Tier two lender, Skye bank has passed the buck on its current woes to the immediate past chairman, and past MDs. The Central Bank of Nigeria (CBN) in July 2016 sacked the previous management of the bank and has so far pumped a N100 billion into the bank as bailout. The bank has allegedly sought the assistance of the presidency to recover funds allegedly misappropriated by its previous Chairman Tunde Ayeni.
Here’s a summary of the bank’s alleged petition to the Presidency:
- A forensic audit by KPMG shows the bank kept two sets of accounts: One for regulators and the other showing the true state.
- The previous chairman, Tunde Ayeni allegedly used his position to obtain loans above regulatory limit.
- Ayeni’s industry exposure to the bank is put at N150 billion. The exposure covers both Ibadan and Yola electiricity distribution companies and Nitel.
- Ayeni’s personal exposure is put at N70 billion.
- The loans are said to be to seriously challenged.
- N33 billion was also traced to the former chairman, of which N7 billion was disbursed for the former President Goodluck Jonathan’s campaign.
- Ayeni and several individuals allegedly received N29.5 billion related to the acquisition of Mainstreet bank.
- The bank is seeking the assistance of the government to seize Ayeni’s assets.
Related parties to the petition include previous Managing Directors of the bank Akinsola Akinfewa, Timothy Oguntayo and Kehinde Durosinmi-Etti
Why the bank made this move
Though the bank has yet to officially confirm if it authored the petition, the bank may have decided to fly the kite of a petition to put pressure on its debtors to pay up on their loans. Recovered funds would enable the bank to boost its capital base.
This goes beyond previous MDs
In addition to past senior management, the auditor and regulators also have a share in the blame game. How did these anomalies in the balance sheet escape the attention of previous auditors ? Several analysts had raised question as to the manner and modality in which Skye bank acquired Mainstreet bank, yet the deal was approved by the Central Bank of Nigeria (CBN). Regulators prefer to wait till dire moments before intervening.
Recovering the assets will be an uphill task
The assets the bank intends to recover are barely making any profit. Distribution companies in the country are currently weighed down by huge receivables (these are debts people owe them). Ntel is a marginal player in the telecoms space, and had been making moves to raise capital to fund its expansion. General TY Danjuma is said to have shareholding in Ntel and is currently the chairman. The country being in recession means getting a buyer may be difficult.
Dangote delays London Stock Exchange listing
Dangote Cement Plc isn’t expected to attempt a U.K. initial public offering until at least 2023.
Africa’s richest man, Aliko Dangote, is once again delaying plans to list Nigeria’s second most capitalized company on the London Stock Exchange, rather choosing other options like boosting exports and the Nigerian company’s foreign-exchange reserves in a report credited to Bloomberg.
Dangote Cement Plc, Africa’s biggest producer of building material isn’t expected to attempt a U.K. initial public offering until at least 2023, Temilade Aduroja, Head of Investor Relations, at the Lagos-based company, said by email.
“The London listing is not something which will happen in the short to medium term. We are focused on our export strategy and increasing our foreign-currency revenue,” he said.
Dangote, a major shareholder of Dangote Cement, with a net worth of more than $14 billion has longed for the company to have a secondary London Stock Exchange listing to diversify its holding and gain more leverage to cheaper funds on international markets.
Aliko Dangote said in 2018 that the listing would happen the following year (2019), only for Brian Egan, former Chief Financial Officer, to state that 2020 was more likely.
More detail later as the story is developing…
NB Plc to raise additional N20 billion from its N100 billion Commercial Paper
Nigerian Breweries has announced the continuation of its N100 billion Commercial Paper (CP) Issuance Programme.
Nigerian Breweries has announced the continuation of its N100 billion Commercial Paper (CP) Issuance Programme in a bid to raise up to N20 billion to support its short term funding needs. The company has launched Series 9 and 10 of the programme for this purpose.
This information was disclosed in a notification signed by the Company’s Secretary, Uaboi G. Agbebaku, and sent to the Nigerian Stock Exchange.
The notification reads;
“[Nigerian Breweries Plc] is pleased to inform the Nigerian Stock Exchange and the investing public of the continuation of its “CP” (Commercial Paper) programme with the launch of Series 9 and 10 of the programme.
“Series 9 of the Commercial Paper programme would be for a tenor of 180 days, while Series 10 would be for 270 days. However, the launch of the CP opens today 23rd October 2020.”
What you should know
According to data obtained from Financial Market Dealers Quote (FMDQ), Nigerian Breweries has raised up to N90.12 billion since the start of the year.
- N52.76 billion was raised from Series 6 between February 12 to November 6, 2020.
- N13.03 billion was raised from Series 7 from April 15 to October 14, 2020.
- N24.33 billion was raised from Series 8 from April 15 to January 8, 2021.
- The recent issuance of the Series 9 and 10 CP will bring the total funds raised to N110.12 billion.
Why it matters
- The CP will help the company navigate through the recent impact of COVID-19 and other trade disruptions.
- The programme will strengthen the balance sheet of the company, and enable the brewer to execute its plans while delivering value to customers and creating wealth for shareholders,
- In like manner, the CP programme is expected to provide opportunities for non-equity investors to invest in the company and support its cost management initiatives.
MTN shareholders have made approximately N1 trillion since April 2020
Shareholders of MTN Nigeria gained close to a trillion naira in less than 7 months.
MTN Nigeria shareholders have gained N986.58 billion since the first trading session in April 2020.
This was uncovered by calculating the difference in the telecommunication giant’s market capitalization of ₦1.832 trillion at the open of trade, for the first trading session in the month of April 2020, and the market capitalization of ₦2.646 trillion at the close of trade in the first trading session in the month of October.
This gives a whopping N814 billion increase in market capitalization, and this with the dividend the company has paid to shareholders on two occasions between this time period, brings the total gains both realized and unrealized to approximately N1 trillion.
Hence, the N814 billion increase in market capitalization translates to the joint gains MTN investors have made from the increase in the shares of the company, as the share price of the company has increased by 44.44% or ₦40.00 between April 1, 2020, and October 2, 2020, with the share price of increasing from ₦90.00 to ₦130.00.
However, the gains MTN NG investors have made from their investments in the telecommunication company, is not limited to the gains driven by the increase in the price of the shares.
Recall that the company declared payment of dividends to its shareholders on two occasions, as investors/shareholders of the company, whose names appear in the Register of Members, as of the close of business on April 17, 2020 and August 14, 2020 were paid a cumulative dividend per share of ₦8.47, for all the outstanding shares of 20,354,513,050 held by the shareholders, and this translates to a total dividend payout of N171 billion by the company to its shareholders.
It is noteworthy that the realized and unrealized gains MTN investors have made from holding the shares over this period stands at N986.58 billion.