Top News Update 05/06/2017
1. Zenith Bank’s Eurobond Four Times Oversubscribed
2. Senate plans to invite CBN, banks over high interest rates
3. NNPC Incurs Losses as Marketers Shun Petrol Importation
4. Presidency to Sue N’Assembly over Power of Appropriation
5. Nigeria’s June oil exports poised to hit 15-month high on Forcados plan
6. CBN’s exporter, importer window attracts $1b deals
7. CBN Pledges to Sustain Dollar Injection in FX Market
8. Afreximbank seals $1.2b dual currency deals
9. Forex: 3,239 BDCs access $520m in four weeks
10. CIS engages finance minister, SEC on 10 year capital market master plan
Zenith Bank’s Eurobond Four Times Oversubscribed
Zenith Bank Plc has issued a five-year senior unsecured benchmark Eurobond of $500 million on the Irish Stock Exchange, which has broken new grounds with an oversubscription of more than 400%. A statement by the bank’s management at the weekend said the issue was in addition to its existing $500 million Eurobond, which matures in April 2019. Subscription to Zenith’s latest Eurobond 2022 issue was $2.1 billion and recorded landmark success on three counts: pricing, subscription and global appeal. Available details of the issue showed that the subscription makes it the highest by any non-sovereign and non-supranational company in sub-Saharan Africa (SSA). According to the statement, the bond was issued at par with both coupon rate and yield to maturity rate priced at 7.375%. The 7.375% pricing is 50 basis points better than the sovereign (Nigeria’s Eurobond) of 7.875%.
Senate Plans To Invite CBN, Banks Over High Interest Rates
Senate President Bukola Saraki has said the Senate is concerned about the high interest rates on loans, stating that lawmakers will this week discuss the issue with the Central Bank of Nigeria and the Deposit Money Banks. He stated that in an economy where workers were being retrenched and people were losing investments, it was immoral for certain sectors to be making astronomical profits. In an interview with journalists in Ilorin, the Kwara State capital, on Sunday, the Senate President said, “They (banks) will tell you that they are doing business but in doing business, there must be social responsibility. We must be able to sit down and look at ourselves eyeball to eyeball, and we intend to do that; and I can promise Nigerians that we can find a solution. Hopefully with the stability in the forex market, we will now begin to address the high interest rate.
Presidency To Sue N’Assembly Over Power of Appropriation
Owing to the unending disagreement with the legislature over the extent of its power of appropriation, the executive has resolved to approach the Supreme Court for interpretation of Section 80 of the 1999 Constitution, which grants the National Assembly the power to approve appropriated public funds, presidency sources told THISDAY yesterday. According to sources, the Muhammadu Buhari administration is determined to end the perennial disagreement over the extent of the power of the legislature to appropriate public funds and would be asking the highest court in the land to determine whether the National Assembly has the latitude to revise estimates proposed by the executive arm of government or not.
NNPC Incurs Losses As Marketers Shun Petrol Importation
With oil marketers shunning the importation of petrol due to dwindling margins, the Nigerian National Petroleum Corporation (NNPC) is incurring losses of between N8 and N10 per litre through the allocation of the product to marketers at a coastal price of N126.63 per litre, THISDAY’s investigation has revealed. This translates to a loss of N350 million daily at the current estimated daily domestic consumption of 35 million litres of petrol. Investigations further revealed that for both NNPC and the marketers to import petrol and sell at the official price without incurring losses, the appropriate pump price should be N155 per litre.
Nigeria’s June oil exports poised to hit 15-month high on Forcados plan
Nigeria issued its first Forcados oil loading plan since 2016, putting the nation’s June oil exports on track to hit thier highest level in at least 15 months. The plan, if realised, would return loadings by Nigeria, normally West Africa’s biggest oil exporter, to levels not seen since militant attacks in the oil-rich Niger Delta first shut down Forcados exports in early 2016. It is also likely to put more downward pressure on oil prices, which are already trading more than 16 percent below the highs reached in January on the back of a persistent global excess. Last week the Organization of the Petroleum Exporting Countries along with several other oil producing nations agreed to extend output cuts of 1.8 million bpd, but it gave Nigeria, along with Libya, another exemption.
CBN’s Exporter, Importer Window Attracts $1b Deals
The Exporter/Importer Forex Window launched by the Central Bank of Nigeria (CBN) to deepen dollar inflows to the economy has recorded $1 billion deals in the last six weeks, Managing Director, Financial Derivatives Limited, Bismarck Rewane, has said. In the company’s economic report, released at the weekend, he said the CBN introduced a new foreign exchange window for investors and exporters targeted at increasing forex supply in the market and allowing the timely settlement of transactions. “So far, approximately $1billion has been traded at this window. The spread between the parallel and interbank markets narrowed to N76.15 (May 30) compared to N83.65 as at April 28,” he said.
CBN Pledges To Sustain Dollar Injection In FX Market
Basking in the euphoria of the near rate convergence achieved in the foreign exchange (forex) market, indications emerged yesterday that the Central Bank of Nigeria (CBN) would sustain its dollar injection in the market this week. The sell side of the naira exchange rate against the dollar appreciated significantly by N12, to close at N363 to the dollar on the parallel market on Friday, as against the N375 to the dollar as was last Thursday.
Afreximbank Seals $1.2b Dual Currency Deals
The African Export-Import Bank (Afreximbank) has concluded a record $1.16 billion dual-tenor and dual-currency syndicated term loan facility, structured as $632.9 million and 499.6 million euros. The move will help the multilateral financial institution devoted to financing and promoting intra- and extra-African trade to pursue its avowed regional trade integrations and financing goals, support corporate organizations, as well as repay existing debt and general corporate purposes.
Forex: 3,239 BDCs Access $520m In Four Weeks
The 3,239 bureaux de change (BDCs) approved by the Central Bank of Nigeria (CBN) got $520 million from the apex bank dollar interventions in the last four weeks, The Nation has learnt. The funds, followed $40,000 per BDC weekly dollar allocations from the CBN, in its commitment to deepen liquidity in the foreign exchange market. A circular from the CBN confirmed the number of BDCs, even as the regulator has reiterated its commitment to continue funding key segments of the FOREX market.
CIS Engages Finance Minister, SEC On 10 Year Capital Market Master Plan
AS part of effort to addressing the lull in the Nigerian capital market occasioned by the economic recession, the Chartered Institute of Stockbrokers, CIS, said it will engage the Minister of Finance and the Securities and Exchange Commission, SEC, on the 10-year Capital Market Master Plan (CMMP) in order to make the market more attractive to investors. The Plan, which was launched in 2015 is a very detailed and thoroughly researched document that is intended to guide the evolution of the Nigerian capital market into a global masterpiece by the year 2025.We will engage with government authorities to ensure the fullest implementation of this plan.