Corporate actions are decisions taken by companies’ boards of directors or management teams, that could have impacts on the firms themselves or shareholders.
Examples of corporate actions include the payment of dividends, closing of shareholders’ registers, announcing qualification dates and Annual General Meeting (AGM) dates.
Here is a review of corporate actions that took place last week, and those expected this week.
Ikeja Hotels Plc, last week, responded to an article by Nairametrics, concerning a large share sale. According to the firm, Oma Investments Limited had purchased a stake that had been hitherto owned by UBA Trustees. Oma, which is now the largest individual shareholder, is an investment vehicle controlled by Maiden Ibru. Mrs Ibru took charge following the death of her husband, Alex Ibru.
UPDC holds AGM
UAC Property Development Company held its Annual General Meeting (AGM) last week. The meeting, earlier scheduled for Tuesday, was shifted due to a public holiday declared to mark the Eid El Maulud holiday.
The company is yet to issue a notice concerning resolutions achieved, but the meeting was bound to be a difficult one due to the losses incurred by the company, in the last few years.
Back to business
11 Plc (formerly known as Mobil Oil Nigeria Plc) this week announced its reentry into the aviation fuel business, in partnership with Air BP. The company last operated in the sector five years ago, and the move appears to be one of several taken to revitalize 11 (pronounced double one) Plc following NIPCO’s acquisition of a majority stake.
$200 million in the bank
Tier two lender, Ecobank Trans International, announced the successful close of a USD 200 million syndicated loan facility.
The facility was oversubscribed at USD 268.5 million, with ETI increasing Deutsche Bank’s mandate as the arranger from USD150 million to USD200 million. The loan will be due for repayment in November 2019.
UAC appoints Non-Executive Director
UAC of Nigeria Plc has appointed Bolaji Odunsi as a Non-Executive Director. He replaces Mrs. Funke Ighodaro who exited the board following her taking up an executive position in South Africa.
Interlinked Technologies Plc, in a notice to the NSE, stated that there was a change of ownership in its key shareholder, Boussole Limited. Boussole will be wholly owned by Eunisell Limited, after a reorganisation. The firm will, however, remain the key shareholder in Interlinked Technologies Limited.
Goldlink Insurance Chairman Resigns
Goldlink Insurance this week announced the resignation of its Chairman, Mohammed Bintube. His resignation was effective 5th of November, 2018.
Cornerstone Insurance appoints ED
Cornerstone Insurance Plc appointed Chidiebere Nwokeocha as an Executive Director.
Corporate Actions taking place next week
Consolidated Hallmark Insurance Plc
Consolidated Hallmark Insurance will be holding an Extraordinary General Meeting on the 28th of November. While the agenda is to obtain shareholders’ approval to raise funds through a private placement, it remains to be seen if the company will suspend the move due to NAICOM canceling the tier based recapitalisation programme.
RT Briscoe Plc
RT Briscoe Plc will be holding its Annual General Meeting on the 29th of November. The meeting is bound to be a feisty one, going by the company’s string of losses.
Cement Company of Northern Nigeria Plc
Cement Company of Northern Nigeria Plc will be holding a Court Ordered Meeting on the 29th of November, The company intends merging with Kalambaina Cement.
Manufacturing PMI slide into recession territory
This is the first clear data-driven sign that Nigeria is in a recession.
The much-awaited Purchasers Managers Index (PMI) was released on May 29th by the Central Bank of Nigeria. According to the latest data, Manufacturing PMI in the month of May stood at 42.4 index points, indicating contraction in the manufacturing sector for the first time after recording expansion for thirty-six consecutive months.
The figure compares to 51.1 and 49.2 index points in March 2020.
The latest number now falls squarely within recession numbers and this is a clear sign that Nigeria is closer to recording a major contraction in the second quarter of the year.
Meanwhile, the nation’s PMI’s number hit a year low in April 2016 of 43.7, before plummeting further to 41.9 in June 2016. Nigeria subsequently fell into a recession by the end of the second quarter of 2016 and remained in recession throughout the course of the year.
The nation’s non-manufacturing PMI fell for a consecutive month to an all-time low of 25.3. The decline in manufacturing PMI was significant following thirty-six consecutive months of expansion, while the non-Manufacturing PMI contracted for the second consecutive month.
A further look into the report shows that the manufacturing sector employment level index stood at 24.5 points in May, a decline compared to 47.1 points recorded in March and 56.4 points in February 2020.
This downturn is mostly attributed to the halt in economic activity as businesses in Nigeria result in layoffs and pay cuts in order to survive the effect of the lockdown.
Also, all 14 subsectors of the manufacturing sector, reported lower raw material inventories, consequently contracting the inventories index to 37.4 points in May 2020. An effect of the supply chain bottleneck associated with the lockdown measures implemented in most countries of the world.
Specifically, this figure translates the effect of lockdown procedures and trade restrictions implemented by Nigeria’s major trade partners in response to the COVID-19 pandemic. Note that Nigeria’s major trade partners; China, USA, Spain, and the Netherlands account for about 45% of our import.
What you need to know: PMI is a survey that is conducted by the Statistics Department of the Central Bank of Nigeria. The respondents are purchasing and supply executives of manufacturing and non-manufacturing organizations in all 36 states in Nigeria and the Federal Capital Territory (FCT).
In his reaction to the data, the Central Bank Governor, Godwin Emefiele, in the Monetary Policy Communique, highlighted how dire the situation.
He said, “The contraction in the manufacturing and non-manufacturing PMIs was attributed to slower growth in production, new orders, employment level, raw materials, and input prices.
“The employment level index for the manufacturing and non-manufacturing PMIs also contracted further to 25.5 and 32.0 index points, respectively, in May 2020 compared with 47.1 and 47.3 index points in March 2020.
“Generally, the purchasing managers’ activities in May 2020, were largely affected by the lockdown of the global economy to curtail the spread of the COVID-19 pandemic.”
The CBN thereafter reduced its monetary policy rate from 13.5% to 12.5% for the first time since March 2019.
What this means: This survey is a bellwether for economic growth in Nigeria and helps the central bank gauge the mood of businesses in the economy.
PMI above 50 typically indicates a positive mood for the manufacturing and non-manufacturing sectors. Two major causes for concern in the data are the new orders and employment levels.
At 42.8 points, the new orders index declined after thirty-sixth consecutive months of growth, indicating declines in new orders in May 2020. Three subsectors reported growth, 2 remained unchanged while 9 recorded declines in the review month.
Covid-19 Update in Nigeria
On the 3rd of June 2020, 348 new confirmed cases and 1 death were recorded in Nigeria bringing the total confirmed cases recorded in the country to 11,166.
The spread of novel Corona Virus Disease (COVID-19) in Nigeria continues to rise as the latest statistics provided by the Nigeria Centre for Disease Control reveal Nigeria now has 11,166 confirmed cases.
On the 3rd of June 2020, 348 new confirmed cases and 1 death were recorded in Nigeria.
To date, 11166 cases have been confirmed, 3329 cases have been discharged and 315 deaths have been recorded in 35 states and the Federal Capital Territory having carried out 69,801 tests.
Covid-19 Case Updates- 3rd June 2020
- Total Number of Cases – 11,166
- Total Number Discharged – 3,329
- Total Deaths – 315
- Total Tests Carried out – 69,801
The 348 new cases are reported from 19 states- Lagos (163), FCT (76), Ebonyi (23), Rivers (21), Delta (8), Nasarawa (8), Niger (8), Enugu(6), Bauchi (5), Edo(5), Ekiti (5), Ondo (5), Gombe (5), Benue(4), Ogun (2), Osun (1), Plateau (1), Kogi (1), Anambra (1).
The latest numbers bring Lagos state total confirmed cases to 5440, followed by Kano (970), Abuja at 763, Katsina (371), Edo (341), Oyo (317), Kaduna (297), Borno (296), Ogun (282), Jigawa (274), Rivers (269), Bauchi (246), Gombe (169), Sokoto (115).
Kwara State has recorded 111 cases, Plateau (109), Delta (106), Nasarawa (88), Zamfara (76), Ebonyi (63), Yobe (52), Osun (47), Akwa Ibom (45), Adamawa (42), Niger (41), Imo (39), Kebbi and Ondo (33), Ekiti (25), Enugu (24), Bayelsa (21), Taraba (18), Abia (15), Benue (13), Anambra (12), while Kogi state has recorded only 3 cases.
Lock Down and Curfew
In a move to combat the spread of the pandemic disease, President Muhammadu Buhari directed the cessation of all movements in Lagos and the FCT for an initial period of 14 days, which took effect from 11 pm on Monday, 30th March 2020.
The movement restriction, which was extended by another two-weeks period, has been partially put on hold with some businesses commencing operations from May 4. On April 27th, 2020, President Muhammadu Buhari declared an overnight curfew from 8 pm to 6 am across the country, as part of new measures to contain the spread of the COVID-19. This comes along with the phased and gradual easing of lockdown measures in FCT, Lagos, and Ogun States, which took effect from Saturday, 2nd May 2020, at 9 am.
|Date||Confirmed case||New cases||Total deaths||New deaths||Total recovery||Active cases||Critical cases|
|June 3, 2020||11166||348||315||1||3329||7522||7|
|June 2, 2020||10819||241||314||15||3239||7266||7|
|June 1, 2020||10578||416||299||12||3122||7157||9|
|May 31, 2020||10162||307||287||14||3007||6868||7|
|May 30, 2020||9855||553||273||12||2856||6726||7|
|May 29, 2020||9302||387||261||2||2697||6344||7|
|May 28, 2020||8915||182||259||5||2592||6064||7|
|May 27, 2020||8733||389||254||5||2501||5978||7|
|May 26, 2020||8344||276||249||16||2385||5710||7|
|May 25, 2020||8068||229||233||7||2311||5524||7|
|May 24, 2020||7839||313||226||5||2263||5360||7|
|May 23, 2020||7526||265||221||0||2174||5131||7|
|May 22, 2020||7261||245||221||10||2007||5033||7|
|May 21, 2020||7016||339||211||11||1907||4898||7|
|May 20, 2020||6677||284||200||8||1840||4637||7|
|May 19, 2020||6401||226||192||1||1734||4475||7|
|May 18, 2020||6175||216||191||9||1644||4340||7|
|May 17, 2020||5959||388||182||6||1594||4183||7|
|May 16, 2020||5621||176||176||5||1472||3973||7|
|May 15, 2020||5445||288||171||3||1320||3954||4|
|May 14, 2020||5162||193||168||3||1180||3815||4|
|May 13, 2020||4971||184||164||6||1070||3737||4|
|May 12, 2020||4787||146||158||6||959||3670||4|
|May 11, 2020||4641||242||152||10||902||3589||4|
|May 10, 2020||4399||248||142||17||778||3479||4|
|May 9, 2020||4151||239||127||11||745||3278||4|
|May 8, 2020||3912||386||118||10||679||3115||4|
|May 7, 2020||3526||381||108||4||601||2818||4|
|May 6, 2020||3145||195||104||5||534||2507||1|
|May 5, 2020||2950||148||99||5||481||2370||4|
|May 4, 2020||2802||245||94||6||417||2291||2|
|May 3, 2020||2558||170||88||2||400||2070||2|
|May 2, 2020||2388||220||86||17||351||1952||2|
|May 1, 2020||2170||238||69||10||351||1751||2|
|April 30, 2020||1932||204||59||7||317||1556||2|
|April 29, 2020||1728||196||52||7||307||1369||2|
|April 28, 2020||1532||195||45||4||255||1232||2|
|April 27, 2020||1337||64||41||0||255||994||2|
|April 26, 2020||1273||91||41||5||239||994||2|
|April 25, 2020||1182||87||36||3||222||925||2|
|April 24, 2020||1095||114||33||1||208||855||2|
|April 23, 2020||981||108||32||3||197||753||2|
|April 22, 2020||873||91||29||3||197||648||2|
|April 21, 2020||782||117||26||3||197||560||2|
|April 20, 2020||665||38||23||1||188||466||2|
|April 19, 2020||627||86||22||2||170||436||2|
|April 18, 2020||541||48||20||2||166||356||2|
|April 17, 2020||493||51||18||4||159||317||2|
|April 16, 2020||442||35||13||1||152||277||2|
|April 15, 2020||407||34||12||1||128||267||2|
|April 14, 2020||373||30||11||1||99||263||2|
|April 13, 2020||343||20||10||0||91||242||2|
|April 12, 2020||323||5||10||0||85||228||2|
|April 11, 2020||318||13||10||3||70||238||2|
|April 10, 2020||305||17||7||0||58||240||2|
|April 9, 2020||288||14||7||1||51||230||2|
|April 8, 2020||274||22||6||0||44||226||2|
|April 7, 2020||254||16||6||1||44||204||2|
|April 6, 2020||238||6||5||0||35||198||2|
|April 5, 2020||232||18||5||1||33||194||2|
|April 4, 2020||214||5||4||0||25||185||0|
|April 3, 2020||209||25||4||2||25||180||0|
|April 2, 2020||184||10||2||0||20||162||0|
|April 1, 2020||174||35||2||0||9||163||0|
|March 31, 2020||139||8||2||0||9||128||0|
|March 30, 2020||131||20||2||1||8||121||0|
|March 29, 2020||111||22||1||0||3||107||0|
|March 28, 2020||89||19||1||0||3||85||0|
|March 27, 2020||70||5||1||0||3||66||0|
|March 26, 2020||65||14||1||0||2||62||0|
|March 25, 2020||51||7||1||0||2||48||0|
|March 24, 2020||44||4||1||0||2||41||0|
|March 23, 2020||40||10||1||1||2||37||0|
|March 22, 2020||30||8||0||0||2||28||0|
|March 21, 2020||22||10||0||0||1||21||0|
|March 20, 2020||12||4||0||0||1||11||0|
|March 19, 2020||8||0||0||0||1||7||0|
|March 18, 2020||8||5||0||0||1||7||0|
|March 17, 2020||3||1||0||0||0||3||0|
|March 16, 2020||2||0||0||0||0||2||0|
|March 15, 2020||2||0||0||0||0||2||0|
|March 14, 2020||2||0||0||0||0||2||0|
|March 13, 2020||2||0||0||0||0||2||0|
|March 12, 2020||2||0||0||0||0||2||0|
|March 11, 2020||2||0||0||0||0||2||0|
|March 10, 2020||2||0||0||0||0||2||0|
|March 9, 2020||2||1||0||0||0||2||0|
|March 8, 2020||1||0||0||0||0||1||0|
|March 7, 2020||1||0||0||0||0||1||0|
|March 6, 2020||1||0||0||0||0||1||0|
|March 5, 2020||1||0||0||0||0||1||0|
|March 4, 2020||1||0||0||0||0||1||0|
|March 3, 2020||1||0||0||0||0||1||0|
|March 2, 2020||1||0||0||0||0||1||0|
|March 1, 2020||1||0||0||0||0||1||0|
|February 29, 2020||1||0||0||0||0||1||0|
|February 28, 2020||1||1||0||0||0||1||0|
Nigeria’s tier-1 banks earn N18.4 billion from account maintenance charges in Q1 2020
Banks’ earnings from account maintenance charges, though low when compared to other revenue streams, still make up a significant portion of their non-interest income.
Nigeria’s tier-1 banks — comprised of First Bank, UBA, GTBank, Access Bank, and Zenith Bank (FUGAZ) — generated a total of N18.4 billion from bank maintenance charges in Q1 2020. The sum is 17.12% more than N15.6 billion that was generated by the five banks during the comparable period in 2019.
This is according to recent checks by Nairametrics Research, a breakdown of which revealed that Zenith Bank generated the most income from account maintenance fees, followed by Access Bank and then, GTBank.
See the breakdown below.
- Zenith Bank Plc: N5.7 billion
- Access Bank Plc: N3.9 billion
- Guaranty Trust Bank Plc: N3.3 billion
- First Bank Plc: N3.1 billion
- United Bank for Africa Plc: N2.3 billion
What you should know about account maintenance charges
Banks’ earnings from account maintenance charges, though low when compared to other revenue streams, still make up a significant portion of their non-interest income.
According to the latest directive by the Central Bank of Nigeria on bank charges, Nigerian banks are allowed to charge their customers a “negotiable” N1 per mille. What this means is that banks can charge N1 per N1000 debit transactions on current accounts. Banks’ account maintenance charges come in the form of COT (i.e., Commission on Turnover) which is a charge levied on customer withdrawals by their banks. In Nigeria, these charges are mainly applicable to current accounts.
“Current Account Maintenance Fee (CAMF): Applicable to current accounts ONLY in respect of customer-induced debit transactions to third parties and debit transfers/lodgments to the customer’s account in another bank. Note that CAMF is not applicable to Savings Accounts,” said part of the CBN directive.
Customers don’t like account maintenance charges
Interestingly, a lot of Nigerian bank customers are not keen on bank maintenance charges. After all, nobody likes to get debit alerts, especially so when such is coming from their banks. Perhaps, the main reason some customers dislike bank maintenance charges is because they tend to be higher than the interest capitalised entitled to such customers. Professor Ayobami Ojebode of the Department of Communications and Language Arts, University of Ibadan, recently complained about this, saying:
“Dear bank, I see o! Don’t think I don’t see you! You credit me N50 interest on my savings and debit N150 for account maintenance & card fee etc! Come here, what do you really think you are doing?”