Akeem ReachnaijaJune 12, 2019


Fitch Ratings, a global ratings agency has stated that Nigeria will continue to experience sluggish recovery following a weak business climate, regulatory uncertainty in the oil sector and tight credit supply which has held back investment.  The agency which predicted that the country’s GDP growth would average 2.2 per cent in 2019-2020, below its previous 10-year average of 4.2 per cent and the current ‘B’ median of 3.4 per cent, added that the high unemployment and inflation would constrain private consumption.

Fitch who affirmed the country’s long-term foreign-currency issuer default rating at ‘B+’ with a stable outlook, stated that Nigeria will continue to experience a sluggish recovery, driven by the rebound in oil prices and the expansion of services.

“A large infrastructure deficit, which is illustrated by acute power supply shortages and security challenges, also dampen the medium-term growth outlook. Nigeria’s ratings are supported by the large size of its economy, a track record of current account surpluses and a relatively low general government debt-to-GDP. This is balanced against poor governance and development indicators, structurally low fiscal revenues and high dependence on hydrocarbons. The rating is also weighed down by subdued GDP growth and inflation that is higher than in rating peers,” it said.

Akeem ReachnaijaMay 21, 2019


The attention of The Nigerian Stock Exchange (NSE or The Exchange) has been drawn to a few critical issues raised in various print and social media platforms regarding the listing of MTN Nigeria Communications Plc (MTN Nigeria) on the Premium Board of the Exchange. As an Exchange that is committed to operating a fair, orderly and transparent market, we deem it important to clarify these issues.

Paucity of MTN Shares on the Floor

MTN Nigeria Listed by Introduction. Where a company lists following an Initial Public Offering, shares are expected to be available for trading on the day of listing. In a Listing by Introduction, however, no shares have been offered for subscription by the company prior to listing. Thus, without any intervention, it is possible that there will be no shares available for trading on the listing date. Indeed, currently, no rule of The Exchange compels shareholders in a listed company to tender their shares for trading. Shareholders are at liberty to trade their shares at any time and price suitable to them. Thus, in order to stimulate trading in the shares of companies that List by Introduction, the NSE’s practice is to urge the company to make shares available on the day of listing. In the case of MTN Nigeria, the NSE used and will continue to use moral suasion to get MTN Nigeria to make available shares daily, pending its Initial Public Offer.

Since the listing of MTN Nigeria on Thursday, May 16, 2019, a total of 105,301,759 shares valued at N12,231,997,316 have traded in three days. These trades were carried out by ten (10) dealing member firms in 134 cross deals/negotiated deals. According to the rule book of the Exchange, “When a Dealing Member or Authorized Clerk has an order to buy and an order to sell the same security at the same price, the Dealing Member or Authorized Clerk may “cross” those orders at a price at or within The Exchange best bid or offer”. A variant of this is the negotiated deal, which describes a situation where a cross-deal is executed between two dealing member firms at a price which may be within the Exchange’s best bid or offer or with the approval of the Exchange, outside the best bid or offer. Because cross deals involve clients of the same stockbroker on both sides of a trade, significant issues have been raised about the fact that stockbrokers who have not been involved in the cross deals have not been able to trade on behalf of their clients. The Exchange is not unconcerned about this state of affairs.

As an Exchange that champions transparency and equity for all stakeholders in our market, we have received stakeholder feedback concerning our present rules on cross dealing and will consider the issues raised as part of our sustained efforts to ensure our market remains equitable for all stakeholders.

MTN Nigeria’s Free-Float Valuation

There appears to be a misconception that a concession was given to MTN Nigeria on the minimum free float required for companies listed on The Exchange. According to the Rules Governing Free Float Requirements for Issuers Listed on The Nigerian Stock Exchange, free float is defined as the number of shares that an Issuer has outstanding and available to be traded on The Exchange. It includes all shares held by the investing public, and excludes shares held directly or indirectly by promoters, directors and their close relatives; strategic investors holding five per cent (5%) and above of the issued share capital; or government.

The Exchange’s rules for listing on the Premium Board (which is the board in which MTN Nigeria is listed) require a Company to have a minimum free float of twenty per cent of its issued share capital or that the value of its free float is equal to or above N40 billion on the date the Exchange receives the Issuer’s application to list. MTN Nigeria met with the free float requirement of N40 billion. The free float of MTN at the time of listing was in excess of N160 billion.

Investor protection is very important to us at the NSE and we have taken necessary steps to ensure that our market is fair and orderly. In 2016, we acquired NASDAQ’s SMARTS platform to proactively detect and deter manipulative tendencies, gather intelligence and execute risk-based supervision of flagged participants. We have also implemented other initiatives aimed at providing investors with timely information on the compliance status of our dealing members and issuers including BrokerTrax, our member compliance report, and Compliance Status Indicator (CSI) codes (for issuers). In addition, we have institutionalized our investor education program and launched X-Academy in June 2017, because we have identified investor education as a veritable tool to galvanizing informed investments and necessary step towards protecting investors in our market.

Whilst we believe we have addressed the concerns raised, we will like to assure our stakeholders and the general public that The Exchange will continue to uphold global best practices in its business operations and will sustain engagement with its stakeholders to continually develop regulatory frameworks that ensure our market completely reflects our values of ambition, fairness and inclusion.​

Akeem ReachnaijaMay 17, 2019


MTN Nigeria Communications Plc has just listed its shares on the Nigerian Stock Exchange (NSE), rallying N184 billion gain in first day of trading. The NSE admitted, by way of introduction, 20.35 billion ordinary shares of MTN Nigeria Communications at N90 per share.

The shares, which were listed on the Premium Board of NSE immediately rose by the highest daily allowance price change of 10 per cent or N9 to close at N99 per share. National Council President NSE, Otunba Abimbola Ogunbanjo, said: “We are particularly pleased that MTN Nigeria has joined the prestigious club of companies listed on our Premium Board with this landmark transaction, which will differentiate it as a professionally run telecommunications company with high standards, having met The NSE’s listing criteria.

“A Premium Board listing is a sign of commitment to strong corporate governance, excellence, professionalism, efficiency in service delivery and providing increased returns to shareholders. “It is our expectation that the MTN Nigeria listing, which is the NSE’s 2nd largest, will encourage other telecommunication companies to list their shares on The Exchange, thereby opening the sector up to cheaper, long term capital that will boost innovation and development.”

Chief Executive Officer NSE, Mr. Oscar Onyema, said: “We are delighted to welcome MTN Nigeria to the Exchange. Today’s listing is a promising development in the country’s telecommunications sector and we encourage other players in the sector to explore the different opportunities in the capital markets for raising long term capital.

“As a listing platform of choice, today’s listing will add to our bouquet of diverse investment offerings to the public. “Having MTN Nigeria listed in our market is a testament of The Exchange’s commitment to building a dynamic and inclusive market and creating channels for sustainable investment. This listing will promote liquidity for MTN Nigeria and enhance its value.”

Akeem ReachnaijaMay 17, 2019


The Nigerian Stock Exchange (NSE) opens the week tradings’ on a  bearish note. The All Share-Index (ASI) declined by 1.26% to close at 28,484.44 basis points. Year-to-Date the ASI was down by 9.37%.

The equity market capitalization closed at N10.701 trillion in contrast to N10.842 trillion recorded last week Friday. The market breadth closed with 11 gainers and 30 losers. Okomu Oil led the gainers’ chart while NEM Insurance Plc led the top losers’ chart.

United Capital Plc was the most traded stock by volume. The stock sold 41.2 million units of its shares valued at N289.1 million. Guaranty Trust Bank was the most traded stock by volume. The company sold 37.9 million shares valued at N1.1 billion.

UBA sold 15.9 million units worth N96.8 million. Sterling Bank transacted 13 million units valued at N34.4 million. Transnational corporations of Nigeria ranked in 12.2 million units valued at N14.2 million.

Okomu Oil Palm Company Plc was the best-performed stock for the day. The stock appreciated by 10% to close at N77. Neimeth International Pharmaceuticals plc also appreciated by 10% to close at 55 Kobo.

AG Leventis Nigeria Plc was up by 8.33% to close at 26 Kobo. Africa Prudential Plc appreciated by 7.91% to close at N3.82. Japaul Oil completes the top five gainers for the day. The stock increased by 7.69% to close at 28 Kobo.

NEM Insurance Plc was the worst performed stock for the day. The stock shed 10% to close at N2.25. Chams Plc also depreciated by 10% to close at 36 Kobo. United Capital Plc was down by 9.37% to close at N2.32.

Goldlink Insurance Plc declined by 8.70% to close at 21 Kobo. Jaiz Bank Plc rounds up the top five losers chart. The stock went down by 8% to close at 46 Kobo.

Akeem ReachnaijaApril 29, 2019


Statistics on the performance of the 36 states of the federation obtained by our correspondent showed that the 36 states generated a total of N4.5tn within the five years under review.

This meant that the top four states in IGR generated as much as 60.22 per cent of the total IGR of the subnational governments in the country while the remaining 32 states accounted for the remaining 39.78 per cent or N1.79tn.

Expectedly, Lagos came tops on the table with a total of N1.72tn within the five-year period. With this performance, Lagos alone accounted for 38.22 per cent of the entire IGR generated by the subnational governments in the five-year period.

In 2013, Lagos generated a total of N236.2bn. The performance went up in 2014 with a total of N276.16bn. It went down slightly in 2015 to N268.2bn. In 2016, the state’s IGR went up again to N302.43bn before peaking at N333.97bn in 2017.

Rivers State came a distant second with a revenue performance of N433.9bn. Thus, the state accounted for 9.64 per cent of the total IGR collected by the states in the five-year period.

The state generated N87.91bn; N89.11bn; N82.1bn; N85.29bn and N89.48bn in 2013, 2014, 2015, 2016 and 2017 respectively.

On the third place is Ogun State, which generated a total of N286.67bn within the period of five years. Thus, the state accounted for 6.37 per cent of the total IGR that the 36 states of the federation collected within the same period of time.

The state moved steadily up in the five-year period. The state generated N13.78bn in 2013; N17.5 in 2014; N34.6bn in 2015; N72.98bn in 2016 and N74.84bn in 2017.

On the fourth position in IGR is Delta State, which generated N273.84bn in the five-year period. It, therefore, accounted for 6.09 per cent of the entire IGR collected by the subnational governments in five years.

The state generated N50.21bn; N42.82bn; N40.81bn; N44.06bn and N51.89bn in 2013, 2014, 2015, 2016 and 2017 respectively.

Four other states hit the N100bn mark in the revenues they generated within the period under review. These are Kano, Edo, Oyo and Akwa Ibom.

Kano State generated N148.75bn in the following order: N17.9bn in 2013; N13.66bn in 2014; N13.61bn in 2015; N30.96bn in 2016 and N42.42bn in 2017.

Edo State generated N126.47bn in the following order: N18.9bn in 2013; N17.02bn in 2014; N19.12bn in 2015; N23.04bn in 2016 and N25.34bn in 2017.

On the other hand, Akwa Ibom made N108.36bn spread thus in five years – N15.4bn in 2013; N15.68bn in 2014; N14.79bn in 2015; N23.27bn in 2016 and N15.96bn in 2017.

Similarly, Oyo State generated N107.43bn – N15.25bn; N16.31bn; N15.66bn; N18.88bn and N22.45bn in 2013, 2014, 2015, 2016 and 2017 respectively.

The 10 states on the bottom of the table are Yobe, Borno, Ekiti, Kebbi, Gombe, Nasarawa, Zamfara, Taraba, Katsina and Ebonyi.

Thus, no state in the South-South geopolitical zone was among the bottom of the table. Ebonyi represented the South-East in the bottom league while Ekiti represented the South-West in the bottom league. 

Kebbi, Zamfara and Katsina represented the North-West on the bottom of the table. Nasarawa and Taraba represented the North-Central on the bottom of the table while the North-East was represented by Yobe, Borno and Gombe.

Yobe made a total of N18.48bn in five years. Borno generated N18.76bn in the period under review while Ekiti made N20.05bn within the five-year period.

On the other hand, Kebbi made N21.82bn; Gombe generated N21.91bn while Nasarawa generated N23bn within the period under review.

Similarly, Zamfara generated N24.51bn; Taraba generated N27.41bn; Katsina generated N30.44bn while Ebonyi made N30.91bn.

Mid-table states in terms of IGR include Kaduna which generated N95.89bn; Enugu (the first state from the South-East to show up on the radar), N93.81bn; Cross River, N88.97bn; Kwara, N87.62bn and Abia, N78.54bn.

Others are Anambara, N68.13bn; Ondo, N60.61bn; Bayelsa, N58.51bn; Benue, N55.8bn; Osun, N53.37bn; Plateau, N52.88bn; Kogi, N48.75bn; Imo, N39.76bn; Bauchi, N36.91bn; Sokoto, N35.46bn; Jigawa, N34.83bn; Niger, N34.11bn and Adamawa, N31.38bn.

On an annual basis, the 36 states generated a total of N662.05bn in 2013. This increased to N707.86bn in 2014 before coming down to N682.67bn in 2015. It rose to N820.19bn in 2016 and peaked at N936.47bn in 2017.

Low IGR has been the bane of development in the states, with many of them depending virtually on what they get from the federation account. Thus, some experts have queried the viability of the many state governments, given their low IGRs.

While some experts think that true federalism will wean the states of overdependence on the federation account, others think that there is an urgent need to restructure the federation into a federation of six geopolitical zones, instead of operating 36-state structure with three arms of government in each state of the federation.

Even in 2017 when IGR of the states stood at its peak, a higher proportion of the fund available to the states came from the federation account. While IGR accounted for N936.47bn, the states received N1.73tn from the federation account.

This means that IGR accounted for only 35.21 per cent while the federation account was responsible for 64.79 per cent of the funds available to the states.

Acting Chairman of Revenue Mobilisation, Allocation and Fiscal Commission, Mr Umar Gana, told our correspondent that the states needed help to increase their IGR but only two states – Kebbi and Katsina – had accepted to host IGR workshops facilitated by the agency.

According to him, only a few states have effective IGR system. Gana said it was because of low IGR that the states were now clamouring for new revenue formula to be able to pay the new minimum wage.

A lot more needed to be done, he added.

Akeem ReachnaijaApril 25, 2019


The Society of Women in Taxation (SWIT) has raised concern that 70% of the N5.2 trillion taxes collected in 2018 in Nigeria, came from Lagos State alone. This development shows a lopsided tax base, and also an indication that the long four-year tax reforms and campaign have little impact in the remaining 35 states in Nigeria.

The Chairperson of SWIT, Mrs Justina Okoror, said it is worrisome that 35 states and the FCT contributed a paltry 30% of the total. She also said that to broaden the nation’s tax base, there was the need to expand tax collections into the interior parts of Nigeria, to increase the number of people in the tax pool.

“For instance, out of the trillions of naira generated by the Federal Inland Revenue Service (FIRS), 70 per cent came from Lagos, which means that 35 states plus FCT contributed only 30 per cent.” It means that there are so many states with nearly no productive activities happening, and by implication are not paying tax. If Lagos decides to become a sovereign state, Nigeria will not be able to generate any revenue from tax, she said. It’s mostly in the cities that there is a record of organisations paying tax, but in suburbs and local councils, there are no tax collections.

Stressing the need to expand the tax base, Okoror said with some states mining gold, diamond, and other natural resources, there is an urgent need for government to go into the hinterland and increase their revenue base, especially from private companies. Government must take seriously tax revenue generation just like what is being done with crude oil. They should go into these places with natural resources and make it another revenue base, she said.

She however, called on the Federal Government to engage governors on how to make their states viable, to attract investors and create more productive activities that would increase the tax base and revenue generation.
Furthermore, the incoming National Chairperson of SWIT, Kudiirat Abdulhamid, queried government’s increased borrowing, when potential revenue generation is lying idly, saying the increasing obligations is tying the nation’s resources to payment and servicing of the loan that is being taken.

She said that revenue generation through taxation is more sustainable, especially when such resources are judiciously tailored towards development projects that would benefit the people. It is the responsibility of government to provide basic amenities for the comfort of the citizens, while the citizens have the responsibility to pay directly or indirectly for it, she said the present situation in the country is not inspiring.

“I agree with people complaining over government borrowing, but if citizens pay taxes and it is judiciously utilised for provision of this services, people will be eager to pay more. But when government borrows money without providing infrastructures, citizens would become angry,” she said.

Akeem ReachnaijaMarch 30, 2019


Weekly transactions on the Nigerian Stock Exchange (NSE) closed on Friday with the market indicators appreciating marginally by 0.68 per cent.

The All-Share Index, which opened at 30,833.50 on Friday, rose by 207.92 points or 0.68 per cent to close at 31,041.42.

Similarly, the market capitalisation inched by N79 billion or 0.68 per cent to close at N11.672 trillion from the N11.593 trillion posted on Thursday.

Nestle led the price gainers with a gain of N82.1 to close at N1,580 per share.

Spelat followed with a gain of N50 to close at N590, while Mobil Oil rose by N8 to close at N178 per share.

Dangote Cement appreciated by N1 to close at N191, while CCNN rose by 0.9k to close at N19.9 per share.

Conversely, Pressco topped the price losers, dropping N5.25 to close at N62.75 per share.

Cadbury trailed with a loss of 0.9k to close at N10, while Guaranty Trust Bank was down by 0.85k to close at N36.05 per share.

Wapco dipped by 0.75K to close at N12.2, while Dangote Flour declined by 0.3k to close at N10.2 per share.

Fidelity Bank was the most active stock, trading 58.19 million shares worth N126.34 million.

Chams followed 40.89 million shares valued at N8.18 million, while UBA traded 36.30 million shares worth N280.34 million.

Zenith Bank sold 25.75 million shares valued at N562.74 million, while FCMB transacted 15.92 million shares worth N30.82 million.

In all, investors exchanged 266.86 million shares valued at N3.15 billion in 3,455 deals.

This was in contrast to the 1.92 billion shares valued at N2.80 billion traded in 2,807 deals on Thursday.

Akeem ReachnaijaMarch 23, 2019


According to the Debt Management Office (DMO), The Federal Government will auction by subscription N100 billion worth of bonds on March 27.

The DMO disclosed this in a circular on its official website on Tuesday in Abuja, that the five-year re-opening bonds of N40 billion to mature in April 2023 was offered at 12.75%. It said that the seven-year re-opening bonds also of N40 billion to mature in March 2025 would be auctioned at 13.53%.

It added that the 10-year bonds, also re-opening, of N20 billion which would be due in Feb. 2028, would be auctioned at 13.98%.

According to the DMO, units of sale is N1,000 per unit, subject to a minimum subscription of N50 million and in multiples of N1,000 thereafter. The DMO explained that the bonds are backed by the full faith and credit of the Nigerian Government, with interest payable semi-annually to bondholders, while bullet repayment will be made on maturity date.
Nigeria issues sovereign bonds monthly to support the local bond market, create a benchmark for corporate issuance and fund its budget deficit.

Akeem ReachnaijaMarch 19, 2019


The internally generated revenue (IGR) of Lagos state rose by approximately N33 billion from 2015 to 2016, beating 33 states put together.

According to a report by the Nigeria Extractive Industries Transparency Initiative (NEITI), the state recorded an IGR of N301.19 billion, a rise of N32.99 billion in one year.

The total IGR from 33 states of the federation, excluding Delta, Ogun and Rivers states, stood at N299 billion — over a billion less than Lagos IGR.

Delta, Ogun and Rivers raked in N44.89 billion, N56.30 billion and N82.10 billion respectively.

Like his predecessors, Bola Tinubu and Babatunde Fashola, Akinwunmi Ambode, governor of Lagos state, has at various times committed himself to the generation of IGR in the state.

The NEITI report, which reviewed disbursements from the Federation Account Allocation Committee (FAAC) for the fourth quarter of 2016, also showed that Lagos received N109 billion in 2016.

The agency lamented low revenue generation across 34 states, citing Lagos and Ogun as the only states generating more than what they get from the central.

“IGR is very low in most states and it is only in two states – Lagos and Ogun – that IGR is higher than FAAC allocations. The figure shows that total revenue by itself cannot fund states budgets,” it said.

NEITI said the three tiers of government shared N5.121 trillion through 2016 — a decline from 2015 figures.

“Total disbursements fell by 14.8% from N6.011 trillion for the year 2015 to N5.121 trillion for the 2016. In Q1 2016, total disbursements were N1.132 trillion as against N1.648 trillion in Q1 2015, a decline of 31.2% in Q1 2016,” NEITI said.

“Total disbursements fell by 26.9% from N1.241 trillion in Q2 2015 to N906 billion in Q2 2016. There was a further decline in Q3 when total disbursements dropped by 7.8% from N1.887 trillion in 2015 to N1.738 trillion 2016.

“However, total disbursements increased in Q4 by 8.8% from N1.233 trillion in 2015 to N1.343 trillion in 2016.”

The report revealed that “the federal government received a total of N2.08 trillion from the federation account in 2016, which represents a drop of 19.9% of the total N2.6 trillion received in 2015.”

The 2016 budget was for N6.06 trillion, implying that at N2.08 trillion, total FAAC disbursements were only 34.3 percent of the budget.

“Thus, the federal government would have to resort to even higher debts to fund the budget. The implication of this is that debt service payments, which accounted for 24.3% of the 2016 budget, would increase.”