Author: merchant-bank
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A difficult fiscal position
The fiscal position of the Federal Government of Nigeria (FGN) is, not surprisingly, tight, as oil prices have crashed and economic growth has slowed down. As we describe below, being able to re-finance debt cheaply is critical to the FGN. So, the fact that Naira interest rates are so low (no government T-bill or bond […]
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The mystery of Naira liquidity
When a currency is under pressure you expect interest rates to go up, and the long-term (we mean 10-year) lesson is that this generally happens in Nigeria. But is it not happening now. A huge amount of liquidity held by investing institutions (such as pension funds and mutual funds) is seeking a home. The result […]
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Coronation Merchant Bank Images
Coronation Merchant Bank Boardroom Coronation Merchant Bank Boardroom
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Oil back to normal?
The confusing thing about oil prices is that, after the Organization of the Petroleum Exporting Countries (OPEC) and Russia agreed to production cuts in mid-April, prices continued to fall for a further two weeks. Since late April the price of Brent crude has more than doubled. The reason for the continued fall during April was […]
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Agusto affirms Coronation Merchant Bank’s rating at A+ with Stable Outlook
Coronation Merchant Bank remains one of the top-rated merchant Banks in Nigeria as shown by the recently released Rating Report by Agusto&Co, a foremost rating agency in Nigeria. In the Report, Agusto affirmed the A+ rating assigned to the Bank with stable outlook and stated that the rating reflects the Bank’s position in the merchant […]
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Nigeria GDP: Sliding into recession
On Monday we learned about Q1 2020 GDP, up by 1.87% year-on-year (Q4 2019: +2.27% y/y) with Non-oil growth at just 1.55% y/y. The Non-oil growth drivers were Agriculture and Telecoms, but both showing slightly weaker growth than before. Going forward, we expect the large Trade sector to continue with negative growth (-2.82% in Q1), […]
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Coronation Merchant Bank organizes virtual forum on the impact of COVID-19 and declining Oil Prices on the Nigerian Economy
Despite the uncertainties in the economy, Coronation Merchant Bank remains optimistic that there are yet investment opportunities in Nigeria’s economy. This was disclosed by a team of analysts at the Coronation Breakfast Session, tagged “Discovering the New Normal: Impact of COVID-19 and Collapse of Oil Prices” that held recently in Lagos. The breakfast session which […]
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Economic policy outcomes
Last week the Central Bank of Nigeria (CBN) surprised the market by cutting its policy rate from 13.50% to 12.50%, a clear signal that it approves of market interest rates (see sidebar) that are all below inflation. The CBN’s idea is to avert a recession with a monetary stimulus after a weak GDP print (growth […]
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Low interest rates in a low-growth economy
The Monetary Policy Council (MPC) of the Central Bank of Nigeria (CBN) meets this week to consider its policy rate and the overall direction of interest rates. As we pointed out last week, the upward movement in the CBN’s foreign exchange reserves, combined with the positive direction in oil prices and the stock market, gives […]
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Breathing space for FX reserves
The foreign exchange reserves of the Central Bank of Nigeria (CBN) are going up again. This is largely thanks to public-sector loans (such as the US$3.4bn facility granted recently by the IMF) to the government. It is tempting to see such loans as the building blocks of a bridge; this bridge takes the CBN’s FX […]
