Nigerian Stock exchange has reported that foreign investors spent N381 Billion to purchase Nigerian equities, that represents a 88% increase over 2009. “Some of our erstwhile foreign investors are returning, while new investors sought opportunities considering the key attributes of higher returns,” the stock exchange said at an annual briefing to journalists in Lagos.
NSE also said that wider trading hours introduced last month had led to a 15.6 percent increase in traded volumes meaning liquidity was improving. NSE was also concerned that 99.9% of trades made were in equities and announced that It expected trading in exchange-traded funds (ETF) to start in 2011. The bourse said in October it was in talks with South Africa’s Absa Capital to list a fund.
Nigeria’s domestic debt grew most in 11 years due to increased government spending. Loans to government grew by 50% in 2010 while growing only 3% for private companies. NSE expects a good year but remains wary of inflationary risks in the country due to increase in minimum wage, election spending. NSE expects AMCOM to soak up all the non performing loans of banks by March 31st
Nigerian Stock exchange has reported that foreign investors spent N381 Billion to purchase Nigerian equities, that represents a 88% increase over 2009. “Some of our erstwhile foreign investors are returning, while new investors sought opportunities considering the key attributes of higher returns,” the stock exchange said at an annual briefing to journalists in Lagos.
NSE also said that wider trading hours introduced last month had led to a 15.6 percent increase in traded volumes meaning liquidity was improving. NSE was also concerned that 99.9% of trades made were in equities and announced that It expected trading in exchange-traded funds (ETF) to start in 2011. The bourse said in October it was in talks with South Africa’s Absa Capital to list a fund.
Nigeria’s domestic debt grew most in 11 years due to increased government spending. Loans to government grew by 50% in 2010 while growing only 3% for private companies. NSE expects a good year but remains wary of inflationary risks in the country due to increase in minimum wage, election spending. NSE expects AMCOM to soak up all the non performing loans of banks by March 31st
AMCOM is moving quickly in absorbing the bad loans of banks in Nigeria and has set a deadline of March 31 to soak up all such bad debts. The CEO of AMCOM, Mustapha Chike Obi told reuters that “”We are going to clear up everything by March 31 and at that point we would have issued proper bonds, fully tradable, I think we will be spending around 500 billion naira more.” He also revealed that margin loans made up 40% of all the bad loans.
On Dec 31, AMCOM had issued N1.03 Trillion of consideration bonds to 21 banks in exchange for non performing loans paying a discounted face value of N 770 Billion. Thererfore easykobo.com calculates the future value of bonds to be 1.03 Trillion because of the 0 coupon consideration.
The entire aim of the bond issue is to bring the shareholder equity of rescued banks back to positive so that new investors can come in. It is part of a strategy the minimized the damage to Banks’ shareholder’s. The extra 500 Billion of bonds will be used to purchase non performing loans of Banks that were not rescued in 2009.
Among the rescued Bank’s, WEMA Bank has received 15.2 Billion, Bank PHB has received N140 Billion while Union Bank has received the most money topping N200 Billion.
Shares in all 3 banks were higher today. WEMA bank was higher by 4.3%, PHB by 4.6% and Union Bank by 0.2%. For more information kindly enter the stock symbol in the top left box on easykobo.com and click “get quotes”
