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 release of quarterly and full year results, 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 in the coming week.
Corporate Actions that took place last week
Saved by the Courts
Oando Plc remained in the headlines this week, as the company obtained an injunction from a Federal High Court restraining the Securities and Exchange Commission (SEC) from appointing an interim management team.
Daar Communications Plc informed the Nigerian Stock Exchange (NSE) that it had resumed operations. The company was briefly shut down this week, following the suspension of its operating licence by the National Broadcasting Commission (NBC). It subsequently obtained a court injunction which mandated a return to the status quo.
The firm will however continue to engage with the NBC, the government and the public on the issue.
Oghogho Akpata and Sena Anthony, who were non Executive Directors of Oando Plc, have stepped down.
Akpata is the Managing Partner of Templars, a prominent law firm. Ms. Anthony had a long and distinguished career with the Nigerian National Petroleum Corporation (NNPC) before retiring as Group Executive Director Level Corporate Secretariat and Legal Division, after spending thirty four years.
While no reasons were given for their actions, it may be linked to the SEC’s decisions following the forensic audit conducted.
The duo are reportedly among several non Executive Directors asked to step down from the board, and refund certain payments collected, to the company.
Dangote Sugar Refinery Plc, Law Union and Rock Insurance Plc, NEM Insurance Plc, Julius Berger Nigeria Plc, The Initiates Plc, BOC Gases Nigeria Plc, Dangote Cement Plc, and Forte Oil Plc were all marked down this week.
A markdown simply means that a proposed dividend or bonus, is subtracted from the stock’s share price.
Dangote Sugar Refinery Plc was marked down by N1.10. Law Union and Rock Insurance Plc was marked down by N0.02. NEM Insurance Plc was marked down by N0.13. Julius Berger Nigeria Plc was marked down by N2. The Initiates Plc was marked down by N0.05. BOC Gases Plc was marked down by N0.40. Dangote Cement Plc was marked down by N16. Forte Oil Plc was marked down by N1.15.
While the dividend payment has been subtracted from the respective share prices, payment to shareholders will take place on or after Annual General Meetings have been held.
ETranzact International Plc has confirmed the appointments of Oluwaniyi Tolulope as substantive Managing Director/CEO, and Hakeem Adeniji Adele as Deputy Managing Director.
Last year in May, the Central Bank of Nigeria instructed the erstwhile Managing Director, Valentine Obi and two Executive Directors, Sullivan Akala and Ike Eze to step down. The Chief Technology Officer (CTO) Richard Omoniyi and Chief Operating Officer (COO), Kehinde Segun, also resigned. The action was taken following the fraud that had taken place using the company’s platform.
CAP Plc’s board has appointed two non Executive Directors Mrs, Muhibat Abass and Mrs Bolarin Okunowo.
Ecobank Transnational Incorporated announced the over subscription of its $50 million bond, issued at 8.25%. The bonds will be consolidated and form a single series with the $450 million 9.5% issued in April 2019 and due in April 2024.
The proceeds will be used for ETI’s general corporate purposes and will further strengthen the liquidity of ETI.
Corporate Actions taking place next week
Wapic Insurance Plc, Oando Plc, NASCON Allied Industries Plc, Okomu Oil Palm Plc, and Eterna Plc will be holding their Annual General Meetings (AGMs).
Union Bank of Nigeria Plc will also hold an Extraordinary General Meeting (EGM), as it seeks shareholders’ approval to net accumulated permanent losses from legacy transactions amounting to N54.4 billion against its share premium.
Credit arising from this transaction will be used to eliminate the bank’s retained losses for the 2018 financial year.
The balance sheet restructuring proposed will not affect the bank’s authorized or issued share capital or regulatory capital, but enable it pay dividends in the near future.
COVID-19 Update in Nigeria
On the 5th of June 2020, 328 new confirmed cases and 10 deaths were recorded in Nigeria bringing the total confirmed cases recorded in the country to 11,844.
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 11,844 confirmed cases.
On the 5th of June 2020, 328 new confirmed cases and 10 deaths were recorded in Nigeria.
To date, 11844 cases have been confirmed, 3696 cases have been discharged and 333 deaths have been recorded in 35 states and the Federal Capital Territory having carried out 73,064 tests.
COVID-19 Case Updates- 5th June 2020
- Total Number of Cases – 11,844
- Total Number Discharged – 3,696
- Total Deaths – 333
- Total Tests Carried out – 73,064
The 328 new cases were reported from 14 states- Lagos (121), FCT (70), Bauchi (25), Rivers (18), Oyo (16), Kaduna (15), Gombe (14), Edo (13), Ogun (13), Jigawa (8), Enugu (6), Kano (5), Osun (2), Ondo (2).
The latest numbers bring Lagos state total confirmed cases to 5663, followed by Kano (985), Abuja at 862, Katsina (385), Edo (364), Kaduna (335), Oyo (334), Ogun (329), Borno (322), Rivers (308), Jigawa (282), Bauchi (281), Gombe (184), Kwara (127).
Delta State has recorded 116 cases, Sokoto (115), Plateau (113), Nasarawa (90), Ebonyi (80), Zamfara (76), Yobe (52), Osun (49), Imo (47), Akwa Ibom (45), Adamawa (42), Niger (41), Ondo (38), Kebbi (33), Bayelsa and Enugu (30), Ekiti (25), 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 5, 2020||11844||328||333||10||3696||7815||7|
|June 4, 2020||11516||350||323||8||3535||7646||7|
|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|
CBN debits banks another N459.7 billion for failure to meet CRR target
Sadly, this move, in addition to similar policies by the CBN, has left many banks cash-strapped and unable to pursue various profitable ventures.
The Central Bank of Nigeria (CBN) has debited twenty-six banks, including merchant banks, to the tune of N459.7 billion for failure to meet their CRR (Cash Reserve Ratio) obligations. The fresh debit, which Nairametrics reliably gathered occurred yesterday, has left many stakeholders in the banking sector very upset.
The details: Among the banks that were most affected are United Bank for Africa Plc (N82.3 billion), First Bank of Nigeria Ltd (N59.3), Zenith Bank Plc (N50 billion), First City Monument Bank (FCMB) Limited (N45 billion), and Guaranty Trust Bank Plc (N40 billion). The rest of the affected banks can be seen in the table below.
Note that the latest CRR debits are coming barely one month after a lot of banks were collectively debited to the tune of N1.4 trillion for the same reason in April. Between then and now, a lot of other minor CRR debits have occurred. Nairametrics understands that the apex bank now debits banks on a weekly basis.
Some backstory: During the CBN’s Monetary Policy Committee (MPC) meeting that was held last month, committee members voted to retain CRR rate at 27.5%. The rate was increased in January this year from 5% to its current level after the apex bank cited inflationary pressure concerns. What this means, therefore, is that Nigerian banks are required to keep 27.5% of their deposits as CRR with the Central Bank of Nigeria.
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But banks are silently upset: Sadly, this move, in addition to similar policies by the CBN, has left many banks cash-strapped and unable to pursue various profitable ventures. While reacting to the latest development, a banker who refused to be identified, said:
“What we’ve seen in recent times is that the CBN just indiscriminately debits banks, usually towards the stale-end of every week. They will look at your bank account and if your liquidity is plenty, they will debit you.
“You know the central bank also does what we call retail FX intervention, that is when they sell FX to corporates. Now, because they don’t want banks coming with huge demands, what they do is that a day before the FX sales, they debit the banks so that the naira you have available is small and you cannot put them under pressure because of your FX demands. That has really been the driver.
“We understand that the central bank had set up a special CRR team that is supposed to monitor banks’ CRR once a month. But now, the team monitors banks’ CRR on a weekly basis. This is why the central bank is effectively debiting banks on a weekly basis. Some weeks ago, they debited some banks about N1.4 trillion. That was one of many. Between that time and now, there have been more debits that have happened. But the debits that are huge/significant are what is troubling the banks. There was a N300 billion that happened about two weeks ago. and then yesterday that was this N459.7 billion that was also debited.
“These are huge amounts that are leaving the banking sector. It’s a squeeze on the banks. A bank like First Bank, for instance, has about N1.4 trillion in CRR with the Central Bank. And there is Zenith Bank with equally as much as N1.5 trillion. These are monies that banks can potentially put in loans at 52% at 30%, or even put in money market instruments at maybe 10%. So, for a shareholder of these banks, this CRR debits are impairing the banks’ ability to increase their earnings because now are not able to use the funds that are legitimately theirs to create money for their shareholders. And the question is that under what framework is the Central Bank choosing to take people’s money?”
Understanding CRR: The cash reserve requirement is the minimum amount banks are expected to retain with the Central Bank of Nigeria from customer deposits. In January, the CRR was increased from 5% to 27.5% by the CBN Monetary Policy Committee (MPC) who explained that the decision was intended to address monetary-induced inflation whilst retaining the benefits from the CBN’s LDR policy.
Precious metals slump, investors focus on Central Bank’s intervention
Gold fell on Friday morning to $1,717.10. as global investors await the release of Friday’s U.S non-farm payrolls data for May
Spot gold went slightly lower, trading at $1,711.57 per ounce by 4 am local time on Friday morning and gold futures was down to $1,717.10.
“Gold collapsed like a house of cards as investors overlooked civil unrest in the United States and heavily focused on hopes around central bank intervention and economic recovery,” said Lukman Otunuga, senior research analyst at FXTM.
Gold fall on Friday morning also came as global investors await the release of Friday’s U.S (United States.) non-farm payrolls data for May, scheduled to be released at 1.30 pm Nigerian local time.
“There are quite a few market participants still bargain-hunting gold given the fundamental backdrop of the coronavirus crisis and ongoing recession,” Julius Baer analyst Carsten Menke said.
However, investors are still waiting to see whether the easing of restrictions will lead to a second wave of infections, supporting demand for gold, Menke added.
What you need to know about Precious metals: Precious metals include gold, silver, and platinum. Gold and silver are the most popular metals, and have been used by jewelers, and as wealth status symbols since ancient times. Global investors use precious metals to hedge against inflation.
Meanwhile, palladium gained 0.34% to $1,947 an ounce, while platinum lost 0.31% to $833.91. Silver was down 0.63% to $17.9 4am local time, having hit a more than three-month high of $18.36 on Monday.
“Some people are buying silver just because it’s much cheaper than gold (or) platinum,” a trader from Tokyo-based retailer Tokuriki Honten said.