Nigeria’s biggest and oldest leasing firm, C&I Leasing, plans to raise funds to buy more vessels to lease to oil companies and expand its business in Ghana as Dubai-based private equity firm Abraaj exits, its chief executive said.
C&I Leasing supplies patrol boats and tug boats to Shell, Mobil, Chevron and NNPC’s operating unit, via long-term contracts. It has 23 vessels and competes with French rival Bourbon Offshore.
“We are looking at increasing our footprint in our current business, increasing our vessel and fleet management business. Our next plan is to introduce our marine business in Ghana over the next 1-3 years,” chief executive Andrew Otike-Odibi told Reuters.
He said the company is planning to issue bonds next month to raise seven billion naira ($22.3 million), partly to refinance existing debt of up to three billion naira. The leasing company is in talks with local pension funds for the five-year debt, which would also be used for working capital and to acquire new vessels. Nigerian firms are tapping bonds this year after the government redeemed some treasury bills to lower yields instead of rolling them over. Analysts expect the central bank to cut interest rates this year as inflation slows.
The 27-year old company also plans to raise fresh funds via the equity market, with about 40 percent of a target of between $10 million to $50 million over the next five years coming from share sales, Otike-Odibi said. The company is listed on the Lagos stock exchange and its core investors are also directors, owning 56 percent of the shares while the rest is free-float, he added.
C&I Leasing posted a 23 percent rise in pretax profit for 2017 to 1.28 billion naira. Its shares more than doubled last year and have risen 8.5 percent so far this year. On Wednesday they were up 2.26 percent to N1.36
C&I Leasing has 44 billion naira worth of total assets, of which 30 billion naira is invested in marine assets contributing 60 percent of profits and seen rising to 65 percent over the next five years. The company shut its vehicle distribution unit at the start of Nigeria’s worst recession in a quarter of a century, to focus on oilfield service marine vessel rentals, fleet management and personnel outsourcing. “We don’t see the retail market taking off until the economy stabilises again. People might have jobs today but you can’t guarantee job retention, therefore making payment of lease rentals uncertain,” Otike-Odibi said.
He said the company’s debt ratio would be cut to 70 percent from 80 percent now and it would redeem a $2.4 million loan it got from Aureous Capital, now part of Abraaj group, from part of the proceeds of the bond sale. He said Abraaj was also looking to exit another $10 million loan this year. “Besides the last two years, where we reinvested cash to support business growth, we have paid out dividends,” Otike-Odibi said.
This is to inform you that the Federal Government of Nigeria Savings Bonds can be bought and sold every day like ordinary stocks for minimum investment of N1,000 thereby having a better & active control on Your savings plan.
Definition: FGN Savings Bills (FGN S-Bills) are FGN Savings Bonds with TTM less than 12 months, for example March-2018 Issue – FGS2019S1 and/or April-2018 Issues – FGS2019S2 & FGS2020S3 are now S-Bills…
Special Liquidation Offer To TRW Stockbroker Bond Clients Only:
If You have FGN S-bills with code FGS2019xx (thus TTM remains 12 months or less) and would want to shift to a FGN S-bonds with code FGS2020xx/FGS2021xx (thus TTM remains 2 – 3 yrs), our ARMF Bond Portfolio can offer a better than market price discount for FGS2019xx bond as far as You mandate us to use Your cash to purchase FGS2020xx/FGS2021xx once available on the secondary market.
The Key Features of FGN Savings Bonds Bought On Secondary Market are as follows:
– Coupon payments: Quarterly (interest payments 4x in a year) with initial coupon payment depending on the FGN S-bond’s coupon program thus your first coupon payment can be paid in less than 91 days;
– TTM (time-to-maturity): 10 months – 36 months;
– Purchase/Sales Sizes: Minimum order of NGN 1,000 with additional multiples of NGN 1,000
TRW Stockbroker Investment Recommendation:
Take note that the best future predictor of Your bond yield (quarterly interest income flow) is your initial coupon level so please try to attain a higher coupon level for Your bond investments. For example, a 14% p.a coupon is greater than a 10% p.a coupon !!!
Mar-2018 inflation fell further to 13.34% while April-2018 is forecasted to fall to 12.6%. Last week’s average FGN T-bills’ & FGN T-bonds’ secondary market yields stabilized @ 13.09% and @ 13.49% respectively on the FMDQ thus yields remain in a downtrend. The ”forecasted” average yield of FGN T-bill, 91-days on the PMA (Primary Auction) for April-2018 is 11.5% p.a. while the last PMA of N5.85bln of FGN T-bills, 91-days was executed at a rate of 10.90% p.a
N.B: Take note that 91-day FGN T-bills are similar in structure to the 2-3 yrs FGN S-Bonds. Invest in FGN S-bonds only for savings purposes, please do not speculate with them !!!
TRW Stockbroker Transaction Fee Policy:
Fixed income trades of the bond segment of the NGSE trading platform are subject to the following term(s):
– transaction fee of 1% of total consideration will be charged for both “Sell” and/or “Buy” transaction(s) while CSCS will charge 0.0001%;
Caution – selling bonds on the secondary market before maturity, can either incur capital loss or capital gain !!!!
Should you require further information on how to get the best (and higher) coupon for Your FGN S-bonds purchase, please contact directly Ekwueme Mike Anyadibe (080 6656 4748 and/or e-mail: email@example.com): Manager-In-Charge Of Fixed Income Sales.
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By Zedcrest Capital
***IMF Warns Of Possible Crash in Oil Prices***
The Bond market remained slightly bullish with continued demand on the long end of the curve (27s – 37s) which compressed further by c.4bps. The outperformers were the 27s, 34s and 37s which recorded new highs, whilst we noticed some profit taking on the 2036s having also hit new highs during the session. The shorter end of the curve were more lackluster with fewer volumes traded during session (nothing on the 19s and 20s). We expect the market to be relatively stable tomorrow, as market players anticipate a resumption in OMO by the CBN.
The T-bills market remained firmly bullish as the market was awash with liquidity at c.N500bn long. Yields consequently fell by c.15bps across the curve. We witnessed significant oversubscription at the PMA conducted today, mostly on the 364-day bill which cleared at 12.08% with a 16x bid to cover. We expect the market to retrace slightly tomorrow on the back of a much anticipated OMO auction by the CBN.
The OBB and OVN rates fell slightly to 1.75% and 2.33% respectively, as system liquidity improved to c.N500bn long due to c.N33bn inflows from bond coupon payments on the 2037 bond. We expect rates to trend higher tomorrow on the back of an anticipated OMO sale by the CBN.
The Interbank rate remained stable at its previous rate of N305.60/$, with the CBN external reserves recorded to have improved by 1.53% to $47.01bn as at 16-April. The NAFEX rate appreciated by 0.09% to N360.16/$, while rates in the Unofficial market remained stable at N361.20/$.
The NGN Sovereigns were slightly bearish, with some sell especially on the 23s and 47s. We however witnessed slight demand for the 38s which gained +0.50pt.
The NGN Corps were fairly bullish with demand especially on the 2022 maturities (Zenith, UBANL and FIDBAN) which gained +0.06pt on average. We however witnessed slight sell on the shorter tenured GRTBNL 18s and ZENITH 19s. The SEPLLN 23s traded higher at 101.05, now trading 101/101.75.
By Daniëlle Kruger – IT News Africa
“It used to be quite simple. Customers arrived at banks through the revolving doors and opened accounts or applied for lending in-store. Banks owned the customer relationship by default and ‘see my bank manager’ was a common term,” says Mark Fitzgerald, Director – Government and Enterprise at FaceMe
Fast forward, and technology has altered the way in which business communicates with consumer. The new customer landscape, along with today’s technology, pose notable threats that outweigh the former challenges wrought by Web 1.0. What happens when a third-party website aggregates the best deals on current accounts for the consumer, much like the ‘get ten instant quotes’ websites that disrupted insurance – whose customer are they? What happens when that aggregation service is an app – does the owner of the app get a sliver of the relationship pie too? And then there’s what Forrester calls Amazon’s customer relationship ecosphere around tens of millions of customers. The group warns CMOs to learn from and even imitate Amazon, but to “stay tethered to their consumers as Amazon envelops their shared customers in a cozy cocoon that will influence their use of every possible service.”
In today’s banking environment, connection is up for grabs – but when owning the customer relationship is anyone’s game, how can banks make sure it’s theirs?
Fintech, meet banking
Investment in fintech sector is seen as an investment hot ticket. While the 2015 edition of the EY FinTech Adoption Index estimated that fintech was still in its infancy, the 2017 edition found that adoption had risen dramatically to one in three. “But while it’s clear that digital start-ups and first round investments in fintech are growing and that the digital revolution in banking is well and truly here, what hasn’t yet been mapped is the impacts on banking’s biggest players,” says Fitzgerald.
In its report, Banking disrupted, Deloitte suggests that the future of European retail banks is looking rather grim. Rocked by the wake of the financial crisis and the ongoing shakings of re-regulation, retail bankers face the threat of today’s “de-banked consumer”. Open Banking in England is demanding that Britain’s nine biggest banks crack open their customer data to third parties upon customer consent, with the aim of improving price comparison and boosting account switching.
Through platforms like WhatsApp, cash can be transferred by way of instant message (as opposed to the multi-layered authentication process required by your bank app.) Beyond financial transactions, Open Banking will integrate services from third parties, allowing lifestyle choices to be made quicker and easier – for example, the same interface will help you find and finance a new car.
The new breed of customer
“In short, the silos of traditional retail banking are coming down, giving way to a more personalised and self-regulated form of financial management. Today’s customers expect to engage directly and immediately with their retailers. Needs are not only to be met, but to be anticipated before they arise, and service must be a fluid, intuitive and integrated extension of their lifestyle,” says Fitzgerald.
Previously banks were able to make small, incremental changes to meet the first internet-based challenges. But today’s ongoing digital disruption and re-regulation offer a tsunami of change that has chipped away at the competitive advantage banks used to enjoy. Deloitte believes the challenge “is not that any single new entrant or model will emerge to dominate their market. Rather, the risk is that the combination of attackers across the banks’ eco-system will steadily erode their core competitive advantage, resulting in a much smaller banking sector.”
If banks want to win the game, they’ll have to win the customer relationship. If they don’t own that relational space, someone else will.
“FaceMe encourages banks to take a few steps back – enough time to extract themselves from the hamster wheel of optimising short-term profitability – to consider a longer-term vision that can buffer future uncertainty and innovation,” he cautions.
The future of banking is cryptic, and fintech is rewriting the rules as we go. But the more we can capture the unchanging power of human relationships and prize the customer experience, the greater chance we have to outwit disruption.
Wema Bank Plc plans to raise N20 billion from the bond market by July-2018 and aims to pay a dividend this year for the first time in a decade, paving the way for an equity sale next year, its Chief Financial Officer, Tunde Mabawonku said.
Mabawonku said the mid-tier bank was focused on selling debt this year after it raised N6.2 billion in its first tranche of a N50 billion ($159 million) debt programme. He said the bank would start the process next month.
“We would want to pay dividends first to existing shareholders before raising equity in early 2019. It could be a combination of rights issues and private placement,” Mabawonku told Reuters. The debt issue would help Wema boost its capital ratio above its internal guidance of 15 percent, from 14.3 percent, the bank said earlier. The regulatory minimum capital ratio for Wema and its peers is 10 percent.
In July, Wema Bank said it could issue debt assuming government bond yields dropped below 18 percent with falling inflation. Yields are now at around 14 percent. It also talked about raising equity in 2018 to bolster its capital ratio and cut its operating costs as its new digital strategy gains traction.
Nigerian firms are tapping debt markets this year after the government redeemed some treasury bills, instead of rolling them over, to bring down yields. Analysts expect the central bank to cut interest rates this year as inflation slows.
Wema Bank aims to revive loan growth this year by focusing on small firms after its lending dropped by 4.9 percent last year – despite the bank’s target of 1.5 percent growth. It plans to increase lending by 10 percent in 2018.
By Olasunkanmi Akoni & Monsuru Olowoopejo LAGOS, The Vanguard
THE Lagos State Government, yesterday, disclosed that works on the proposed Fourth Mainland Bridge, earlier estimated to gulp N844 billion, would commence before the end of the year as a new investor will be announced by June this year.
The gigantic project was stalled a year ago when the state government terminated a contract with a consortium of investors over delay in commencement.
The consortium earlier engaged included: Visible Asset Limited, Julius Berger Nigeria Plc, Africa Finance Corporation (AFC) and Access Bank, Hi-tech Construction Limited, Eldorado Nigeria Limited, Nigerian Westminster Dredging and Marine and J.P. Morgan.
The new alignment of the bridge will pass through Lekki, Langbasa and Baiyeiku towns along the shoreline of the Lagos Lagoon estuaries, further running through Igbogbo River Basin and crossing the Lagos Lagoon estuaries to Itamaga Area in Ikorodu. The alignment would further cut through the Itoikin road and the Ikorodu – Sagamu Road to connect Isawo inward Lagos – Ibadan Expressway at Ojodu Berger axis. The four-lane dual carriageway is also designed to have eight interchanges to facilitate effective inter-connectivity between different parts of the state.
The state’s Commissioner for Works and Infrastructure, Mr. Adebowale Akinsanya,Wednesday , announced the planned commencement date for the bridge in his address at the 2018 Ministerial briefing in Alausa, Ikeja, to mark the third anniversary of Governor Akinwunmi Ambode in office. He added that the state government was at the last stage of selection of preferred bidder for the 38 kilometre project.
“In the last one year, the state received a series of proposals from prospective partners. As head of the technical committee, we looked at technical proposals submitted by the bidders and after the exercise we ended up short listing three bidders. After that, the finance and technical committee met to check bids submitted. Presently, we are at the last stage, the interview session. By June, we will announce the preferred bidder for the project.’’
Also speaking on some road projects, the commissioner said that works on 25 roads and 17 building projects are on-going across various local governments in the state. Adebowale further said the Public Works Corporation rehabilitated 31 roads aside embarking on palliative works on 115 roads.