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Rand Merchant Bank set to float bond on NSE

Rand Merchant Bank Nigeria has announced plans to float a bond programme expected to be listed on the Nigerian Stock Exchange.

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Rand Merchant Bank Nigeria (RMB) has announced plans to float a bond programme expected to be listed on the Nigerian Stock Exchange (NSE).

Michael Larbie, Chief Executive Officer, RMB Nigeria and Regional Head West Africa, revealed this at the official launch of the RMB Stock Brokers and bank’s 5th anniversary at the NSE.

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He further disclosed that the bond programme is part of the bank’s partnership with the NSE to come out with varieties of investment options that can be listed on the exchange. The bond is already listed with the Securities and Exchange Commission (SEC).

Larbie, while speaking after the event, noted that creating products like derivatives, securities, lending options on stocks would help in deepening the market, increase transaction volume and attract more investment into the market.

Speaking on areas of improving the market to attract more investment, Larbie said, emphasizing on corporate governance, it will further enhance confidence in the market which will attract both domestic and foreign investors to play more in the market.

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“You would have seen that since CBN introduced Nigerian Autonomous Foreign Exchange Fixing (NAFEX) market, we have seen an increased portfolio investment both in fixed income and equity to the extent that people become convinced that the NAFEX market is here to stay and investors believe that they can leverage the market”

He expressed optimism that the capital market would continue on a consistent growth trajectory, urging investors to leverage opportunities in the Nigerian market for maximum investment returns.

He said:

“In terms of investment, generally, the bank is trying to show that Nigeria investment over time has done fairly well, so I think investors that are looking for long-term decent returns, this is the market to play and that is why as a bank, we continue to invest in Nigeria.

“We would continue to build our business and those foreign direct investment coming in will increment our capital and I think over time we remain optimistic on Nigerian economy.”

The bank had recently received approval from FMDQ OTC Securities Exchange to register its N80 billion commercial paper programme on the FMDQ platform, according to Punch.

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The commercial paper was a debut for RMB Nigeria as an issuer in the Nigerian money markets and formed an integral part of the bank’s funding strategy as it provided an avenue to successfully diversify its short-term funding sources, thereby delivering value to its shareholders.

It is also among the selected issuing houses for the planned MTN IPO that is expected to come up later this year.

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Rand Merchant Bank (RMB) Nigeria Limited, a member of the FirstRand Group, is a leading African corporate and investment bank and part of one of the largest financial services groups in Africa.

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The bank, which offers clients innovative advisory, capital markets, financing and principal investing solutions, has funded various infrastructure, real estate resources, acquisitions and development projects in over 35 African countries in the past decade.

The projects range from ports, dams and energy installations, mines, railways, to factories.

The bank established a representative office in Nigeria in 2010 and opened a fully-fledged merchant bank in early 2013.

In its full year 2017 financial statement for the year ended December 31, 2017, the total comprehensive income for the year stood at N7.9 billion as against N890 million recorded in 2016. While its Profit Before Tax stood at N7.2 billion.

The bank is rated A with a stable outlook by rating agency, Agusto & Co. The rating assigned to the bank reflects its good asset quality, strong capitalisation, and a good liquidity profile.

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However, the rating is constrained by weak profitability, low market share as well as the current macroeconomic climate that is expected to adversely impact the performance of the Nigerian banking industry.

Fikayo has a degree in computer science with economics from Obafemi Awolowo University. ITIL v3 in IT service management. An alumnus of Daystar Leadership Academy. Prior to joining Nairametrics had stinct in Project management, Telecommunications among others. Also training in Consulting and Investment banking from Edubridge Academy. He has very keen interest in Politics, Agri-business, private equity and global economics. He loves travelling and watching football. You can contact him via fikayo.owoeye@nairametrics.com

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Business News

Oando loses Chief Legal Officer

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Oando loses Chief Legal Officer

Chief Legal Officer of Oando Plc, Ngozi J Okonkwo is dead.

Adewale Tinubu, Group Chief Executive Officer of Oando Plc announced this via a tweet.

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Until her death, she was the Chief Legal Officer of Oando Plc, having joined the company as Head, Legal Services of the company in 2009.

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According to a tweet from one of her nephews, she battled cancer for a while, recovered before having a relapse during the recent COVID-19 crisis.

READ ALSO: NSE, SEC train capital market operators on legal and regulatory requirements for the derivatives market

Before joining Oando, she worked as Junior Counsel  with F.O Akinrele & Co., and also with KPMG Professional Services (previously known as Arthur Andersen) as Manager in the Tax, Regulatory and People Services unit and Head of indirect tax services.

READ ALSO: Common legal and general mistakes made by new businesses (Part 1)

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She obtained LLB (Hons) from University of Nigeria, Nsukka in 1997 and BL from the Nigerian Law School, Lagos in 1999. She was a member of the Nigerian Bar Association, honorary fellow of the Association of Fellows and Legal scholars of the centre for International Legal Studies, Austria, Associate Member of the Chartered Institute of Arbitrators, United Kingdom and Associate Member of the Chartered Institute of Taxation, Nigeria.

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Economy & Politics

NNPC diversifies into housing, power; plans to beat crude production cost to $10 per barrel

The Nigerian National Petroleum Corporation (NNPC) has announced that it is building up business portfolios in the housing, power, and medical sectors.  

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NNPC, Domestic Crude Allocation, Why NNPC’s Duke Oil is quitting London operations for Dubai , NNPC divests stake in four oil wells to NPDC , How NNPC discovered oil, gas deposits in the North , Nigeria to leverage on condensate refineries to be petrol net exporter, How NNPC saved $3 billion from arbitration , NNPC, IPPG donate medical supplies to South West state governments, NNPC discloses bases for employment and managerial progression in the oil firm, NNPC diversifies into housing, power; plans to beat crude production cost to $10 per barrel

To cushion against the volatility in the global crude market and strengthen profitability, the Nigerian National Petroleum Corporation (NNPC) has announced that it is building up business portfolios in the housing, power, and medical sectors.

This is one of several measures the corporation is taking to sustain revenue generation for Nigeria, and cope with the boom and bust cycles which are gradually becoming a feature of the global crude oil market.

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NAN reports that this was contained in a statement from the Corporation Chief Operating Officer, Ventures and Business Development, Mr. Roland Ewubare, and signed by NNPC Spokesman, Kennie Obateru.

According to Ewubare, the NNPC will establish Independent Power Plants using the Ajaokuta-Kaduna-Kano (AKK) pipeline network, and consolidate its presence in the power sector.

(READ MORE: COVID-19: Nigerians react as CBN partners NNPC to feed, accommodate Nigerian returnees)

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The statement reads in part; “NNPC is creating an energy company that would have portfolios in renewable energy; we have initiatives on solar that is ongoing.

“We have got biofuels agreements with some state governments that would soon be activated. We do have a lot of non-core businesses that are aggregated under the Ventures and Business Development Autonomous Business Unit of the NNPC. 

“This would be expanded through effective collaboration and partnership with the private sectors,” 

NNPC diversifies into housing, power; plans to beat crude production cost to $10 per barrel

Lower costs, more profits

As part of moves to improve profitability, the NNPC also announced plans to drive crude oil production cost down to 10 dollar per barrel by Q4 2021,

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This according to the statement would be done by systematically and gradually beating down logistics costs.

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The Corporation’s revenue took a major hit in 2020 due to the slump in global oil prices, and this in turn affected the Nigerian budget given that oil proceeds account for a significant fraction of her income.

“When you have a low commodity price regime, as the case now, the only way we are able to squeeze out some reasonable cash and financial gain to the nation is by curtailing and constraining our costs in line with the GMD’s aspiration to push for a 10 dollar per barrel cost of production,” Ebuware said.

(READ MORE: NNPC pipeline vandalism up by 50% in January, may suspend crude oil production)

There is also an ongoing collaboration with selected partners to commercialise flared gas in order to preserve the flora and fauna of the country.

This would be done by converting it to Compressed Natural Gas (CNG) and Liquefied Natural Gas, for sale to consumers.

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The NNPC is partnering with private developers to reduce the housing deficit in the country and also partnering with medical centres to provide innovative healthcare for Nigeria.

 

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Business News

Microsoft Teams’ rival, Slack shares drop on withdrawal of full-year billings guidance

Slack reported steady revenue growth 50% in Q1 2020, compared with 49% recorded in Q1 2019 on an annualized basis this brought in more customers

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 Slack shares dropped as much as 17% yesterday after the company’s reported first-quarter earnings.

Investors and stock traders were not happy with Slack’s annual revenue forecast of $855 million to $870 million, up just slightly from Slack’s projection in March stock analysts, on the average, estimated $856.5 million, according to data obtained from Bloomberg.

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“Slack’s withdrawal of full-year billings guidance looks conservative to us and likely suggests a pull-forward of revenue amid faster new-customer additions due to remote work,” Mandeep Singh, a Bloomberg Intelligence analyst, wrote in a note yesterday.

Slack grew revenue 50% in Q1 2020, compared with 49% recorded in Q1 2019 on an annualized basis.

However, Slack reported steady revenue growth during  Q1 2020 brought in more customers, as organizations sought to keep communications going with their newly remote workforces during coronavirus pandemic. It had earnings per share of 2 cents loss per share, adjusted and adjusted revenue of $201.7 million

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(READ MORE: How to Profit from Directors’ Share Dealing Notifications)

Slack, in a statement, yesterday reported that it added a record 12,000 paid customers Q1 2020 as against two prior quarters when it added about 5,000 new customers. Slack’s top competitor, Microsoft’s Teams, has also experienced growth in recent months.

“What you saw with Zoom, what you saw with Teams is a great indication that this is not apples-to-apples and that the products are not truly competitive with one another,” Butterfield the Chief Executive Officer of Slack told Investment analysts on a conference call yesterday.

READ ALSO: Jumia is optimistic of COVID-19 boost, despite poor Q1 2020 earnings report

Paid users spent over 120 minutes per day in Slack at the end of the quarter, up from below 90 minutes one quarter earlier. 

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“I can’t care about the stock price on the level of individual days,” Butterfield said when asked about the reaction to earnings. “I just wouldn’t be able to do my job. I care about where the share price is five years from now and 10 years from now. This is just a very volatile time.” 

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