The scorecard for the listed banks that have reported their H1 results is mixed. We believe that it is a matter of timing changes in interest rates and that Q3 is likely to be a better story than Q2 and H1. See details below. FX Last week, the exchange rate at the Investors and Exporters …
More →eNaira- Yay or Nay? In a recent press statement, the Central Bank of Nigeria (CBN) stated its plans to launch its Central Bank Digital Currency (CBDC) pilot scheme called the eNaira on 1 October 2021 with Bitt Inc, a financial technology company that utilises blockchain and distributed ledger technology to facilitate secure peer-to-peer transactions, as …
More →Summary Opening market liquidity was reported at NGN445.4bn on Friday (03 Sep ‘21). Overnight and repo rates closed within a range of 10.0-13.5%. The secondary market for NTBs was relatively active. As a result, the average NTB yield declined by 34bps over the week to close at 4.6%, while the average yield for OMO bills …
More →At the end of the second quarter of the year we wrote about how Nigerian banks were moving lending rates in order to accommodate rising market interest rates (see Coronation Research: Nigerian Banks, Resilience Built In, 25 June). Since then market interest rates, and interbank lending rates, have been falling. This suggests margin expansion for …
More →A new economy, a digital one fueled by technological innovation, is emerging and the COVID-19 pandemic has only accelerated this technological transformation, bringing about changes in work, skill requirements, work tools and work relationships. There were concerns preceding the pandemic about the continuity of certain jobs, which have deepened as a result of the COVID-19 …
More →The NBS has released its August inflation report to show – Headline rate 17.01% y/y (17.38% in July): Core rate 13.41% y/y (13.72%); and Food rate 20.30% y/y (21.03%).  August’s headline reading declined by 37bps (when compared with the previous month) to 17.01% y/y. Food inflation also recorded a decline (of 73bps). The highest …
More →Over the past three weeks, the Nigeria Weekly Update has examined how total cumulative equity returns (returns with dividends reinvested) have outperformed equities this year and examined the best dividend-paying stocks. Yet, over a long study period (six years) the returns have been poor. The reason, we believe, is the de-rating of the market, with …
More →As fixed income yields tighten the dividend yields of some of the largest stocks listed on the NGX Exchange are beginning to look juicy. From our own brokerage activity, we are aware of how investors appreciate dividend yields. So, the question is as follows. Could one construct a portfolio of high dividend-paying stocks and thereby …
More →For the past 10 weeks we have documented the flow of liquidity back into the Nigerian Treasury Bill (T-bil) and FGN bond markets, and the resulting fall in yields. Yet inflation has not fallen as quickly, and so stays well ahead of the yields available on risk-free Naira investments. Yields are now so low that …
More →Wise investors in the Nigerian equity market count the dividend yields of the stocks they hold. These days, and with T-bill yields and bond yields trending downwards (and far below the level of inflation), there are some stocks with yields as strong as fixed income. As investors consider risk assets, like equities, again, they need …
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