Nigeria's forex reserves up 4.6 pct mth-on-mth to $38.9 bln

CBN Gov, Emefiele

Nigeria's foreign exchange reserves rose to $38.94 billion on July 24, a 4.67 percent increase over the level a month ago, when they were $37.20 billion, owing to slower draw downs by the central bank to defend local currency.
Data from central bank on Thursday showed the reserves of Africa's biggest economy have steadily grown in the last two months "due to increased accretion and moderation in the rate of  depletion," the central bank said.
Forex reserves were however down 17 percent year-on-year, the data showed. Reserves stood at $46.87 billion on July 24, 2013.
Nigerian local currency has remained stable at around 161-162 to the dollar on the interbank market and 155.75 on the official window ,on the back of support from dollar sales by some energy companies and offshore investors buying local debt.

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Nigerian naira flat vs dollar on oil firms' sales

The Nigerian naira closed unchanged against the dollar on the interbank market on Wednesday, after two days public holiday to mark a Muslim festival, supported by dollar sales by two major energy companies.
The local unit closed at 161.85 to the dollar, the same level it closed at on Friday before the holiday.
A unit of Royal Dutch Shell sold an undisclosed amount of dollars to some lenders, while Eni sold $5 million.
Month-end dollar sales by some energy companies have continued to provide support for the local currency in the last two weeks, keeping it within the band of 161.50-162 against the dollar.
"We see the naira stable around the present band in the near term, with more dollars expectated from some energy companies," one dealer said.

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Nigeria interbank rate rises as central bank drains liquidity

Nigeria's interbank lending rate climbed to 11.12 percent on Friday, compared with 10.50 percent last week, after a central bank open market operation (OMO) drained cash from the system.

Traders said the regulator sold OMO bills worth 415 billion naira ($2.6 billion), soaking up liquidity from banks and driving up lending rates.

Lenders have been unable to access their cash balances with the central bank for the third week, owing to a system glitch, meaning that banks have been dealing with their own cash flows rather than on sector-wide liquidity, traders said.

The open buy-back (OBB) rate climbed to 10.75 percent from 10.50 percent, 1.25 percentage points below the central bank's benchmark interest rate of 12 percent.

Overnight placements also rose to 11.50 percent, as against 10.50 percent last week. 

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Nigeria sells 134.9 bln naira in T-bills at mixed yields

Bonds

Nigeria sold 134.9 billion naira ($833 million) in treasury bills of three-month, six-month and one-year maturities, with three-fifths fetching lower yields than at the previous auction, the central bank said on Thursday, a day after the sale.
The central bank on Wednesday sold 34.88 billion naira in the 3-month paper at 9.84 percent, compared with 9.95 percent at the previous auction on July 9. It sold 48 billion naira in the 6-month debt note at 10.10 percent, 14 basis points lower than the 10.24 percent at the previous auction.
A total of 52 billion naira was sold in the one-year paper at 10.40 percent, higher than 10.34 percent similar-tenor paper fetched at the June 25 auction, the last time such paper was sold.
Demand for the debt was 305.74 billion naira, driven by high level of excess liquidity in the banking system, traders said.

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Nigeria naira up 0.12 pct on oil firm dollar sales

The Nigerian naira firmed against the greenback on Wednesday, lifted by month-end dollar sales from multinational oil companies buying the local currency to meet their domestic obligations, dealers said.
The local unit closed at 162.08 naira to the U.S. dollar, up 0.12 percent from 162.28 naira the previous day.
The local unit of Italy's Eni sold $20 million and France's Total sold $55 million, while two units of Addax sold a total of $10 million and Shell sold an undisclosed amount onto the interbank market, dealers said.
Multinational oil companies operating in Africa's biggest economy usually sell dollars every month in exchange for local currency to meet their local obligations.
Dealers expect the naira to strengthen further this week trading within a range of 161-162 level as more oil companies sell dollars.

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Nigeria holds rate at 12 pct, wants to lower it later

CBN Governor, Emefiele

Nigeria's central bank held interest rates at 12 percent on Tuesday, keeping them at the same level as the last two years, but its new governor said he would be seeking a gradual reduction in rates over the next five years.
Governor Godwin Emefiele, at his first Monetary Policy Committee (MPC) meeting since he was sworn in last month, flagged "underlying inflationary pressure" as one reason to be cautious and hold the policy rate as it is.
Nigeria's consumer inflation rose for the fourth straight month in June to hit 8.2 percent, a 10-month high, driven by higher food prices -- within the bank's current target of between 6 and 9 percent, but trending upwards.
"All measures of inflation have witnessed a progressive upward trend since February ... this trend should be monitored closely to achieve a reversal."
The corridor for borrowing from or lending to the bank remained 200 bps plus or minus that rate, the MPC decided. The liquidity ratio was retained at 30 percent. The private sector cash reserve requirement (CRR) was retained at 15 percent, while the private sector CRR was kept at 75 percent.
Emefiele said the bank was satisfied with relative stability in the macro economy and prices and that it welcomed a moderation in inflation, but he stayed the course of his predecessor Lamido Sanusi in keeping monetary policy tight.
Emefiele at his first press conference last month said he would seek to gradually reduce rates, in comments that send the naira down against the dollar.
But in an interview with Reuters the following day he clarified that there could be no rate cut until after the February 2015 presidential elections, when fiscal spending next has a chance to get under control.

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Nigeria's foreign reserves up 3.8 pct mth-on-mth-cenbank

Nigeria's foreign exchange reserves climbed to $38.49 billion on July 18, a 3.8 percent increase on a month ago, when they were $37.09 billion, owing to a more stable local currency, data from central bank showed on Tuesday.
Nigeria's naira has remained stable against the U.S dollar in the past two weeks around 161.5-162.25, supported by slowing demand for the dollars and increased dollar flows from independent sources other than the central bank.
Africa's top crude exporter's forex reserves were however down 18 percent year-on-year, the data showed. The reserves stood at $46.93 billion on July 18, 2013.

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Nigeria naira slips 0.21 pct on importer demand for dollars

Naira and dollar

The Nigerian naira eased 0.21 percent against the U.S. dollar on Monday, after some importers took advantage of its recent appreciation against the greenback to lock in rates, dealer said.The local currency eased after last week's gains, closing at 162.25 naira to the dollar on Monday after closing Friday at 161.90 naira.Dealers said some importers had set limit orders to buy hard currency and were in the market after recent gains. Italy's local unit of Eni sold $11.5 million, but that was not enough to lift the naira.Africa's biggest economy relies on imports for around 80 percent of what it consumes."We expect the naira to strengthen this week because of possible dollar sales by some oil multinational companies," one dealer said. Oil companies in Nigeria sell hard currency to obtain naira to fund their local obligations.The local currency traded around 161.45-161.90 naira to the dollar last week, lifted by dollar flows from oil companies and offshore investors buying local debt.

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Nigeria's Transcorp doubles first-half profit on hotel, power investments

Transcorp Hilton Hotel, Abuja

 Nigerian conglomerate Transcorp reported that half-year pretax profit more than doubled to 8.01 billion naira ($49.4 mln), with its chief executive citing strong performance from hotel and power assets.
Transcorp's flagship hotel, managed by the Hilton group in Nigeria's capital city Abuja, was the main venue for an African version of the World Economic Forum that takes place annually in Davis, Switzerland.
The hotel achieved strong revenue growth through increased traffic during the World Economic Forum for Africa event in May, CEO Obinna Ufudo said in a statement on Monday.
He also highlighted a revenue-boosting rise in output from the power plant Transcorp acquired in a government privatisation last November. The plant lifted output to 453 megawatts during the six-month period to June 30, up from 160 megawatts when it took over.
Ufudo said the company was on course to expand capacity at the plant to 715 megawatts by the end of the year.
Shares in Transcorp, which have gained 33 percent this year, fell 3.55 percent to 5.70 naira on Monday.
The conglomerate, which also has interests in agribusiness, oil and gas, on Saturday announced plans to invest about $200 million to expand its hotel network and power generation capacity in Africa's biggest economy.
Transcorp reported turnover of 21.2 billion naira for the half-year, up 177 percent from 7.7 billion naira the previous year.

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Transcorp to expand Nigerian hotel, power investments - CEO

Transcorp Hilton Hotel, Abuja

Nigerian conglomerate Transcorp plans to invest around $110 million to expand its hotel network in Africa's biggest economy as it seeks to tap into a growing market for business travellers, its chief executive said on Saturday.
New hotels are springing up across Africa, despite bureaucratic delays and poor infrastructure, to take advantage of an increasing number of tourists and business travellers, serving a growing middle class.
Obinna Ufudo told Reuters the hotel, which will be managed by the Hilton group, will house 100 rooms and located in an upmarket district of Ikoyi in the commercial capital Lagos.
"We have concluded all designs ... what we are waiting for is the approval from the state building authority to commence construction," Ufudo said. He said he expected the project to be completed in 36 months.
Industry executives say that as consumer spending stalls in developed markets, more multinationals are betting Africa's growth will eventually translate into meaningful revenue if they can negotiate the considerable regulatory and infrastructure challenges of doing business there.
Transcorp has one hotel already managed by Hilton in Abuja, Nigeria's capital city.
Shares in Transcorp gained 33 percent this year, after rising 314 percent in 2013.
Ufudo said the conglomerate, which also has interest in power, oil and gas, would invest $90 million to upgrade the generation capacity of its power plant to 715 megawatts from 463 megawatts.
Transcorp was one of several firms to win bids last year to buy government power assets sold as part of a privatisation meant to end decades of blackout in Africa's most populous nation.

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Nigeria interbank rate unchanged for second straight week

Nigeria's central bank gov, Emefiele

Nigeria's interbank lending rate was unchanged for the second straight week at an average of 10.50 percent on Friday, supported by ample liquidity as the central bank held back issuance of fresh open market operation (OMO) bills.
The central bank has not issued fresh OMO bills for the past one week despite further boosting liquidity in the banking system by paying off about 114 billion naira ($704 mln) in matured treasury bills on Thursday, dealers said.
Dealers did not have access to their credit balances with the central bank owing to a system glitch at the regulator, but say excess liquidity had kept rates down.
The open buy-back (OBB) rate was flat at 10.50 percent, 1.50 percentage points below the central bank's benchmark interest rate of 12 percent.
All 20 analysts polled by Reuters in the past week expected the central bank to keep rates steady at 12 percent at its next policy meeting on Tuesday.
The overnight placement rate was also unchanged at 10.50 percent, the same level as last week.
Dealers expect lending rates to ease further next week with a liquidity boost from government revenue disbursements to its agencies set to hit the banking system by Monday.

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Nigeria cocoa shipment resumes after levy dispute ends

Cocoa jute bags in container

Exporters have resumed loading of cocoa shipments in Nigeria's second-largest producing area, Cross Rivers state, after the state government suspended on Friday a levy on bean exports, a trade body said.
Cocoa shipments from Cross Rivers, which produces annual volumes of around 60,000 tonnes in the world's fourth-biggest producer, had been halted for over a week as exporters protested the state's failure to adhere to a court ruling last week to repeal the tax.
About 500 tonnes of cocoa due for export were stuck in warehouses while shipments were suspended.
The Cross Rivers state government in 2011 introduced a levy on cocoa exporters who ship the beans through Nigerian seaports other than the state's Calabar port. Exporters went to court to stop the levy.
The state aims to generate revenue through its seaport and compete with more established seaports in the commercial capital Lagos. Cocoa farmers said they paid around 300 million naira ($1.85 million) last year to the state government in levies.
Godwin Ukwu, spokesman for the Cocoa Association of Nigeria, said on Friday that the state government had suspended the 5,000 naira ($30.90) per tonne levy on cocoa exports, pending a meeting with exporters next Tuesday.
"The levy has been suspended for now ... Exporters have started loading cocoa. Trucks will be leaving between today and Tuesday," Ukwu said.
Cocoa exports from Cross Rivers are usually destined for Europe. Taxes on exports including cocoa are usually collected by the federal government.
A mix of rainfall and sunshine in the two main cocoa areas of Ondo state and Cross Rivers last month have helped the crop but there are fears that a lack of sun may allow diseases to spread, hurting bean quality.
Ukwu said the logjam could affect output this season as it delays exports. Nigeria typically produces around 250,000 tonnes every year. Official figures for 2013/2014 cocoa output have not yet been released.

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Kenya sells stake in wines marketer to S.Africa's Distell Group

Assorted wines

Kenya has agreed to sell a 26 percent stake in a wines and spirits marketer to South Africa's Distell Group for 860 million shillings ($9.81 million), Kenya's Privatisation Commission said on Friday.
The sale of government-owned shares in Kenya Wine Agencies Limited (KWAL) to Distell is part of a bigger privatisation programme first announced in 2011 as a strategy to help improve the east Africa nation's finances and to transfer the running of businesses to the private sector.
Distell, whose brands include Amarula liqueur, Two Oceans wines and Savanna cider, is part of a host of South African companies increasingly looking to fast-growing African markets to offset sluggish performance at home, where consumers are hampered by high debt levels and sluggish economic growth.
Kenya also plans to sell a 51 percent stake in five sugar millers to strategic investors as it looks to complete reforms aimed at making its sugar industry competitive.
The government has previously announced plans to sell its shareholding in the country's oil pipeline company, its main power producer, Kenya Electricity Generating Company and three luxury hotels.

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Southern African, EU negotiators sign new trade pact

Negotiators for Southern African states have agreed a new trade pact with the European Union which will give the countries a bigger market for food exports, South Africa's trade and industry department said.
The Economic Partnership Agreement, which has been in the pipeline for a decade, comes in time to beat an Oct. 1 deadline which would have seen Botswana, Namibia and Swaziland lose preferential EU access for their beef, fish and sugar.
If ratified by the governments involved, the deal will allow South Africa to export 110 million litres of wine, 150,000 tonnes of sugar and 80,000 tonnes of ethanol duty free to the EU, among other concessions.
"There is also improved access for our exports of flowers, some dairy, fruit and fruit products," the trade and industry department said in a statement.

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Ghana's Cocobod to buy more next season, seal $2 bln loan

Cocoa pod and beans

Ghana cocoa industry regulator Cocobod will buy at least 950,000 tonnes of cocoa in the 2014/15 crop year, which begins in October, up 5.5 percent on forecasts for the current harvest, according to a parliamentary document and an official.
Ghana, the world's No. 2 producer after Ivory Coast, will sign a syndicated loan of $2 billion from international banks in September to finance the purchases and related operations, James Avedzi, chairman of Parliament's finance Committee told Reuters.
The loan for the 2014/15 season was previously expected to be $1.8 billion. Cocobod is hoping to buy a cumulative 900,000 tonnes of cocoa in the current crop year which ends in September.
A Cocobod official told Reuters the loan amount was increased to accommodate a potentially bigger harvest, adding that purchases could hit as high as 1 million tonnes if weather conditions were good and policies like free fertilizer distribution at certain farms had the right impact.
"We believe we can produce more and even hit 1 million, if we get the right weather to complement the interventions," the source said, asking not to be named.
Ghana runs a two cycle cocoa year consisting of the October-June main crop which is mainly exported and the minor light crop harvest which is discounted to local processing firms.
Purchases so far declared in the current season were around 870,000 tonnes at the end of June, according to Cocobod data.Ȋ

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Kenya's 2-year bond seen drawing investors

Nigeria's central bank gov, Emefiele

Kenya's sale of a re-opened two-year Treasury bond next week is likely to meet with good demand from investors while yields on Nigerian Treasuries could fall due to good liquidity in the markets.
KENYA
Investors are likely to pile into next week's sale of a Kenyan 2-year Treasury bond to the detriment of Treasury bills, amid expectations the average yield on bills could fall further.
The central bank will auction the re-opened bond, worth up to 10 billion shillings ($114 million), on July 23. Traders said they expected the bond to come with an interest rate of 10.70 percent, a higher return than bills.
"Liquidity will be skewed to the bond issue," said Alex Muiruri, a fixed-income trader at Kestrel Capital.
Kenyan treasury bill yields, which have been coming off this month after the government cut its weekly borrowing by a quarter to 9 billion shillings, were expected to fall by another 40 basis points on average, market participants said.
The yield on the benchmark 91-day Treasury bills slid to 9.274 percent at this week's auction from 9.727 percent a week earlier.
Yields on six months bills and 364-day Treasury bills dropped at auction to 10.430 percent and 10.558 percent respectively.
NIGERIA
Yields on Nigerian Treasury bills are expected to fall further next week as liquidity improves following the disbursement of monthly budget allocations to government agencies.
Traders said liquidity will also be buoyed by a slowdown in the central bank's Open market Operations (OMO), boosting demand at the sale of 134.88 billion naira ($832.90 million) worth of Treasury bills, scheduled for Wednesday.
"Yields have dropped by around 20 basis points across the board on the secondary market this week alone because there has not been regular issuance of OMO bills by the central bank," one dealer with GTBank said.
Nigeria, Africa's top energy producer, distributes revenues from oil exports among its three tiers of government - federal, states and local - on a monthly basis and the bulk of the funds pass through commercial banks.

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