Stories by Blaise Udunze 

THREE commercial banks and a microfinance institution may be sanctioned by the Nigerian Stock Exchange (NSE) for failure to conclude the audit of their accounts for the 2015 financial year in line with the regulatory timeline of three months after the end of a business year.

It was learnt that ahead of the sledge hammer stakeholders are worried the sanction could add to the institutions’ woos since the business year ended on December 31, 2015. Most quoted companies including banks, manufacturers, oil and gas companies, breweries and cement companies use the 12-month Gregorian calendar as their business year.

But NSE’s regulatory filing calendar indicates that the deadline for submission of annual report for companies with Gregorian calendar business year, which ended on December 31, 2015, was Thursday, March 31.

Although the NSE can grant waiver and extension to companies on special consideration such as those awaiting regulatory approval, some companies have already filed for extension of the earnings deadline to enable them finalise their annual report.

As at the time of filing this report, some of the banks affected include Stanbic IBTC Holdings, Skye Bank, Diamond Bank and NPF Microfinance Bank were listed as having defaulted in the late filing of their statements.

Only last weekend, Stanbic notified it had applied for extension of the earnings deadline to enable it complete the audit of its accounts.

Similarly, Diamond Bank, in a release titled, “Notification on the Release of Diamond Bank Plc 2015 Audited Financial Statement for the Financial Year Ended December 31, 2015” explained that it had completed the auditing of its accounts and submitted the approved accounts and report to the Central Bank of Nigeria (CBN) for final approval.

The notification reads in part: “The Management of Diamond Bank Plc would like to advise our esteemed shareholders, key shareholders and the wider investor community that from available indications we are unlikely to issue our audited financial statements on March 31, 2016, as required by the NSE Rules (the Rules) and other regulatory rules guiding release of Audited Financial Statements.”

It stated that the auditors have concluded the review of the Audited Financial Statements and had been approved by the Board of Directors.

According to Diamond Bank, CBN has not completed the review of the accounts as it assured that the approved audited financial statements would be made available on or before April 30, 2016.

On its part, Skye Bank said its earnings report was delayed by the additional external audit work that arose from its merger with Mainstreet Bank Limited in 2015.

“Prior to the merger, the two banks operated as separate entities for five months of the financial year, each operating on different information technology platforms and firms of external auditors. The foregoing has necessitated additional external audit work on the part of the surviving audit firm, being the first post-merger period,” Skye Bank stated.

Also, financial services companies such as banks and insurance companies awaiting regulatory approval will carry the appropriate symbol of awaiting regulatory approval (ARA).


Q2: DMO plans to raise N365bn in local currency denominated bond 

THE Debt Management Office (DMO) said on Monday that it plans to raise between N274 billion ($1.4 billion) and N365 billion in local currency-denominated bonds with maturities ranging between five and 20 years in the second quarter of 2016.

The debt office said it would auction between N15 and N25 billion in five-year paper in April, along with N35 to N45 billion worth in 10-year debt and N45 to N55 billion in 20-year bonds.

In May, the debt office plans to issue between N10 and N20 billion worth of five-year paper, N35 to N45 billion of 10-year bonds and N45 to N55 billion of 20-year debt.

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In its latest bond issuance calendar, DMO also said it would in June raise between N10 and N20 billion in five-year, N35 to N45 billion in 10- year and N45 to N55 billion worth of 20-year paper.

The debt office said all were re-openings of those previously issued. Nigeria issues sovereign bonds monthly to support the local bond market, create a benchmark for corporate issuance and fund its budget deficit. The Federal Government had hinted that it would borrow about N900 billion locally to finance part of the N2.2 trillion deficits in 2016 budget.

Meanwhile, Nigeria’s overnight interbank lending rates fell by more than half on Friday to around 5 percent from last week’s 13 percent after the Central Bank of Nigeria injected fresh liquidity into the financial system.

The apex bank retired about N179 billion ($900.40 million) in matured treasury bills through open market operations (OMO) on Thursday.

On Wednesday the bank refunded about N500 billion in unused balance of cash deposited by commercial lenders for forex purchases, swelling liquidity in the market and forcing down cost of borrowing among banks.

But overnight placement rose sharply last week to around 20 percent after the central bank recalled some 400 billion naira from the banking system to meet a new cash reserves ratio (CRR) on deposits.

The market closed at 13 percent a fortnight ago after cash payments from international oil companies operating in Africa’s largest crude producer under a joint venture agreement hit the system.

The CBN had raised its benchmark interest rate from 11 to 12 percent a fortnight ago, and the cash reserve ratio for commercial banks to 22.5 percent from 20 percent, to try to curb inflationary growth, leading to fears of higher interest rates.

The total commercial lenders’ credit balance with the central bank rose to 564.35 billion naira, up from 320.9 billion naira last week Thursday, traders said.

Traders said the central bank floated 50 billion naira in 209- day OMO bills on Friday, but was yet to release the auction results.


AfDB invests $8.2m in Shelter Afrique to boost housing finance

AFRICAN Development Bank (AfDB) disclosed that it invested $8.2million in Shelter Afrique, a pan African finance institution, which exclusively supports the development of housing and real estate sector on the continent.

AfDB stated that the investment is well aligned to its ten-year strategy for the period 2013-2022, as well as one of its high strategic priorities of “improving the lives of people in Africa”.

In a statement made available to Daily Sun, the bank said the fund injected was meant to strengthen its balance sheet and help achieve its objective of providing quality affordable housing in Africa. It further highlighted the confidence it has in the future of the continent and the implications for housing development in the continent.

“Africa’s economic landscape remains positive with promising scope for growth; Gross Domestic Product remains robust supported by multiple factors. The continent’s growing population, a growing middle class and the fastest urbanisation rate in the world are some of the factors driving increased demand for affordable houses and housing finance,” AfDB noted.

Managing Director of Shelter Afrique, Mr. James Mugerwa, noted that the equity increase is a reflection of the confidence reposed by AfDB in his firm.

“The African Development Bank has sent strong signals about the seriousness of housing on the continent, and by extension, the seriousness of what we do here at Shelter Afrique. It is a welcome development but we see it as engaging as well. This equity increase means the AfDB wants to see more, they want to see impact and scale and that is what we will be aiming for this year; impact,” he said.