The Minister of Finance, Budget and National Planning, Zainab Ahmed, has disclosed that the Federal Government is monitoring proceedings of the planned currency change, Eco. The currency change involves eight West African countries of the Economic Community of West African States (ECOWAS).
Ahmed said the Nigerian government would respond to the decision by the ECOWAS members to adopt the Eco as the region’s currency, but it is still monitoring related activities.
“Nigeria has received the news of the change of name of the UEMOA (The West African Monetary and Economic Union) currency, the CFA to Eco supposedly as ECOWAS single currency. Nigeria is studying the situation and would respond in due course.”
The decision to adopt Eco as ECOWAS’ single currency began 30-years ago, however, due to failure to reach a resolution, the single currency plan has been delayed to date, with countries like Benin Republic, Burkina Faso, Guinea-Bissau, Ivory Coast, Mali, Niger, Senegal and Togo set to adopt the new currency regime next year, January 2020.
Nigeria’s economy and Naira at risk: Nigeria, which is the continent’s largest economy and the largest contributor to the region’s gross domestic product (GDP) by 75%, may soon have to contend with a challenge following this development.
Analysts are of the opinion that the adoption of the new single currency for trade within the region might have a catastrophic effect on Nigeria’s economy and the Naira. They have termed the move a “premature ideology” considering the region’s trade agreement which Nigeria has yet to sign.
As Nairametrics earlier reported, a report by SB Morgen opined that the adoption of a unified currency system may several shortcomings. The report also highlighted some major economic issues that call for concern. Aside from the Eco sending the Naira into extinction, it could also affect the monetary authority in Nigeria or the CBN losing its power to adjust the interest and exchange rates.
Will FG favour Eco over Naira? Although the Minister of Finance has stated that the agreed date, January 2020, is not realistic because only Togo had met the criteria necessary for the adoption of the single market currency, but with the possible loss of control on monetary policy and the possible implications on Nigeria’s economy, it’s unclear if Nigeria will go ahead with Eco currency, dumping Naira, a national symbol which portrays the nation’s independent and identity in trade.
Heavy sell-off in Guinness shares leads to N6.9 billion market value loss in a single day
Shares of Guinness Nigeria Plc suffered a 9.89% loss today.
Guinness Nigeria Plc suffered a 9.89% loss today following a heavy sell-off in the shares of the brewer. This triggered a market value loss amounting to about N6.9 billion at the close of trading activities on the Nigerian Stock Exchange, as investors scaled-down stakes in the brewer.
Data tracked at the close of the market today revealed that the shares of GUINNESS declined from N31.85 per share at the market open, to N28.70 per share at the close of the market today, to print a loss of 9.89%.
This decline saw the market capitalization of the leading maker of beer and spirits fall from N69.75 billion to N62.86 billion at the close of trading activities today, putting the total market value loss at N6.89 billion.
The shares of Guinness at the close of the market today cleared at N28.70 per share, 9.89% lower than the closing price of N31.85 per share yesterday.
At the current price, Guinness shares are currently trading 20.27% lower than their 52-week high of N36.00 per share. However, the shares of the company have returned about 120.8% gains for investors who bought them at their 52-week low trading price of N13.00 per share last week.
During trading hours on the Exchange today, about 159,380 ordinary shares of Guinness Nigeria Plc worth about N4.57 million, were exchanged in 27 executed deals.
The shares of Nigerian Breweries Plc and Golden Guinea Breweries Plc closed flat at N50.1 per share and N0.81 per share respectively, while the shares of International Breweries Plc shed 0.88% to close low today at N5.65 per share.
What you should know
- At the close of trading activities today, the NSE All-Share Index and market capitalization appreciated by 0.29% to close higher at 39,128.34 index points and N20.477 trillion respectively.
- The NSE Consumer Goods Index, an investable benchmark designed to track the performance of the shares of consumer goods companies like Guinness Nigeria Plc, depreciated by -0.35% to close the day lower at 553.26 index points.
NAICOM revokes operational licence of UNIC Insurance, appoints Receiver/Liquidator
NAICOM stated that it had appointed Hadiza Baba Gimba as the Receiver/Liquidator to wind up the affairs of the company.
The National Insurance Commission (NAICOM) on Wednesday announced the withdrawal of the operational licence issued to UNIC Insurance Plc.
Although no official reason has been provided for the revocation of the insurance firm’s operating license, NAICOM, however, stated that the decision of the regulator was in the exercise of the powers conferred on it by the enabling laws.
According to a report from the News Agency of Nigeria (NAN), this disclosure is contained in a notice which was issued by the commission in Lagos to the general public and policyholders, where it noted that the revocation of the operational license, RIC 043, is with effect from March 25.
NAICOM, thereafter stated that it had appointed Hadiza Baba Gimba as the Receiver/Liquidator to wind up the affairs of the company.
NAICOM in its statement said, “The general public/policyholders are by this notice required to direct all inquiries and correspondence regarding UNIC Insurance to the receiver/liquidator.
The receiver/liquidator will be dealing with the company’s liabilities in accordance with the provision of Insurance Act 2003.’’
What you should know
- It can be recalled that NAICOM, for the third time in June 2020, gave insurance firms in the country a one-year extension to meet the recapitalisation obligation that was recently set for them apparently due to the coronavirus pandemic which had disrupted the activities of most insurance companies.
- Some insurance companies had been going through some bad patches with a good number of them struggling to meet up with their obligations and the recapitalization requirements.
- The recapitalisation programme requires life insurance firms to meet a minimum paid-up capital of N8.0 billion, up from N2.0 billion previously. In the same vein, general insurance companies are required to raise their minimum paid-up capital to N10.0 billion from N3.0 billion previously.
- The regulatory capital for composite insurance was raised to N18.0 billion from N5.0 billion previously while reinsurance businesses are now required to have a minimum capital of N20.0 billion from a previous N10.0 billion.
Nairametrics | Company Earnings
Access our Live Feed portal for the latest company earnings as they drop.
- VFD Group set to raise additional capital of N9.01 billion through rights issue and private placement.
- GT Bank records a 9% dip in profit to N45.55 billion in Q1 2021.
- Secure Electronic Technology Plc records a 121% surge in Profit after tax in Q1 2021.
- Lafarge Africa Plc notifies stakeholders of 62nd Annual General Meeting.
- GlaxoSmithKline (GSK) announces Annual General Meeting.