The Nigerian Stock Exchange (NSE) has reported that securities lending transactions stood at N34.8 billion as at April 17, 2020 as against the comparative period of 2019.
Securities lending is the market practice of temporarily transferring securities, for a fee, from their holder (the lender) to another party (the borrower), with the borrower agreeing to return the securities to the lender either on-demand or at the end of the agreed loan term.
It usually requires the borrower to collateralise the transaction with cash or other securities of a value equal to or greater than that of the lent securities, in order to protect the lender against counterparty credit risk.
Data obtained from the NSE’s website showed that the volume of securities as at April 17, 2020 stood at 4.13 billion units compared with 61.4 million units while the value rose by N34.8 billion compared with 344.5 million.
The report gave the breakdown of the companies that pledged the shares as follows: GT Bank pledged 8.58 million shares; Presco Plc , 4.02 million shares; UBA , 2.6 million shares and MTNN with 2.54 million shares.
Others are Dangote Sugar with 2.35 million shares, Okomu Oil with 2.19 million shares, Dangote Cement with 1.74 million shares, Zenith Bank with 1.66 million shares, Flour Mills with 600,000 shares, Union Bank of Nigeria (UBN) with 450,000 shares and Nigerian Breweries with 318,000 shares.
Meanwhile, proceedings on the NSE turned negative as the All Share Index (ASI) fell by 1.36 per cent to close Thursday’s session at 22,470.79 points due to price depreciation in Nestle and Dangote Cement.
This was even as market capitalisation decreased by N162 billion to settle at N11.710 trillion from N11.872 trillion recorded in the previous trading session. Furthermore, the volume and value of stocks traded stood at 201.47 million units and N3.35 billion, exchanged in 3,381 deals.