my cross deal comment.

222Martins:
Like i said in one of my comments, it is all about interest. And what brought about this topic was stock-splitting of 100,000 units into smaller bits to influence price, not cross-dealing.... That one na talk for another day. What i explained above works, whether you agree with it or not.

ChampBrew is N3.68 today.......I can buy 1,000,000 units of Champion Brewery on Monday and it will still close at N3.68.

I commented because you waved off the observation of Adinije. She is correct. You are also correct with your strategy. I brought in cross-deal as anti-dote to your setup today, which I saw during trading.

Many ways to/fro the market and nobody knows all.

Streetinvestor2:
You no go kill me for road.Company way no fit buy new delivery trucks or do better maintenance for the outdated trucks they use.Charmpion trucks look like the trucks they use in carrying wood logs in ondo state.You go see many of them in ondo/osun state axis. Nobi only machine and plants they buy.

Lol. Bros suffry o. Lol

Locotrader:
We are having funs.
Don't you like funs?

Lol. That's why I said it's amusing. Fun. Both divides with strong and compelling views.

Though your team is doing more of permutations now, but are critical of DS/NS players'.

PS: Good you have locked in, for now, 14% via bonus.

222Martins:
It was not an illusion of demand and supply. The seller did that on purpose because he/she is knowledgeable on the workings/rules of the NGX. For example, When Intenegins was N1.17 today..........I opened multiple bids of 500,000 and 400,000 unit. The 400,000 units became filled at N1.17. Few hours later, someone bought 239,000 units at N1.28.

Immediately i saw this, i split one of my single 500,000 bids into 99,999 in 5 places; so that i can buy without altering the price. The point is that a knowledgeable person on NGX can buy/sell 5,000,000 units of a stock and still not move the price up or down; depending on what serves his purpose. Note that this can only work by studying and timing the Top BID/OFFER.

I hope you understand..

Inspite of your setups, an interested person (with trading firm access) would do a cross deal of at least 100k at 1.17 to close price at 1.17.

Locotrader:
At this point I have nothing to loose.
I am always grateful to God Almighty.

This bonus came at the right time.Enjoycorp is not happy over Q1 result and want to defend the share price till they come onboard

Please what does Enjoycorp benefit to "defend the share price till they come onboard"? They will also get the bonus just like others.

Most times, market prices of shares of a company should not bother management if they are not planning on capital raise or image influence.

Una postings on Champion sha. Amusing.

KayOn1:
Don't know what is wrong with GTBank. Have been trying all morning but it seems the site is down. Have a strong feeling the market will turn around after this week.

GTB is working. I just used it. Thru their website - online banking.

gold360:
dear friends . I am a shareholder of zenith and UBA but yet to receive share dividend this year . Please how do I go about it ? Thanks

Both banks have not declared any dividends this year.

SonofElElyonRet:
The results clearly say N92.25k eps


Can someone help explain the interim dividend declared for 2022 and 2023...
*why interim?
*will new shareholders who bought after listing on the stock market be entitled to both 2022 and 2023 interim dividends?

The interim dividends are to the pre-listing shareholders. N247.07 per share for 2023. Note 29. Also see Note 20.2.

Dilutive EPS is about N4. Should have been indicated. The new shares came from existing share premium account. Just accounting entries.

onegentleguy:
I know.

I had to highlight the share premium A/c as a would-be mode of increasing issued/paid-up capital via bonuses because of the exclusion of the RE component, before highlighting that the apex bank may have also excluded bonuses because it takes away from one of the 2 recognized share capital component (share premium) while adding to the other. (paid-up
capital)

It is well

Ok. 👍🏿

onegentleguy:
I was smiling reading this.
Not for a lack of logic and reasonableness in your post, but because it would seem that you have assumed the Nigerian state to be an ideal one.

I understand you completely. But just know that this country can be a painfully funny place.
This is why I call it a portfolio country... where one needs to consistently apply wisdom and discernment by looking to "bet for or against the system" to grow.
Ideally, this should not have been the way to go but there are just too many structural deficiencies in the system especially from the fiscal end.

We just need to seek to take advantage of the opportunities that this recap exercise would create.
Nigeria is nothing but a portfolio country and it needs you to FOCUS more on your portfolio to benefit from it!

It is well

True.
Looking out to maximize my benefit, anyways.

onegentleguy:
The definition of share premium is in order but that's not the crux of the matter.
The concern is on how a bonus issue relates to it and why it (bonuses) was also excluded by the apex bank.
Bonuses (which is one way of increasing a coys issued/paid-up capital) is usually paid from the share premium A/c.
So a bonus issue would have brought about a reduction in the banks share premium even with an increase in paid-up capital.
By implication, it supports one of the 2 CBN approved/recognized capital components by taken away from the other.

On RE, your definition underscores the many points I highlighted in my 1st post. True, RE are excess accumulated earnings but any jack will agree that in recent times, a sizable proportion of those earnings can be deemed unsustainable (mainly arbitrage gains from Fx), which may have occasioned the need to exclude that component. (RE)
Again, that unsustainability heightens with the fact that a good % of these earnings were largely from non-traditional banking plays.

Lots to say but I really don't have strength for long epistle.

Bonus shares can be issued from retained earnings. Scrip dividend.

ositadima1:
Excuse me, but is your definition of security premium account different from the one I know, which is the excess amount received when a company issues new shares at a price higher than the face value? Also, in my understanding, retained earnings are mostly the excess money accumulated from past earnings. I don't see connection between the two accounts.

In my opinion, if the CBN is insisting on not allowing the use of retained earnings (based on my understanding), then banks should better embark on legal action. You cannot dictate how earnings should be used; they can be used at the company's discretion, including to buy shares if they want.

Retained Earnings can be applied for bonus issues. Retained earnings are available for distribution to shareholders as dividends. Dividends can be paid by cash (cash dividend) or issue of additional shares (scrip dividend).

Bonus shares are simply scrip dividend.

onegentleguy:
One straightforward answer to the part in bold would be because Nigeria's reserve is in dollars and historically, there's always a "strain" with managing it due to a persistently lopsided outflow-inflow imbalances occasioned by a largely unproductive import-driven economy.
That means your Naira will consistently come under pressure!

Your statement with the 2nd paragraph is in order, but a bank is not just a business. ...it's capital/liquidity state is much more pivotal to an economy hence the need to, where necessary, take certain stringent steps which may even be unfamiliar ones.

Pls note am not taken sides with the CBN. ...I am not against the inclusion of RE as a mode of boosting issued share capital.
Am only saying that I understand that the situation requires a bit of an unfamiliar approach to avoid certain fragments of assets that could be deemed unsustainable and which the RE and a few other share capital component houses.

Good points. But your answer in the first paragraph shouldn't be the burden of the banks. They have no control of the reserves, etc. More on the macro economic level.

The bank are private enterprises, even though regulated. Regulations on single obligor, dividend distribution, etc already exist. This recap approach tends to place burdens on efficient banks and is unfavorable to existing investors.

Imagine that Zenith with about N1.9trillion s/holders fund is burdened to look for fresh N230billion to inject. The dilutive effect alone? The policy has discounted the sacrifice and efforts over the years to build a successful business. But a Unity Bank, that should have lost its licence long ago, with negative N190billion position needs just fresh N184billion to retain licence (and continued protection).

Is CBN encouraging/protecting failure? They should rather wake up and do more regulation. Allow the banks to grow to fit and do bigger-ticket transactions. Not capitalization by fiat.

onegentleguy:
Honestly, your concerns are valid!
But look at it this way; If the component of RE (retained earnings) is included, the proportion of equity financing needed to boost the banks share capital to appreciable levels in line with current economic realities will be insufficient.

Some class of share capital particularly RE, could imply the incorporation of certain fragments of "risky asset" that can sometimes be unsustainable. (ref: that from the recent spate of Fx revaluation gains)
RE can be an indirect beneficiary of these sought of gains.
While this takes nothing away from the RE position of shareholders (that's sacrosanct), it would in this instance, be better not to incorporate it.

Again, by excluding these components, the CBN can seek to find the right balance on the "dislocation" between Naira asset pricing and the present economic reality. DBMs are key to finding that balance!
These key points underscores the need for banks to raise enough funds. ...they really need to and like I once said, it's actually long overdue.

To give this a bit of context; compare the Fx-N differential/PPP between the last time we had a banking sector recapitalization in 2006 (during the Soludo era) and now.
...a brief;
2006: Minimum cap requirement was N25B @ N130+/$... which is approx $193M.
2024: Proposed minimum cap requirement of N500B @ N1,300+/$ (a 9x multiple from 2006)... will be less $380M.
So the actual raise in capital base will essentially be by a multiple of 2x (380/193) when infact our currency has depreciated by over 9x (i.e 1--130/1,300) within the same timeframe.

Notice how I had only used N500B, the min cap requirement for DBMs with international spread (mainly the stronger banks) for this example. Now imagine if we zoom in on the smaller banks.
This should put to bed the debate in some quarters on whether the proposed minimum capital is too big. But for anything, I think it's even a bit too small. Now imagine if the CBN allows for the incorporation of other components aside paid-up capital and share premium.
That would reduce the difference between what is required and what they have and imply less capital raise, when in reality, the banks actually need more... otherwise, the economy "might have to pay for it" sooner or later.

There's a reason no Nigerian bank is among the top 10 largest banks in the African continent. So much for the self acclaimed "African giant"!
As at 2023, the 10th on the list, South Africa's Investec Bank has a capital base of near $30B. Not sure if all the quoted banks in Nigeria can match that!
Top on the list is also South Africa's Standard Bank (group) with a capital base of $172.9B. (South Africa dominates the list with no fewer t
than 5 in the top 10)
Part of the reason for the unworthy cap base of Nigeria banks can be attributed to the many years of underpricing of banking equities. But then again, we know it's broadly a deliberate "set-up" so certain cooperate criminals in the financial services industry and their cronies can continue to thrive.
Now banking coys are surging in price. Perhaps the wide gap between RV & MV will close on their journey to real price discovery but whether that will be sustained or if it's just another flash in the pan occasioned by the planned recap exercise would be a different kettle of fish.

On a side note, I align with those who also see the recap policy as a strategic move by the CBN to continually tighten system liquidity (justified by the recent high rates in the FI market) and reduce Naira volatility by closing the gap btw capital flight and Fx inflow.
Perhaps the Naira could strengthen a bit more from current level and hopefully find a balance around it... which should help with the long awaited clarity in exchange rate and spur confidence towards Naira assets.

Overall, I think the policy spells good for the economy and by extension, the market.
Aside banking coys, some select asset names will do well!

CAVEAT: The entirety of this post is merely the view of the writer. ...no part of t should be inferred as an investment advice/guide.
Due diligence still applies as always.

It is well

I often wonder why we think we have to declare by fiat a very high minimum capital to be employed in our banks and this amount is referenced to the US$. If the Naira strengthens significantly, shouldn't there be a downward review?

Generally, a business should inject capital to the extent of its strategic plans and capacity to employ same efficiently.
After the last round of recapitalization by the banks, they had so much more than they had plans and capacity to efficiently deploy. What followed? Many were readily offering credit is diverse forms: 'Margin' facilities were practically hawked, NSE abracadabra, etc.

A key problem with Nigeria's financial ecosystem (especially with banks) is effective regulations and supervision. Not these fire brigade one-measure-fits-all approach.

chillykelly86:
I totally agree with you on this. They could still have set a higher recapitalization threshold but excluding retained earnings may lead to shortchanged existing shareholders. The retained earnings are shareholders' funds. Its just like someone waking up one day and saying your savings in a bank are not part of your net worth.

Exactly. Would the CBN allow the banks pay out most (if not all) of it's retained earnings (RE) to existing shareholders as dividends? This way, new investors would have their shares fairly ranked with existing.

Mind you I have only pointed out RE ( which is distributable). Other reserves exist.

ttmax09:
It's simple, they actually are trying to mop up excess money in circulation, and also trying to attract fresh inflow of USD into the economy.

Using the recapitalization policy to achieve these goals is a mismatch, to me. Capital here is more long term than short/medium term.

Sometimes, our policy makers come up with positions that look somehow. Why will the CBN discount retained earnings of banks as part of their capital? I can understand some other/statutory reserves, but not retained earnings. Retained earnings form part of the interest of shareholders, which has been left to help grow the banks faster. This policy would require total fresh injection of over N4trillion as capital (long-term) for the existing banks to retain their licences/status as at date. Does this recapitalisation drive guarantee attainment of the utopia of a US$1trillion-economy?

Some banks already have negative shareholders' fund. This policy does not take into cognisance such precarious position, but just wants the bank to add funds to its share capital/premium to achieve the new target, which might still leave the banks retain licence with negative s/holders fund. Some magic! I think CBN should do more on the supervisory and regulatory front. A lot of benchmarks exist, so the banks that want to play bigger, within the regulatory frameworks, should plan and implement strategies to meet higher capital demands, not this blanket approach to forcing every bank to be big.

As it stands, the least capital injection required by a member of the FUGAZ group is about N230billion (Zenith Bank). Unity Bank with a negative s/holders' fund of N190billion, requires just about N184billion new capital injection to retain its licence (will still have negative N6billion) based on this recapitalisation policy. The new policy needs rethinking through. Does not look well formulated. Retained earnings, at least, needs recognition as existing capital for the banks.

My opinion sha.

ExcessKJ:
Please 🙏 I have a question

How can I know when (what times/dates in a year) companies listed on the NSE are to release their quarterly or yearly financial reports - prior to releasing the info.

Perhaps, there are no NSE stipulated time of the year listed company are to release their reports 3 or 4 times per year

Please, what is the rules of NSE & SEC, within a period of how many days pre or post fiscal quarters in a year must companies release their financial reports

Please, what is a fiscal quarter according to NSE (from when to when in a year)

Thanks in anticipation

There are 4 quarters (3 months each) in a year and the company determines the structure; the most popular being Q1(Jan-Mar), Q2(Apr-Jun), Q3(Jul-Sep), Q4(Oct-Dec). This applies to all banks by regulation.

The rules require a company to release its unaudited results for a quarter within 30days after the last day of the Q ending. Where it's for Q4, same rule applies and the audited financials should be filed within 90days after the last day of Q4. Where a company decides not to file unaudited results for Q4 (or any Q but wants to have interim audit) it is required to file it's audited results within 60days.

Note that banks and insurance companies need to get their reports approved by CBN and NICOM respectively before filed at NGX. This could affect the timelines.

NGX and SEC websites would give you details.

Objectivist04:
Good day everyone, pls l repoted an issue l am having with Meristern with regards to my Fbnh shares about a couple of weeks ago, advice was given and followed but unfortunately they have not credited my shares fully to my account, infact whenever I call the receptionist will tell me that registrars are busy that l should call later. The guy that attends to me with the name Femi no longer please picks my calls and neither do they respond to my mails.

For those who don't know the crust of the matter.
I bought 10k units of Fbnh during their IPO in 2007 and handed the certificate including that of my first bonus (200k) units to my stockbroker ( Transglobe investment) I did not care to follow up because I am not a trader and neither do I knew much about the stock market, just following the rave of the moment.
Years later when I wanted to sell the shares l was told that Transglobe has gone underground and that l have to open account with another stockbroker so I can move my shares of which l did with Morgan capital.

After applying for share transfer, Morgan informed me that my share were not registered with CSCS and that l have to apply for dematerialization which I did.
Two weeks ago, l received a call from a staff o Morgan capital informing me that my shares has been successfully credited to my CSCS account but I was shocked when he told me that I have 3905 units instead of 18045.
When I reached out to Meristern to complain they told me that it is what they have with them, I tried to let them know that I have been receiving dividends based on 18045 I even mailed to them the screenshot of a mail they sent to me two years ago after an enquiry, informing me that I have 18045 units but still they could not do anything.

I started calling them frequently and they told me they are looking into it, it has been 2 weeks now and there is no feedback from them . Even if they have given me the number of my initial investment it would have been more understandable but 3905 units ? I just can wrap my head on how they came about that figure.
.I have even copied CSCS and NSE while mailing them but still they did not respond.

In addition to the tips from Ositadima above, SEC is the regulator for registrars.

Seems they have not stated you now have just 3905 (instead of 18045). But you are suffering for the inefficiency of the system. Give them some days or a week and contact them again. If not satisfied, you could escalate to SEC.

Also, request for your account statement which should give details of your holdings.

Streetinvestor2:
How about when you look at the eps over 10 yrs and not just for one financial yr eg gtbank and zenith without one time magic like revaluation of forex

Better.

Earnings Per Share (EPS)
This almighty metric, I see folks refer to most times, does not necessarily show the financial health or performance of a company. It is the easiest to manipulate/distort. To create an impressive EPS, management could ship-out products/services towards year end to create higher-than-normal sales, which will eventually add to the bottomline from which EPS is derived. Other forms of financial abracadabra could include suppressing expenses or losses, etc. BunmiOni's Cadbury comes to mind.

It is advisable to also look at the Statement of Financial Position (SFP), pay attention to the shareholders' fund and its components, level of gearing, etc. Also, look at the notes to the accounts for details of some unusual items in the P&L and SFP, in addition to other news about the company.

I often advise that sustainable investing in shares is more of a marathon than a sprint.

PS: Above might not be too relevant to those focused on TA or unorthodox approach to investing.

Locotrader:
A stock with 1.2 Billion OS making a profit of #1.5B Naira in Q4 2023 and you called it illiquid stock. Which penny stock has this eps at the moment?
The body language of this stock shows its going to be a leader of the insurance companies in the next 5 years and price will be heading to #10 with the continuation of positive financial results like this. Unless they are delisting . I rest my case.

This your one-year income statement comparison does not show the whole picture and status of IEI. The facts are all there for those that would read.
A price paid by a core investor does not necessarily reflect the true/real worth of the enterprise, especially for an enterprise doing badly. So many factors, especially qualitative, influence the price paid. Some reasons for take over could include easy access to having licence to a regulated business, to kill-off/reduce competition, etc. So, unreal offers could be made to achieve desired outcome