Business

Banks’ Shares Rally As Thousands Lose Jobs

Published

14 years ago

January 1, 2010

Banks’ shares have rallied after two lenders fired almost 3,000 workers between them, and after shareholders of Fidelity Bank Nigeria and First City Monument Bank Plc approved bond sales.

Intercontinental Bank Plc advanced for the first day in 13, adding 46 per cent to close at N1.36 after it sacked 1,339 staff on December 18.

The shares had declined 89 per cent this year shares in Oceanic Bank International Plc, which had fallen 87 per cent in 2009, posted their steepest two-day rise in more than a month and advanced 4.5 per cent to close at N1.40 after the bank fired 1,500 employees.

The banks led a gain of as much as 1.7 per cent in the Nigerian Stock Exchange’s Banking index, its biggest intra-day rise since November 11. The index has lost 37 per cent this year and closed 0.6 per cent higher.

“the only thing banks can do is look at their cost structures since revenue insn’t growing”,

Bismarck Rewane, the Chief Executive Officer of Financial Derivatives and a number of the committee set up by the government to advise it on Nigeria’s response to the global financial crisis, said “It’s a welcome development. They have to reduce cost”.

The dismissals form part of a shake-up following an audit by the Central Bank of Nigeria in August and September, which resulted in Governor Lamido Sanusi, firing chief executives of both banks and six others and injecting at least N620 billion naira ($4.12 billion) into 10 banks including intercontinental and Oceanic; to boost their capital and Liquidity.

Nigeria’s All-Share Index, is the second-worst performer of 90 benchmark equity indexes on Bloomberg this year, after Ghana plunged 34 per cent in 2009 and 46 per cent last year.

Banks dragged the index down on concern they may have as much as $10 billion toxic assets, according to data in May from Eurasia group, a New York-based research company.

As much as two thirds of the bad debt is the result of a least N1 trillion of margin loans used to buy equities as they soared almost 13-fold since 2000.

Fidelity Bank headed for its highest close in two weeks, climbing 3.2 per cent to N2.58 after shareholders approved a N200 billion ($1.3 billion) bond sale on December 21. First City shareholders gave permission for the lender to raise N100 billion through a bond sale on December 16, company spokesman, Tunde Shofowora, said by phone from Lagos. The shares increased for the first day in four, adding 3.7 per cent to N7.19.

The two lenders are following Nigeria’s four biggest by raising funds through debt sales.

First Bank of Nigeria Plc, the West African nation’s biggest company by market value, will issue N500 billion in bonds after shareholders approved the sale on October 8.

Zenith Bank Limited, the second-biggest lender, will raise N300 billion following approval at a meeting on October 30, spokesman Timi Ejoor, said by phone.

Guaranty Trust Bank Plc, the third biggest, started a five year, naira-denominated bond issue on December 9, while United Bank for Africa Plc, the fourth-biggest lender, received the go-ahead to raise N500 billion through a bond sale on October 2.

The Nigerian bank shake-up may create opportunities for buyers. Standard Bank Group Limited, Africa’s largest lender, is looking at Nigeria for possible acquisition opportunities as the banking crisis slashed valuations, Johannesburg-based spokesman Eric Larsen, said.

Old Mutual Plc, the biggest insurer on the continent, seeks to follow smaller rivals such as Liberty Holdings Limited and FirstRand Limited into Africa, including Nigeria, to boost growth and make up for losses in its U.S business.

Business

Fuel Scarcity: IPMAN threatens shutdown over bridging claims

Published

2 days ago

May 3, 2024

The Tide

The Independent Petroleum Marketers Association of Nigeria (IPMAN) Depot Chairmen Forum, has exonerated its members from the current fuel scarcity in the country.

According to IPMAN, this is caused by its inability to source petroleum products.

The IPMAN Depot Chairmen Forum also threatened to withdraw its services over non-payment of N200 billion bridging claims by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) to its members, since 2022.

Alhaji Yahaya Alhassan, the Chairman, of the Forum said this while briefing newsmen in Abuja, yesterday.

Alhassan said the Nigerian National Petroleum Company Limited (NNPC Ltd.) was the sole importer of the product, but the marketers could not source products from NNPC Ltd. deport, rather from the private depots at high rate.

“We cannot buy fuel from the private depots at N950 and transport the product from Lagos to the North and other parts of the country with N2 million and still sell it at N900 or N1, 000.

“It is expedient for us to state that we are more pained by the non-availability of petroleum products in the country, which has given rise to another round of untold hardship for Nigerians.

“Contrary to claims that IPMAN members are hoarding Premium Motor Spirit (PMS) known as fuel, we would like to categorically state that PMS scarcity is wholly triggered by inability to get fuel from NNPC and not IPMAN,’’ he said.

Meanwhile, the NNPC Ltd. Chief Corporate Communications Officer, Olufemi Soneye said the disruption was due to logistical issues which had since been resolved.

“We currently have an availability of products exceeding 1.5 billion litres, which can last for at least 30 days. Unfortunately, we experienced a three-day disruption in distribution due to logistical issues, which has since been resolved.

“However, as you know, overcoming such disruptions typically requires double the amount of time to return to normal operations.

“Some folks are taking advantage of this situation to maximise profits. Thankfully, product scarcity has been minimal lately, but these folks might be exploiting the situation for unwarranted gain,’’ Soneye said.

He however, said the lines would clear out soon.

On the non-payment of bridging claims, the IPMAN forum said it was distressed and depressed by the laidback attitude of the NMDPRA towards the survival its member’s businesses, arising from its refusal in paying the claims.

“It is with deep frustration that we have assembled here today as the IPMAN Depot Chairmen Forum. It is also disheartening to note that some of our members have completely shut down businesses and retrenched employees.

“As businessmen and women, our members acquired bank loans to keep their fuel retail outlets running on a daily basis across the nooks and crannies of Nigeria in order to serve the teeming population of Nigerians,’’ Alhassan said.

He recalled that Sen. Heineken Lokpobiri, Minister of State Petroleum Resources (Oil), at a stakeholders meeting in February mandated the NMDPRA management to clear the entire debt in 40 days.

“However, today, we have crossed the 40 days’ time lapse given to the NMDPRA to clear the debt, and it is shameful to state that only the paltry sum of N13 billion has been paid, ignoring minister’s directive.

“We are not happy with the indiscriminate increment in the issuance and renewal of Sales and Storage Licence, by the NMDPRA, and the subsequent delays in acquiring the licence, which our members are recently subjected to.

“We are also calling on President Bola Tinubu to look into this unwholesome figure which is highly detrimental to our business and reverse it forthwith, as it is bound to impact negatively on the masses.

“We are poised to take far reaching decisions that may cripple the supply and sales of petroleum products across Nigeria if our demands are not met within the shortest period of time.

“We are collectively prepared to withdraw our services, shut down every single outlet, and suspend lifting of products forthwith till our demands are fully met, and the consequences will be terrible.

“We call on our members to however remain resolute and law abiding, even as we draw close to the immediate ultimatum for our demands to be met by the NMDPRA,’’ the chairman said.

Reacting to the IPMAN’s claims, the Acting Head, Corporate Communications, NMDPRA, Seiyefa Osanebi said the bridging claims payment was ongoing.

“The bridging claims payment is always an ongoing process,” she said.

Maritime

Shippers’ Council Registers 160 Port Operators

Published

6 days ago

April 29, 2024

The Tide

The Nigerian Shippers Council (NSC) says it has registered 160 Port stakeholders into its Regulated Port Service Provider and Users platform since the initiative began in 2023.
Executive Secretary, NSC, Mr Pius Akutah, made the disclosure on the sideline of a sensitisation programme by the commission for port operators in Lagos, with the theme, “Regulated Port Service Provider and Users”.
Represented by the Director, Consumer Affairs, Chief Cajetan Agu, Akutah emphasised the significance of the programme for stakeholders.
He said the sensitisation programme was the second edition after its commencement during the last quarter of 2023.
The Secretary said the 160 registered port operators consist of agencies, terminal operators, shipping companies, individual port users as well as service providers.
“We invited the ports stakeholders for enlightening them on the processes for online registration of Regulated Port Service Provider and Users.
“We have demonstrated to them how to register and how to make payment and we were able to present before them the various categories of the registration.
“The rate of payment is also in the registration. The payment of each group depends on the operation. A shipper pays N30,000, terminal operators and shipping companies pay N300,000, truckers also pay N30,000, while some pay N50,000 and N100,000.
“The Council was able to intimate them on the benefits, because port users benefit more as we help to interface on reducing port charges from time to time”, Akutah said.
He said that there was a need to continue to work with port operators to stop delays and eliminate high costs to make the port efficient.
Also speaking, the Deputy Director, Stakeholders, Service, NSC, Mr Celestine Akujobi, said “the sensitisation exercise was important for the council to enable us bring all the port stakeholders together”.
According to him, this is to avoid challenges during the implementation of the council’s responsibilities.
“By the time we introduce sanctions on defaulters, no operators will complain that he or she is not aware of the registration.
“I’m happy with the turnout of this sensitisation. This shows that the operators are well informed of the statutory friction of the council as the port regulator.
“The final implementation will commence as soon as we discover that all the operators have keyed into the portal.
“We are engaging other ports across the country and we’re hopeful that before the last quater of 2024, the council will implement sanctions on defaulting operators”, Akujobi said.
Earlier, Vice Chairman, National Association of Government Approved Freight Forwards (NAGAFF), Dr Ifeanyi Emoh, said port challenges were enormous, adding that they originated from some of the government agencies.

Emoh urged the council to look into regulating other government agencies, so that there could be a window through which they can collect port charges collectively instead of indiscriminately.

By: Chinedu Wosu