Vanguard Markets, August 11, 2014 edition

A disputed legacy 5 years on

! page VM2

AST WEEK, POLITIcal and business leaders from across

the African continent gath-ered in Washington D.C. at the behest of President Barack Obama. They were in the US capital for the inaugural US-Africa Leaders’ Summit. The 3-day event was supposed to provide an opportunity for the US to win commercial in-fluence in Africa, where pri-vate- and state-backed Chi-nese investment have made significant inroads over the last decade. It was also an at-tempt to erase concerns that the US was more interested

in Africa from a security angle in its fight against global ter-ror groups as against a com-mitment to build mutually rewarding economic relation-ships.

While they sleptAmerican businessmen and

policy makers are alarmed at the inroads made by China on the continent. For example, Chinese investment on the continent has risen more than 20-fold over the last decade to $200 billion in 2013. This is more than double the US in-vestment in sub-Saharan Af-rica. Another informative sta-

tistic is that while China has over 150 commercial attachés on the continent, the United States has only 8.

Separately, as the Chinese have gained ground, the pre-viously important cultural and economic ties that bound African countries to their Eu-ropean colonisers have weak-ened. Economic stagnancy in the European Union, coupled with anti-immigrant policies have created the impression of a Europe self-absorbed with resolving its deficit and iden-tity problems.

Beginning in the last dec-ade, Chinese companies and

financiers began an aggres-sive push to gain ground in Africa. They invested in ar-eas that received paltry inter-est from Western companies with few exceptions. Notably, in infrastructure, transport, mining, and energy Chinese companies with the backing of Beijing started to win con-tracts and concessions at a rate that must have shocked Western companies. The Chi-nese government’s policy of refraining from imposing the types of conditionalities set by the Bretton Woods institu-tions before lending assistance won it yet more friends on the corridors of power and board rooms in Africa.

In actual factIt is technically inexact to

accuse the United States of ignoring the continent on commercial matters. US com-panies like Exxon Mobil are major investors in the Africa’s

extractive industries. The real issue is that Africans feel that the current US administra-tion, because it is led by a per-son of African descent, should have done a lot more. In fact, a few would argue that his two immediate predecessors in office, Presidents Bill Clinton and George W. Bush did more for the continent during their time in office.

In fairness, President Obama has some achieve-ments under his belt. In 2013 he launched the Power Af-rica initiative. It will pool $8 billion in investments for the continent’s underdeveloped electricity generation sector led by companies like Gen-eral Electric.

Behind the scenes, he has also led efforts for the renewal of the Africa Growth and Opportunity Act, a non-reciprocal trade preference

Vanguard Markets | Monday, August 11, 2014 | Issue 005

INTERNATIONAL TRADE

Fixed Income & Forex

Inside

Big, strong, and reliable again

Under the leadership of Emeka Emuwa, Union Bank is re-establishing itself as a heavyweight con-tender after a long turnaround

! Page VM7

CAR dealers

The Central Bank an-nounced changes to how financial insti-tutions calculate the capital adequacy ratio (CAR) and decreed that Tier 2 capital must not exceed 33.3% of Tier 1 capital

! Page VM3

US seeks top spot in African trade

0B 10.0 10.023/07 24/07 24/0704/08 05/08 05/0807/08 08/08 08/0830/07 31/07 31/07

120B 11.6 15.0

14.090B 11.213.0

60B 10.812.0

30B 10.4 11.0

FGN Bonds & TBills NITTY NIBORFGN BondsTreasury Bills

O/N1M

3M6M

2009 BANK RESCUE

Dr. Sanusi Lamido Sanusi, former CBN governor

160.524/07 05/08 08/0831/07

163.0

162.5

162.0

161.5

161.0

FX ($/N)

Source: FMDQ

BidAsk

1M2M

3M6M

9M12M

L

Tony Elumelu, chairman of the HEIRS Group, exchanges greetings with President Barack Obama at the 2013 launch of Power Africa initiative

Source: HEIRS Capital

! Page VM3

FOREIGN EXCHANGE TABLE (AUGUST 8, 2014)

Currency Central Rate

US DOLLAR 155.23

POUNDS STERLING

260.9416

EURO 207.8374

SWISS FRANC 171.1844

YEN 1.5219

CFA 0.3063

WAUA 236.9358

YUAN/ RENMINBI

25.2127

RIYAL 41.3891

DANISH KRONA

27.8749

SDR 237.7968

Source: Brookings Africa Growth Initiative from International Monetary Fund data

Trade with Sub-Saharan AfricaTotal exports and imports with each partner

$0B‘00 ‘01 ‘02 ‘03 ‘04 ‘05 ‘06 ‘07 ‘08 ‘09 ‘10 ‘11 ‘12 ‘13

$20B

$40B

$80B

$60B

$100B

$140B

$120B

$160B

$180BChina U.S.

Data visualisation by Publican Media

Obiora [email protected]

HIS WEEK WOULD mark the fifth an-niversary of Act One

of Bloody Friday. On August 14, 2009, Lamido Sanusi, ex-governor of the Central Bank of Nigeria, announced the sack-ing of the chief executives of the defunct Afribank, Finbank, Intercontinental Bank, Oce-anic Bank and Union Bank. Six weeks later, he would complete the excision with the sacking of the heads of Bank PHB, Equa-torial Trust Bank, and Spring Bank. The CBN quickly injected N620 billion to rescue the ten banks. Over the next two years, it would spend more than N3 trillion to resolve the crisis.

None of these banks remain as a standalone institution, and only Union Bank has retained its name. In two fell swoops, the central banker decapitated these leaders of a sector that many had considered untouch-able until then. Despite the significance of those heady months no authoritative ac-count that gives both sides of the story has appeared on bookstands.

Altogether, the following ex-ecutives lost their jobs and hard earned reputations: Sebastian Adigwe, Okey Nwosu, Eras-tus Akingbola, Cecilia Ibru, Bartholomew Ebong, Francis Atuche, Ike Oraekwuotu, and Charles Ojo. That is not all. Thousands of families faced an uncertain future as breadwin-ners lost their jobs due to the right-sizing and cost-cutting

that followed their exits. It was natural that a lot of the

narrative in the media focused on the governance, manage-ment, and moral failures of the departed CEOs. That is only half of the tale though. Too lit-tle of the human story that cap-tures the impact of wave after wave of abrupt dismissals has been told.

In the days and weeks that followed their dismissal accu-sations, counter-accusations, conspiracy theories, and in-trigue filled the air. It was cloak-and-dagger drama ex-cept that trillions of depositors’ funds were involved. There was a story that Erastus Akingbola had got wind of his impending dismissal and had informed Intercontinental’s executive directors that their jobs were on the line before disappear-ing. Cecilia Ibru went missing for a number of days, while her kinsmen threatened to cast a spell on the banking regulator. Francis Atuche handed in his resignation a few hours before his removal was announced. Then for months, Akingbola’s moles at the CBN kept him and his allies au courant of plots by

the governor, smuggling inter-nal memos and letters to him in his London address, where he had taken refuge. Then there was the case of Unity Bank, a largely northern-con-trolled financial institution. It escaped the wrecking ball be-cause while it was ‘adjudged to have insufficient capital,’ it was ‘not in grave situation because it has a healthy liquidity posi-tion.’ The most lethal arm in the arsenal of conspiracy theo-rists has been that no one to date, outside the CBN, has seen the damning reports of stress tests prepared by its examin-ers. So much for transparency.

On his part, the Central Bank governor courted press attention. He seemed to enjoy every minute of it. He was on CNN, Bloomberg, CNBC, BBC, Channels, NTA and several other stations. He found time to grant interviews and press conferences for the print me-dia. Also, a steady stream of press releases were made avail-able. Labelled as a ‘reformer’ his actions were celebrated as akin to cleaning the Au-gean stables. He would go on to win a plethora of awards,

and have his face plastered on some of the most prestigious finance-focused magazines in the world.

Nigerians were treated to several pages in newspapers listing names of recalcitrant debtors. They were invited to the Awolowo Road, Ikoyi of-fice of the Economic and Fi-nancial Crimes Commission to explain how and when they planned to repay. In the end it was discovered that several companies and individuals names were wrongly included. Many others featured on the list because they had failed to pay back loans taken to deliver goods and services to state and federal governments that were yet to pay.

The lawsuits came fast and thick. Sunny Nwosu, Boniface Okezie, and other shareholder representatives challenged the apex bank’s power to take over the banks. Renaissance Professionals, a faceless but deep pocketed group, ran full page adverts on most days with screaming headlines rejecting the public intent of the sack-ings and involuntary takeovers.

For a long time, no public of-

ficer spoke out about the non-intended consequences of the CBN governor’s actions. The first one with the courage to do so was General Aliyu Gusau. He was the National Security Adviser at the time. The influ-ential former intelligence of-ficer warned that the manner in which the banking reforms were being executed could im-peril the broader economy. If that happened, he interjected, it could quickly transmute from a purely economic di-mension to become a national security issue.

All this time, not a single journalist, former official or senior executive at any of the affected banks has written a detailed account of events sur-rounding their removal, and the subsequent evolution of the Nigerian banking sector during Sanusi’s tenure.

In the United States, Timo-thy F. Geithner, President Obama’s first Treasury Secre-tary released Stress Test: Re-flections on Financial Crises in May this year. Before him, Henry ‘Hank’ M. Paulson Jr., who had served in the same role under President George

W. Bush, wrote On the Brink. In the book, he defended the rescue of Bear Stearns by JP Morgan, the decision to let Lehman Brothers fail, the sal-vage of AIG, as well as the $700 billion Troubled Asset Relief Program (TARP) to save the financial sector.

A random search on Ama-zon.com shows that tens of other publications by reporters, bankers, consultants, lawyers, and researchers have appeared since the crisis exploded.

It is tempting to dissect the story about the two Acts of Bloody Friday as one of heroes and villains. It is a more nu-anced and complex story. On one side, cheerleaders of the Sanusi Fan Club drown out any criticism of the former chief executive of First Bank. On the other, his opponents claim that his self-declared mission to ‘expose the rot in the bank-ing system’ was inspired by ego, ethnic self-interest, or an amateurish-overzealous ap-proach to intervention depend-ing on whom you listen to. All the more reason why five years later the complete story needs to be told. ;

INTERVIEWVM2

BANK RESCUE

SPOTLIGHT

VM | Monday, August 11, 2014 | Issue 005

Five years after, not a single journalist, former official or senior executive at any of the affected banks has written a detailed account of events surrounding their removal

Contested discretion

Critics such as the Renaissance Professionals (right) accused the ex-CBN governor of mishandling the rescue of the banking sector in 2009 and conjuring a phantom crisis in the process

Tony Elumelu

Source: HEIRS Holdings

T

Source: bbc.com

Tony Elumelu, Businessman, Philanthropist, VisionaryHE USAFRICA SUMmit has been called the summit that Tony

Elumelu, CON, 51, inspired. The chairman of HEIRS Hold-ings, a pan-African investment firm, has led calls for a new en-trepreneurial mindset on the continent, which he christens Africapitalism.

Born in Jos, Nigeria on March 22, 1963, Elumelu is a fervent champion for home-grown solutions that leverage on external technologies and networks. His idea of charity is firmly rooted at home.

Since he left United Bank for Africa (UBA) in 2010, Elumelu

has undergone what must count as the fastest transfor-mation in Nigerian corporate history. He has transmuted from a hard-nosed capitalist to a restless philanthrocrat hob-nobbing with the likes of Bill Clinton, the former US presi-dent, and billionaires Warren Buffett, Bill Gates, Richard Branson, and Patrick Motsepe.

He admits that in his last incarnation as a financier, his objective was ‘to democratize banking – at the time, it was an economic, not a social act.’ This is not to say that the economic instinct is extinct. He has only grafted on social responsibility

to produce fruits of ‘impact’. MBA students around the

world are familiar with the story of how he turned a $5 million investment in the flail-ing Crystal Bank in 1997 into the behemoth that UBA be-came after its merger with the Standard Trust Bank under his leadership.

At UBA, T.O.E., as he is fondly called, was known for his marathon strategy sessions where his managers mapped out how they would conquer Nigeria, and later, Africa.

The rest, as they say, is his-tory.

These days Elumelu is more

likely to be found at high-level gatherings pondering global problems that affect Africans from food and power to educa-tion and investment.

His message diverges from those that appeal only to altru-ism.

Here is what he has to say:‘I do not suggest that entre-

preneurs should build compa-nies in Africa or that capitalists should invest in Africa out of goodwill. I suggest that Africa offers compelling economic and business opportunities that can, at the same time, meet a range of social objec-tives.’

He describes it as ‘doing well by doing good.’

In an op-ed he wrote in the Wall Street Journal at the end of July, the economics gradu-ate invited summit attendees ‘to move beyond the usual conversations on aid and in-stead to explore new oppor-tunities to collaborate and co-invest in initiatives that generate value on both sides of the Atlantic.’

His message struck a chord with business and political leaders. By the end of the summit more $14 billion worth of transactions had been agreed. ;

T

INTERVIEW VM3

REGULATION

INTERNATIONAL TRADE


US seeks to claim top spot in African commerce and tradeprogram, which was signed under President Clinton in 2000. Its current authoriza-tion expires on September 30, 2015. However, countries like Angola, Gabon, and Nigeria, whose main exports to the US are crude oil do not benefit very much from AGOA due to low tariffs on the resource as the table below shows.

Follow the moneyIn an op-ed written in the

Wall Street Journal, Tony Elumelu, chairman of the HEIRS Group and founder of the Tony Elumelu Foun-dation, observed that the United States is finally and ‘formally recognizing the stra-tegic importance of Africa in a multipolar world to its own future growth.’

Underscoring his points, Penny Pritzker, the US Commerce Secretary, speak-ing at the US-Africa Business Forum, held on the side-lines of the summit spoke some truths to US citizens and Con-gress. ‘Investing in Africa will spur job growth in Cincinnati through Proctor & Gamble’s $300 million investment in a new manufacturing plant near Lagos – because when P&G expands in Nigeria and else-where, it supports thousands of jobs at home. Make no mis-take: our economic and com-mercial partnership is a two-way street. Goods and services

exports from the United States to African markets support roughly 250,000 jobs here at home.’

‘We are a country of values, but we are also a country that wants to promote the eco-nomic interests of our people,’ summed up the Commerce Secretary. When asked by the Wall Street Journal if the sum-mit was ‘about helping U.S. businesses catch up with com-panies from Europe, China or

other Asian countries that are already well-established in Africa?’ Pritzker vehemently denied this. ‘Not at all,’ she denied.

But playing catch up is the name of the game. ‘We gave it to the Europeans first and to the Chinese later, but today it’s wide open for us,’ said Jeff Immelt, chief executive of General Electric.

His company announced that it would spend $2 billion

by 2018 to boost infrastruc-ture, worker skills and access to energy.

For the US this summit was about gaining attractive re-turns for US investors, jobs for US citizens, and ring-fencing Chinese commercial expan-sion in Africa. With Europe in decline, and increasing Chi-nese competition in emerging markets, Africa presents the last great contest for global commercial hegemony. A new scramble for Africa is playing out.

Wallets are good, but livelihoods matter too

In his WSJ letter, Elumelu, a former chief executive of United Bank of Africa that operates in 19 African coun-

tries, explained that the Power Africa initiative ‘sends a clear message that America means business with Africa, facilitat-ing billions of dollars of invest-ment and ultimately generat-ing value both for American stockholders and African con-sumers.’ More to the point, ‘Africa’s one billion consumers are an increasingly compelling market.’

The point is not lost on American companies. Ford, the second biggest US car-maker, plans to set up a new plant in Nigeria, expand its dealership network across the continent, and tie in fi-nancing packages to entice buyers. It will also introduce brands like the Mustang, Fu-sion, and Focus to appeal to the rising middle class. Jim

Benintende, Ford’s head of operations in the Middle East and Africa, said that ‘We at Ford are taking a long-term view in places like Nigeria. It’s the biggest economy in Africa. You can’t ignore that. It’s got abundant natural resources, it’s got a burgeoning middle class. There’s a lot of real good reasons to look at Nigeria for future investment.’

The risk of investment without local prosperity as has been the case in the past looms large. Joseph Stiglitz, a past winner of the Nobel Prize in economics, writing in the Financial Times cau-tioned against an excessive emphasis on ‘mineral exports that provide foreign exchange and fiscal revenue but not jobs, especially for frustrated youth in urban areas.’ Rather, he advocates for ‘foreign di-rect investment into intensive light manufacturing and agro-processing industries, where Africa’s large pool of unskilled labour could be used.’

Some CEOs are listening. One company that has taken the lead in the direction of job creation is General Electric. The Fairfield, Connecticut-based company announced that it plans to double the number of employees on its payroll in Africa to 4,000 over the next 4 years. Jay Ireland, GE’s Africa chief executive has given assurances that ‘all those investments need people, so we’ll be adding.’ As details of other agreements reached at the summit become known it is expected that no fewer than 15,000 new jobs will be added by US companies and their Af-rican partners across the con-tinent in coming years. ;

AGOA and GSP Eligibility, U.S. Imports, and GSP/Capita, by Country

Country GSP AGOAAGOA/GSP

(thousand $s, 2013)

GDP/Capita ($s, 2012)

Angola 66 5,485Botswana 5,929 7,191Cameroon 21,560 1,151Cape Verde 159 3,838

Cote d’Ivoire 84,670 1,244Ethiopia 35,310 470Gabon 224 11,430Ghana 34,673 1,605Kenya 342,502 862

Lesotho 320,879 1,193Malawi 51,238 268

Mauritius 199,268 8,124Nigeria 5,403 1,555Rwanda 782 620Senegal 625 1,032

South Africa 3,667,783 7,508Tanzania 10,986 609Uganda 1,578 547Zambia 3,999 1,469

Source: Analysis by Congressional Research Office. Data from USTR, ITC, and Commerce Department

Source: agoa.info

US-Nigeria bilateral goods trade

-$0.4B‘00 ‘01 ‘02 ‘03 ‘04 ‘05 ‘06 ‘07 ‘08 ‘09 ‘10 ‘11 ‘12

-$0.3B

-$0.2B

$0.0B

-$0.1B

$0.2B

$0.1B

$0.3B

$0.4B


US Imports US Exports US-Nigeria Trade balance

W Continued from Page VM1

N WEDNESDAY, the Central Bank of Nigeria released a

new set of guidelines for the calculation of banks’ capi-tal adequacy ratios. The new rules had become necessary for the domestic banks to comply with the regulations contained in the Bank of In-ternational Settlement’s In-ternational Convergence of Capital Measurement and Capital Standards (Basel II). In effect, it would improve the quality and loss absorbency of the financial institutions.

Under the title Guidance Notes on the Calculation of Regulatory Capital, the regu-lator spelled out that hence-forth, reporting institutions shall exclude non-distribut-able regulatory reserves and

other reserves in the compu-tation of regulatory capital.

One vital innovation that has got bankers and markets abuzz is the 33.3 per cent of Tier 1 capital maximum limit set on Tier 2 capital. Accord-ing to analysts at Afrinvest, it would ‘place a restriction on banks that intend to raise further Tier-2 capital in the second half. Hence, they may be forced to explore the Tier-1 capital, that is, equity raise option.’

In 2013, the CBN set a min-imum capital adequacy ratio of 15 per cent for the coun-try’s 8 systemically important banks. These are banks that control at least 5 per cent of nationwide deposits each, and 75 per cent as an aggre-gate. The banks are Access

CBN resets regulatory capital

Source: Central Bank of Nigeria

Categories of bank capital


Bank’s Capital

Paid-up share capital/ common stock

Disclosed reserves: Share premia Retained profits General reserves SMEEIS reserves Regulatory risk reserves Statutory/ legal reserves

Revaluation reserves

Provisions and loan-loss reserves

Hybrid capital instruments

Subordinated debt

Tier 1 Tier 2

O

Capital adequacy ratio of Nigerian banks: 2012-2013

Source: Central Bank of Nigeria

-16

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16

24

32

Capi

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Acc

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Diam

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FCM

B Gr

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Fide

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Bank

Guar

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ank

Skye

Ban

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IBTC

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15%, the minimum CAR for non-systemically important banks

16%, the minimum CAR for systemically important banks

Bank’s CAR in 2013

Bank’s CAR in 2012

Bank, Diamond Bank, Eco-bank Nigeria, First Bank, GT Bank, Skye Bank, UBA, and Zenith Bank.

Recently, FBN Holdings and Diamond Bank com-pleted Eurobond offerings, raising $450 million and $200 million respectively. FCMB has announced plans to raise up to $350 million by issuing Eurobonds. Dur-ing a half year presentation to analysts and investors, Sola David, Borha, chief ex-

ecutive of Stanbic IBTC, disclosed that the Nigerian unit of South Africa’s Stand-ard Bank plans to raise up to N30 billion in Tier 2 capital. Last week it emerged that Ecobank Transnational has successfully issued $200 million of dated subordinated notes that would qualify as Tier 2 capital. Skye Bank has also announced that it plans to conclude a $200 mil-lion Tier 2 capital raising by the end of September. ;

MARKET DATAVM4

TRADING UPDATE


DASHBOARD

TickerFriday 5-day 4-Week

52-Week Hi

52-Week Lo YtD PE EPS

Last Change, % Volume Start Week Hi Week Lo Change,

% Volume Start Change, % Volume

7UP 126.78 4.99 241 112.35 126.78 112.35 12.84 8,088 107.35 18.10 17,922 126.78 64.80 77.49 25.79 4.46ABCTRANS 0.85 -1.16 9,551 0.85 0.88 0.81 0.00 49,695 0.90 -5.56 163,310 1.07 0.69 -1.16 4.05 0.21

ACCESS 9.80 -2.00 206,107 9.98 10.00 9.66 -1.80 1,771,224 9.80 0.00 6,314,735 11.10 7.22 2.08 6.30 1.57AGLEVENT 1.45 0.00 1,001 1.40 1.48 1.40 3.57 1,778 1.39 4.32 17,932 1.87 1.25 -11.04 6.22 0.23

AIICO 0.80 0.00 16,277 0.81 0.82 0.80 -1.23 169,296 0.83 -3.61 708,974 1.03 0.74 -13.04 5.26 0.15ASHAKACEM 34.20 0.86 15,571 33.00 34.20 31.53 3.64 85,989 32.55 5.07 301,150 34.20 13.87 56.31 42.50 0.80BETAGLAS 17.70 -1.12 253 17.11 17.90 17.11 3.45 912 17.00 4.12 2,982 22.10 10.69 22.66 5.06 3.38CADBURY 70.54 0.00 57 70.54 70.54 70.54 0.00 1,783 72.15 -2.23 16,511 110.00 67.80 -27.42 47.29 1.57

CAP 39.91 -2.54 204 40.00 40.95 39.51 -0.23 4,355 39.15 1.94 22,791 51.66 35.96 -16.82 23.30 1.67CCNN 15.00 -1.25 15,147 13.99 15.98 12.05 7.22 114,138 11.38 31.81 418,060 15.98 8.00 25.10 13.41 1.12

CONOIL 75.73 10.23 25,775 61.98 75.73 58.66 22.18 31,387 67.90 11.53 46,708 79.80 25.92 23.50 22.69 3.34CONTINSURE 1.00 -2.91 18,829 1.12 1.14 0.96 -10.71 124,799 1.16 -13.79 505,404 1.33 0.93 -16.67 6.25 0.16COURTVILLE 0.55 -1.79 370 0.51 0.58 0.51 7.84 42,461 0.58 -5.17 123,055 0.90 0.50 -15.38 5.18 0.11CUSTODYINS 3.94 -0.76 3,692 4.00 4.00 3.76 -1.50 65,429 3.71 6.20 256,290 4.03 1.30 80.73 16.42 0.24

CUTIX 2.00 0.50 2,201 1.99 2.07 1.90 0.50 40,144 1.90 5.26 73,876 2.27 1.59 2.56 10.53 0.19CWG 4.75 0.00 4 4.75 4.75 4.75 0.00 920 4.75 0.00 992 5.83 4.75 -18.52

DANGCEM 230.00 0.00 11,674 224.10 230.03 224.10 2.63 36,079 240.00 -4.17 950,201 250.02 185.00 6.40 10.53 11.80DANGFLOUR 7.70 -0.90 2,249 7.55 7.77 7.37 1.99 11,311 8.09 -4.82 100,139 10.76 7.25 -24.73DANGSUGAR 9.00 0.00 15,884 9.01 9.20 8.77 -0.11 118,194 9.09 -0.99 315,140 12.49 8.67 -20.35 11.09 0.81DIAMONDBNK 6.33 -1.09 13,584 6.35 6.68 6.24 -0.31 414,678 6.24 1.44 1,204,856 8.20 5.86 -15.60 3.87 1.65

ETERNA 3.89 -2.51 25,410 3.80 4.20 3.66 2.37 66,459 4.45 -12.58 140,174 5.73 2.48 -17.76 6.23 0.61ETI 18.49 0.87 57,461 16.87 18.60 16.00 9.60 328,697 17.03 8.57 630,425 18.60 12.40 12.81 5.00 3.67

FBNH 15.48 1.24 88,129 14.40 15.50 14.30 7.50 671,798 16.23 -4.62 4,246,633 17.29 11.50 -5.03 7.14 2.16FCMB 4.25 -1.16 270,459 4.23 4.45 4.10 0.47 873,885 4.15 2.41 1,745,684 4.59 3.01 10.68 4.83 0.88

FIDELITYBK 2.02 -0.49 46,692 2.01 2.05 1.98 0.50 484,278 2.00 1.00 3,740,356 2.95 1.85 -25.19 2.97 0.68FIDSON 3.13 2.62 14,446 3.00 3.13 3.00 4.33 45,906 3.09 1.29 130,689 3.25 1.80 13.82 12.50 0.24

FLOURMILL 79.00 -0.63 1,872 77.67 79.79 70.29 1.71 41,686 76.00 3.95 104,542 92.00 63.91 -12.22 23.48 3.38FO 240.00 0.42 4,127 228.90 240.01 218.31 4.85 11,285 234.06 2.54 44,234 259.94 35.00 158.43 51.81 4.63

FORTISMFB 6.00 1.69 100,000 6.00 6.00 5.70 0.00 100,036 6.00 0.00 100,174 6.66 5.70 -4.31 5.08 1.18GLAXOSMITH 62.41 -0.27 664 65.85 65.85 62.41 -5.22 4,434 68.00 -8.22 43,753 74.97 58.50 -10.84 21.68 3.00GUARANTY 30.44 0.13 114,911 28.61 30.80 28.61 6.40 629,748 29.98 1.53 3,748,885 31.80 22.67 9.69 9.31 3.27GUINNESS 196.20 -1.30 283 190.10 200.86 190.10 3.21 19,978 205.00 -4.29 42,272 266.70 162.00 -16.87 25.38 7.88

HONYFLOUR 4.14 2.22 9,528 4.18 4.24 4.05 -0.96 28,859 4.27 -3.04 294,628 4.50 2.56 7.53 12.18 0.34INTBREW 27.12 -1.38 1,725 26.10 27.50 25.70 3.91 4,181 29.20 -7.12 28,771 31.50 17.98 -4.24 43.63 0.63JBERGER 66.65 -0.12 274 63.39 66.95 63.00 5.14 2,307 68.00 -1.99 52,647 76.45 59.18 5.67 9.64 6.74

LINKASSURE 0.50 0.00 2 0.50 0.50 0.50 0.00 51 0.50 0.00 23,569 0.50 0.50 0.00 12.57 0.04MANSARD 2.54 1.60 236 2.55 2.55 2.50 -0.39 8,544 2.51 1.20 113,849 2.73 1.95 1.60 16.35 0.15MAYBAKER 1.62 -2.99 1,634 1.64 1.72 1.61 -1.22 5,918 1.72 -5.81 54,926 2.67 1.58 -36.47 18.00 0.09

MOBIL 173.00 1.13 221 160.22 178.00 160.00 7.98 7,460 136.50 26.74 26,119 178.84 102.00 49.14 16.66 10.44MRS 57.00 -5.00 1,670 58.90 61.50 57.00 -3.23 5,987 60.03 -5.05 12,631 70.00 32.53 10.21 57.21 1.04

NAHCO 5.02 -0.59 2,462 4.95 5.25 4.95 1.41 93,011 4.98 0.80 270,627 6.80 4.56 -20.94 15.43 0.32NASCON 10.36 0.39 28,359 10.12 10.94 10.07 2.37 69,958 11.49 -9.83 842,551 15.10 10.07 -30.24 9.94 1.05

NB 185.00 -0.05 18,083 185.00 187.90 180.00 0.00 163,339 174.50 6.02 385,631 189.00 140.00 12.11 35.16 5.24NEIMETH 1.08 0.00 2,513 1.18 1.18 1.08 -8.47 10,973 1.19 -9.24 41,030 2.08 0.79 -1.82

NEM 0.80 1.27 105,790 0.76 0.82 0.76 5.26 200,263 0.81 -1.23 887,956 0.97 0.55 -1.23 0.41 1.96NESTLE 1,110.00 -0.36 3,903 1,105.10 1,114.00 1,105.00 0.44 7,597 1,105.00 0.45 40,236 1,250.01 916.00 -6.09 38.51 28.82

NIGERINS 0.50 0.00 521 0.50 0.50 0.50 0.00 22,757 0.54 -7.41 150,859 0.54 0.50 0.00 25.00 0.02NNFM 21.68 4.84 1,590 18.77 21.68 18.00 15.50 16,355 19.70 10.05 31,218 32.67 18.00 -1.50OANDO 27.30 2.25 49,242 27.00 27.80 26.00 1.11 276,615 27.99 -2.47 2,704,248 36.89 9.32 2.13 24.49 1.11

OKOMUOIL 35.98 4.29 2,615 33.76 35.98 32.16 6.58 35,921 32.90 9.36 80,124 48.05 32.15 -19.74 15.71 2.29PAINTCOM 1.51 0 1.54 1.54 1.51 -1.95 148 1.41 7.09 4,873 2.30 1.33 -22.56 4.20 0.35PORTPAINT 5.50 2.42 726 5.75 5.75 5.00 -4.35 10,006 5.13 7.21 31,853 6.25 4.00 4.76 8.97 0.60

PREMPAINTS 10.39 0 10.39 10.39 10.39 0.00 11 10.39 0.00 12 10.39 9.84 0.00PRESCO 36.01 0.00 1,079 36.83 38.01 35.90 -2.23 7,536 38.09 -5.46 73,227 49.00 32.00 -7.67 4.42 8.38

PRESTIGE 0.51 2.00 279 0.53 0.55 0.50 -3.77 54,177 0.53 -3.77 121,390 0.81 0.50 -19.05 1.99 0.25PZ 37.12 -1.67 1,569 38.00 38.00 37.12 -2.32 17,406 36.74 1.03 342,379 43.98 30.08 0.33 28.34 1.34

ROYALEX 0.57 7.55 10,509 0.52 0.57 0.50 9.62 13,522 0.52 9.62 41,791 0.69 0.50 5.56 5.69 0.10RTBRISCOE 0.95 -6.86 2,099 1.04 1.04 0.95 -8.65 10,816 1.15 -17.39 39,383 1.60 0.95 -32.62

SEPLAT 699.47 1.08 3,063 643.00 708.75 643.00 8.78 10,078 675.00 3.63 19,752 735.00 590.00 15.65SKYEBANK 3.17 -0.31 50,749 3.01 3.18 2.99 5.32 324,114 3.27 -3.06 1,862,062 4.67 2.99 -29.71 3.79 0.84STANBIC 30.01 2.28 38,078 31.00 31.40 29.00 -3.19 83,243 27.13 10.62 295,650 31.50 15.51 34.33 15.61 1.92

STERLNBANK 2.20 0.00 26,013 2.30 2.42 2.19 -4.35 173,324 2.30 -4.35 656,568 2.92 2.09 -12.00 3.49 0.63TOTAL 180.00 2.16 434 172.00 180.00 171.48 4.65 2,093 172.09 4.60 13,937 195.50 146.26 3.87 13.86 12.91

TRANSCORP 5.59 0.36 66,934 5.51 5.71 5.48 1.45 820,408 5.80 -3.62 6,214,985 6.03 1.17 28.80 63.71 0.09UAC-PROP 16.70 -1.76 3,243 16.61 17.40 16.61 0.54 11,725 17.20 -2.91 56,755 21.31 12.00 8.61 7.73 2.20

UACN 62.00 1.64 26,581 60.02 62.00 59.99 3.30 38,739 60.07 3.21 98,726 67.85 42.58 10.73 28.47 2.14UBA 7.90 0.13 111,731 7.49 7.91 7.40 5.47 767,442 7.90 0.00 2,413,048 9.60 6.65 -13.66 4.65 1.70

UBCAP 2.16 1.41 19,260 2.08 2.22 2.08 3.85 116,779 2.19 -1.37 789,267 3.04 1.05 -4.85 7.45 0.29UBN 8.94 3.83 14,699 8.45 9.00 8.18 5.80 47,214 9.65 -7.36 104,771 11.62 8.00 -6.97 48.14 0.19

UNILEVER 49.85 2.15 1,191 49.25 49.85 48.55 1.22 28,408 50.75 -1.77 312,782 65.00 42.50 -5.94 35.76 1.37UNITYBNK 0.50 0.00 3,593 0.50 0.50 0.50 0.00 65,457 0.50 0.00 3,136,197 0.72 0.50 0.00 4.65 0.11VITAFOAM 4.25 -0.70 1,878 4.33 4.33 4.01 -1.85 11,389 4.38 -2.97 72,551 5.70 3.66 -11.64 5.99 0.71

WAPCO 119.94 -1.69 1,096 120.00 124.98 119.94 -0.05 47,774 112.36 6.75 130,291 136.73 87.50 4.30 14.80 8.10WAPIC 0.82 -1.20 13,680 0.88 0.90 0.82 -6.82 174,290 0.87 -5.75 1,813,551 1.48 0.66 -27.43 11.71 0.07

WEMABANK 1.00 -0.99 11,285 1.01 1.05 0.98 -0.99 54,376 0.98 2.04 2,554,248 1.40 0.89 -21.88ZENITHBANK 25.00 0.04 97,784 25.05 25.45 24.78 -0.20 1,075,118 25.10 -0.40 2,477,488 27.40 19.23 0.00 7.22 3.46

Market review — August 4-8, 2014. The Nigerian equity market gained 1.6 per cent last week lifting the All Share Index to a YtD gain of 3.1 per cent.Total market capitalization increased by N219.3 billion, while aggregate volume advanced by 30.2 per cent. The week’s top gainers were CONOIL: 10.23%, ROYALEX: 7.55%, NNFM: 4.99%, PHARMDEKO: 4.76%, UBN: 4.53%, OKOMUOIL: 4.47%, IKEJAHOTEL: 4.23%, NPFMCRFBK: 4.17%, CUTIX: 4.17%, and PREMBREW: 3.90%.The following companies led in price declines. RTBRISCOE: -5.00%, AGLEVENT: -4.76%, ETERNA: -4.76%, JOSBREW: -4.65%, NEIMETH: -4.42%, AIRSERVICE: -4.07%, REDSTAREX: -2.73%, COSTAIN: -2.54%, WAPCO: -2.49%, and INTENEGINS: -1.96%.

MARKET SNAPSHOT

MARKET DATA VM5

3-MONTH PRICE TREND OF BELLWETHER STOCKS

LEGEND

ACCESS 9.8011.17.22

1YtD 0.202.08%

0.798.77%

-0.18-1.80%3M 1W

PE 6.300.18

May June July04/08

M T W T F

08/08

ASHAKACEM 34.2034.2013.87

1YtD 12.3256.31%

14.3171.95%

1.203.64%3M 1W

PE 42.501.20

May June July04/08

M T W T F

08/08

CADBURY 70.54110.0067.80

1YtD -26.64-27.42%

0.921.32%

0.000.00%3M 1W

PE 47.290.00

May June July04/08

M T W T F

08/08

CAP 39.9151.6635.96

1YtD -8.07-16.82%

1.052.70%

-0.09-0.23%3M 1W

PE 23.30-0.09

May June July04/08

M T W T F

08/08

CCNN 15.0015.988.00

1YtD 3.0125.10%

5.8163.22%

1.017.22%3M 1W

PE 13.411.01

May June July04/08

M T W T F

08/08

CONTINSURE 1.001.330.93

1YtD -0.20-16.67%

-0.07-6.54%

-0.12-10.71%3M 1W

PE 6.25-0.12

May June July04/08

M T W T F

08/08

FCMB 4.254.593.01

1YtD 0.4110.68%

0.6518.06%

0.020.47%3M 1W

PE 4.830.02

May June July04/08

M T W T F

08/08

GUARANTY 30.4431.8022.67

1YtD 2.699.69%

3.8414.44%

1.836.40%3M 1W

PE 9.311.83

May June July04/08

M T W T F

08/08

MANSARD 2.542.731.95

1YtD 0.041.60%

0.239.96%

-0.01-0.39%3M 1W

PE 16.350.01

May June July04/08

M T W T F

08/08

OANDO 27.3036.899.32

1YtD 0.572.13%

11.3070.62%

0.301.11%3M 1W

PE 24.490.30

May June July04/08

M T W T F

08/08

STANBIC 30.0131.5015.51

1YtD 7.6734.33%

8.0136.41%

-0.99-3.19%3M 1W

PE 15.610.99

May June July04/08

M T W T F

08/08

UBA 7.909.606.65

1YtD -1.25-13.66%

1.1517.04%

0.415.47%3M 1W

PE 4.650.41

May June July04/08

M T W T F

08/08

DANGCEM 230.00250.02185.00

1YtD 13.846.40%

5.002.22%

5.902.63%3M 1W

PE 10.535.90

May June July04/08

M T W T F

08/08

FIDELITYBK 2.022.951.85

1YtD -0.68-25.19%

0.126.32%

0.010.50%3M 1W

PE 2.970.01

May June July04/08

M T W T F

08/08

GUINNESS 196.20266.70162.00

1YtD -39.81-16.87%

16.209.00%

6.103.21%3M 1W

PE 25.386.10

May June July04/08

M T W T F

08/08

MOBIL 173.00178.84102.00

1YtD 57.0049.14%

44.2034.32%

12.787.98%3M 1W

PE 16.6612.78

May June July04/08

M T W T F

08/08

OKOMUOIL 35.9848.0532.15

1YtD -8.85-19.74%

0.381.07%

2.226.58%3M 1W

PE 15.712.22

May June July04/08

M T W T F

08/08

TOTAL 180.00195.50146.26

1YtD 6.703.87%

26.7717.47%

8.004.65%3M 1W

PE 13.868.00

May June July04/08

M T W T F

08/08

UNILEVER 49.8565.0042.50

1YtD -3.15-5.94%

1.342.76%

0.601.22%3M 1W

PE 35.760.60

May June July04/08

M T W T F

08/08

DIAMONDBNK 6.338.205.86

1YtD -1.17-15.60%

0.020.32%

-0.02-0.31%3M 1W

PE 3.870.02

May June July04/08

M T W T F

08/08

FLOURMILL 79.0092.0063.91

1YtD -11.00-12.22%

10.0014.49%

1.331.71%3M 1W

PE 23.481.33

May June July04/08

M T W T F

08/08

HONYFLOUR 4.144.502.56

1YtD 0.297.53%

0.4211.29%

-0.04-0.96%3M 1W

PE 12.180.04

May June July04/08

M T W T F

08/08

NASCON 10.3615.1010.07

1YtD -4.49-30.24%

-2.06-16.59%

0.242.37%3M 1W

PE 9.940.24

May June July04/08

M T W T F

08/08

PRESCO 36.0149.0032.00

1YtD -2.99-7.67%

0.812.30%

-0.82-2.23%3M 1W

PE 4.420.82

May June July04/08

M T W T F

08/08

UACN 62.0067.8542.58

1YtD 6.0110.73%

17.2038.39%

1.983.30%3M 1W

PE 28.471.98

May June July04/08

M T W T F

08/08

WAPCO 119.94136.7387.50

1YtD 4.944.30%

10.759.85%

-0.06-0.05%3M 1W

PE 14.800.06

May June July04/08

M T W T F

08/08

ETI 18.4918.6012.40

1YtD 2.1012.81%

5.6544.00%

1.629.60%3M 1W

PE 5.001.62

May June July04/08

M T W T F

08/08

FO 240.00259.9435.00

1YtD 147.13158.43%

98.4569.55%

11.104.85%3M 1W

PE 51.8111.10

May June July04/08

M T W T F

08/08

INTBREW 27.1231.5017.98

1YtD -1.20-4.24%

2.419.75%

1.023.91%3M 1W

PE 43.631.02

May June July04/08

M T W T F

08/08

NB 185.00189.00140.00

1YtD 19.9912.11%

36.0024.16%

0.000.00%3M 1W

PE 35.170.00

May June July04/08

M T W T F

08/08

PZ 37.1243.9830.08

1YtD 0.120.33%

1.925.45%

-0.88-2.32%3M 1W

PE 28.340.88

May June July04/08

M T W T F

08/08

UAC-PROP 16.7021.3112.00

1YtD 1.328.61%

-1.47-8.08%

0.090.54%3M 1W

PE 7.730.09

May June July04/08

M T W T F

08/08

ZENITHBANK 25.0027.4019.23

1YtD 0.000.00%

2.058.93%

-0.05-0.20%3M 1W

PE 7.220.05

May June July04/08

M T W T F

08/08

TICKER 25.2327.4019.23

1YtD 0.230.92%

2.9012.99%

0.010.04%3M 1W

PE 7.290.01

May June July21/07

M T W T F

25/07

FBNH 15.4817.2911.50

1YtD -0.82-5.03%

2.4318.62%

1.087.50%3M 1W

PE 7.141.08

May June July04/08

M T W T F

08/08

GLAXOSMITH 62.4174.9758.50

1YtD -7.59-10.84%

-7.64-10.91%

-3.44-5.22%3M 1W

PE 21.683.44

May June July04/08

M T W T F

08/08

JBERGER 66.6576.4559.18

1YtD 3.585.67%

2.103.26%

3.265.14%3M 1W

PE 9.643.26

May June July04/08

M T W T F

08/08

NESTLE 1110.001250.01916.00

1YtD -72.00-6.09%

39.993.74%

4.900.44%3M 1W

PE 38.514.90

May June July04/08

M T W T F

08/08

SEPLAT 699.47735.00590.00

1YtD 94.6715.65%

9.471.37%

56.478.78%3M 1W

PE --56.47

May June July04/08

M T W T F

08/08

3 4 5

9

13

10 11

12

6

8

14

7

21

1. 52-week low price2. Year low price3. Current price4. Year high price5. 52-week high price6. Current price7. 5-day price change8. PE ratio9. 1-year price change10. 3-months price change11. 1-week price change12. Daily price movement over 3 months.13. 30-day moving average14. Daily price movement over last week


MARKET DATAVM6 VM | Monday, August 11, 2014 | Issue 005

MARKET SNAPSHOT

# TICKER WTD YTD

1 DANGCEM 2.63 6.40

2 NB 0.00 12.11

3 GUARANTY 6.40 9.69

4 NESTLE 0.44 -6.09

5 ZENITHBANK -0.20 0.00

6 FBNH 7.50 -5.03

7 WAPCO -0.05 4.30

8 STANBIC -3.19 34.33

9 GUINNESS 3.21 -16.87

10 ETI 9.60 12.81

11 UBA 5.47 -13.66

12 FO 4.85 158.43

13 OANDO 1.11 2.13

14 ACCESS -1.80 2.08

15 TRANSCORP 1.45 28.80

16 UNILEVER 1.22 -5.94

17 FLOURMILL 1.71 -12.22

18 UBN 5.80 -6.97

19 PZ -2.32 0.33

20 CADBURY 0.00 -27.42

21 UACN 3.30 10.73

22 DANGSUGAR -0.11 -20.35

23 DIAMONDBNK -0.31 -15.60

24 INTBREW 3.91 -4.24

25 JBERGER 5.14 5.67

26 FCMB 0.47 10.68

27 7UP 12.84 77.49

28 ASHAKACEM 3.64 56.31

29 MOBIL 7.98 49.14

30 TOTAL 4.65 3.87

31 GLAXOSMITH -5.22 -10.84

32 FIDELITYBK 0.50 -25.19

33 CONOIL 22.18 23.50

34 STERLNBANK -4.35 -12.00

35 SKYEBANK 5.32 -29.71

36 PRESCO -2.23 -7.67

37 OKOMUOIL 6.58 -19.74

38 CAP -0.23 -16.82

39 NEIMETH -8.47 -1.82

40 MAYBAKER -1.22 -36.47

WEEK-TO-DATE RETURN-10% -5%

-40%

-20%

-30%

-10%

0%

+10%

+20%

+30%

+40%

+50%

+60%

+70%

+80%

+100%

+90%

+120%

+130%

+150%

+140%

+110%

+160%

0% 5% +25%+20%+15%+10%

YEA

R-TO

-DAT

E RE

TURN

LAGGING

SLIPPING LEADING

IMPROVING

1

23

45

6

7

8

9

10

11

12

1314

15

16

1718

19

20

21

22

23

24

2526

27

28

29

30

31

032

33

34

35

36

3738

39

40

The relative size of each individual stock’s bubble chart is determined by its market capitalization. For indices, the relative size of each bubble chart is the total value of the capitalization modified values of each constituent stock.

TRADING BREAKDOWN BY SECTOR

Sector %

Financial Services 75 \ 76

Conglomerates 6 \ 8

Oil & Gas 6 \ 6

Others 13 \ 10

04/08 08/0806/0812.5

12.6

12.7

12.8

12.9

2906

2912

2918

2924

2930

FGN Bond Index

Market Value YTD Return

INDEX PERFORMANCE

Index Week Opening

Week Close Change WtD MtD QtD YtD

1 All Shares Index 41,801.51 42,598.46 796.95 1.58 1.19 0.27 3.07

2 NSE 30 Index 1,909.01 1,946.39 37.38 1.73 1.30 0.76 2.06

3 NSE Banking Index 427.85 441.52 13.67 3.28 1.87 2.00 -1.41

4 NSE Insurance Index 146.18 144.4 -1.78 -2.28 -2.29 -1.65 -5.54

5 NSE Consumer Goods Index 1,056.28 1,070.19 13.91 1.36 1.15 1.13 -2.73

6 NSE Oil/Gas Index 468.13 493.37 25.24 4.63 5.01 5.37 45.16

7 NSE Lotus Islamic Index 2,777.80 2,805.84 28.04 0.53 0.25 -2.39 -2.00

8 NSE Industrial Index 2,711.50 2,736.06 24.56 0.40 0.84 2.60 7.44

MARKET SNAPSHOT

Date Deals Turnover Volume Turnover Value Traded Stocks Advanced

StocksDeclined Stocks

Unchanged Stocks

All Shares Index Value

1 04.08.2014 5,480 287,650,341 4,936,264,068.76 113 29 26 58 41,801.51

2 05.08.2014 5,788 257,005,662 3,635,951,100.93 117 35 13 69 42,292.93

3 06.08.2014 5,736 323,913,132 4,874,077,861.67 117 \ 119 19 \ 29 38 \ 29 60 \ 61 42,339.84

4 07.08.2014 4,637 201,385,464 3,012,919,333.14 123 \ 118 34 \ 24 18 \ 34 71 \ 60 42,612.33

5 08.08.2014 4,648 360,020,617 3,725,588,006.50 129 \ 103 30 \ 19 25 \ 36 74 \ 48 42,598.46

The \ arrow signifies week-on-week change in value. This week’s value is shown on the left of the \ sign, and last week’s value on the right.

GLOBAL INTEREST RATES & INFLATION TARGETSCentral Bank Rate Last Date

Change%

Change Inflation

TargetChina 6.00% 05.07.2012 -0.31 4.00%Japan 0-0.10% 05.10.2010 -0.20 2.00%

UK 0.50% 05.03.2009 -0.50 2.00%USA 0-0.25% 16.12.2008 -0.75 2.00%

Eurozone 0.15% 05.06.2014 -0.10 <2.00%Brazil 11.00% 02.04.201 +0.25 4.5% +/-2.0%Canada 1.00% 20.07.2010 +0.25 2.0% +/-1.0%Egypt 8.25% 05.12.2013 -0.50

India 8.00% 28.01.2014 +0.25Indonesia 7.50% 12.11.2013 +0.25 4.5% +/-1.0%Malaysia 3.25% 10.06.2014 +0.25Mexico 3.00% 06.06.2014 -0.50 3.00% +/-1.0%Morocco 3.00% 28.03.2012 -0.25Nigeria 12.00% 10.10.2011 +2.75 6.00% - 9.00%Qatar 4.50% 10.08.2011 -0.50Russia 8.00% 28.07.2014 +0.50 5%*

Thailand 2.00% 12.03.2014 -0.25 0.5% - 3.0%Turkey 8.75% 24.06.2014 -0.75 5.00%

* +/- 1.5 pct point uncertainty band

Indices

ASI

NSE30

NSEBNK

NSEINS

NSECNSMRGDS

NSEOILGAS

NSELOTUSISLM

NSEINDUSTR

1.58%-0.03%

1.73%-0.11%

3.28%0.13%

-2.28%-0.08%

1.36%-0.51%

4.63%1.86%

0.53%-0.13%

0.40%-0.91%

3.07%

YtD, % WtD, % DtD, %

2.06%

-1.41%

-5.54%

-2.73%

45.16%

-2.00%

7.44%

-6% -4% -2% 0% 8%4% 6%2%

FrTh50,60

50,80

51,20

51,00

51,4050,674.61

Mo Tu We Th

JSE FTSE

MoFr6,565

6,595

6,655

6,625

6,6856,567.36

Tu We Th Fr

FTSE 100

MoFr1,900

1,910

1,930

1,920

1,9401,931.59

Tu We Th Fr

S&P 500

MoFr41,74

41,96

42,40

42,18

42,6242,598.46

Tu We Th Fr

NSEASI

CORPORATES

COMMENTARIAT VM7VM | Monday, August 11, 2014 | Issue 005

Bisi Onasanya, CEO, First Bank, (left) shakes hands with Efi Dahan, PayPal regional director at signing of partnership

Union Bank head office, Marina

MTN vendor standSola David-Borha, Stanbic IBTC CEO

PayPal’s second bounce of the ball

T IS NO LONGER news that PayPal has started operations

in Nigeria. At a big launch in July, Efi Dahan, regional director for Israel and Af-rica at PayPal, announced a partnership with First Bank and urged global payments processing companies to end the online discrimination against purchase orders that originate from Nigerian IP addresses.

Where many have not con-nected the dots is that eBay, the online auction company, which owns PayPal is prep-ping to launch its services in Nigeria. With the payments

channel in place, all that re-mains is the logistics angle. That is being looked into.

Malvina Goldfeld, Pay-Pal’s head of business de-velopment for sub-Saharan Africa, observed that while Nigeria has 63 million active Internet users, only 1 per cent of that number make online transactions, which are ex-pected to reach $1 billion this year. This would translate to 630,000 customers making $1,590 in online purchases. The opportunity for growth is vast in both the buyer popu-lation and total spend per buyer.

She went on to say that

‘though challenges remain - including abysmal infrastruc-ture, port delays, other sup-ply chain woes and the task of persuading shoppers to trust websites with their bank de-tails, a lot of the merchants that we work with already ship to Nigeria. I think that the growth of e-commerce will push the logistics cus-tomers to up their game.’

It does not take genius to see that DHL, FedEx, and the other courier companies would be deep in discussions with eBay to finalise logistics for global online purchases from Nigeria on the auction site. ;

I

O

Small print at Stanbic IBTC’s H1 2014 investor presentation

Company in the News: Diamond Bank

LMOST HIDDEN away as the last bul-let point of slide 31

(Moving forward) of Stanbic IBTC’s half year presenta-tion to analysts and investors is a single line mention that the bank would ‘raise Tier II capital of up to N30 billion.’ No further details are given.

Whichever way one looks at it N30 billion is not chump change.

All the more reason why in-vestors are asking why Sola David-Borha, the chief ex-ecutive of the South African bank’s Nigerian operations, included it almost as an after-thought. ;

MTN to sell towers

TN GROUP, THE telecom operator, has revealed that it

is in an advanced stage to sell its tower business in Nigeria. Sifiso Dabengwa, MTN’s chief executive, announced that it would be disposing of 8,640 existing and 543 towers-un-der construction at a presen-tation of the company’s H1 results.

MTN would subscribe to 51% controlling equity in the new externally managed ven-ture.

The company has been aggressively pursuing cost reduction in Nigeria. It has focused these on two areas: reduction in dealer commis-sions and marketing expens-es, as well as reviews of rents and utility bills. ;

Union Bank leaps again

N HIS RESUMPTION as chief executive of Union Bank in

2013, Emeka Emuwa de-clared that: ‘When you men-tion the name Union Bank, one of the first things that come to people’s minds is ‘Big, Strong, Reliable. In-deed, Union Bank was once all these. Our long-term goal is that Union Bank will be all three again – big, strong and reliable. But for today, our fo-cus is on being reliable.’

Since then the former Citi-

bank Nigeria chief executive has led the bank on an ar-duous, steady crawl up the banking league tables. As banks non-interest income has come under pressure from regulatory restrictions, they are turning back to good old loan book expansion. Un-ion Bank is not left behind.

According to Oyinkan Adewale, the bank’s chief financial officer and Citibank Nigeria alum, Union Bank would grow its loan portfolio by 30 per cent in the second

half of 2014. It grew loans by 10 per cent in the first six months.

In April, Atlas Mara, the investment vehicle of Bob Diamond, ex-Barclays Bank CEO, bought 9.1 per cent of the bank. Keffi Group, founded by Jide Zeitlin, a former global chief operating officer of Goldman Sachs is another prominent investor. He was part of the Union Global Partners Limited consor-tium to invest $750 million in the bank in July 2011. ;

Consensus detail DIAMOND BANK PLC


Source: Dailypost.ng

A

M

Source: Thomson Reuters

4Buy Consensus Sell BuyOutperform

Hold

Underperform

Sell

Unchanged

7

0

0

0

0

Mean consensus OUTPERFORMNumber of Analysts 11Average target price 9,66 NGNLast Close Price 6,40 NGNSpread / Highest target 77%Spread / Average Target 51%Spread / Lowest Target 25%

Source: UNION BANK and CUSTOMS STREET ADVISORS

Net Loans (% Assets)

02009 2010 2011 2012 2013 TTM

10%

20%

40%

30%

50%

60%

70%


UBN-NG Peers

Source: MTN.com

MTN Expenses in Nigeria

0Dec 2012 Dec 2013 Jun 2014

50M

100M

200M

150M

250M

300M

350M


H1H2

313,904

58.3%EBITDA margin

58.3% 58.3%

312,473

154,042131,440 165,121

165,121

ART AS AN ALTERNATIVE INVESTMENT

EDITOR: MIDENO BAYAGBON

GROUP BUSINESS EDITOR: OMOH GABRIEL

CONTENT DIRECTION: OBIORA TABANSI ONYEASO

DESIGN & ILLUSTRATION: PUBLICAN MEDIA

Vanguard Markets features unbiased, in-depth coverage of corporate and market developments across a wide range of business sectors.Every week, Vanguard Markets delivers essential business analysis and commentary on Nigerian companies, regional economies, and global markets. Vanguard Markets is published by Vanguard Media Limited in associa-tion with Customs Street Advisors Limited, a specialist communications consultancy.

Vanguard Media Limited, Vanguard Avenue, Kirikiri Canal, P.M.B.1007, Apapa.

Website: www.vanguardngr.com

ISSN 0794-652X

Published by

In Association With

AST WEEK, WE an-alyzed auction results for celebrated Nige-

rian artist, Yusuf Grillo, taking a look at indications of future values for his paintings. In the past we have also looked at photography as a good invest-ment asset in the collector’s portfolio.

This week, we will explore the life and work of one of the most iconic figures in African photography, Malick Sidibé. In achieving our objectives, results of auction sales of his work from major international auction houses such as Bon-hams, The Auction Room and Christies will be examined.

Malian photographer, Mal-ick Sidibé is best known for his black-and-white studies of popular culture in Bama-ko. Born in 1935 into a Peul (Fulani) family in a small vil-lage in Soloba, he graduated from school in 1952. He later completed his studies in De-sign and Jewelry at the École des Artisans Soudanais in Bamako. In 1955, he served an apprenticeship at Gérard Guil-

lat–Guignard’s Photo Service Boutique, known famously as Gégé la Pellicule. The follow-ing year, he took up photogra-phy as a profession.

In 1958, he opened his own studio called Studio Malick in Bamako, specializing in docu-mentary photography and focusing on the youth culture of the Malian capital. By the 1970s, he had turned his at-tention towards studio por-traiture.

Sidibé gained increased photography recognition through the first meeting on African photography held in Mali in 1994. His work has since been exhibited exten-sively across Africa, Europe, the United States and Japan.

Sidibé has also received sev-eral awards including the Has-selblad Award for photography (2003), 52nd Venice Bien-nale’s Golden Lion (2007), and the ICP Infinity Award for Life-time Achievement (2008). His works are in the collection of several prominent institutions and museums and form part of the Jean Pigozzi Contemporary African Art Collection (CAAC).

In a fitting tribute, in 2006, Tigerlily Films made a docu-mentary, Dolce Vita Africana on him at work in his studio in Bamako. The documentary also features him discussing his work at a reunion with many of his friends and for-mer photographic subjects.

Close observations of prices

for photographs on the inter-national market by Malick Sidibé reveal an increasing in-terest from collectors. In No-vember 2002, Christie’s Paris, Photographies included Les Nouveaux Circoncis by Sidibé in its sale, which realized the sum of €1,880 (N183,227).

This rise in interest from collectors has led to grow-ing prices for the photogra-pher’s work. In April 2010, Christie’s New York sale of Selections from the Baio Collection of Photography included Sidibé’s Les Vrais Lycéennes, Bal Fin d’Année, Lycée de Filles (1966). It sold for $2,500 (N372,165) against its presales estimate of $2,000 (N297,732).

Subsequent sales of Sidibé’s work include Le deux amis (1971) which fetched a princely sum of €3,250 (N654,403) at Christie’s Paris October 2012 sale, Rendez-vous Interieurs contemporains. The photo-graph was previously estimat-ed at €2,500 (N503,387).

The year 2013 was also an eventful one for Malick Sidibé on the auction market. Some of the highlights include Bon-hams’ May 22, 2013 Africa Now sale, where a set of three signed photographs, Yokoro (1970), Danseur Mérengué (1964) and Les deux soeurs en même tenue (1977), each made in gelatin print, sold for £2,250 (N534,850, includ-ing buyer’s premium). An-

other important highlight is the sale of Hercule Africain (1970), silver gelatin print, at £2,233 (N530,809) previously estimated between £2,000 - 3,000, (N475,422 - 713,133). The photograph was sold at The Auction Room with al-most all the photographs sell-ing approximately 20% above their initial estimates.

In 2014, Sidibé’s Yokoro (2006), gelatin silver print was sold for $5,000 (N804,760, including buyer’s premium). This result underscores the growing appreciation for Sidibé’s life work, which spans about 6 decades, as well as an increasing global interest in photography from the conti-nent. ;

Artist dossier: Malick Sidibé

ARENAVM8 VM | Monday, August 11, 2014 | Issue 005

Oliver Enwonwuis the director of leading Lagos gallery, Omenka and president of the Society of Nigerian [email protected]

L

Malick Sidibé, Yokoro, (2006), gelatin silver printMalick Sidibé, Hercule Africain (1970), silver gelatin print

UDE FEJOGWU, principal analyst at Thaddeus In-

vestment Advisors & Re-search, has a different take on bankers’ compensation. He writes that in Nigeria there is no direct relationship between wage increases for bank em-ployees and increased produc-tivity, earnings, and return on equity. This flies in the face of popular wisdom.

In Europe and North America the debate has been mainly around salaries and

bonuses paid to top bankers. It has never dipped down to question the take-home pay of the rank-and-file.

But Fejogwu has the num-bers to back up his argument. Admittedly, he uses an arcane system, proprietarily named the Thaddeus employee val-ue added ranking (TEVAR). They are worth looking at.

In 2013, First Bank de-creased its average salary per head by 12 per cent, and productivity climbed up by 3 per cent. In the same year,

GT Bank cut its average sal-ary per head by 26 per cent, while increasing head count by 24 per cent. There were no adverse consequences because staff at the bank in-creased productivity by 14 per cent. Sterling Bank has ranked the lowest paying bank for two years in a row though it made a slight increase in average salaries by 7 per cent in 2013. Its employees raised productivity by 14 per cent.

On the other side of the coin, Access Bank increased

its average employee salary by 34 per cent during the pe-riod while TEVAR dropped 8 per cent. On the same note, Zenith Bank raised average salary per head by 29 per cent, and saw its staff produc-tivity decline by 10 per cent. Fidelity Bank raised salary per head by 12 per cent and experienced a whopping 63 per cent slide in employee productivity.

The moral of the story must be that you can pay premium and still get monkeys. ;

HUMAN RESOURCES

Team spirit. The female football team of Ansar-Ud Deen Girls High School, Itire huddle together at the GT Bank sponsored Heritage Cup, Season 2

Source: gtbank.com

Counterintuitive compensation scalesJ

Vanguard Markets, August 11, 2014 edition

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