Naira appreciates for second day on dollar sales

Nigeria’s naira appreciated for a second day against the dollar on bets month-end dollar sales by oil companies and increased oil exports by sub-Saharan Africa’s second largest economy will support the local currency.

The currency of Africa’s biggest oil producer strengthened 0.1 percent to 157.53 per dollar as of 11:30 a.m. in Lagos, the commercial capital. The oil industry, which is the second major supplier of foreign exchange after the central bank, often sells dollars to lenders around the month-end period to meet domestic spending needs.

Nigeria plans to boost crude exports in May to a 10-month high, by exporting 69.3 million barrels, or 2.24 million barrels a day, the most since July. That compares with 78 cargoes totaling 2.22 million barrels a day for April, according to loading plans obtained by Bloomberg News. “Month-end implies naira strength as energy firms increase their offerings of U.S. dollars on theinterbank market,” Celeste Fauconnier and Nema Ramkhelawan-Bhana, Africa analysts at Rand Merchant Bank in Johannesburg, wrote in an e-mailed note today.

“The increase in export volume should provide some cushion to the Nigerian foreign exchange reserve in the face of global oil demand” and provide support for the naira, Lagos-based Cowry Assets Management Ltd. analysts led by Edgar Ebinum, wrote in an e-mailed note today. Foreign reserves have risen 7.9 percent this year to $35.6 billion as of March 29, the central bank published on its website today.

The nation’s bonny light crude is trading at more than $50 a barrel above the $72 a barrel incorporated into Nigeria’s 2012 budget, according to the bank. The yield on Nigeria’s $500 million of dollar bonds due 2021 fell 10 basis points to 5.288 percent.

Borrowing costs of domestic bonds due 2015 fell 21 basis points to 15.25 percent, according to the Financial Markets Dealers Association website.

Source:Businessdayonline

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MFBs laud CBN for stoping daily cash withdrawal limits

The National Association of Microfinance Banks (NAMB) has commended the Central Bank of Nigeria (CBN) for waiving the daily cash withdrawal limit of N1 million for its customers.

Mr Olufemi Babajide, the Chairman of the Lagos chapter of NAMB, commended the CBN for the waiver in an interview in Lagos on Saturday.

CBN had on March 5 granted the waiver to some customers of the Primary Mortgage Institutions (PMIs) and Microfinance Banks (MFBs).

A circular issued by Mr Gaius Emokpae, CBN’s Assistant Director (Banking and Payment System), said that the waiver was due to the nature of their businesses.

“PMIs and MFBs are specialised banks under the new banking model and they have customers that maintain savings demand and time deposit accounts with them.

“As deposit-taking institutions, they are obliged to honour the withdrawal requests of their customers and other deposit obligations.

“It is imperative to note that the aggregate withdrawal by the depositors of MFBs and PMIs per day could exceed N1 million, thus necessitating those institutions to withdraw over N1 million from their correspondent banks in order to service their customers,” the circular stated.

Babajide said that the CBN’s waiver would enable microfinance bank operators in the country to perform their functions efficiently.

“It will also reduce the heavy cost that may overweigh the banks,’’ he said.

Babajide said that this would also boost the customers’ confidence in the microfinance banks.

He, nonetheless, called on CBN to continue with its sensitisation programmes on the cashless economy policy so as to foster a better understanding of the policy by the public.

“Many traders in the country still find it tough to operate Automated Teller Machines (ATMs), not to talk of other machine operations which require greater skills,” he said.

NAN reports that the cash withdrawal limit policy, which started in Lagos on Jan.1, will be extended to other states by June.

Under the directive, individuals are not allowed to withdraw more than N150,000 per day, while withdrawals by corporate organisations should not exceed N1 million.

Any withdrawal above N150, 000 for individuals would attract a penalty of N100 on every N1, 000 and N200 on every N1000 for corporate organisations

The objective of the policy is to reduce cash-based business transactions.

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Nigerian naira falls 12/03/2012

The Nigerian naira weakened against the US dollar on the interbank market on Monday, on strong demand by some banks filling their customers' needs for dollars, as dollar liquidity gradually dries up in the market, traders said.

The naira closed at 157.90 to the dollar compared with the 157.30 to the dollar on Friday.

Traders said the naira eased to 158.35 intraday before it finally settled at the 157.90 level, at the close of the market, on buying pressure from banks meeting their customers' demand for dollars.

A trader said the central bank was not meeting all demand for dollars at the auction, while more customers were resorting to the interbank to fill their needs.

The naira has performed well against the dollar since the start of the year, largely driven up by offshore investors into local debt instruments, which currently offer attractive yields.

“We expect that the naira will rebound this week as speculation is that there's an NNPC (state-owned energy company) plan to sell around $300 million to fill the market,” another dealer said.

At the bi-weekly auction, the central bank sold $150 million at 156.06 to the dollar, compared with $150 million sold at 156.01 to the dollar at the previous auction on Wednesday. - Reuters

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CNN to buy Mashable for $200m

According to reports, international news giant CNN, a unit of Time Warner, is in talks to acquire the social news website Mashable for $200 million. Mashable, an American news website and news blog founded by Pete Cashmore in 2005, specialises in technology and social media.


 However the blog now also covers business and entertainment. Mashable is said to have over 15 million monthly visitors and 4 million social media followers across Twitter, Facebook and Google+.

The Reuters blogger Felix Salmon has learned from an unnamed source that CNN will buy social media website Mashable for more than $200 million. The source said that the announcement is expected for Tuesday.

There is also a social media hint about this acquisition. Reportedly, Adam Ostrow, the executive editor of Mashable, "liked" Salmon's story for Reuters on Facebook.

However, according to New York Times, officials at CNN denied that an announcement would be made on Tuesday. Also, spokespeople from both CNN and Mashable declined to comment on the potential acquisition.But if it happens, this will be CNN.com's largest acquisition till date.

Last August, CNN acquired Zite, a company that made an iPad app to determine what its users want to read and view, for a price calculated to be between $20 million and $25 million.If the rumours turn out to be true, this will be the latest in the chain of tech news site purchases. The trend began with AOL, when it purchased popular technology blog TechCrunch in September 2010 for estimated $25 million.

Following this, SAY Media, a digital publishing company headquartered in San Francisco, bought the web tech blog ReadWriteWeb in December last year; and GigaOm purchased ContentNext, paidContent's parent company in February this year.

If CNN acquires Mashable, it will, however, be the highest amount paid for a tech news site.

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Zenith Bank posts N60bn profi - to pay dividend of 95k per share

Lagos – Zenith Bank has posted a Profit Before Tax (PBT) of N60bn which represents an increase of 21 per cent over the N50bn recorded in the corresponding period of 2010.

Profit after Tax (PAT) stood at N44bn over N37bn, an increase of 18 per cent. The Bank has proposed a dividend pay -out of N29.8 billion up from N26.7 billion paid out in 2010.

The result which was released on the floor of the Nigerian Stock Exchange (NSE) in Lagos on Friday showed that the bank’s gross earnings rose by 27 per cent to N244billion, from N192billion, indicating an increasing dominance in its market share.

By this performance, Zenith Bank has surpassed analysts’ projections at Gabros Capital which had forecast a gross earning of N217.95 billion and a profit after tax of N51.63billion. Over the period, the Bank also grew its total assets (plus contingents) by 25 per cent to N3.5 trillion from the N2.8 trillion of the previous year. The result also shows the bank’s prudent approach to loan management as total non-performing credit facilities to total credit facilities stood at 4.00 per cent, a remarkable improvement over the 5.53 per cent recorded last year.

Net Interest Margin increased to 8.5 per cent in 2011 financial year end from 7.8 per cent in 2010. This highlights the bank’s ability to manage its funding cost resulting from its ability to generate cheap deposit liability. It is noteworthy, however, that the bank’s impairment charge increased to N24.3bn compared to N4.3bn in 2010 Financial Year.

The increase was largely caused by the N10.2bn general provision on Performing Credit Facilities and the haircut of about N5 billion on some legacy loans sold to the Asset Management Company of Nigeria (AMCON) and further downgrade of already provisioned loans.

The provision on Performing Credit Facilities was waived for all banks in 2010 by the Central Bank of Nigeria to aid recovery from the huge provisions of the previous year on Capital Market facilities. Furthermore, the bank in making the general provisions on performing loan facilities took some conservative positions by booking its provisions at higher than 1 per cent, a push towards returning provisions coverage to historical high level.

Only last February, the Bank emerged one with highest capitalization on the Nigerian Stock Exchange (NSE) with market capitalization of N424billion. Analysts and investors have hailed the result, which enhances Zenith Bank’s reputation as a market leader especially with regards to return on investment.

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NSE: Market Rises Further By N44bn

Transaction on the floor of the Nigerian Stock Exchange yesterday closed further on a positive note after mid cap shares recorded appreciation in the day, thus leading to both market performance indices appreciating by 0.66 per cent.

The All-share index rose by 142.03 basis points or 0.66 per cent to close at 21,068.34 from 20.926.31 recorded on Tuesday while the market capitalisation of equities appreciated by N44 billion or 0.66 per cent to close at N6.639 trillion from N6.595 trillion recorded the previous day.

Mobil Nigeria Plc and Cadbury Nigeria led on the price gainers’ table with a gain of five per cent and 4.99 per cent to close at N139.65 and N10.10 per share respectively while NCR Plc followed with a gain of 4.98 per cent to close at N10.74 per share.

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NNPC Rescues The Naira From Further Slide

State-owned oil firm, Nigerian National Petroleum Corporation (NNPC) yesterday saved the naira from depreciation when it sold $350 million to select lenders.

The Central Bank of Nigeria (CBN) only offered $150 million at the official window – Wholesale Dutch Auction System (WDAS).

The intervention by NNPC raised the value of the naira by 30 kobo to close at N157.50 at the inter-bank market from N157.80 it closed Tuesday.

Traders said NNPC sold around $350 million to some lenders, which provided support for the local currency, while expectations of additional sales of $350 million by the energy firm before the end of the week boosted outlook for the naira at the interbank.

"The naira is set to strengthen further in the coming days if the NNPC and other oil companies sell more dollars to the market as being speculated in the market," one dealer said.

Traders said dollar inflows from oil companies and off-shore investors have consistently provided support for the naira despite strong demand built up at both the interbank and official window.

More offshore investors are investing in Africa's second biggest economy's local debt instruments because of attractive yields, helping to support dollar supply to meet domestic demand.

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