Slowly shrinking borrowing costs for the federal government - United Capital

In its last monthly auction of FGN bonds, the Debt Management Office (DMO) raised a total of 243.8 billion – almost double of the 135.0 billion it offered, with a bid-to-cover ratio of 2.9x. 

Demand was driven by over-subscription of the 2027 and 2037 tenors (2.6x and 4.3x respectively) given that the coupon rates on those offerings printed above market rates of sub 16 percent. Additionally, stop rates were roughly c.100 bps lower across the curve, compared to the August auction.
On the one hand, the DMO has now reached its 1.25 billion domestic financing target for the 2017 budget deficit, which should improve its bargaining power at the remaining auctions in 2017. 

On the other hand, it appears that investors are plying into the debt market to lock in higher returns, and the FGN would obviously take advantage of this burgling demand to reduce issuance costs.
Following the launch of Nigeria's debut 100 billion naira sovereign Sukuk, the authorities are planning to issue about $5.5 billion Eurobonds by year-end ($2.5 billion is expected to fund the budget and $3 billion to replace naira-denominated debts). 

This should further shrink the cost of debt, given the c.10 percentage-point spread between domestic and foreign borrowing costs.
Putting all these together, the market is expected to see a softer yield environment going forward.

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Nigeria plans to raise $2.5 bln in Eurobond in November

All things being equal, Nigeria plans to knock on the doors of foreign investors before the end of the year to borrow additional $2.5 billion in Eurobond, according to the Debt Management Office (DMO) director general, Patience Oniha on Thursday.
This was part of moves to help the Africa's biggest economy plug the gap in its budget proposal which it currently finding it difficult to provide cash-backing for some of its projects.
The West African country has signed into law a budget proposal worth 7.44 billion naira in June after the parliament passed the executive bill in May.
The budget proposed a deficit of around 2.36 billion naira half of which it said will borrowing from international market including multilateral institutions, while the balance is expected to be sourced from the domestic market.
The spending proposal was designed to help hasten Nigeria out of recession and fuel economy recovery to ease pressure on the most populous black nation growing population.
The planned Eurobond issue is expected to complement the $1.5 billion raised in Eurobond sales in February and March.
Oniha, who spoke at a conference in Lagos, also noted that Nigeria currently has a Treasury bill portfolio worth 3.7 trillion naira and plans to refinance it with foreign borrowing to reduce pressure on the domestic market.
Nigeria's total debt stock stood at $64.19 billion at the end of June, up 2.5 percent from $62.54 billion at the end of March, this year.
Nigeria's external borrowing accounted for 23.44 percent of the total debt, while the domestic portion accounted for 76.56 percent.
A breakdown of the debt profile of African biggest economy indicated that foreign borrowing stood at $15.06 billion, while domestic debt portion was $49.15 billion.
There has been outcry by many Nigerians over the rate at which the present administration of President Mohammadu Buhari ramps up debt without significant projects to show for it.

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Nigeria's Fidelity Bank offers to buy-back $300 mln debt

Nigeria’s Fidelity Bank Plc has offered to buy back $300 million of debt and intends to issue new notes, aiming to extend the maturity of its debt profile, it said on Thursday.
The $300 million of debt, with an interest rate of 6.875 percent, is due to mature 9 May 2018, Fidelity said in a statement. It will offer $1,010 per $1,000 of notes held.
The offer “is being made in connection with a concurrent offering of new unsecured and unsubordinated notes,” the bank said, giving no further details about the new debt.
Citigroup Global Markets Ltd and Renaissance Securities (Nigeria) Ltd are managing the deal, Fidelity said.
The offer expires on October 10 and the results will be announced the same day.
Another Nigerian bank has offered to buy its foreign currency debt this week, making look like a trend in the country's financial market.
Analysts said banks are buying back their debt to as a means to lower yields and potentially help reduce their funding costs in the future.

In recent time, dollar liquidity has improved in Nigeria, which had faced a hard time meeting its foreign exchange obligations in the wake of falling global oil prices leading to currency shortage.

Most banks are taking the advantage of the improved liquidity to reprice their debt and help manage their liability.

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Ecobank appoints transaction advisers for $400 mln convertible bond issuance

The Pan-African banking group, Ecobank Transnational Incorporation (ETI) has appointed transactions advisers to help midwife its proposed issuance of $400 million convertible bonds, the bank said on Thursday.
In a letter to the Nigerian Stock Exchange on Thursday, the bank said to the process leading to the bond issuance is expected to be completed by the end of this year.
"Subject to the necessary legal and regulatory authorisation, the convertible bond will be listed on the International Securities Market (ISM) of the London Stock Exchange by end 2017," ETI said in the statement.
The bank also said it will make available the terms of the transaction to shareholders in due course.
Shareholders of the bank gave their approval for the plan to issue the convertible bond at a meeting in June in a bid to strengthen its capital base.
The bond is expected to have a maturity of five years and a coupon of 6.46 percent above the three-month LIBOR rate.
Investors are allowed the option to convert their holdings at an exercise price of six United States cents during the conversion period.
According to sources within the bank, the bond was to help mitigate the impact of its legacy loan.

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Nigeria's Agricultural sector: relevant and resilient - United capital

Over the past 35 years, the Nigerian economy expanded by more than 3x. The agricultural sector has contributed the most (about 27 percent) to this expansion relative to Oil & Gas (1.4 percent) Financials (3.3 percent), Manufacturing (9.0 percent) and Trade (18.8 percent).

Interestingly, the last time the sector contributed negatively to GDP was way back in 1987.
In 2016, Nigeria fell into a recession that lasted for five quarters. By the end of the year, GDP had contracted by 1.6 percent y/y. 

The agricultural sector, however, sustained a positive momentum. Ex-Agric, GDP would have contracted by 2.5 percent in 2016 and would still be in a recession.

Evidently, it is safe to say that agriculture is the most important and resilient sector in the Nigerian economy, despite underwhelming investment in the sector by the federal government. 

The sector has withstood the"bubbles and bursts" of the wider economy, as its detachment from the negative effects of lower oil prices and currency illiquidity has been key to its sustained growth. Accordingly, we highlight the need for increased effort to boost activities in the sector in order to improve domestic economic output, export and government revenue amid a blurry long-term outlook for oil.

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Ghana GDP growth rises to 9.0 pct in Q2 as oil output increases

Ghana’s gross domestic product growth rose to 9.0 percent in the second quarter of 2017 from 6.6 percent in the previous three months, mainly because oil output increased, the statistics office said on Wednesday.
For years, Ghana’s economy grew around 8 percent per year, but it slowed in 2014 as the prices of its commodity exports fell and it suffered a fiscal crisis that forced it to secure an aid deal with the International Monetary Fund.
“The driver for the change in this year’s second quarter growth was mainly the petroleum component, which rose 188 percent in the mining and quarrying sub-sector,” acting government statistician Baah Wadieh told reporters in the capital, Accra.
This year’s second-quarter growth compares with 1.1 percent recorded in the same period last year. The statistics office also revised its full-year 2016 GDP growth to 3.7 percent, up from 3.5 percent.
Producer price inflation rose to 6.6 percent year-on-year in August from 2.0 percent the previous month, mainly because fuel prices rose, the statistics office said.
Ghana, which also exports cocoa and gold, began production from its TEN oil field in August last year, followed by Italy’s ENI Sankofa field, which came on stream in July of this year.

(C) Reuters News

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Nigeria sets up special body to monitor corruption cases

In a bid to fast-track prosecution of high profile corruption cases in Africa's top economy, its National Judicial Council (NJC) has established a Corruption and Financial Crimes Cases Trial Monitoring Committee (COTRIMCO) to monitor judges and courts handling corruption and financial crimes cases.
The NJC, headed by the country's chief Justice, Walter Onnoghen has appointed top lawyers and a retired head of Court of Appeal as members of the monitoring committee.
A retired president of the court of Appeal, Justice Ayo Salami, will head the committee as its chairman.
Justice Salami retired under controversial circumstances, after the former President Goodluck Jonathan declined to reinstate him back to his position when he was cleared by the NJC of allegations that he conspired with politicians in then opposition party Action Congress of Nigeria (ACN) to manipulated judgment on election matters.
The establishment of the monitoring committee was sequel to a recent directive by the chief justice for the establishment of special courts for the purpose of handling corruption and financial crimes cases.
In a statement on Wednesday by the NJC Director of Information, Mr. Soji Oye, said the decision to constitute the committee and appoint Justice Salami as its chairman was taken Wednesday at the 82nd meeting of the council held in Abuja.
The committee, which has 15 members, will operate from the council’s secretariat in Abuja.
Among other functions, the committee will conduct regular monitoring and evaluation of proceedings at designated courts for financial and economic crimes nationwide.
Other members of the committee are the Chief Judge of Borno State, Justice Kashim Zannah; the Chief Judge of Imo State, Justice P.O. Nnadi; the Chief Judge of Delta State, Justice Marsahal Umukoro; the Chief Judge of Oyo State, Justice M. L. Abimbola; President of the Nigerian Bar Association, Abubakar Mahmoud (SAN); former NBA President, Chief Wole Olanipekun (SAN); and another former NBA president, Mr. Olisa Agbakoba (SAN).
Others are Mr. Joseph Daudu (SAN) and Mr. Augustine Alegeh (SAN) – both former NBA presidents; a member of the NJC, Dr. Garba Tetengi (SAN); NJC Secretary, Gambo Saleh; and a representative of Non-Governmental Organisations (NGOs), Mrs. R.I Inga.
The Ministry of Justice and Institute of Chartered Accountants of Nigeria (ICAN) will also have a representative each on the committee.
The committee will also advise Justice Onnoghen on how to eliminate delays in the trial of corruption cases.
In addition, it will give feedback to the NJC on the progress of cases in the designated courts, conduct background checks on judges selected for the designated courts, and evaluate the performance of the designated courts.
Oye said the committee would drive the council’s new policy on the anti-corruption war.
The Supreme Court of Nigeria and the Court of Appeal were equally directed to fix special dates each week for hearing and determining appeals from such cases.
President Muhammadu Buhari had in the past accused the judiciary of not helping in the fight against corruption.

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Kenya projects deficits at 5.6 pct of GDP in 2018/19 fiscal year

Kenya will target a fiscal deficit of 592.8 billion shillings, or 5.9 percent of GDP, in its 2018/19 (July-June) fiscal year, down from an estimated 7.3 percent this fiscal year, the Treasury said.
The East African nation has raised borrowing in recent years to fund a range of ambitious infrastructure projects like a modern rail line, roads and power plants.
The deficit will be covered by net external borrowing of 205.6 billion shillings, or 2.1 percent of GDP, and 383.0 billion shillings, 3.8 percent of GDP, the Treasury said in a budget outlook paper seen by Reuters on Wednesday.
The government expected to collect total revenue equivalent to 18.6 percent of GDP in 2018/19, unchanged from this fiscal year, while total expenditure will drop to 25.0 percent of GDP from 27.1 percent this year, the Treasury said.
It said the drop in projected spending was due to the completion of the first phase of the construction of a modern railway linking the port of Mombasa to the capital Nairobi.

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More buyers are asking for Nigeria crude oil- NNPC

Demand for Nigeria crude oil has continued to outpace its current output, The Nigerian National Petroleum Corporation has said, providing a shearing news for the country's economic managers.

Nigeria, OPEC member country currently produces 1.75 mbpd crude including condensate, though short from the 2.2 mbpd target for the year.

 “As we speak now, even the demand for Nigeria’s crude oil is over-subscribed. We have more buyers demanding for our crude oil than what we can supply to them,” Ndu Ughamadu, NNPC spokesman said.

Ughamadu said representatives of The Netherlands, one of the European buyers of Nigerian crude, were at the corporation’s headquarters a few weeks ago in connection with their desire to patronise Nigeria's petroleum resources.
“They want to collaborate with the NNPC towards utilising petroleum products for the production of animal feeds. So, more innovations will come up towards utilising the raw materials,” he said.

There have been concerns in recent over the increasing production of electirc cars and weak outlook for pertoleum resource in the near future and its implications on the oil-dependent nations.

Nigeria earning from crude export has suffered declined two year ago in the wake global falling oil price and increase militancy in the Niger Delta which shut out oil production.

At some point, the country's production level plummeted to a near 30-year low of 1.4 million barrels per day from about 2.2 million bpd.

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SEC gets 2-week ultimatum to release probe report on Oando

The Nigerian Securities and Exchange Commission (SEC) has been given two weeks ultimatum by the House of Representatives committee on capital market to release the results of its investigation into the affairs of Oando Plc.

The SEC said in July it was investigating Oando’s shareholding structure following its $1.65 billion acquisition of ConocoPhillips’s Nigerian business in 2014.
A company source said earlier this month the investigation centred on the ownership of some Oando shares bought through an investment vehicle at the time of the ConocoPhillips deal.
The SEC has yet to publish its findings though it allowed the company to proceed with its annual shareholder meeting this month.
Oando Chief Executive Adewale Tinubu told shareholders this month that the SEC allowed the meeting to proceed as the company had disclosed the relevant information to the regulator.
“SEC has set up a committee to look into the ongoing issues. The House Committee on Capital Market has given them two weeks to come up with the report,” Nwulu said late on Tuesday.
Shares in Oando, which are also listed in Johannesburg and Toronto, have fallen 38.3 percent this year after hitting a peak in May. It recovered slightly from a five-month low it touched last week.
The stock was down 1.5 percent at 5.90 naira in Lagos on Wednesday.

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Nigeria almost doubles bond size as funds grab high returns

Nigeria raised 243.7 billion naira at a bond auction on Wednesday, almost double the amount it had initially sought, as local funds and foreign investors piled into longer-term debt to lock in higher returns, traders said.
Nigeria’s borrowing costs have fallen from as high as 18 percent a few months ago as inflation has slowed, helping the government raise money to cover a gap in its budget.
The Debt Management Office (DMO) had offered 135 billion naira worth of bonds maturing in 2021, 2027 and 2037, on offer. However, total investor demand stood at 394.8 billion naira, prompting the debt office to increase the size of the offer.
The DMO paid 15.98 percent for the 2021 bond, 15.90 percent for the 2027 issue and 15.92 percent for the 2037 debt.
Investors bought more of the benchmark 20-year bond at the auction betting that the inflation outlook in the West African country is improving, traders said.
In August inflation slipped for the seventh month running, to 16.01 percent.
A lawmaker in a motion on Tuesday said Nigeria needs to lower its interest rates and cut domestic debt to stimulate lending for private sector investment, which would help boost economic growth.
But the central bank has said loosening its policy now would worsen inflation and drive bond yields into negative territory, which could lead to capital flight and hurt the currency. It kept its main interest rate on hold at 14 percent on Tuesday.
Africa’s biggest economy grew in the second quarter, climbing out of recession as oil revenues rose, but the pace of growth was slow, suggesting the recovery remains fragile.
The country plans to borrow both locally and from offshore sources to help fund its budget deficit, which has widened due to lower oil prices slashing government revenues and weakening the naira currency.
Earlier, the debt office said Nigeria’s debut 100 billion naira sovereign sukuk issue launched last week was more than 5.8 percent oversubscribed, suggesting it may tap this demand more to help narrow the budget gap.

(C) Reuters News

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Lafarge Africa plans 131.65 bln naira rights issue

Lafarge Africa said on Wednesday it plans to raise 131.65 billion naira through a rights issue to existing shareholders.
The cement firm in a letter to the Nigerian Stock Exchange (NSE), said that each shareholder is entitled to buy five shares to nine already held in the company at 42.50 naira per share.
Lafarge Africa said it was yet to obtain regulatory approval for the rights issue while the process to do that is one and date for the opening of the bid is yet to be disclosed.
The cement firm said on Wednesday it plans to merge its operations with that of its two subsidiaries; United Cement Company of Nigeria (UniCem) and Atlas Cement Company.

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Nigerian stock rise 0.44 pct, driven by gains in Dangote, Zenith, Nestle shares

Nigeria stock closed marginally higher on Wednesday with the index rising 0.44 percent, driven by gains in the shares of Dangote Cement, Nestle and Zenith Bank.

The main market index rose to close at 35,104 points compared with 1.15 percent decline the previous day.

The local bourse has gained 30.62 percent year-to-date on the back of improved dollar supply and increase economic activities boosting the performance of listed companies.

Dangote Cement, which accounts for a third of the market capitalisation led the gainer, while Stanbic IBTC, Transcorp, Nestle and Zenith Bank were the major driver of the gains.

The Market Capitalization also appreciated today by 0.44 percent to close at 12.10 trillion, compared with 12.05 trillion the previous day.

Investors traded a total of 1.27 billion naira compared with 3.62 billion naira on Tuesday, representing 64.95 percent decline.

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Nigerian lawmaker wants central bank to cut interest rate, reduce borrowing

A Nigerian senator has called on the Central Bank of Nigeria (CBN) to lower interest rate and reduce borrowing from the domestic market in a bid to boost growth in the West African country.

In a motion raised on the floor of the Senate chamber at the resumption of plenary, Senator Yahaya Abdullahi said there was an urgent need to encourage private investment in the economy and ensure sustainable growth.

Abdullahi said the exit from recession was largely due to favourable oil prices d increased domestic production with relative peace in the restive Niger Delta.

Abdullahi urged the government to take steps to improve policies to avoid slipping into another recession, saying that the situation was reversible.
He asked the central bank to focus on its core job of monetary policy and not development finance and coordinate with the government on getting credit flowing to the real sector.

The CBN on Tuesday held interest rates at 14 percent to keep liquidity tight. The bank said it felt that loosening would worsen inflation and drive bond yields negative which could lead to a capital flight and hurt the currency.
Nigeria exited recession in the second quarter of the year as oil revenues rose, but the pace of growth was slow, suggesting the recovery is fragile.
The central bank has spent around $9 billion to defend the local currency, which hit a record-low of 520 against the dollar in February at the black market. 

The local currency has since stable around 305.80 against the dollar on the official market, while it traded at 360 for investors window.

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Lafarge Africa to merge operations with two subsidiaries; Unicem, Atlas Cement

Lafarge Africa has indicated plans to merge its operations with that of its two subsidiaries; United Cement Company of Nigeria (UniCem) and Atlas Cement Company, the cement firm said in a letter to the Nigerian Stock Exchange (NSE) on Wednesday.
According to the cement firm, maybe merger will enable the enlarged Lafarge Africa to take advantage of benefits arising from various synergies as well as benefits from efficiencies arising from streamlining the operations of UniCem and Atlas.
"UniCem and Atlas will be merged with Lafarge Africa, by way of a court-sanctioned scheme of merger," Lafarge Africa company secretary, Edith Onwuchekwa said in the letter.
She said the company has received the regulatory approval in principle to the scheme of merger.
"An application will be submitted imminently to the Federal High Court, in respect of obtaining an order to convene the respective meetings of shareholders of Lafarge Africa, UniCem and Atlas," Onwuchekwa said.

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Our observations from the Sept MPC - United Capital

At the end of its September policy meeting, the (Nigerian) Monetary Policy Committee (MPC) left key monetary policy rates unchanged in line with consensus expectations. 

Key consideration highlighted included the fragility of the recovery in the local economy, unrelenting pressure on price level and sustained uncertainties in the global economy, especially the recent US-Fed announcement to scale down on asset purchases as well as hike rates once more before year-end. Although the MPC maintained status quo, we highlight our observations as follows:

Although the MPC signaled its readiness to ease rates if need be in the near term, a November-2017 rate cut remains highly unlikely given that the MPC expressed concerns over the US-Fed action which is a threat to the fragile stability in the currency market. 

Also worthy of note is the fact that the CBN is not guiding rate lower as purported by market participants but capitalising on outsized bids at the primary market auctions by offering lower rates. Accordingly, the recent reduction in yields had been broadly driven by panic purchases as dealers attempt to lock down returns ahead of a near-term rate cut.

In line with the foregoing, we maintain our view that the yield environment will remain broadly attractive till year-end amid a tight monetary stance.

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Investors lap up Nigeria's debut Sukuk bond, invest 105.8 bln naira

Oniha, DG DMO

Investors bought 105.88 billion naira worth in Nigeria debut Sukuk bond, indicating an oversubscription of about 5.88 billion naira against the initial offer by the debt Managment Office (DMO), the result of the auction released by the debt office has shown.
Nigeria had closed bids for its debut Islamic bond, Sukuk on Friday, where it initially offered 100 billion naira for sales to investors.
However, investors, which included pension and fund managers lapped up the initial offer and topped it with 5.88 billion extra demand in what analysts said was due to the attractive rental rate offered by the debt office.
The debt office offered 16.47 percent rental rate on the debt maturing in 2024.
The issuance of Islamic Bond has generated controversy among the country's population which was equally divided between Christians and Muslim.
Investors brushed aside sentiment expressed by some religious leaders and put their bet on the bond, analysts said.
According to the debt office official, proceeds from the bond will be channeled toward building critical road infrastructure that will enhance the living standard of Nigerian.
“A look at the investors that subscribed for the sovereign Sukuk revealed that another significant objective was achieved through the participation of over a thousand retail investors from across the nation who accounted for over four percent of the total subscription," the chief executive of DMO Patience Oniha said.
According to her, with the oversubscription, the DMO had been energised to continue with its role of meeting the government’s funding needs as well as introducing new instruments to develop Nigeria’s capital market.Africa's biggest economy, which just exited its worst recession in over two decades issue all kinds of bonds to plug the gap in its budgetary spending.
The West African country issue sovereign bond to raise naira cash monthly, treasury bond twice monthly and recently issued diaspora bond from its citizens abroad in it quest to spend its way out of recession.

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Nigeria govt seeks Senate support to borrow to fund pension, salary arrears

Vice-President Osinbajo

The federal government of Nigeria has written to the National Assembly to amend this year's budget to enable it settle 2.7 trillion naira worth of obligations on pension and salary arrears to its workforce.
In a letter signed by the vice president Yemi Osinbajo and was read on the floor of the Senate on Tuesday, the government was seeking a a virement on the 2017 budget to enable it fund recurrent expenditure from proceeds of the debt rather than just capital projects.

Nigeria’s Fiscal Responsibility Act states that proceeds of government borrowings can only be applied towards capital expenditure. 

However, the vice president said in his letter to the National Assembly that the amendment was to provide the needed legal backing for the use of proceeds from borrowing in the budget to meet its recurrent obligations.
Nigerian Senate and the House of Representatives resumed from a two-month vacation on Tuesday.
Osinbajo had sent the letter to the Senate last month while President Muhammadu Buhari was on medical vacation in the United Kingdom. 

The letter was read out after the Senate reconvened following a seven-week recess.
Africa’s biggest economy grew out of recession in the second quarter as oil revenues rose, but the pace of growth was slow, suggesting the recovery is fragile.
Osinbajo’s letter said the obligations had become inimical to government plans to revive the economy through the provision of modern infrastructure and settle pension and salary arrears dating back five years.
Finance Minister Kemi Adeosun has said the government plans to refinance $3 billion worth of treasury bills denominated in naira with dollar borrowing to lower costs and improve its debt position.

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Nigeria injects 336 bln naira into economy for capital projects in Q1 -finmin

Nigeria's finance minister has confirmed the release of 336 billion naira capital vote for government agencies and ministries in the first quarter of the year in a bid to stimulate the economy.
In a statement on Tuesday, Kemi Adeosun said the balance of about 14 billion from the first quarter allocation is being processed.
Nigeria approved 7.44 trillion naira budget proposal for the with a capital vote of 2.36 trillion naira. The budget was signed into law in June by the vice president, Yemi Osinbajo who acted on behalf of the president who was on medical vacation in the UK at the time.
A breakdown of the total capital expenditure releases showed that 90 billion naira was released to the power, works and Housing ministry, while 71 billion naira was released to the defence ministry and 30 billion naira for the transport sector.
The agricultural sector received 30 billion naira, water resources got 12 billion naira while other sectors combined, received a total sum of 103 Billion naira.
The finance minister said the prioritization of the release of available funds was made in accordance with the objectives of the Economic Recovery and Growth Plan (ERGP).
Adeosun said the government will continue to focus on capital expenditure spending on priority sectors to stimulate economic activities and job creation. “Despite fiscal constraints, the Federal Government was able to fully cash-back the budgeted capital releases so far made, which is a reflection of the current administration’s commitment to economic development”, Adeosun said.

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Nigeria central bank retains interest rate at 14 pct

In line with general expectations, the Central Bank of Nigeria (CBN) on Tuesday retained its benchmark interest rate at 14 percent, the governor of the bank said at the end of MPC meeting.
Godwin Emefiele told newsmen in Abuja, the majority of members of the rate-setting Monetary Policy Committee (MPC) decided to hold the rate at the same level it has been since last two years to further consolidate the gains of the past decision on the economy.
“Loosening at this time would exacerbate inflationary pressures and worsen the exchange rate and inflationary rate condition,” said Emefiele.

He said six out of the seven members present at the meeting voted to retain the rate at 14 percent while only one member decent and voted for a rate cut.
A member of the MPC Dahiru Balam had said in his note at the last meeting the clamour for low-interest rate cannot happen in the near term due to the high level of inflation and rising costs in the economy.
“The clamour for low-Interest rate cannot happen now because of the high level of inflation and rising operational costs in the economy,” Balama said at the last MPC meeting.
Also, fourteen of 15 economists polled by Reuters last week predicted rates would stay on hold while one forecast a 200 basis point cut.

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Ghana central bank ends run of rate cuts, holds at 21 pct

Ghana’s central bank ended a run of rate cuts by keeping its benchmark unchanged at 21 percent on Monday, citing global economic uncertainties and threats to consumer price stability.
The hold - not expected by analysts - should moderate price conditions toward the bank’s medium term inflation target of 8 percent plus or minus 2 percent in 2018, governor Ernest Addison told a news conference in Accra. 

Consumer inflation rose to 12.3 percent in August from 11.9 percent in July. Fuel prices also went up nearly 8 percent in September and could post risks to inflation in the coming months, analysts said.
“The committee decided it was time to pause the easing cycle in view of emerging risks to the inflation outlook, while remaining vigilant and committed to take the necessary policy actions should these initial signs of underlying pressures persist,” said Addison.

Ghana, which exports cocoa, gold and oil, is following a $918-million credit programme with the International Monetary Fund to restore fiscal balance to an economy dogged by deficits and high public debt.

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Husband, 30, kills wife, commits suicide shortly after Face Book post

A husband and wife in their 30s were found dead in the early hours of this morning at separate homes in an apparent murder-suicide.
The body of James Barnes, 30, was found at his parents' home in Streetly in the West Midlands just after midnight - before his wife Amy was discovered 40 minutes later.
The 32-year-old woman's body was found some 15 miles away in the Rednal area of Birmingham at the home of the couple, who got married just three years ago.
Police believe Mrs Barnes was murdered on Cofton Park Close in Rednal before her husband killed himself in the garden of the £160,000 home on Linforth Drive in Streetly.
The couple lived in Rednall in a modern £190,000 semi-detached house, where they were described by neighbours as 'a perfectly normal, friendly couple.'
Less than three hours before he allegedly slaughtered his wife, Mr Barnes updated his Facebook profile picture to one of the couple on their wedding day.
A friend named Caz Goodwill wrote below the photo this morning: 'My heart goes out to you, James.'
Vicky James, who said she was a family member, wrote in response to messages of support: 'Thank you everyone - devastated'.
It is believed Mr Barnes took his own life in the garden at the home of his parents Vivien, 68, and Robert Barnes, 72.
One of the couple's neighbours in Rednal, who did not want to be named, said: 'I am just simply numb from what we've heard so far. I cannot believe it.
'I wasn't aware they had any problems because they just seemed like the perfect pair who were just really starting their lives as a married couple together.
'I can't really say much more than that as I'm still in complete shock. They were really friendly and I just feel so sad this had happened. Such a tragedy.'
Another neighbour said: 'They always seemed like a lovely, young couple.We heard the traffic down the road this morning and thought something bad must of happen but we never thought this.
'It's was about 1am and we woke up to see two large police vans, two ambulances and several police cars. It's just so tragic.'
A group of four friends came to lay flowers at the scene in Rednal while holding back tears.
One friend said: 'It's just so shocking. It's not for us to talk about, it's for the family to say.'
Another neighbour said: 'I was woken up by the police cars and ambulances at around 1pm.
'I don't know what the circumstances were but it is a horrifying scenario. Surely they could have worked something out. Nothing should resort to that, it's just terrible.'
A neighbour at the house in Streetly said: 'The emergency services have been here through the night. We heard a commotion in the night.
'We know the owners to say hello to. They are really nice neighbours but we didn't know them very well. The wife wasn't very well at all. I've only seen her once.'
Mr Barnes is thought to have studied graphic design at Sutton Coldfield College and had a degree in computer games modelling and animation from the University of Derby.
Both Mr and Mrs Barnes had posted pictures of their wedding on Facebook.

Describing one photo showing the bride and bridesmaids, Mr Barnes wrote: 'They all looked perfect, even better than I had imagined in the planning.

'And of course my bride, well she had me spooked and dreading what she had as she threw me off the scent of what she had got, but when I had a sneaky look over my shoulder as she turned the corner down the aisle in the church... she took my breathe away.

'I had to focus and look towards the altar, turned to my brother and said, "bro, she's beautiful". Absolutely stunning.'

A police spokesman said: 'Detectives are not currently looking for anyone else in connection with the deaths.

'Forensic post-mortems will take place in due course on the deceased who were both aged in their 30s.

'Both areas have been cordoned off while inquiries continue to establish the circumstances that led to their deaths.'







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British Airways suspend staff over racist rants against Nigerian passengers

The British Airways stewardess behind a racist Snapchat rant against Nigerian passengers demanding 'f***ing upgrades' is an aspiring actress who hunted for male company on the Plenty of Fish dating website, MailOnline can reveal.
Joanne Wickenden, being investigated by the airline, described herself as a 'Princess' who likes a laugh as she boasted about her job as a flight attendant on the site.
The 23-year-old, a member of mixed fleet cabin crew, sparked outrage after recording the racist clip in her BA uniform before flying from London Heathrow to Abuja on Friday night.
Ms Wickenden, who is believed to have been suspThe friend continued: 'The other colleague just wanted her to impersonate what goes on on the flight. Albeit it was an inappropriate comment to make. She's very upset because now the whole world knows her face and thinks she's a racist.
'It's like someone had a vendetta [by releasing the video] instead of filing the complaint in a normal way.
'Everything is still up in the air at the moment because of the investigation'.
But a former school friend added: 'I was disgusted, it's so embarrassing. She was renowned for making inappropriate jokes at school.'
The 5ft 11in air hostess says she has been single for two years as she boasted about her job on Plenty of Fish.
'I'm a flight attendant living in Crawley. I've been single for 2 years now and miss a bit of male company,' she wrote.
'I'm outgoing, like to have a laugh and enjoy socialising. I'm the sort of person where the little things mean the most. Trust is a must! If you would like to find out more then pop me a message :) xx'
A source told MailOnline that the video - which was captioned 'I can't cope with this flight' - was circulated among 'horrified' BA cabin crew who are 'very concerned'.
Another shocked staff member said BA should apologise to its Nigerian passengers.
The airline launched an investigation into the controversial footage.
In a statement the company said: 'We expect the utmost professionalism from our staff when they are representing British Airways. We are investigating this video.'
In the expletive-filled footage, Ms Wickenden said: 'All Nigerians are going to be asking for f****** upgrades' - after claiming the men would need more leg room in an apparent joke about the size of their privates.
During the one-minute clip she also revealed how she was going to deal with passengers on the six-hour flight.
She said: 'Alright, so all of yous are there getting ready for your Friday night, getting in the pre-drinks, you know, as you do.
'And I'm here, getting ready to go to work, put on a yellow life jacket, point out the exits, hand out chicken or beef, what sort of Friday night is this for me?
'The upside is I'm going to Nigeria and there's gonna be bare B**, I'm joking, I'm joking.
'All the Nigerians are gonna be there like 'gimme Coca Cola, gimme me beef, why you have no beef left? I want beef.'
'And I'm just gonna be there like, 'Sorry sir, we ran out of beef'.
'All the Nigerians are gonna be there asking for f****** upgrades because they haven't got enough leg room because their B**s are in their way. Big d**** like this swinging from side to side.'
An airline source told MailOnline: 'My friend was horrified. BA has a culture of dealing with things like this internally, she passed it to me because she was concerned that nothing was done.'
(C) dailymail.co.uk

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Dealers now re-brand stolen smartphones as London used for sale - Police

For those who love to patronise the "fairly used' phone market, there is a need for caution as some dealers have perfected the acts of rebranding stolen smartphones and pass them on to unsuspecting buyers as London "fairly used phones.

The Police in Lagos last week arrested a man, James Adebayo, on the allegation that he specialises in receiving stolen phones from armed robbers and pick-pockets criminals and resell as fairly used phones to unsuspecting members of the public.

According to the police, the suspect, usually re-furbished the phones as ‘London used’ smartphones and put them up for sale to unsuspecting buyers who are desirous of owning good smartphones but could not afford the high prices of new ones.

Nigeria has the largest market for used smartphones imported from Asians and United Kingdom (UK) for sale in the local market.
The suspect, 30-year-old residence of Araloya Street, Lagos, was tracked down with an Iphone 7  a belonging to a Lagos-based banker and was and later arrested and taken into custody by the police.

“The banker had on August 23 boarded a ‘one chance’ bus around 5.45am on his way to work. The robbers dispossessed him of a laptop and two phones, one of which was traced to Adebayo. He was trying to sell it to a customer on Lagos Island when he was nabbed," Police sources revealed.

a statement by the Lagos State funded rapid Response Squared (RRS) said also found on the suspect were six iPhones, four other smart phones and three MTN SIM packs, which he said he collected from the robbers.
The suspect allegedly said he regularly bought stolen phones from three people, saying he was aware they were robbers.
He said, “I started selling fairly-used phones about a year ago. When customers patronised my clothes shop, they talked about buying fairly-used phones. I started assisting them to collect and sell. This was about three years ago. Uche, Alubi and Pinheiro were three major guys I collected phones from.
“If I said I didn’t know that the phones were stolen, I would be lying. I knew some of the phones were forcefully collected from people. I buy iPhone 7 with iCloud for N45,000 and sell at N55,000. Those without iCloud, I buy for N150,000 and sell at N180,000. I buy Samsung phones for N22,000 and sell at N27,000. I work on the phones and redesign them as London-used phones.”
The police said Uche, Alubi and Pinhero had fled the areas they lived since the arrest of Adebayo.
The Lagos State Police Public Relations Officer, ASP Olarinde Famous-Cole, said the case had been transferred to the State Criminal Investigation and Intelligence Department, Yaba, on the instruction of the state Commissioner of Police, Edgal Imohimi.

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Court strikes out Alison-Madueke’s name from $1.6bn fraud trial

Justice Nnamdi Dimgba of the Abuja division of the Federal High Court Wednesday struck out the name of the former Minister of Petroleum Resources, Mrs. Diezani Alison-Madueke, in the ongoing trial of the Chairman of Atlantic Energy Drilling Concept (AEDC) Nigeria Limited, Mr. Jide Omokore, and five others standing trial over their alleged involvement in a $1.6 billion crude oil fraud.
The trial judge struck out her name while delivering a ruling on the former minister’s motion seeking to be joined as a defendant in the suit.
Omokore, AEDC, Atlantic Energy Brass Development (AEBD) Ltd., Victor Briggs, Abiye Member and David Mbanefo are standing trial for their alleged involvement in defrauding the Nigerian Petroleum Development Company (NPDC), the exploration and production subsidiary of the Nigerian National Petroleum Corporation (NNPC), of $1.6 billion.
Omokore and his firms – AEDC and AEBD – had entered into a Strategic Alliance Agreement (SAA) in 2010 to provide funding for the development of six joint venture oil blocks operated by NPDC.
The SAA allowed AEDC and AEBD to recover their investments in the oil acreages through crude oil lifting under an agreed sharing formula with NPDC.
However, both firms were alleged to have diverted part of the proceeds from the sale of the crude oil which should have paid to NPDC.
But sources close to AEDC and AEBD have maintained that the amount due to NPDC stood at about $800 million as of 2015, and not $1.6 billion as alleged by the Economic and Financial Crimes Commission (EFCC), which charged the parties to court for alleged fraud early this year.
Of the $800 million, they disclosed that $500 million had been repaid to the NPDC after a reconciliation process.
They have also maintained that the companies had not committed any fraud and the matter was a breach of contract which should have gone to arbitration as provided for in the SAA.
At the resumed trial Wednesday, Alison-Madueke had through her lawyer, Dr. Onyechi Ikpeazu (SAN), applied to Justice Dimgba to be joined as one of the defendants in the suit.
She predicated the request on the grounds that count eight of the nine-count charge proffered against the six defendants had mentioned her name, even though the prosecution did not make her one of the defendants.
In the motion argued before Justice Dimgba, Alison-Madueke maintained that her application would not prejudice the criminal trial but rather afford her the opportunity to be heard in the interest of fair hearing.
Ikpeazu said the applicant would be grossly prejudiced if the application was refused by the court, adding that the refusal would further compound the gross violation of her constitutional rights.
In opposing the application, counsel to the EFCC, Aliyu Yusuf, urged the court to decline her request to be joined as a defendant.
Yusuf told the court that Alison-Madueke was currently under investigation by the Metropolitan Police, London for several crimes and has been admitted to bail in the United Kindom but could not leave the country.
“The applicant seeing that the investigations by the Metropolitan Police had reached advanced stage, and that trial in the instant charge before this honourable court is proceeding smoothly, had designed the instant application to distract and scuttle both her investigation and imminent prosecution in the United Kingdom and the trial before this court,” Yusuf argued.
He further claimed that Alison-Madueke knew she would not be able to leave the United Kingdom, in view of ongoing investigation and imminent prosecution, and was therefore seeking the order to amend the charge for her name to be included on the face of the charge in order “to escape investigation and prosecution in the United Kingdom under the guise that she is coming to face her trial before this court and also scuttle the trial”.
In a brief ruling, Justice Dimgba held that the EFCC could not eat its cake and have it because by including Alison-Madueke’s name in count eight of the charge, the commission ought to have made her one of the defendants.
The judge, therefore, struck out count eight where Alison-Madueke’s name was mentioned in the suit and adjourned trial of the substantive matter till October 5 and 6.

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Woman who gives birth to baby number 20, says 'thrilled to announce their precious new addition'

Britain's biggest family has grown again after Sue Radford gave birth to her twentieth baby - but promised this is her last child.
Mrs Radford, 42, has welcomed her 11th son Archie on Monday after an hour's labour but her husband Noel, 46, revealed he still won't get a vasectomy.
The grandmother said she is happy to stop on a 'nice even number' after she held her 8lb 6oz son in her arms at the Royal Lancaster Infirmary.
She wrote online: 'We are so thrilled to announce our precious new addition has arrived. We'd like you all to meet Archie Rowan Radford.'
The couple, from Morecambe, Lancashire, first met when Sue was just seven years old.
They had their first child, Chris, 28 years ago, when Sue was aged only 14. The couple decided to keep the baby as they were both given up for adoption at birth.
The couple then moved into their first home together and got married. Shortly afterwards they welcomed their second child, Sophie when Sue was 17.
They have gone on to have 18 more children but insisted Archie would be their last.
Mrs Radford told The Sun: 'I'm just chuffed he is here safe and sound. It's strange knowing you're not going to have anymore.'
Her husband, who runs a pie company, added: 'It was going to end at some point. We both think this is it. I feel sad in a way but now we can get on and enjoy the kids.'
On their website they said: 'Never did we imagine that when we had Chris all those years ago that we would go onto be blessed with 19 more wonderful children.
'In the Radford house life is busy, hard work and a little bit crazy but we absolutely wouldn't have it any other way.'
The pair announced earlier in March that they are expecting a new addition to their mammoth family tree by posting an ultrasound picture on social media.
They posted a picture online and wrote: 'Boys - 10, Girls - 9 and BABY makes it 20. Arriving Sept 2017.'
Just over a year ago, on July 24, they welcomed baby number 19, Phoebe, and well-wishers sent the couple messages to congratulate them.
Their new son joins Chris, 28, Sophie, 23, Chloe, 22, Jack, 20, Daniel, 18, Luke and Millie 16, Katie, 14, James, 13, Ellie, 12, Aimee, 11, Josh, 10, Max, eight, Tillie, seven, Oscar, five, Casper, four, Hallie, two, and Phoebe, 13 months.
They became grandparents when their daughter Sophie gave birth and she has gone on to have three children.
The family now live in a large £240,000 Victorian house, a former care home, that they bought 11 years ago and they pride themselves on having no credit cards or finance agreements. They also enjoy a holiday abroad every year.
They spend £300 a week on food shopping, with 18 pints of milk, three litres of juice and three boxes of cereal being consumed every day.
When it comes to celebrating their children's birthdays they have a budget of £100 for presents, while at Christmas they set aside between £100 to £250.
Her husband had a vasectomy during his wife's ninth pregnancy but had it reversed when they decided to have more children.
In 2013, the couple starred in the Channel 4 show, 16 Kids and Counting and were filmed in their ten-bedroom home.
The following year, Mrs Radford - who does not receive state handouts apart from child benefit, lost a boy, called Alfie, when she was 23 weeks' pregnant.

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Nigeria raises 216 bln naira in Treasury bill, more than offer at auction

The central bank of Nigeria (CBN) raised 215.88 billion naira at a treasury bill auction on Wednesday, 75 billion naira more than it has initially offered due to huge subscription from invesstors, the bank said on Wednesday.
The bank said subscription from investors total 559 billion naira, almost four times the amount the bank initially planned to raise.
Data from the bank showed that the one-year paper accounted for most of the volume of treasury bills raised.
Range of bids from was between 18.9 percent for the one-year debt and as low as 13.15 percent for the three months note.
The bank raised 22.78 billion naira in three month bills at 13.15 percent, 24.74 billion naira in six month bills at 16.8 percent and 168.36 billion naira in one-year bills at 17 percent.
Traders said foreign investors sold dollars last week in anticipation of the auction, boosting demand for the bills and also liquidity on the currency market.
Dollar liquidity rose slightly to $186.37 million on the investor forex market on Wednesday against $102.75 million on Tuesday with the local currency closed at 360.67 per dollar.
The central bank issues treasury bills twice a month to help the government fund its budget deficit, support commercial lenders in managing liquidity and curb inflation.

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Nigeria's Union Bank to raise 50 bln naira from rights issue, as bid opens

Union Bank of Nigeria (UBN) said on Wednesday it has opened bids for its 50 billion naira rights issue to existing shareholders.

The bank said the bid which is opened for subscription on Sept. 20 will close on Oct. 30. According to a notice, the bank plans to sell 12.1 billion shares at 4.10 naira each, issuing five new shares to investors for every seven already held.
Union Bank, set up 100-years ago, said it planned to spend 80 percent of the funds to enhance its regulatory capital and boost working capital.
The lender, in which Atlas Mara Ltd, the African investment vehicle of former Barclays boss Bob Diamond, owns a 22.1 percent stake, has said it planned to raise funds also to tap opportunities to lend to agribusinesses.
At last Mara in June said it was raising $200 million to increase its stake in Union Bank and other businesses. It said at the time it was buying a 13.4 percent stake in the Union Bank from Clermont Group, taking its total holding to 44.5 percent.
Clermont International is among a consortium of local and foreign investors that own 65 percent, Union Bank said in its rights circular, adding that it was not aware of any investor trying to acquire a majority stake.
Union Bank was a former unit of Barclays Bank.
Shares in Union Bank, which have gained 9.1 percent so far this year, fell 4.67 percent on Wednesday to 5.70 naira on the Lagos bourse, a 28 percent premium to the rights price.

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South Africa's rand rebounds ahead of rate decision, stocks slip

South Africa’s rand recovered on Wednesday from its weakest in a month after consumer inflation figures for August suggested interest rates will fall further, reviving economic growth.
Stocks were weaker as Sasol weighed on the market after announcing a dilutive share issue.
At 1530, GMT the rand was 0.32 percent firmer at 13.2675 per dollar, reversing losses of the last week-and-a-half caused by a report showing stronger U.S. inflation, which pushed it as low as 13.3500, its softest since August 15.
The rand has surrendered about 5 percent since Sept. 6, tumbling through crucial technical support that saw traders mark the currency for short-selling.
But the rand recovered on Wednesday after South Africa reported consumer inflation rose less than expected, to 4.8 percent year-on-year in August from 4.6 percent in July, the rand regained its footing.
The central bank concludes its three-day monetary policy committee (MPC) meeting on Thursday.
“...The September MPC is expected to deliver a further 25 basis points interest rate cut to 6.50 percent, as CPI inflation, and hence inflation expectations, moderate,” said Investec analyst Kamilla Kaplan in a note.
An announcement by the treasury that it had successfully issued a pair of dollar bonds in overseas capital markets worth $2.5 billion also aided the recovery.
Traders said the outcome of the U.S. Federal Reserve’s policy meeting later in the day would also affect the rand.
Bonds also firmed, with the yield on the benchmark debt due in 2026 falling 0.3 basis points to 8.405 percent.
On the stock market, the benchmark Top-40 index was down 0.4 percent at 49,575.88 points, while the broader All-share index declining 0.3 percent to 55,867.46 points.
Petrochemical company Sasol dropped to a two-month low after announcing a plan to issue new shares. Shares in Sasol slumped 6.4 percent to 373 rand.
Steinhoff Africa Retail (STAR) moved in the opposite direction on its market debut, closing at 21.52 rand, a 5 percent gain on its initial public offering price of 20.50 rand.
STAR, majority-owned by Steinhoff International, climbed as high as 22.46 rand on Wednesday, 9.6 percent above the IPO price. The IPO raised 15.3 billion rand ($1.2 billion), making it the biggest in Africa so far this year.

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KPMG South Africa CEO wants independent probe into firm

KPMG South Africa wants an independent investigation into the firm’s conduct to reassure employees and clients after a scandal involving its handling of audits for businessman friends of President Jacob Zuma, its new chief executive said on Wednesday.
The auditor cleared out its South African leadership on Friday after it found that work it did for firms owned by the Gupta family “fell considerably short” of its standards. It found no evidence of crimes or corruption.
The Guptas, accused by a public watchdog of improperly influencing government contracts, have denied any wrongdoing, as has Zuma. The Guptas and their companies have not been charged with any crime and they say they are the victims of a politically motivated witch-hunt.
But the scandal has cost KPMG at least three clients and several of South Africa’s largest listed companies are reviewing whether to continue using the auditing firm.
Nhlamulo Dlomu, who took the reigns of KPMG South Africa on Friday, said in an interview with Talk Radio 702 the firm had agreed with an industry body to conduct an independent investigation.
“We have agreed with the South African Industry of Chartered Accountants that it would be appropriate to set up an inquiry into the matters,” Dlomu said.
KPMG became the third global firm to be damaged by work carried out for the Indian-born brothers after the business consultancy McKinsey and the public relations agency Bell Pottinger, whose British business collapsed last week.
On Tuesday, KPMG Global Chairman John Veihmeyer apologised for the firm’s failings in South Africa and said further action would be taken if new information came to light.
Dlomo said the independent inquiry was needed to reassure employees, clients and the rest of the public.
“This would be an additional assurance lens, to ensure the public can truly see we have opened up our doors. We want to be clear about what has happened.”

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South Africa's stable inflation boosts chances of rate cuts

South African inflation rose less than expected in August, increasing the likelihood of interest rate cuts this week and later in the year.
Consumer inflation rose 4.8 percent year-on-year in August from 4.6 percent in July, data showed on Wednesday. Economists had forecast 4.9 percent.
All are well within the South African Reserve Bank (SARB) target range of 3 and 6 percent, and prices were subdued on a monthly basis, rising just 0.1 percent from 0.3 percent in July.
The rand responded positively to the numbers, strengthening 0.28 percent to 13.2750 per dollar.
The SARB surprised many economists in July by cutting lending rates for the first time in five years. Now markets and analysts are pricing in as many as two more cuts before year-end.
Forward rate agreements point to a 70 percent probability of lending rates being cut by 25 basis points when the SARB announces its latest decision on Thursday, and are factoring in a 30 percent chance of a 50 basis point cut.
Markets also suggest there is a high probability of further cuts in November and January.
Halen Bothma, an economist at ETM Analytics, said he expected SARB to cut rates by 100 basis points in the current cycle.
Finance Minister Malusi Gigaba’s maiden budget speech in October and the ruling African National Congress leadership election in December would be key factors in determining the bank’s future moves, he said.
Before July’s surprise 0.25 percent cut, SARB Governor Lesetja Kganyago played down the prospects of cheaper borrowing costs, citing the risks of currency weakness.
The rand backtracked this week as bets of another rate hike by the United States central bank resurfaced.
However, the currency weathered the shock axing of Pravin Gordhan as finance minister in March and subsequent credit downgrades to junk and is around 10 percent firmer since the beginning of the year.
Kganyago has long been viewed as a hawkish governor but that perception is beginning to change.
“I don’t think Governor Kganyago is any more or less hawkish than other MPC members. Inflation targeting is central to him,” Standard Chartered’s chief Africa economist Razia Khan said.
“Yet there is also recognition that inflation targeting is what allows for a low-interest rate regime, when it is possible and where it is needed, in order to support growth.”

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Nigeria's central bank rules out lower interest rate in near term

The Central Bank of Nigeria (CBN) said the clamour for low-interest rate cannot happen in the near term due to the high level of inflation and rising costs in the economy.
Nigeria’s banking regulator has held its benchmark interest rate at 14 percent level for the consecutive seventh meeting in July as the CBN governor Godwin Emefiele claimed that “Low-interest rate will make it easy for people who want to borrow money, to borrow money at low rates.’
Member of the rate-setting MPC, Dahiru Balama said there is the need to encourage the inflow of FDI both real investment and hot money into the economy.
“The clamour for low-Interest rate cannot happen now because of the high level of inflation and rising operational costs in the economy,” Balama said at the last MPC meeting.
The MPC is expected to meet next week Monday and Tuesday to take a fresh decision on interest rate and the economy in general in the face of latest data shown that Nigeria has exited recession at the end of the second quarter of the year.

Nigeria, Africa's biggest economy Gross Domestic Product (GDP) grew by 0.55 percent year-on-year in real terms in the second quarter of the year, indicating the emergence of the economy from recession after five consecutive quarters of contraction since Q1 2016.
The CBN deputy governor, Adebayo Adelabu also agreed with his colleague on the MPC the need to sustain the present benchmark interest rate.
Adelaabu in his contribution noted that on the account of elevated inflation and the cost of rising non-performing loan (NPL) in the banking sector, the interest rate may not trend downward in the near term.
Private sector operators have been clamouring for lowering of interest rate to boost production in the economy and hasten the recovery of the economy.
However, policymakers have hinged their resistance to lower interest rate to possible pressure cheap borrowing could have on the foreign exchange market.

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Nigeria refunds 740 bln naira Paris Club debt to states this year-says central bank

Nigerian 36 states have received a total of 740 billion naira from a refund on overcharged deductions on Paris club debt this year, data from the central bank has shown.
The total refund represents about 10 percent of this year’s federal budget,  according to Central bank of Nigeria's (CBN) deputy governor, Adebayo Adelabu in his note to the last Monetary Policy Committee (MPC) meeting.

Nigeria federal government has proposed a total of 7.44 trillion naira for this year with an inbuilt deficit of around 2.36 trillion naira.
The refund is in respect of over-deductions on Paris Club, London Club Loans and Multilateral debts between 1995-2002.
Nigeria had reached a final agreement for debt relief with the Paris Club in October 2005, some States had already been overcharged.
The OPEC member country projected the budget to bring it out of its worst recession, which was brought on by low crude prices, which have slashed government revenues, weakened the naira and caused chronic dollar shortages.
The 2017 budget is based on an assumed oil price this year of $44.50 a barrel, while global benchmark Brent crude is currently trading above $50. It also entails debt service for the foreign borrowing of 175.9 billion naira and domestic borrowing of 1.488 trillion naira.
Worried about the increasing inability of many states to pay worker’s salaries, the federal government entered into an agreement with governors of the states to refund certain amount over-charged them on the Paris Club debt to enable them pay outstanding wages.
However, many of the states are still owing their workers unpaid salaries for upward of six to ten months in spite of the huge amounted refunded since the beginning of the year.

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Nigeria plans tax incentives to boost private sector initiative in road constructions

In a bold move to bridge its infrastructural deficit, Nigeria may resort to a novel method; tagged tax recovery funding scheme to rebuild some of its major roads.

Dropping the hints in Abuja on Tuesday, the country's Minister of Power, Works, and Housing, Babatunde Fashola, said the new initiative became necessary due to declining revenue hampering the rapid execution of important economic projects.

Fashola said the government is planning to explore innovative means of funding infrastructure projects and would be willing to offer some companies tax reliefs in the hope to get them to undertake key road projects within their catchment areas.

He noted that such companies with the capacity and willingness to reconstruct existing or build new roads in the country would be encouraged by the government to go ahead, and subsequently claim tax relief as recompense for their investments.
“We welcome other like-minded individuals and companies who have that kind of money to intervene in certain roads, and claim tax relief back," the minister said.
According to him, “What it really means technically is that government is spending in advance the taxes that it should collect to quickly respond to places where there is pain because some of these companies, if they make profit should pay tax at the end but the government is saying if they spend some of the tax on public infrastructure they will get some relief. We commend and welcome this initiative.
He said the government considered the new initiative as the long-term solution to the lockdown in Apapa. 

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Nigeria's debt office to sell 135 bln naira bonds next week

Nigeria's Debt Management Office (DMO) said it will raise 135 billion naira worth in bonds next week Wednesday in continuation of its efforts to borrow from the domestic market to help fund this year's budget deficit.

The debt office said on Tuesday it will raise 35 billion naira in the bond due in 2021 and 50 billion naira apiece in bonds maturing in 2027 and in 2037, using a Dutch auction system.
The bonds are re-openings of previous issues.
Nigeria, Africa’s biggest economy, issues sovereign bonds each month to help fund its budget deficit, support the local debt market and maintain a benchmark for companies to follow.
It has a series of debt issues lined up this year, including a 100 billion naira debut domestic sukuk which it is marketing to fund road projects and a 20 billion naira “green bond”

The West African country has projected a budget deficit of around 2.36 billion naira this year and intends to borrow about half of the money from the domestic debt market.

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Nigerian inflation slows marginally Aug vs July, now 16.01 pct

Nigeria's annual inflation slowed marginally for the seventh month in August, easing to 16.01 percent, the National Bureau of Statistics (NBS) has said.
The rate of annual inflation was 0.04 percent lower than in the July figure of 16.05 percent.
“The highest increases were recorded in clothing materials and articles of clothing, garments, passenger transport by air, motorcycles, shoes and other footwear,” said the statistics office in its report.
A separate food price index showed inflation at 20.25 percent in August, compared with 20.28 percent in July.
Last week the statistics office said Nigeria emerged from recession in the second quarter of this year with Africa’s biggest economy expanding 0.55 percent year-on-year.
Nigeria’s economy shrank by 1.5 percent in 2016 for its first annual contraction in 25 years.

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Nigeria's money market round-up

During the week, the interbank money market tightened with overnight rates hitting 23 percent levels midweek.

However, OMO maturities and coupon payments eased liquidity later in the week. Overnight rates closed at 11.25 percent on Thursday and expected to trade at the same level on Friday.

The fourth quarter T-bill issuance calendar was released during the week, showing a nil net cash flow as maturing T-bills are just expected to be rolled over. 

However, the absence of 364-day tenor offerings at the OMO auctions continued to push a rally at that part of the curve despite tightening liquidity. The 30, 90, 180 and 364-day treasury bills opened in the secondary market at 16.00 percent, 17.25 percent, 17.45 percent, and 17.60 percent respectively, and closed at 13.10 percent, 17.68 percent, 17.88 percent, and 17.45 percent. 

The DMO offered its initial 100 billion naira in 7-year Ijarah sukuk bonds with a rental rate of 16.47 percent with the bidding expected to last for a week. 

The monthly FGN bond auction has been postponed till 27 Sep 2017. Bond yields also dropped due to investor demand in the secondary market. The 2020, 2021, 2022, 2027, 2036 and 2037 maturity bonds opened in the secondary market at 16.82 percent, 16.60 percent, 16.47 percent, 16.65 percent, 16.55 percent, and 16.62 percent respectively, and closed at 16.28 percent, 16.39 percent, 16.28 percent, 16.45 percent, 16.28 percent, and 16.37 percent.

The success or otherwise of the Sukuk offering next week would be of particular interest and could impact expectations of supply at the bond auction coming up in a fortnight.

However, there is likely to be enough investor interest to sustain the bond rally in the secondary market given the increasing confidence in the stability of the exchange rate at the I&E window. In the Investors and exporters' window, the naira traded in a narrow range of 359 and 361 and the average daily turnover for the week has been $130 million. The CBN sold $100 million at this week’s wholesale Special Secondary Market Intervention Sales (SMIS) auction.

(C) Citibank Nigeria

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Nigeria projects higher cocoa output in Q4

There are indications that cocoa farmers in Nigeria will enjoy bumper harvest in the coming season as a result of delay rain in the Southern region of the country, which has helped boost pod production.

According to the head of the Cocoa Association of Nigeria (CAN), Sayina Riman, he expects output for the new season which starts in October to hit between 300,000 tonnes and 320,000 tonnes, up sharply from the season just ended which was blighted by poor weather.

The cocoa season in Nigeria, the world’s fourth biggest producer, runs from October to September, with an October-to-February main crop and a smaller light or mid-crop that begins in April or May and runs through September.
The 2016/17 season started at a slow pace after drought cut the mid-crop harvest by 40 percent. Output for that season was estimated to reach 260,000 tonnes, Riman said, lower than a revised forecast of 280,000 tonnes and down from 340,000 tonnes forecast at the start of the season.
“We have late rains which has affected production. We are hoping that from the first week of October, we should be talking of increased yield,” Riman told Reuters.
The International Cocoa Organization (ICCO), however, gives much lower estimates of Nigerian cocoa output. It forecast last season’s production at 220,000 tonnes.
Riman did not give a reason for the discrepancy. Nigerian government production figures are also significantly higher than ICCO estimates.
“We are looking at new plantations ... rehabilitation of old farms, the level of youth coming into farming and the recovery rate of abandoned farms,” he said by phone.
Farmers across Nigeria’s main growing regions were optimistic as some had used the drought to prepare their farms, Riman said, but some have been stuck with about two-thirds of their produce due to the glut in the world market.
World cocoa prices have declined by a third in the last year amid a global supply glut after record production from top growers Ivory Coast and Ghana. ICCO predicts a global surplus of 371,000 tonnes for 2016/17.
Demand for the London September contract has been dampened by the prospect of receiving cocoa from Nigeria and Cameroon where buyers have less control over the quality of beans.
Cocoa trees need a delicate balance of rainy and dry weather. Too little rain and they wither; too much and they become susceptible to insects or fungal black pod disease. Beans can also go mouldy if small farmers are unable to dry them outside.
One farmer in the southeast region said prices dropped from a high of 1.2 million naira ($3,922) earlier this year to 400,000 naira within a six-month period.
Riman says the West African country needed to develop its local markets. “All of us in producing countries have realised that you need local consumption to make cocoa farming sustainable.”

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Nigeria's Stanbic offers scrip dividend option for three years

Nigeria’s Stanbic IBTC Bank will offer shareholders the option to receive scrip dividends in lieu of cash dividends over the next three years, it said on Thursday after it declared an interim dividend.
The mid-tier lender, which is part of South Africa’s Standard Bank, did not give a reason for the move.
The bank declared an interim dividend of 0.60 naira for its half-year to June 30. It set a reference price of 39.45 naira for the scrip issue, compared with Thursday’s share price of 40.02 naira.
“Shareholders have a choice of receiving dividends declared by the company, up to year 2020, either in cash or may elect to receive their dividends as new ordinary shares in the company,” the bank said.
Nigerian companies have been struggling in an economy battered by low oil prices. Companies typically use scrip dividends to conserve cash.
In March, Nigerian Breweries granted shareholders the option of taking new shares in lieu of a cash dividend, so that it can use the money to cut interest costs and fund working capital.
Nigeria’s IPO market has been moribund for close to a decade. The Securities and Exchange Commission has proposed cutting listing fees to attract issuers. Stanbic shares have gained 167 percent so far this year, outperforming the broader index, which is up 32 percent.

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Nigeria's Dangote Cement says making moves to take over S/Africa rival

Nigeria’s Dangote Cement, majorly owned by Africa’s richest man, Aliko Dangote said it has opened takeover talks with South African rival PPC.

“DCP (Dangote Cement Plc) hereby confirms that the board of directors of DCP has merely communicated its interest to the board of directors of PPC with respect to the acquisition of the entire share capital of PPC,” Dangote Cement said in a statement of the Nigerian Stock Exchange (NSE).

The company, however, noted that “This communication is still at the preliminary stage.”
PPC is already considering a bid by local rival AAfriSam, which launched a new all-share merger proposal that values South Africa’s largest cement maker at about 9.2 billion rand ($700 million).
PPC has a third offer from an unnamed bidder.
PPC said in a statement its independent board is considering the proposal.
Shares in PPC were up 4.53 percent to 6.23 rand, while shares in Dangote were up 2.39 percent.

Nigeria's Dangote Cement accounts for a third of the local bourse capitalisation and has plants in major African country, making it the largest producer 

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Nigeria's Rivers Governor says Police responsible for kidnappings, robberies in the state

The recent spate of armed robbery and kidnapping in Nigeria's Rivers State has been blamed on the clandestine activities of Special Anti-Robbery Squad (SARS) of the Nigeria Police in a bid to cause confusion and distabilise the state, says governor Nyesom Wike.

Wike, who spoke in the state capital, Port Harcourt on Wednesday accused the SARS boss in the state of behind the criminal activities and breach of security in the state.

According to the governor, the Police special unit commander, Akin Fakorede, and his operatives had been indicted by an official police signal, which indicated that they were responsible for the series of kidnappings and deadly robbery incidents across the state.

He accused the SARS Commander of being an agent provocateur, planted in the state to sabotage the security architecture of Rivers and create an atmosphere of fear.

Wike said: “Most of the kidnappings and armed robbery taking place in this state are done by men of SARS. They use exhibit vehicles to operate. As the Chief Security Officer of the state, you complain, but they choose to play politics with crime.
“They fight crime in some state, but they refuse to fight crime in Rivers State. We are done with the elections, but they are using SARS to create insecurity in the state. As I speak with you, they will deny.
“But the SARS operative, who was killed, was amongst those who raided the Rivers East Senatorial District Collation Centre. This man can be identified in the video as one of those who invaded the collation centre with Fakorede.”
He specifically said that the criminal activities of Fakorede were uncovered by the Inspector General of Police X Squad, Abuja, deployed in the state after the team busted the attempted kidnap of one Mr. Azumana Ifeanyi on September 11, 2017, at the GRA, Port Harcourt.
He blamed the situation in the state as part of the strategy of the rigging process for 2019.
“I have never seen a country where they politicise crime. It is very obvious that they want to give the impression that Rivers State is unsafe. They want to instil fear preparatory to declaring during the elections that there are so many killings.
“Authorities deliberately trying to destroy a whole state and you want the people to be happy. I will no longer write (to the IGP). Now is the time to take my case to the public for the whole world to know what is happening,” Wike added.
The governor maintained that his administration had invested more than any other state in security, logistics and lamented that the Police was working against the state.

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Nigeria may not join OPEC output cuts before March

Nigeria is very unlikely to join OPEC’s cuts in oil production before March, its oil minister said on Wednesday.
The Organization of the Petroleum Exporting Countries and other producers, including Russia, are reducing crude output by about 1.8 million barrels per day (bpd) until next March in an attempt to support prices by cutting a glut of crude oil on world markets.
Nigeria and Libya, whose output has been affected by political turmoil and attacks, are exempt from the agreement.
“It is very unlikely that I see stability that convinces me with certainty that I should exit the exemption between now and March,” Nigerian oil minister Emmanuel Ibe Kachikwu told reporters in Abuja.
He also said an extension to the cartel’s cuts was possible since volumes of oil stocks were still a challenge.
“I will not be surprised if an extension to the cuts is contemplated post-March, given the sort of volumes I‘m still seeing because as long as the volumes are still a challenge we will continue to do everything that we need to do to tighten up the market.”
Kachikwu said earlier on Wednesday that Nigeria’s oil production currently stood at 1.6 million bpd, excluding condensates.

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