Get all the latest information on businesses and companies in Nigerian Stock Exchange.
Courtesy of FSDH, Cordros Capital, and Afrinvest, here are some of the reports and analysis of the company results for Q3 2011:
Company Results - Zentih Bank Q3 2011 - Press Release (871).
Company Analysis - Afrinvest - Custodian and Allied Insurance Plc Q3 2011 Result (734).
Company Analysis - Afrinvest - Dangote Cement Plc Q3 2011 Result (684).
Company Analysis - Afrinvest - Dangote Sugar Refinery Plc Q3 2011 Result (847).
Company Analysis - Afrinvest - Diamond Bank Plc Q3 2011 Result (774).
Company Analysis - Afrinvest - FCMB Plc Q3 2011 Result (673).
Company Analysis - Afrinvest - Fidelity Bank - Q3 2011 Results (715).
Company Analysis - Afrinvest - First Bank - Q3 2011 (678).
Company Analysis - Afrinvest - Flour Mills of Nigeria - H1 2012 Result (744).
Company Analysis - Afrinvest - GT Assurance Plc - Q3 2011 Result (1911).
Company Analysis - Afrinvest - GT Bank Plc - Q3 2011 Result (711).
Company Analysis - Afrinvest - Guinness (Nigeria) Plc Q1 2012 Result (664).
Company Analysis - Afrinvest - Nestle Nig PLC Q3 2011 (775).
Company Analysis - Afrinvest - Nigerian Banking Sector Q3 2011 Earnings Preview (790).
Company Analysis - Afrinvest - Nigerian Breweries Plc - Q3 2011 Result (761).
Company Analysis - Afrinvest - PZ Cussons (Nig.) Plc - Q1 2012 Result (732).
Company Analysis - Afrinvest - Skye Bank Plc Q3 2011 Result (736).
Company Analysis - Afrinvest - Stanbic IBTC Bank Plc Q3 2011 Result (678)
Company Analysis - Afrinvest - Total (Nigeria) Plc Q3 2011 Result (661)
Company Analysis - Afrinvest - UACN Plc Q3 2011 Result (672)
Company Analysis - Afrinvest - Unilever (Nigeria) Plc - Q3 2011 Result (794)
Company Analysis - Afrinvest - Zenith Bank Q3 2011 Results (671)
I sincerely apologize for not updating this blog earlier.
Below are the company earnings reports and press releases from some of the companies who have released their reports in the last 3 months:
Company Result - Access Bank - Q3 2011 Press Release.pdf (644).
Company Result - Access Bank - Q3 2011 Press Release.pdf (632).
Company Result - Ecobank - Q1 - Q3 2011 Results Presentation.pdf (649).
Company Result - FCMB - Q3 2011 Press Release.pdf (691).
Company Results - Access Bank - Q3 2011 Investor Presentation.pdf (625).
Company Results - Access Bank - Q3 2011 Results.pdf (620).
Company Results - Ecobank - Q3 2011 Results Press Release.pdf (649).
Company Results - FCMB - Q3 2011 (665).
Company Results - First Bank - Q3 2011 Results (587).
Company Results - First Bank - Q3 2011 (691).
Company Results - First Bank of Nigeria - 9 Month 2011 Results Presentation (738).
Company Results - First Bank of Nigeria - 9 Month Results (652).
Company Results - Oando PLC - Q3 2011 (665).
Company Results - Sterling Bank Q3 2011 Earnings Release (683).
Company Results - UAC of Nigeria Plc - Q3 2011 Press Release (1018).
Company Results - UBA 9-Month Results (Q1-Q3 2011) Presentation (689).
Company Results - Zenith Bank Q3 2011 (637).
Company Results - Zentih Bank Q3 2011 - Press Release (871):
Courtesy of Afrinvest, FSDH Securities, IBTC, Access Bank and Lead Capital here are the weekly reports for the week ended October 14th as well as the reports for the past month.
Equity Market Review & Outlook
+ The Nigerian equity market closed the week in bearish territory, despite a marginal rally on the last trading day. Consequently, the benchmark Index shed 176bps, while the average value of transactions for the week rose by 45.2%, relative to the previous week.
+ We expect equity market activities to remain flat this week as attractive rates in money and fixed income markets will lure investors from this market, despite anticipation that the release of results this week will boost the level of activities.
Money Market Review & Outlook
+ A hike in the MPR last week led to corresponding hikes in money market rates across board. A dearth of liquidity within the system saw rates skyrocket during the week, with slight moderation on Friday as proceeds from AMCON bond sales to the tune of N450.0bn were credited into the system.
+ We expect a decline in system liquidity this week on the back of an upcoming bond auction. Interbank rates should adjust upward by the end of the week, as liquidity within the system eases out.
Foreign Exchange Market Review & Outlook
+ Demand for the Dollar at the official market stood at US$1.3bn, 93.8% higher than the US$685.4m on demand at the single auction in the previous week. The CBN’s offer of US$400.0m at Monday’s auction was 45.7% short of the US$736.9m on demand, depreciating the Naira by 151k to close at N156.91/US$1.00.
+ We expect to see a slight depreciation in the Naira this week at the official market, with an appreciation at the interbank segment. We also expect the CBN to help ease supply gaps for the Greenback at the interbank, in a bid to limit the growing premium between markets.
Bond Market Review & Outlook
+ The 275bps hike in the MPR to 12.0% last week saw yields in the bond market adjust upwards by at least 300bps apiece on all securities at the end of the week. Although inflation for September came in at 10.3%, 100bps above the 9.3% reported for August 2011, these instruments will continue to generate real returns for investors based on current yields.
+ Despite an inflow of N450.0bn from the sale of AMCON bonds by certain banks late last week, liquidity is expected to tighten slightly this week on account of T-bills and bond auctions. This may lead to a further increase in yields, albeit marginally.
Week Ended September 30th:
NSE Weekly Report - Access Bank - Sept 30th 2011 (824).
NSE Weekly Report - FSDH - Sept 30th (780).
NSE Weekly Report - Lead Capital - Sept 30th (737).
NSE Weekly Report - Lead Capital - Sept 30th 2011 (735)
Week Ended September 23rd:
Afrinvest Weekly Update 23rd September 2011 (761).
NSE Weekly Report - Access Bank - Sept 23rd 2011 (766).
NSE Weekly Report - FSDH - Sept 23rd 2011 (781).
NSE Weekly Report - Lead Capital - Sept 23rd 2011 (795)
Courtesy of Afrinvest, Stanbic IBTC, FSDH, Lead Capital, here is the summary of the NSE activities for the week ended September 16th 2011:
– The NSE All-Share Index inched up by 1 basis point this week.
– Bearish sentiments in the banking sector were skewed mainly to top-tier banks this week. Unrelenting sell side pressure during the week sent First Bank to its lowest value in 12 months, closing at N10.00 on Thursday. The stock also generated interest from bargain hunters, curbing the cumulative loss to a 2.4% drop. GTBank similarly had a volatile week, though re-entries also curbed its loss to a 1.9% dip. On the flip side, bullish sentiments resulted in a 16.0% cumulative gain for Unity Bank, while UBA and Ecobank also closed the week with cumulative gains of 3.8% and 5.5% respectively.
– Sentiments were mixed in the breweries sector this week, with NB recording a 9.2% mark-up in price, as strong demand for the stock was sustained throughout the week. On the other hand, Guinness lost 3.5% finding support at the N220.00 price band.
– The food and beverages sector went to the bears this week, with only two companies recording gains in the sector. Nascon and 7-Up inched up with gains of 7.0% and 0.3% respectively, while bearish sentiments shaved off points ranging from 2.1% to 15.2% in Dangote Flour, Dangote Sugar, Cadbury and Honeywell Flour.
Their reports are below:NSE Weekly Report - Lead Capital - Sept 16th 2011 (465)
Here are the reports for the prior periods:
September 2nd:Afrinvest Weekly Update 2nd September 2011 (463)
The Monetary Policy Committee (MPC) of the CBN met on the 19th of September 2011 to review the current domestic and international economic and financial developments, including challenges facing the Nigerian economy in the near term. At the conclusion of the meeting, the MPC raised the benchmark rate by 50bps to 9.25% and maintained the CRR at 4.0%.
Here is an excerpts from the meeting communique:
Central Bank of Nigeria
Communiqué No. 78 of the Monetary Policy Committee Meeting, September 19, 2011
The Monetary Policy Committee (MPC) met on 19 th September, 2011 to review domestic economic conditions during the first eight months of 2011 and the challenges facing the Nigerian economy against the backdrop of developments in the international economic and financial environment in order to reassess the challenges facing monetary policy for the rest of 2011.
On the domestic front, the MPC noted that inflationary pressures faced by the domestic economy had slightly moderated following the series of monetary policy tightening measures adopted by the Bank, complemented by a favourable harvest. The output growth remained robust, although the current security challenges could undermine investors’ confidence and output in the near term. Nonetheless, the inflation outlook appears uncertain despite the expected favorable agricultural production, the stability in expectations engendered by the imminent conclusion of the banking sector reforms, and the prospects for a return to a regime of fiscal prudence in the medium-term following the reconstitution of the Federal Government of Nigeria (FGN) Economic Management Team. It is against this backdrop that the Committee considered the monetary policies required to attain the objectives of price and financial stability in the short to medium term.
Key Domestic Macroeconomic and Financial Developments
Output and Prices
The Committee observed that the output growth rate for the second quarter 2011 remained robust. Provisional data from the National Bureau ofStatistics (NBS) indicated that real Gross Domestic Product (GDP) grew by 7.72 per cent in the second quarter of 2011, which is above the 7.69 per cent recorded in the second quarter of 2010. Overall GDP growth for 2011 is projected at 7.85 per cent which is slightly lower than the 7.87 recorded in 2010. The non-oil sector remained the major driver of growth, recording 8.82 per cent growth rate compared with 1.81 per cent for the oil and gas sector in the second quarter of 2011. The growth drivers remained agriculture, wholesale and retail trade, and services, which contributed 2.48, 1.88 and 2.52 per cent, respectively.
The Committee noted that the moderation in inflationary pressures, which commenced towards the end of the second quarter of 2011, continuedintothe third quarter. The year-on-year headline inflation rate decreased from 9.4 per cent in July 2011 to 9.3 per cent in August and core inflation decelerated from 11.5 per cent to 10.9 per cent during the same period. However, food inflation rose to 8.7 per cent inAugust 2011, from 7.9 per cent in July. The harvesting of early maturing crops, especially maize, tomatoes, vegetables, potatoes and fruits playeda key role in the moderation of headline inflation. The recently announced government policies and programmes are likely to have asalutary impact on agricultural output, if speedily implemented. These expectations are however currently under threat from anticipated fiscal injections, increased government borrowing to finance the huge fiscal deficit in the 2011 budget, the recent upward revision of electricity tariffs and the anticipated deregulation of petroleum product prices, among other factors.
Monetary, Credit and Financial Market Developments
Broad money (M2) grew by 8.55 per cent in the eight months to August 2011, which annualized to a growth rate of 12.82 per cent. Aggregate domestic credit (net) grew by 14.72 per cent in August 2011 when compared with the level in December, 2010. On annualized basis, the growth in net domestic credit translated to 22.08 per cent compared with the growth rate of 15.0 per centin the corresponding period of 2010.
The growth in aggregate credit was accounted for by increases in credit to the Federal Government and the private sector. Credit to theFederal Government grew by 18.99 per cent, which annualized to 28.48 per cent, close to the indicative benchmark of 29.29 per cent for2011. Similarly, credit to the private sector grew by 10.88 per cent, which annualized to 16.32 per cent, as against the benchmark of 23.34 per cent. With the banking crisis approaching a final resolution with the recapitalization of banks, it is expected that banks will increaselending once integration issues are concluded. Interest rates in all segments of the interbank money market rose in response to the upward review of the MPR at the previous MPC meeting. The Inter-bank and Open Buy Back (OBB) rates both opened at 7.49 per cent onJuly 27, 2011 and rose to 11.0 per cent and 10.36 per cent on September 15, 2011, respectively. The retail lending rates which hadremained relatively high, however, declined during the period. The average maximum lending rate declined to 22.27 per cent in August, 2011 from 22.42 per cent in July. The weighted average saving rate rose to 1.46 per cent from 1.42 per cent over the same period.The consolidated deposit rate declined during the period from 2.42 to 2.30 per cent. Thus, the spread between the average maximumlending rate and the consolidated deposit rate narrowed marginally from 20.0 per cent to 19.97 per cent during the period.
The bearish performance of the stock market continued during the review period as the All-Share Index (ASI) decreased by 15.5 per cent from 24,980.20 at end-June, 2011 to 21,106.67 on September 16, 2011. Market Capitalization (MC) decreased by 15.7 per cent from N7.99 trillion to N6.73 trillion during the same period. Despite the bearish performance, the equity market was more or less fairly valued as reflected in the NSE Price-Earnings (PE) ratios of 10.82 in August 2011, which was close to the 10-year 8-month median of 11.57. Moreover, the performance of the NSE during the review period is consistent with the performance of other stock markets around the world, and reflects lingering risk aversion and deleveraging on the part of foreign institutional investors who are key players on the NSE.
External Sector Developments
At the wDAS, the exchange rate, during the period (July 27 – September 15, 2011) opened at N150.00/US$ and closed at N153.52/US$, representing a depreciation of N3.52 or 2.35 per cent. At the inter-bank segment, the selling rate opened at N151.80/US$ andclosed at N156.30/US$, representing a depreciation of N4.50 or 2.96 per cent during the period. The exchange rate recorded a modest appreciation at the BDC segment where the selling rate opened at N163.00/US$ and closed at N158.00/US$, representing an appreciation ofN5.00or 3.07 per cent. The appreciation recorded in the BDC segment of the market was attributed to the increased supply of foreignexchange by the CBN and the removal of ceilings on DMBs’ sales to BDCs. The Committee noted that the premium between the rates at the WDAS and the interbank stabilized towards the end of the review period, while that of the BDCs narrowed significantly, suggesting the need to sustain existing measures to improve the efficiency of the market.
The Committee also noted the modest accretion to external reserves during the period. Gross external reserves stood at US$34.85 billion on 15 th September, 2011, representing an increase of US$1.12 billion or 3.32 per cent above the level of US$33.73 billion attained on July 21, 2011. The increase was mainly accounted for by increased inflows of royalties into the federation account, reflecting the upward trend in international oil prices and stable oil production in the Niger Delta. Besides, foreign direct and portfolio investments increased over the last eight months. Foreign capital inflows for the first eight months of 2011 stood at US$5.66 billion which is US$1.06 billion or 23.04 per cent higher than the US$4.60 billion recorded in the corresponding period of 2010.
The Committee’s Considerations
The key concerns noted by the Committee were:
1. Continuing expansionary fiscal stance and high component of recurrent expenditure;
2. Liquidity surge expected from AMCON intervention, following conclusion of bank recapitalization;
3. Sharp rise in month-on-month headline inflation rate despite falling headline inflation rate on year-on-year basis;
4. Need to have positive real interest rates; and
5. Persisting demand pressure in the foreign exchange market, driven by significant liquidity injections and reflecting structural deficiencies that have perpetuated the import dependence of the economy.
The Committee considered that given the difficult and uncertain international environment, it is important to ensure that the current trends in growth are sustained and price stability is maintained. The recent data on inflation showed that the headline inflation rate has been maintained within single digit for two consecutive months. However, concerns remain about sustaining the present inflation trend. The Committee viewed the rise in the monthly headline inflation rate in August which, while justifiable from the point of view of the large household expenditures on account of festivities, was sharp and out of line with the trend in the preceding 11 months. Besides, the anticipated high liquidity in the near future would have a bearing on inflation. The fiscal stance continues to be expansionary. The announcement of a target of one (1) per cent annual reduction in government recurrent spending when viewed in the context of the anticipated injections associated with the implementation of the new national minimum wage, suggests that thefiscal retrenchment is likely to be drawn-out. In addition, there is the weight of structural factors such as the announced hikes in electricity tariffs and the expected removal of petroleum subsidy.
Moreover, the AMCON injection of N3.0 trillion is going to add to liquidity surge with attendant adverse impact on prices. It is forthese reasons that the Committee felt the need for further tightening of monetary policy. On the other hand, the Committee noted that rates have been increased in the last four consecutive MPC meetings and that high lending rates increase the cost of finance for SMEs and this has an adverse consequence for growth and job creation. However, having considered the arguments for and against tightening, the Committee voted for maintaining the stance of tightening in the short term. The Committee emphasized that for monetary policy to be effective it would need to be complemented by other policies, both structural and fiscal. Monetary policy can onlyaddressthe monetary aspects of inflation while fostering growth and financial stability. The need for accelerating fiscal retrenchment and structural adjustment can therefore not be overemphasized.
In the light of the above considerations the Committee decided as follows:
1. A majority of 8 to 3 members voted for a tightening of monetary policy.
2. Seven (7) members voted for a 50 basis-point increase in MPR from 8.75 to 9.25 per cent. One (1) member voted for a 100- basis-point increase in MPR. The 3 remaining members voted to maintain the MPR at the current rate.
3. A Unanimous decision to:
a. maintain the current symmetric corridor of +/-200 basis points around the MPR; and
b. retain the current CRR of 4.0 per cent
You can download the report below:CBN MPC Communique - September 19th 2011 (545)
Courtesy of Afrinvest, FSDH and Vetiva, here are the company results released in the last month and the analyses of these results.Company Result - Afrinvest - GT Assurance Plc FY 2010 Result (619)
The Monetary Policy Committee of the Central Bank of Nigeria met for their regular meeting on July 25th and 26th 2011. The 3 major decisions made were:
1. To tighten monetary policy by a majority decision of 10 to 2.
2. To raise the MPR by 75 basis points from 8.0 per cent to 8.75 per cent by a majority vote of 8 members in its favour, 1 member favoured 50 basispoint increase while 3 members voted for holding the MPR at 8.0 per cent.
3. To maintain the corridor at +/- 200 basis points around the MPR.
Below is the summary from the communique of the meeting:
The Monetary Policy Committee (MPC) met on 25th and 26th July, 2011 to review domestic economic conditions during the first half of 2011 and the challenges facing the Nigerian economy against the backdrop of developments in the international economic and financial environment in order to chart the course of monetary policy in the second half of the year.
On the global scene, the Committee noted with concern the enormity of the challenges being faced by the US and euro zone countries as well as the major emerging market economies such as the fiscal position of Brazil, possible real estate bubbles in China and seemingly intractable inflation in India, which may impact the Nigerian economy adversely through several channels. The economic slowdown and the commodity price inflation in the international economy as well as the rapid increase in prices of some asset classes in some emerging market economies remain serious threats to the global economic recovery. There are continuing widespread threats of inflationary pressures fuelled by the sustained high energy, commodity and food prices in the global economy. Headline inflation in many of the major emerging market economies is now exceeding 6 per cent and is running close to or above central banks’ targets in a number of other larger economies.
The performance of the global financial markets was mixed. Many national currencies in Africa depreciated against the US dollar while in many emerging markets, currencies appreciated vis-à-vis the US dollar during the first half of 2011. Furthermore, most stock markets around the world showed weak recovery during the period due to high inflation, weakening consumer confidence and government finances, particularly in the US and eurozone. The unfolding debt crises in the European periphery could damage confidence and output in the near-term while the US debt and unemployment situation pose grave danger to the international economy given the reserve currency role of the US dollar and the size of the US economy. It is not unlikely that the US will lose its AAA rating and actual default is possible unless a deal can be worked out between the White house and the Congress.
On the domestic scene, the Committee noted that inflationary pressures which were traceable to the high expenditure levels associated with the April 2011 general elections as well as the effects of rising international energy, commodity and food prices had moderated by June 2011. This development was due in part to the tight monetary policy stance of the Bank since September of 2010. However, the Committee observed that the inflation outlook appears uncertain owing to the expected implementation of the new national minimum wage policy and the imminent deregulation of petroleum prices.
Significant injection of liquidity from FAAC in the third quarter coupled with the impact of AMCON recapitalizing intervened banks to the tune of N1.6 trillion will both add to inflationary pressures. The Committee welcomed the favorable growth projections but cautioned that the current security challenges, infrastructural bottlenecks and the uncertainty in the international economy as well as fiscal developments could undermine investors’ confidence and output growth in the near term.
The Committee expressed serious concerns about the continued sluggish growth of credit to the private sector during the first half of the year which is attributed, among other factors, to the heightened credit risk in the real economy as a result of the persisting structural problems occasioned by the inadequate power supply and critical infrastructure deficit. It also observed that the lending rates of deposit money banks (DMBs) remained relatively high.
You can download the full communique below:MPC JULY COMMUNIQUE NO 77 (697)
And here is the communique from the June meeting:CBN - MPC Communique No 76 Issued on May 24 2011 (680) Monetary Policy Committee Decision Preview - July 2011 - Vetiva (722)
Courtesy of FSDH Securities, here are the results released in the weeks of July 18th – 22nd, July 25th – 29th and August 1st – 5th:
Week of July 18th – 22nd:
Week of July 25th – 29th:
Week of August 1st – 5th:
Here is the summary of the Nigerian Stock Exchange for the week ended August 5th 2011 (reports and summary for the last week will be posted soon).
+ The NSE All-Share Index lost 180 bps cumulatively this week.
+ Bearish sentiments were prevalent in the banking sector this week depleting previous gains recorded. Participants however appeared to favour Oceanic Bank on the back of merger news with ETI and speculative trades led to a 19.8% cumulative gain for the stock this week. On the flip side, rescued banks Unity Bank, Afribank and Intercontinental Bank recorded losses ranging from 11.6% to 18.6%.
+ Marginal gains was recorded by two companies in the building materials sector this week, institutional purchases during the week took Ashaka Cement into positive territory with a 2.3% gain, while a hold back on offers and subsequent upward review of Lafarge Wapco prices also led to a 1.1% mark-up. Dangote Cement was quiet during the week with average daily volumes of about 100,000 units and price hovering between N118.00-N120.00.
+ In the breweries sector, bullish sentiments during the week firmed up the prices of Guinness and NB, they however also attracted investors seeking to exit positions. They both bagged cumulative gains in excess of 3.0% at the close of the week.
And here are the stats:
Here are the NSE reports (from Afrinvest, FSDH, IBTC, and Lead Capital) for the week ended August 5th 2011.NSE Weekly Update - Afrinvest - August 5th 2011 (706)
Here are the reports for the week ended July 29th 2011:NSE Weekly Report - IBTC - July 29th 2011 (790)
Here are the reports for the week ended July 22nd 2011:NSE Weekly Report - Lead Capital - July 22nd 2011 (673)
In the last month, most of the Nigerian banks have released their results. Here are the press releases from the banks, and results and analysis from some stockbrokers:Company Result - Zenith Bank Plc H1 2011 Conference Call Notes- Afrinvest (1807)
Last Friday,the licenses for Afribank, Bank PHB, and Spring Bank were revoked and their assets and liabilities have been transferred to the newly incorporated Bridge Banks:
1. Mainstreet Bank Limited has assumed the assets and liabilities of Afribank Nigeria Plc.
2. Keystone Bank Limited has assumed the assets and liabilities of Bank PHB Plc.
3. Enterprise Bank Limited has assumed the assets and liabilities of Spring Bank Plc.
Here is the press release from the NDIC:
LAGOS, Fri, Aug 5 2011
PRESS BRIEFING BY NIGERIA DEPOSIT INSURANCE CORPORATION (NDIC)
RESOLUTION OF FAILING BANKS THROUGH THE ESTABLISHMENT OF BRIDGE BANKS
In July 2009, the Central Bank of Nigeria (CBN) and Nigeria Deposit Insurance Corporation (NDIC) carried out a special examination of all 24 deposit banks in Nigeria, with the aim of assessing their health, with particular focus on liquidity, capital adequacy, risk management and corporate governance practices.
Ten (10) banks were adjudged to be in grave states with deficiencies in capital adequacy. Of these, eight (8) also had significant deficiencies in liquidity, risk management practices and corporate governance policies. The Managing and Executive Directors of these 8 were immediately replaced, and all the 10 banks were bailed out by the injection of fresh capital totaling about N620 billion, in the form of Tier 2 Capital.
It has been two years since the commencement of the banking reforms and to date, two of the banks (Wema Bank Plc and Unity Bank Plc) have been successfully recapitalized, while four banks (Union Bank of Nigeria Plc, Intercontinental Bank Plc, Finbank Plc and Oceanic Bank International Plc have signed legally-binding Transaction Implementation Agreements (TIAs), a significant step towards recapitalization by the deadline of September 30th set by the CBN. Equitorial Trust Bank (ETB) Ltd is currently in the final stage of negotiation with a prospective investor with strong likelihood that it will meet the recapitalization deadline.
However, the remaining 3 banks (Afribank Plc, Bank PHB Plc and Spring Bank Plc), have not shown the necessary capacity and ability to recapitalize within the September 30th deadline.
Accordingly, in the interest of depositors and to prevent liquidation which will have dire consequences for depositors and undermine public confidence in the banking system, pursuant to the provisions of the NDIC Act, the Corporation, after due consultation with the CBN and Federal Ministry of Finance and with the full support of the Federal Government, has resolved the problems of the three banks through the Bridge Bank mechanism.
To this effect, the assets and liabilities of the affected banks, whose licenses have now been revoked by the CBN, have been duly transferred by the Corporation to newly incorporated Bridge Banks as follows:
1. Mainstreet Bank Limited has assumed the assets and liabilities of Afribank Nigeria Plc.
2. Keystone Bank Limited has assumed the assets and liabilities of Bank PHB Plc.
3. Enterprise Bank Limited has assumed the assets and liabilities of Spring Bank Plc.
The Corporation is encouraged by the provision of the Bridge Bank option in our law, to resolve the problems in the banking sector. The Bridge Bank option is a veritable tool of enhancing depositor protection and promoting confidence by ensuring seamless continuity of banking operations. The NDIC will operate the Bridge Banks until such a time that we engage the Asset Management Company of Nigeria (AMCON) with a view to capitalizing the Bridge Banks. AMCON is expected to open up negotiations with investors who may be interested in capitalizing the Bridge Banks.
With this action, a resolution of the crisis in the Nigerian banking system is assured, as it brings certainty and stability to the banking system. It is worthy of note, that unlike other parts of the world where depositors lost funds in the resolution of banking crises, NO depositor lost any funds in this reform process in Nigeria.
This is indeed in line with the avowed commitment of the Federal Government, and Mr President in particular, to ensure that Nigerian depositors do not suffer the trauma and suffering associated with bank liquidations.
NIGERIA DEPOSIT INSURANCE CORPORATION
You can download the press release below:
NDIC Press Release (445)
Courtesy of FSDH, Afrinvest, and Lead Capital, here are the NSE reports and stats for the week ended July 15th 2011:
Gainers and Losers:
And here are the reports:NSE Weekly Report - Lead Capital - July 15th 2011 (499)
This blog is dedicated to informing users on the latest business and economic news news from the CBN and Nigerian Stock Exchange. Happy reading!