Business News
GTBank, Zenith rake in over N30 billion from Electronic Business fees
Two of Nigeria’s biggest banks, Zenith Bank and GTBank, reported record-high profits of N193 billion and N184.6 billion in 2018.
Two of Nigeria’s biggest banks, Zenith Bank and GTBank, reported record-high profits of N193 billion and N184.6 billion (respectively) for the fiscal year ended December 2018. The banks were able to achieve this on the back of a rather slow economy, where most businesses struggled to grow topline revenues.
A major contributing factor to both companies’ revenues and bottom lines is the money they earned from their electronic products. Electronic products, for most banks, refers to income from online transfers and transactions using a mobile phone application, etc.
Earnings keep rising – In 2018, Zenith Bank reported total fees of N20.4 billion from their electronic product, compared to N14.1 billion in 2017. GT Bank, on the other hand, realised a total of N9.5 billion in 2018 compared to N7.4 billion in 2017.
Why it matters – Despite being the two of Nigeria’s biggest banks, Zenith and GTBank fell behind the likes of FBNH and UBA in terms of earnings from the e-business market segment.
Last year, the five biggest banks in Nigeria — First Bank, UBA, GTBank, Access Bank, and Zenith Bank (collectively known as FUGAZ) — made a total of N68.1 billion from electronic fees. This was a 4.2% drop compared to the N71.7 billion reported in 2017.
Growth Industry – Nigeria’s e-payment industry is fast growing, with billions of transactions taking place monthly. According to data from the National Bureau of Statistics, Nigeria’s electronic payment market (which is made up P.O.S, mobile payments, internet web, and e-bills), has a transaction value of about N426 billion per month.
Nigerian Banks see this as an area of incremental revenue and have invested billions in this segment of the financial services sector. The CBN has also played its part by pushing banks to support its financial inclusion policy.
Fintech Angle – In Nigeria, several Fintech startups have also made inroads into the financial services space as they all jostle for a growing industry with seemingly huge opportunities for everyone. Thus, a peep into the results of banks provides an idea into how huge the industry is. Fintech companies are also valued based on the potential fees they can earn from transactions.
Business News
Ecobank Transnational to hold AGM by proxies on June 30th
Due to the ravaging Coronavirus pandemic, ETI said the AGM will be held by proxies.
Ecobank Transnational Incorporated (ETI) has announced the date and venue of its 32nd Annual General Meeting (AGM). According to a disclosure that was sent to the Nigerian Stock Exchange, the company’s AGM and an Extraordinary Meeting are scheduled to hold on June 30th, 2020, at Eko Hotels and Suites in Victoria Island, Lagos.
Due to the ravaging Coronavirus pandemic, ETI said the AGM will be held by proxies. The proxy AGM is expected to enable the Pan-African financial institution to abide by the directives issued by governments and agencies regarding COVID-19 and how to contain its spread.
“As a responsible corporate citizen, ETI intends to strictly comply with this restriction in addition to other applicable health and safety measures. Accordingly, attendance at this year’s General Meetings shall be mainly by proxies in accordance with the Articles of Association of the Company and applicable law,” a statement by the company said.
To this end, shareholders have been advised to select any of the company’s top executives (including the Chairman, Emmanuel Ikazoboh, and the MD of Ecobank Nigeria, Patrick Akinwuntan) to represent and vote on their behalf during the AGM. Proxy forms may be downloaded from the company’s website, filled, and submitted in advance.
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Meanwhile, the issues that are up for discussion during the AGM and the Extra Ordinary meeting are enumerated below.
Annual General Meeting
1. Approval of the accounts
2. Appropriation of the Profits
3. Election of Directors
4. Ratification of the co-option of directors
5. Renewal of the appointment of the joint auditors
6. Approval of the Final Board Fees for Retiring Directors
Extraordinary General Meeting
1. Withdrawal of resolution on consolidation of shares
2. Amendment of the Articles
Note that in Q1 2020, ETI reported profited after-tax from continuing operation of N66.4 billion, marking a 19% decline when compared to N81.9 billion during the comparable period in 2019.
ETI’s share price on the Nigerian Stock Exchange closed Friday’s trading session at N5.55. The company has a market capitalisation of about N137.3 billion according to information obtained from Bloomberg.
Business News
NNPC explains measures to cut cost of crude oil production
Ewubare stated that NNPC was looking very closely at such variables as logistics, security, and transportation with a view to reducing the cost of production to $10 per barrel or below.
The Nigerian National Petroleum Corporation (NNPC) has said that it is taking some measures to bring down the cost of crude oil production to $10 per barrel or below.
According to a press statement that was signed by NNPC’s Group General Manager, Group Public Affairs Division, Dr. Kennie Obateru, this was disclosed by the Corporation’s Chief Operating Officer (COO), Ventures and Business Development, Mr. Roland Ewubare, on a Channels TV breakfast programme on Friday, June 5, 2020.
Ewubare pointed out that the peculiarity of the terrain was an important factor in determining cost, with such issues as pipeline vandalism, crude oil theft, and some others being critical factors that are peculiar to the Nigerian terrain and would definitely drive up crude oil production cost in the country.
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He, however, stated that NNPC was looking very closely at such variables as logistics, security, and transportation with a view to reducing cost of production to $10 per barrel or below.
He disclosed that much had been done over the years in the area of reducing contracting cycle which used to be a major factor responsible for high cost of production, stressing that the National Petroleum Investment Management Services (NAPIMS) achieved a six-month contracting cycle under him as Group General Manager.
Mr. Ewubare denied reports that Nigeria is part of OPEC+ member countries that did not comply with the output cut that was agreed by the alliance
Mr. Ewubare explained that though Nigeria’s total production capacity was 2.3million barrels per day, it was currently producing only about 1.4million barrels per day in compliance with the OPEC+ production quota, stressing that what makes up the little extra over the 1.4mbpd figure being bandied around for Nigeria was condensate which is usually not computed as part of production in OPEC quota.
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While making some clarification, Ewubare said, “There’s some confusion in the market around the parameters for the production cuts. Nigeria has a full production capacity of about 2.3mbpd. We are currently producing between 1.6 and 1.7mbpd. Our OPEC quota as a result of the cuts is about 1.4mbpd. You and I know that condensate is not included in the computation of the cut numbers. So what we have is 1.4mbpd of crude oil. The little you see above 1.4mbpd is made up of condensate which does not count as part of the basis for assessing our OPEC quota”.
NNPC Group Managing Director, Mallam Mele Kyari, in a recent interview, advanced a similar position where he stressed that NNPC was working assiduously to bring down the cost of crude oil production to not more than $10 per barrel by 2021.
Business News
NNPC raises alarm over low grade, contaminated diesel in the market
This warning was contained in a report by the Managing Director, NNPC Retail Limited Managing Director, Dr. Billy Okoye, who also admonished motorists to be careful of the off-spec products.
The Nigerian National Petroleum Corporation (NNPC) has raised alarm over the circulation of low grade and contaminated AGO, popularly known as diesel, which is offered at discounted prices in some parts of the country.
This was disclosed in a press release by the Group General Manager, Group Public Affairs Division, Dr Kennie Obateru, on Friday June 5, 2020.
This warning was contained in a report by the Managing Director, NNPC Retail Limited Managing Director, Dr. Billy Okoye, who also admonished motorists to be careful of the off-spec products.
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The state oil giant, in the press statement, said, “The Nigerian National Petroleum Corporation (NNPC) has raised an alarm over prevalent low grade and contaminated AGO, otherwise called diesel, offered at discounted prices in parts of the country.”
Dr. Okoye, stated that the warning became necessary because the low grade contaminated diesel is harmful to machines and the environment. He explained that NNPC Retail Ltd is a market leader and therefore considered it incumbent upon it to alert the general public on the circulation of these low grade products.
While urging consumers of the product to patronize the oil firm’s service stations where the quality of their products was assured, Dr. Okoye gave assurances that NNPC Retail Limited dealt only in premium high-quality products in the interest of Nigerian motorists and users.
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Unlike the premium motor spirit otherwise known as petrol, which was operating a fixed price regime and had NNPC as the sole importer, the diesel products were deregulated and had other independent marketers apart from NNPC importing the products as well.
The intense competition and unhealthy drive for profit, in addition to poor regulation, could have given rise to this.
