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TINUBUNOMICS: Bank Stocks Gain ₦‎544.807 Billion In A Week

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Tinubu

Last Updated on July 18, 2023 by Fellow Press

Nigerian banking sector investors gained N544.807 billion as the stock market closed the trading week on a positive note, with the banking sector index emerging as the best-performing index.

The gains in the banking sector were driven by changes in Nigeria’s foreign exchange operational framework and the suspension of Central Bank Governor Godwin Emefiele, whose restrictive policies affected bank earnings.

President Bola Tinubu also announced a list of technocrats as special advisers for his economic team, further shaping investor sentiment.

Investors in Nigeria’s banking sector raked in a whopping N544.807 billion in gains from banks listed on the Nigerian Exchange Limited (NGX) as the local bourse closed the trading week positive.

The banking sector index gained 12.59% to emerge as the best-performing index at the close of trading.

Investors were reacting to the changes in Nigeria’s foreign exchange operational framework and President Bola Tinubu’s suspension of Central Bank Governor, Godwin Emefiele, who oversaw restrictive policies that cramped their earnings.

The president also announced a list of technocrats as special advisers for his economic team.

Market performance
Available statistics to Nairametrics showed that the NGX All-Share Index and Market Capitalization appreciated by 5.49% to close the week at 59,000.96 and N32.126 trillion respectively.

Similarly, all other indices finished higher except NGX Industrial Goods and NGX Growth which depreciated by 1.63% and 1.07% respectively while the NGX ASeM index closed flat.

Banking index
The banking index which measures the performance of the banks quoted on the floor of the Nigerian Exchange however appreciated by 12.59% or 66.21 basis points to close at 592.14 points from 525.93 points it closed the previous week.

Nairametrics analysed how the share prices of fourteen banks quoted on the floor of the Nigerian Exchange Group performed during the week. Notable among the banks are Zenith Bank Plc, Access Holdings Plc, FBNH Plc, UBA Plc, GTCO Plc, Stanbic IBTC Holdings Plc, and ETI Plc.

Others are Fidelity Bank Plc, Jaiz Bank Plc, Sterling Bank Plc, Union Bank Plc, Unity Bank Plc, Wema Bank Plc, and FCMB Group Plc.

Data obtained from the NGX showed that the stocks of the banks recorded a combined gain of N544.807 billion in market value during the week under review.

Note that aside from the shares of Union Bank Plc, whose share price closed flat, all other banks recorded an appreciation in market value following positive sentiment on the part of investors excited by the new reforms.

Further checks revealed that banks such as Zenith Bank, Stanbic IBTC, GTCO, Fidelity Bank, and ETI topped the list of gainers during the week.

These banks collectively recorded a gain of N373.810 billion in market capitalisation, accounting for about 68.61% of the combined gain of all the banks.

1. ETI – N51.379 billion
ETI Plc enjoyed a profitable week in its equity performances. The Bank recorded a gain of N51.379 billion in market capitalization during the week from N231.204 billion the previous week to close at N282.583 billion on Friday. Its share price grew to N15.40 per share from N12.60 it recorded the previous week, representing an increase of 22%.

ETI closed its last trading on Friday at N15.40 per share on the Nigerian Stock Exchange (NGX), recording a 1% gain over its previous closing price of N15.25. Ecobank began the year with a share price of N10.60 and has gained 45.3% on price valuation.

2.FBNH-N61.021 billion
FBNH recorded a gain of N61.021 billion in market value from N506.123 billion it opened the week’s trading to N567.145 at the end of trading on Friday, representing a growth of 12.06%.

The share price equally grew by 12.06% to close at N15.80 per share compared to 14.10 as of the previous week.

FBNH ended its trading session at the weekend at N15.80 per share, recording a 1.9% drop from its previous closing price of N16.10. The group began the year with a share price of N10.90 and has gained 45% on price valuation.

3. GTCO- N76.521 billion
GTCO Plc closed the week with a gain of N76.521 billion in market capitalization, from N824.073 billion the previous week to close at N900.594 billion, accounting for 9.28%.

The share price gained 9.28% to close at N30.60 per share from N28.00 recorded as of the previous week.

GTCO closed its last trading session at N30.60 per share recording a 3.9% drop from its previous closing price of N31.85. Guaranty Trust Holding began the year with a share price of N23.00 and recorded 33% on that price valuation.

4. Stanbic IBTC-N90.698 billion
Stanbic IBTC Plc also enjoyed a profitable week in its equity performance. The group recorded a growth in market capitalization of N90.698 billion to close at N673.763 billion at the close of the week’s trading, from N583.064 billion the previous week.

Stanbic IBTC’s share price appreciated by 15.55% to close the year at N52.00 per share from N45.00 recorded a week after.

Stanbic finished the last trading day of the week at N52.00 per share, posting a 3.7% drop from its previous closing price of N54.00. Stanbic IBTC began the year with a share price of N33.45 and has since achieved 55.5% on the price valuation.

5. Zenith Bank- N94.189 billion
Zenith Bank Plc closed the week with a gain of N94.189 billion in market value, from N879.101 billion the previous week to close at N973.291 billion on Friday.

The share price recorded a gain of 10.71% to close at N31.00 per share from N28.00 recorded as of the previous week.

Zenith Bank closed at N31.00 per share on the Nigerian Stock Exchange (NGX), recording a 3.3% drop from its previous closing price of N32.05. Zenith began the year with a share price of N24.00 and has since gained 29.2% on the price valuation.

Others include
Access Holdings- N43.431 billion
UBA- N39.329 billion
Fidelity Bank- N33.900 billion
Sterling Bank- N19.289 billion
Jaiz Bank-N14.161 billion
Wema Bank – N9.257 billion
FCMB – N8.119 billion
Unity Bank- N3.506
Union Bank – Flat

What financial analysts are saying
The former President of the Chartered Institute of Brokers (CIS) and the Managing Director of Arthur Steven Asset Management Limited, Mr Olatunde Amolegbe, said the main driver of the Nigerian Banks’ stock appreciation was the beginning of the cleanup programme by the president at the CBN.

He noted that market operators now expect that the reforms in the monetary and forex policy will lead to an inflow of foreign portfolio investment in the market.

“The changes at the CBN will lead to changes in the monetary and forex policies which is expected to increase foreign participation in the market.

“Recall that the previous policies of the CBN had hitherto led to a sharp drop in participation by foreign portfolio investors from 65% in 2015 to less than 10% in 2022. The new reform will lead to an increase in appetite by this class of investors in our market,” he said.

Tajudeen Ibrahim, Director of Research at investment firm Chapel Hill Denham, said:

“Banking index appreciation is a reflection of investor sentiment around a possible clean-up of the sector as indicated by the president.”

The Managing Director of APT Securities and Funds Limited, Mallam Garba Kurfi, noted that the international response to the decision to suspend the apex bank’s chief could have an impact on the domestic market.

He said the direction of the market reflects its response, adding that the action of the acting CBN Governor would also influence the markets going forward.

Business

AMCOSS, PEDI partner for 3-day management training

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A leading personnel consultancy, AMCOSS, is organizing “a 3-day leadership and management development retreat” for PEDI management staff.

The retreat which is scheduled to hold between Thursday 20th June and Saturday 22nd June 2024, will feature trending, emerging and solution-focused presentations, as well as interactive sessions by the participants.

The programmes of the event lined up are as follows:

Opening day, June 20 will start by 9:00am, and by 10:00am, the Managing Director/CEO will give a welcome address, which will be followed by a brief remark from the Managing Director of PEDI, Ilesa. An highlight of the event is a guided tour of places of historical importance in Ilorin.

By 2:30pm, there will be a presentations titled “Effective Leadership and Leadership Skills”, followed by the interactive session of questions and answers.

There will be three presentations on the second day June 21, tagged: “Managerial Skills and Personal Effectiveness”; Performance Management System” and “Health and Well-being”.

Likewise on the last day of the programmes, there will be two presentations: “Team Building and Effective Communication” and “Organisational Continuity, Sustainability and Succession Planning”.

The training starts each day by 9am, with provision for interactive sessions after each presentation and lecture, tea break/lunch, and ends approximately 4:30pm.

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Business

Dangote to venture into steel production

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Last Updated on June 14, 2024 by Fellow Press

Africa’s richest man, Alhaji Aliko Dangote has mooted plans to delve into steel production in the near future stating that he wants to ensure that every steel used in West Africa comes from Nigeria.

The industrial mogul stated this during an interview at the ongoing Afreximbank Afro-Caribbean Trade & Investment Forum in Nassau, The Bahamas.

When asked if he is taking a break after the refinery, he noted that the next venture after the refinery project would be in Steel manufacturing and ensure that all Steel products used in West Africa comes from Nigeria.

He also encouraged African leaders to take agriculture and solid mineral development seriously lamenting the fact that food imports cost the continent dearly by increasing unemployment and poverty.

He said, “What we need to do that is missing is actually to concentrate and pay more attention to agriculture and solid minerals.
I don’t like people coming to take our solid minerals to process and bring the finished product.
We should try and industrialise our continent and take it to the next level.”

“I told somebody we are not going to take any break. What we are trying to do is to make sure at least in West Africa, we want to make sure that every single steel that we use will come from Nigeria”

Nigeria has tried unsuccessfully to become a leader in the steel manufacturing industry with a handful of failed projects like the Ajaokuta steel plant, Delta Steel Company, Osogbo and Jos rolling mills even under government and private ownership.

Like the oil refineries, the federal government under different administrations has spent billions trying to put the local steel plants to work but has been unsuccessful.
The administration of President Bola Tinubu had promised during the campaigns to ensure steel production starts in the multi-billion-dollar Ajaokuta steel complex.

The federal government in the 2024 appropriation act budgeted around N4.45 billion for the plant but hopes to raise around N35 billion from private investors to bring the plant to life for the first time in its history.

However, the Minister of Steel Development, Shuaibu Audu has also stated that reviving the plant could cost around $2 billion to $5 billion.

According to the National Steel Raw Materials Exploration Agency (NSRMEA), total steel consumption in the country averages around 10 million metric tonnes of which 70% is imported.
The current Minister of Steel Development had earlier stated that Nigeria spends around $4 billion on steel imports annually despite having around 74 steel plants and fabricators across the country.

Nigeria is home to significant iron-ore deposit- a critical raw material in steel production found in Kogi state.

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