Vanguard Markets, August 11, 2014 edition

Vanguard Markets | Monday, August 11, 2014 | Issue 005

2009 BANK RESCUE

A disputed legacy 5 years on ! page VM2

Dr. Sanusi Lamido Sanusi, former CBN governor

INTERNATIONAL TRADE

Inside

US seeks top spot in African trade

CAR dealers

$140B

The Central Bank announced changes to how financial institutions calculate the capital adequacy ratio (CAR) and decreed that Tier 2 capital must not exceed 33.3% of Tier 1 capital

$120B

! Page VM3

Trade with Sub-Saharan Africa Total exports and imports with each partner U.S.

China $180B $160B

$100B $80B $60B $40B $20B $0B ‘00 ‘01 ‘02 ‘03 ‘04 ‘05 ‘06 ‘07 ‘08 ‘09 ‘10 ‘11 ‘12 ‘13 Data visualisation by Publican Media Source: Brookings Africa Growth Initiative from International Monetary Fund data

Tony Elumelu, chairman of the HEIRS Group, exchanges greetings with President Barack Obama at the 2013 launch of Power Africa initiative

AST WEEK, POLITI­ cal and business leaders from across the African continent gathered in Washington D.C. at the behest of President Barack Obama. They were in the US capital for the inaugural USAfrica Leaders’ Summit.

The 3-day event was supposed to provide an opportunity for the US to win commercial influence in Africa, where private- and state-backed Chinese investment have made significant inroads over the last decade. It was also an attempt to erase concerns that the US was more interested

L

in Africa from a security angle in its fight against global terror groups as against a commitment to build mutually rewarding economic relationships.

While they slept American businessmen and policy makers are alarmed at the inroads made by China on the continent. For example, Chinese investment on the continent has risen more than 20-fold over the last decade to $200 billion in 2013. This is more than double the US investment in sub-Saharan Africa. Another informative sta-

Source: HEIRS Capital

tistic is that while China has over 150 commercial attachés on the continent, the United States has only 8.

Separately, as the Chinese have gained ground, the previously important cultural and economic ties that bound African countries to their European colonisers have weakened. Economic stagnancy in the European Union, coupled with anti-immigrant policies have created the impression of a Europe self-absorbed with resolving its deficit and identity problems.

Beginning in the last decade, Chinese companies and

financiers began an aggressive push to gain ground in Africa. They invested in areas that received paltry interest from Western companies with few exceptions. Notably, in infrastructure, transport, mining, and energy Chinese companies with the backing of Beijing started to win contracts and concessions at a rate that must have shocked Western companies. The Chinese government’s policy of refraining from imposing the types of conditionalities set by the Bretton Woods institutions before lending assistance won it yet more friends on the corridors of power and board rooms in Africa.

In actual fact It is technically inexact to accuse the United States of ignoring the continent on commercial matters. US companies like Exxon Mobil are major investors in the Africa’s

extractive industries. The real issue is that Africans feel that the current US administration, because it is led by a person of African descent, should have done a lot more. In fact, a few would argue that his two immediate predecessors in office, Presidents Bill Clinton and George W. Bush did more for the continent during their time in office.

In fairness, President Obama has some achievements under his belt. In 2013 he launched the Power Africa initiative. It will pool $8 billion in investments for the continent’s underdeveloped electricity generation sector led by companies like General Electric.

Behind the scenes, he has also led efforts for the renewal of the Africa Growth and Opportunity Act, a nonreciprocal trade preference

! Page VM3

Big, strong, and reliable again

Under the leadership of Emeka Emuwa, Union Bank is reestablishing itself as a heavyweight contender after a long turnaround

! Page VM7 FOREIGN EXCHANGE TABLE (AUGUST 8, 2014) Currency

Central Rate

US DOLLAR

155.23

POUNDS STERLING

260.9416

EURO

207.8374

SWISS FRANC

171.1844

YEN

1.5219

CFA

0.3063

WAUA

236.9358

YUAN/ RENMINBI

25.2127

RIYAL

41.3891

DANISH KRONA

27.8749

SDR

237.7968

Fixed Income & Forex

FGN Bonds & TBills 120B

FGN Bonds Treasury Bills

11.6

90B

11.2

60B

10.8

30B

10.4

0B

1M 2M

NITTY

3M 6M

9M 12M

10.0 23/07

30/07

04/08

07/08

O/N 1M

NIBOR 15.0

3M 6M

31/07

05/08

08/08

163.0

14.0

162.5

13.0

162.0

12.0

161.5

11.0

161.0

10.0 24/07

Bid Ask

FX ($/N)

160.5 24/07

31/07

05/08

08/08

24/07

31/07

05/08

08/08 Source: FMDQ

VM2

INTERVIEW

VM | Monday, August 11, 2014 | Issue 005

BANK RESCUE

Contested discretion Five years after, not a single journalist, former official or senior executive at any of the affected banks has written a detailed account of events surrounding their removal Obiora Onyeaso obiora.onyeaso@customsstreet.com

HIS WEEK WOULD mark the fifth anniversary of Act One of Bloody Friday. On August 14, 2009, Lamido Sanusi, exgovernor of the Central Bank of Nigeria, announced the sacking of the chief executives of the defunct Afribank, Finbank, Intercontinental Bank, Oceanic Bank and Union Bank. Six weeks later, he would complete the excision with the sacking of the heads of Bank PHB, Equatorial Trust Bank, and Spring Bank. The CBN quickly injected N620 billion to rescue the ten banks. Over the next two years, it would spend more than N3 trillion to resolve the crisis.

None of these banks remain as a standalone institution, and only Union Bank has retained its name. In two fell swoops, the central banker decapitated these leaders of a sector that many had considered untouchable until then. Despite the significance of those heady months no authoritative account that gives both sides of the story has appeared on bookstands.

Altogether, the following executives lost their jobs and hard earned reputations: Sebastian Adigwe, Okey Nwosu, Erastus Akingbola, Cecilia Ibru, Bartholomew Ebong, Francis Atuche, Ike Oraekwuotu, and Charles Ojo. That is not all.

Thousands of families faced an uncertain future as breadwinners lost their jobs due to the right-sizing and cost-cutting

T

Critics such as the Renaissance Professionals (right) accused the ex-CBN governor Source: bbc.com of mishandling the rescue of the banking sector in 2009 and conjuring a phantom crisis in the process

that followed their exits.

It was natural that a lot of the narrative in the media focused on the governance, management, and moral failures of the departed CEOs. That is only half of the tale though. Too little of the human story that captures the impact of wave after wave of abrupt dismissals has been told.

In the days and weeks that followed their dismissal accusations, counter-accusations, conspiracy theories, and intrigue filled the air. It was cloak-and-dagger drama except that trillions of depositors’ funds were involved. There was a story that Erastus Akingbola had got wind of his impending dismissal and had informed Intercontinental’s executive directors that their jobs were on the line before disappearing. Cecilia Ibru went missing for a number of days, while her kinsmen threatened to cast a spell on the banking regulator.

Francis Atuche handed in his resignation a few hours before his removal was announced.

Then for months, Akingbola’s moles at the CBN kept him and his allies au courant of plots by

the governor, smuggling internal memos and letters to him in his London address, where he had taken refuge. Then there was the case of Unity Bank, a largely northern-controlled financial institution. It escaped the wrecking ball because while it was ‘adjudged to have insufficient capital,’ it was ‘not in grave situation because it has a healthy liquidity position.’ The most lethal arm in the arsenal of conspiracy theorists has been that no one to date, outside the CBN, has seen the damning reports of stress tests prepared by its examiners. So much for transparency.

On his part, the Central Bank governor courted press attention. He seemed to enjoy every minute of it. He was on CNN, Bloomberg, CNBC, BBC, Channels, NTA and several other stations. He found time to grant interviews and press conferences for the print media. Also, a steady stream of press releases were made available. Labelled as a ‘reformer’ his actions were celebrated as akin to cleaning the Augean stables. He would go on to win a plethora of awards,

and have his face plastered on some of the most prestigious finance-focused magazines in the world.

Nigerians were treated to several pages in newspapers listing names of recalcitrant debtors. They were invited to the Awolowo Road, Ikoyi office of the Economic and Financial Crimes Commission to explain how and when they planned to repay. In the end it was discovered that several companies and individuals names were wrongly included.

Many others featured on the list because they had failed to pay back loans taken to deliver goods and services to state and federal governments that were yet to pay.

The lawsuits came fast and thick. Sunny Nwosu, Boniface Okezie, and other shareholder representatives challenged the apex bank’s power to take over the banks. Renaissance Professionals, a faceless but deep pocketed group, ran full page adverts on most days with screaming headlines rejecting the public intent of the sackings and involuntary takeovers.

For a long time, no public of-

ficer spoke out about the nonintended consequences of the CBN governor’s actions. The first one with the courage to do so was General Aliyu Gusau.

He was the National Security Adviser at the time. The influential former intelligence officer warned that the manner in which the banking reforms were being executed could imperil the broader economy. If that happened, he interjected, it could quickly transmute from a purely economic dimension to become a national security issue.

All this time, not a single journalist, former official or senior executive at any of the affected banks has written a detailed account of events surrounding their removal, and the subsequent evolution of the Nigerian banking sector during Sanusi’s tenure.

In the United States, Timothy F. Geithner, President Obama’s first Treasury Secretary released Stress Test: Reflections on Financial Crises in May this year. Before him, Henry ‘Hank’ M. Paulson Jr., who had served in the same role under President George

W. Bush, wrote On the Brink.

In the book, he defended the rescue of Bear Stearns by JP Morgan, the decision to let Lehman Brothers fail, the salvage of AIG, as well as the $700 billion Troubled Asset Relief Program (TARP) to save the financial sector.

A random search on Amazon.com shows that tens of other publications by reporters, bankers, consultants, lawyers, and researchers have appeared since the crisis exploded.

It is tempting to dissect the story about the two Acts of Bloody Friday as one of heroes and villains. It is a more nuanced and complex story. On one side, cheerleaders of the Sanusi Fan Club drown out any criticism of the former chief executive of First Bank. On the other, his opponents claim that his self-declared mission to ‘expose the rot in the banking system’ was inspired by ego, ethnic self-interest, or an amateurish-overzealous approach to intervention depending on whom you listen to. All the more reason why five years later the complete story needs to be told. ;

SPOTLIGHT

Tony Elumelu, Businessman, Philanthropist, Visionary HE US-AFRICA SUM­ mit has been called the summit that Tony Elumelu, CON, 51, inspired.

The chairman of HEIRS Holdings, a pan-African investment firm, has led calls for a new entrepreneurial mindset on the continent, which he christens Africapitalism.

Born in Jos, Nigeria on March 22, 1963, Elumelu is a fervent champion for homegrown solutions that leverage on external technologies and networks. His idea of charity is firmly rooted at home.

Since he left United Bank for Africa (UBA) in 2010, Elumelu

T

Tony Elumelu Source: HEIRS Holdings

has undergone what must count as the fastest transformation in Nigerian corporate history. He has transmuted from a hard-nosed capitalist to a restless philanthrocrat hobnobbing with the likes of Bill Clinton, the former US president, and billionaires Warren Buffett, Bill Gates, Richard Branson, and Patrick Motsepe.

He admits that in his last incarnation as a financier, his objective was ‘to democratize banking – at the time, it was an economic, not a social act.’ This is not to say that the economic instinct is extinct. He has only grafted on social responsibility

to produce fruits of ‘impact’.

MBA students around the world are familiar with the story of how he turned a $5 million investment in the flailing Crystal Bank in 1997 into the behemoth that UBA became after its merger with the Standard Trust Bank under his leadership.

At UBA, T.O.E., as he is fondly called, was known for his marathon strategy sessions where his managers mapped out how they would conquer Nigeria, and later, Africa.

The rest, as they say, is history.

These days Elumelu is more

likely to be found at high-level gatherings pondering global problems that affect Africans from food and power to education and investment.

His message diverges from those that appeal only to altruism.

Here is what he has to say: ‘I do not suggest that entrepreneurs should build companies in Africa or that capitalists should invest in Africa out of goodwill. I suggest that Africa offers compelling economic and business opportunities that can, at the same time, meet a range of social objectives.’

He describes it as ‘doing well by doing good.’

In an op-ed he wrote in the Wall Street Journal at the end of July, the economics graduate invited summit attendees ‘to move beyond the usual conversations on aid and instead to explore new opportunities to collaborate and co-invest in initiatives that generate value on both sides of the Atlantic.’

His message struck a chord with business and political leaders. By the end of the summit more $14 billion worth of transactions had been agreed. ;

INTERVIEW

VM | Monday, August 11, 2014 | Issue 005

VM3

REGULATION Capital adequacy ratio of Nigerian banks: 2012-2013 32

Tier 2

24

Bank’s CAR in 2013

16%, the minimum CAR for systemically important banks

Bank’s CAR in 2012

Zenith Bank

Unity Bank

15%, the minimum CAR for non-systemically important banks

Wema Bank

United Bank for Africa

Union Bank

ecutive of Stanbic IBTC, disclosed that the Nigerian unit of South Africa’s Standard Bank plans to raise up to N30 billion in Tier 2 capital.

Last week it emerged that Ecobank Transnational has successfully issued $200 million of dated subordinated notes that would qualify as Tier 2 capital. Skye Bank has also announced that it plans to conclude a $200 million Tier 2 capital raising by the end of September. ;

Sterling Bank

Bank, Diamond Bank, Ecobank Nigeria, First Bank, GT Bank, Skye Bank, UBA, and Zenith Bank.

Recently, FBN Holdings and Diamond Bank completed Eurobond offerings, raising $450 million and $200 million respectively.

FCMB has announced plans to raise up to $350 million by issuing Eurobonds. During a half year presentation to analysts and investors, Sola David, Borha, chief ex-

-16 Stanbic IBTC Holdings

Source: Central Bank of Nigeria

Skye Bank

Data visualisation by Publican Media

-8

Fidelity Bank

Subordinated debt

0

Guaranty Trust Bank

Hybrid capital instruments

8

FCMB Group

Provisions and loan-loss reserves

Disclosed reserves: Share premia Retained profits General reserves SMEEIS reserves Regulatory risk reserves Statutory/ legal reserves

16

FBN Holdings

other reserves in the computation of regulatory capital.

One vital innovation that has got bankers and markets abuzz is the 33.3 per cent of Tier 1 capital maximum limit set on Tier 2 capital. According to analysts at Afrinvest, it would ‘place a restriction on banks that intend to raise further Tier-2 capital in the second half. Hence, they may be forced to explore the Tier1 capital, that is, equity raise option.’

In 2013, the CBN set a minimum capital adequacy ratio of 15 per cent for the country’s 8 systemically important banks. These are banks that control at least 5 per cent of nationwide deposits each, and 75 per cent as an aggregate. The banks are Access

Revaluation reserves

Diamond Bank

Paid-up share capital/ common stock

Ecobank Trans. Inc.

Tier 1

Bank’s Capital

Access Bank Plc

N WEDNESDAY, the Central Bank of Nigeria released a new set of guidelines for the calculation of banks’ capital adequacy ratios. The new rules had become necessary for the domestic banks to comply with the regulations contained in the Bank of International Settlement’s International Convergence of Capital Measurement and Capital Standards (Basel II).

In effect, it would improve the quality and loss absorbency of the financial institutions.

Under the title Guidance Notes on the Calculation of Regulatory Capital, the regulator spelled out that henceforth, reporting institutions shall exclude non-distributable regulatory reserves and

O

Categories of bank capital

Capital adequacy ratio

CBN resets regulatory capital

Data visualisation by Publican Media Source: Central Bank of Nigeria

INTERNATIONAL TRADE

US seeks to claim top spot in African commerce and trade W Continued from Page VM1 program, which was signed under President Clinton in 2000. Its current authorization expires on September 30, 2015. However, countries like Angola, Gabon, and Nigeria, whose main exports to the US are crude oil do not benefit very much from AGOA due to low tariffs on the resource as the table below shows.

Follow the money In an op-ed written in the Wall Street Journal, Tony Elumelu, chairman of the HEIRS Group and founder of the Tony Elumelu Foundation, observed that the United States is finally and ‘formally recognizing the strategic importance of Africa in a multipolar world to its own future growth.’

Underscoring his points, Penny Pritzker, the US Commerce Secretary, speaking at the US-Africa Business Forum, held on the side-lines of the summit spoke some truths to US citizens and Congress. ‘Investing in Africa will spur job growth in Cincinnati through Proctor & Gamble’s $300 million investment in a new manufacturing plant near Lagos – because when P&G expands in Nigeria and elsewhere, it supports thousands of jobs at home. Make no mistake: our economic and commercial partnership is a twoway street. Goods and services

AGOA and GSP Eligibility, U.S. Imports, and GSP/Capita, by Country Country

GSP

AGOA

Angola Botswana Cameroon Cape Verde Cote d’Ivoire Ethiopia Gabon Ghana Kenya Lesotho Malawi Mauritius Nigeria Rwanda Senegal South Africa Tanzania Uganda Zambia

AGOA/GSP (thousand $s, 2013)

GDP/Capita ($s, 2012)

66 5,929 21,560 159 84,670 35,310 224 34,673 342,502 320,879 51,238 199,268 5,403 782 625 3,667,783 10,986 1,578 3,999

5,485 7,191 1,151 3,838 1,244 470 11,430 1,605 862 1,193 268 8,124 1,555 620 1,032 7,508 609 547 1,469

Source: Analysis by Congressional Research Office.

Data from USTR, ITC, and Commerce Department

exports from the United States to African markets support roughly 250,000 jobs here at home.’

‘We are a country of values, but we are also a country that wants to promote the economic interests of our people,’ summed up the Commerce Secretary. When asked by the Wall Street Journal if the summit was ‘about helping U.S. businesses catch up with companies from Europe, China or

other Asian countries that are already well-established in Africa?’ Pritzker vehemently denied this. ‘Not at all,’ she denied.

But playing catch up is the name of the game. ‘We gave it to the Europeans first and to the Chinese later, but today it’s wide open for us,’ said Jeff Immelt, chief executive of General Electric.

His company announced that it would spend $2 billion

US-Nigeria bilateral goods trade US Imports

US Exports

US-Nigeria Trade balance

$0.4B $0.3B $0.2B $0.1B $0.0B -$0.1B -$0.2B -$0.3B -$0.4B

‘00 ‘01 ‘02 ‘03 ‘04 ‘05 ‘06 ‘07 ‘08 ‘09 ‘10 ‘11 ‘12 Data visualisation by Publican Media Source: agoa.info

by 2018 to boost infrastructure, worker skills and access to energy.

For the US this summit was about gaining attractive returns for US investors, jobs for US citizens, and ring-fencing Chinese commercial expansion in Africa. With Europe in decline, and increasing Chinese competition in emerging markets, Africa presents the last great contest for global commercial hegemony. A new scramble for Africa is playing out.

Wallets are good, but livelihoods matter too In his WSJ letter, Elumelu, a former chief executive of United Bank of Africa that operates in 19 African coun-

tries, explained that the Power Africa initiative ‘sends a clear message that America means business with Africa, facilitating billions of dollars of investment and ultimately generating value both for American stockholders and African consumers.’ More to the point, ‘Africa’s one billion consumers are an increasingly compelling market.’

The point is not lost on American companies. Ford, the second biggest US carmaker, plans to set up a new plant in Nigeria, expand its dealership network across the continent, and tie in financing packages to entice buyers. It will also introduce brands like the Mustang, Fusion, and Focus to appeal to the rising middle class. Jim

Benintende, Ford’s head of operations in the Middle East and Africa, said that ‘We at Ford are taking a long-term view in places like Nigeria. It’s the biggest economy in Africa.

You can’t ignore that. It’s got abundant natural resources, it’s got a burgeoning middle class. There’s a lot of real good reasons to look at Nigeria for future investment.’

The risk of investment without local prosperity as has been the case in the past looms large. Joseph Stiglitz, a past winner of the Nobel Prize in economics, writing in the Financial Times cautioned against an excessive emphasis on ‘mineral exports that provide foreign exchange and fiscal revenue but not jobs, especially for frustrated youth in urban areas.’ Rather, he advocates for ‘foreign direct investment into intensive light manufacturing and agroprocessing industries, where Africa’s large pool of unskilled labour could be used.’

Some CEOs are listening.

One company that has taken the lead in the direction of job creation is General Electric.

The Fairfield, Connecticutbased company announced that it plans to double the number of employees on its payroll in Africa to 4,000 over the next 4 years. Jay Ireland, GE’s Africa chief executive has given assurances that ‘all those investments need people, so we’ll be adding.’ As details of other agreements reached at the summit become known it is expected that no fewer than 15,000 new jobs will be added

by US companies and their African partners across the continent in coming years. ;

VM4

MARKET DATA

VM | Monday, August 11, 2014 | Issue 005

TRADING UPDATE Market review — August 4-8, 2014. The Nigerian equity market gained 1.6 per cent last week lifting the All Share Index to a YtD gain of 3.1 per cent.

Total market capitalization increased by N219.3 billion, while aggregate volume advanced by 30.2 per cent.

The week’s top gainers were CONOIL: 10.23%, ROYALEX: 7.55%, NNFM: 4.99%, PHARMDEKO: 4.76%, UBN: 4.53%, OKOMUOIL: 4.47%, IKEJAHOTEL: 4.23%, NPFMCRFBK: 4.17%, CUTIX: 4.17%, and PREMBREW: 3.90%.

The following companies led in price declines. RTBRISCOE: -5.00%, AGLEVENT: -4.76%, ETERNA: -4.76%, JOSBREW: -4.65%, NEIMETH: -4.42%, AIRSERVICE: -4.07%, REDSTAREX: -2.73%, COSTAIN: -2.54%, WAPCO: -2.49%, and INTENEGINS: -1.96%.

DASHBOARD Friday Ticker 7UP ABCTRANS ACCESS AGLEVENT AIICO ASHAKACEM BETAGLAS CADBURY CAP CCNN CONOIL CONTINSURE COURTVILLE CUSTODYINS CUTIX CWG DANGCEM DANGFLOUR DANGSUGAR DIAMONDBNK ETERNA ETI FBNH FCMB FIDELITYBK FIDSON FLOURMILL FO FORTISMFB GLAXOSMITH GUARANTY GUINNESS HONYFLOUR INTBREW JBERGER LINKASSURE MANSARD MAYBAKER MOBIL MRS NAHCO NASCON NB NEIMETH NEM NESTLE NIGERINS NNFM OANDO OKOMUOIL PAINTCOM PORTPAINT PREMPAINTS PRESCO PRESTIGE PZ ROYALEX RTBRISCOE SEPLAT SKYEBANK STANBIC STERLNBANK TOTAL TRANSCORP UAC-PROP UACN UBA UBCAP UBN UNILEVER UNITYBNK VITAFOAM WAPCO WAPIC WEMABANK ZENITHBANK

Last 126.78 0.85 9.80 1.45 0.80 34.20 17.70 70.54 39.91 15.00 75.73 1.00 0.55 3.94 2.00 4.75 230.00 7.70 9.00 6.33 3.89 18.49 15.48 4.25 2.02 3.13 79.00 240.00 6.00 62.41 30.44 196.20 4.14 27.12 66.65 0.50 2.54 1.62 173.00 57.00 5.02 10.36 185.00 1.08 0.80 1,110.00 0.50 21.68 27.30 35.98 1.51 5.50 10.39 36.01 0.51 37.12 0.57 0.95 699.47 3.17 30.01 2.20 180.00 5.59 16.70 62.00 7.90 2.16 8.94 49.85 0.50 4.25 119.94 0.82 1.00 25.00

Change, % 4.99 -1.16 -2.00 0.00 0.00 0.86 -1.12 0.00 -2.54 -1.25 10.23 -2.91 -1.79 -0.76 0.50 0.00 0.00 -0.90 0.00 -1.09 -2.51 0.87 1.24 -1.16 -0.49 2.62 -0.63 0.42 1.69 -0.27 0.13 -1.30 2.22 -1.38 -0.12 0.00 1.60 -2.99 1.13 -5.00 -0.59 0.39 -0.05 0.00 1.27 -0.36 0.00 4.84 2.25 4.29 2.42 0.00 2.00 -1.67 7.55 -6.86 1.08 -0.31 2.28 0.00 2.16 0.36 -1.76 1.64 0.13 1.41 3.83 2.15 0.00 -0.70 -1.69 -1.20 -0.99 0.04

5-day

4-Week

Volume

Start

Week Hi

Week Lo

Change, %

241 9,551 206,107 1,001 16,277 15,571 253 57 204 15,147 25,775 18,829 370 3,692 2,201 4 11,674 2,249 15,884 13,584 25,410 57,461 88,129 270,459 46,692 14,446 1,872 4,127 100,000 664 114,911 283 9,528 1,725 274 2 236 1,634 221 1,670 2,462 28,359 18,083 2,513 105,790 3,903 521 1,590 49,242 2,615 0 726 0 1,079 279 1,569 10,509 2,099 3,063 50,749 38,078 26,013 434 66,934 3,243 26,581 111,731 19,260 14,699 1,191 3,593 1,878 1,096 13,680 11,285 97,784

112.35 0.85 9.98 1.40 0.81 33.00 17.11 70.54 40.00 13.99 61.98 1.12 0.51 4.00 1.99 4.75 224.10 7.55 9.01 6.35 3.80 16.87 14.40 4.23 2.01 3.00 77.67 228.90 6.00 65.85 28.61 190.10 4.18 26.10 63.39 0.50 2.55 1.64 160.22 58.90 4.95 10.12 185.00 1.18 0.76 1,105.10 0.50 18.77 27.00 33.76 1.54 5.75 10.39 36.83 0.53 38.00 0.52 1.04 643.00 3.01 31.00 2.30 172.00 5.51 16.61 60.02 7.49 2.08 8.45 49.25 0.50 4.33 120.00 0.88 1.01 25.05

126.78 0.88 10.00 1.48 0.82 34.20 17.90 70.54 40.95 15.98 75.73 1.14 0.58 4.00 2.07 4.75 230.03 7.77 9.20 6.68 4.20 18.60 15.50 4.45 2.05 3.13 79.79 240.01 6.00 65.85 30.80 200.86 4.24 27.50 66.95 0.50 2.55 1.72 178.00 61.50 5.25 10.94 187.90 1.18 0.82 1,114.00 0.50 21.68 27.80 35.98 1.54 5.75 10.39 38.01 0.55 38.00 0.57 1.04 708.75 3.18 31.40 2.42 180.00 5.71 17.40 62.00 7.91 2.22 9.00 49.85 0.50 4.33 124.98 0.90 1.05 25.45

112.35 0.81 9.66 1.40 0.80 31.53 17.11 70.54 39.51 12.05 58.66 0.96 0.51 3.76 1.90 4.75 224.10 7.37 8.77 6.24 3.66 16.00 14.30 4.10 1.98 3.00 70.29 218.31 5.70 62.41 28.61 190.10 4.05 25.70 63.00 0.50 2.50 1.61 160.00 57.00 4.95 10.07 180.00 1.08 0.76 1,105.00 0.50 18.00 26.00 32.16 1.51 5.00 10.39 35.90 0.50 37.12 0.50 0.95 643.00 2.99 29.00 2.19 171.48 5.48 16.61 59.99 7.40 2.08 8.18 48.55 0.50 4.01 119.94 0.82 0.98 24.78

12.84 0.00 -1.80 3.57 -1.23 3.64 3.45 0.00 -0.23 7.22 22.18 -10.71 7.84 -1.50 0.50 0.00 2.63 1.99 -0.11 -0.31 2.37 9.60 7.50 0.47 0.50 4.33 1.71 4.85 0.00 -5.22 6.40 3.21 -0.96 3.91 5.14 0.00 -0.39 -1.22 7.98 -3.23 1.41 2.37 0.00 -8.47 5.26 0.44 0.00 15.50 1.11 6.58 -1.95 -4.35 0.00 -2.23 -3.77 -2.32 9.62 -8.65 8.78 5.32 -3.19 -4.35 4.65 1.45 0.54 3.30 5.47 3.85 5.80 1.22 0.00 -1.85 -0.05 -6.82 -0.99 -0.20

Volume 8,088 49,695 1,771,224 1,778 169,296 85,989 912 1,783 4,355 114,138 31,387 124,799 42,461 65,429 40,144 920 36,079 11,311 118,194 414,678 66,459 328,697 671,798 873,885 484,278 45,906 41,686 11,285 100,036 4,434 629,748 19,978 28,859 4,181 2,307 51 8,544 5,918 7,460 5,987 93,011 69,958 163,339 10,973 200,263 7,597 22,757 16,355 276,615 35,921 148 10,006 11 7,536 54,177 17,406 13,522 10,816 10,078 324,114 83,243 173,324 2,093 820,408 11,725 38,739 767,442 116,779 47,214 28,408 65,457 11,389 47,774 174,290 54,376 1,075,118

Start

Change, %

Volume

52-Week Hi

52-Week Lo

YtD

PE

EPS

107.35 0.90 9.80 1.39 0.83 32.55 17.00 72.15 39.15 11.38 67.90 1.16 0.58 3.71 1.90 4.75 240.00 8.09 9.09 6.24 4.45 17.03 16.23 4.15 2.00 3.09 76.00 234.06 6.00 68.00 29.98 205.00 4.27 29.20 68.00 0.50 2.51 1.72 136.50 60.03 4.98 11.49 174.50 1.19 0.81 1,105.00 0.54 19.70 27.99 32.90 1.41 5.13 10.39 38.09 0.53 36.74 0.52 1.15 675.00 3.27 27.13 2.30 172.09 5.80 17.20 60.07 7.90 2.19 9.65 50.75 0.50 4.38 112.36 0.87 0.98 25.10

18.10 -5.56 0.00 4.32 -3.61 5.07 4.12 -2.23 1.94 31.81 11.53 -13.79 -5.17 6.20 5.26 0.00 -4.17 -4.82 -0.99 1.44 -12.58 8.57 -4.62 2.41 1.00 1.29 3.95 2.54 0.00 -8.22 1.53 -4.29 -3.04 -7.12 -1.99 0.00 1.20 -5.81 26.74 -5.05 0.80 -9.83 6.02 -9.24 -1.23 0.45 -7.41 10.05 -2.47 9.36 7.09 7.21 0.00 -5.46 -3.77 1.03 9.62 -17.39 3.63 -3.06 10.62 -4.35 4.60 -3.62 -2.91 3.21 0.00 -1.37 -7.36 -1.77 0.00 -2.97 6.75 -5.75 2.04 -0.40

17,922 163,310 6,314,735 17,932 708,974 301,150 2,982 16,511 22,791 418,060 46,708 505,404 123,055 256,290 73,876 992 950,201 100,139 315,140 1,204,856 140,174 630,425 4,246,633 1,745,684 3,740,356 130,689 104,542 44,234 100,174 43,753 3,748,885 42,272 294,628 28,771 52,647 23,569 113,849 54,926 26,119 12,631 270,627 842,551 385,631 41,030 887,956 40,236 150,859 31,218 2,704,248 80,124 4,873 31,853 12 73,227 121,390 342,379 41,791 39,383 19,752 1,862,062 295,650 656,568 13,937 6,214,985 56,755 98,726 2,413,048 789,267 104,771 312,782 3,136,197 72,551 130,291 1,813,551 2,554,248 2,477,488

126.78 1.07 11.10 1.87 1.03 34.20 22.10 110.00 51.66 15.98 79.80 1.33 0.90 4.03 2.27 5.83 250.02 10.76 12.49 8.20 5.73 18.60 17.29 4.59 2.95 3.25 92.00 259.94 6.66 74.97 31.80 266.70 4.50 31.50 76.45 0.50 2.73 2.67 178.84 70.00 6.80 15.10 189.00 2.08 0.97 1,250.01 0.54 32.67 36.89 48.05 2.30 6.25 10.39 49.00 0.81 43.98 0.69 1.60 735.00 4.67 31.50 2.92 195.50 6.03 21.31 67.85 9.60 3.04 11.62 65.00 0.72 5.70 136.73 1.48 1.40 27.40

64.80 0.69 7.22 1.25 0.74 13.87 10.69 67.80 35.96 8.00 25.92 0.93 0.50 1.30 1.59 4.75 185.00 7.25 8.67 5.86 2.48 12.40 11.50 3.01 1.85 1.80 63.91 35.00 5.70 58.50 22.67 162.00 2.56 17.98 59.18 0.50 1.95 1.58 102.00 32.53 4.56 10.07 140.00 0.79 0.55 916.00 0.50 18.00 9.32 32.15 1.33 4.00 9.84 32.00 0.50 30.08 0.50 0.95 590.00 2.99 15.51 2.09 146.26 1.17 12.00 42.58 6.65 1.05 8.00 42.50 0.50 3.66 87.50 0.66 0.89 19.23

77.49 -1.16 2.08 -11.04 -13.04 56.31 22.66 -27.42 -16.82 25.10 23.50 -16.67 -15.38 80.73 2.56 -18.52 6.40 -24.73 -20.35 -15.60 -17.76 12.81 -5.03 10.68 -25.19 13.82 -12.22 158.43 -4.31 -10.84 9.69 -16.87 7.53 -4.24 5.67 0.00 1.60 -36.47 49.14 10.21 -20.94 -30.24 12.11 -1.82 -1.23 -6.09 0.00 -1.50 2.13 -19.74 -22.56 4.76 0.00 -7.67 -19.05 0.33 5.56 -32.62 15.65 -29.71 34.33 -12.00 3.87 28.80 8.61 10.73 -13.66 -4.85 -6.97 -5.94 0.00 -11.64 4.30 -27.43 -21.88 0.00

25.79 4.05 6.30 6.22 5.26 42.50 5.06 47.29 23.30 13.41 22.69 6.25 5.18 16.42 10.53

4.46 0.21 1.57 0.23 0.15 0.80 3.38 1.57 1.67 1.12 3.34 0.16 0.11 0.24 0.19

10.53

11.80

11.09 3.87 6.23 5.00 7.14 4.83 2.97 12.50 23.48 51.81 5.08 21.68 9.31 25.38 12.18 43.63 9.64 12.57 16.35 18.00 16.66 57.21 15.43 9.94 35.16

0.81 1.65 0.61 3.67 2.16 0.88 0.68 0.24 3.38 4.63 1.18 3.00 3.27 7.88 0.34 0.63 6.74 0.04 0.15 0.09 10.44 1.04 0.32 1.05 5.24

0.41 38.51 25.00

1.96 28.82 0.02

24.49 15.71 4.20 8.97

1.11 2.29 0.35 0.60

4.42 1.99 28.34 5.69

8.38 0.25 1.34 0.10

3.79 15.61 3.49 13.86 63.71 7.73 28.47 4.65 7.45 48.14 35.76 4.65 5.99 14.80 11.71

0.84 1.92 0.63 12.91 0.09 2.20 2.14 1.70 0.29 0.19 1.37 0.11 0.71 8.10 0.07

7.22

3.46

MARKET DATA

VM | Monday, August 11, 2014 | Issue 005

VM5

MARKET SNAPSHOT 3-MONTH PRICE TREND OF BELLWETHER STOCKS

ACCESS

9.80 0.18

7.22

PE 6.30

11.1 0.20 2.08%

1YtD

3M

0.79 8.77%

-0.18 -1.80%

1W

04/08

May

June

July

CONTINSURE 1YtD

-0.20 -16.67%

3M

-0.07 -6.54%

-0.12 -10.71%

1W

04/08

May

June

July

FCMB 0.41 10.68%

3M

0.65 18.06%

0.02 0.47%

1W

04/08

May

June

July

GUARANTY 2.69 9.69%

3M

3.84 14.44%

1.83 6.40%

1W

04/08

May

June

July

MANSARD 0.04 1.60%

3M

0.23 9.96%

-0.01 -0.39%

1W

04/08

May

June

July

OANDO 0.57 2.13%

3M

11.30 70.62%

0.30 1.11%

1W

04/08

May

June

July

STANBIC

PE 15.61

31.50 7.67 34.33%

3M

8.01 36.41%

1W

04/08

May

June

July

UBA

-0.99 -3.19%

F

PE 4.65

9.60 -1.25 -13.66%

3M

1.15 17.04%

1W

04/08

May

June

DANGCEM

July

1YtD

250.02 13.84 6.40%

3M

5.00 2.22%

0.41 5.47%

PE 10.53 5.90 2.63%

1W

04/08

May

June

July

FIDELITYBK 1YtD

3M

0.12 6.32%

0.01 0.50%

1W

04/08

May

June

GUINNESS

July

266.70 -39.81 -16.87%

3M

16.20 9.00%

6.10 3.21%

04/08

May

June

MOBIL

July

178.84 57.00 49.14%

3M

44.20 34.32%

12.78 7.98%

04/08

May

June

July

OKOMUOIL -8.85 -19.74%

3M

0.38 1.07%

2.22 6.58%

1W

04/08

May

June

TOTAL

July

195.50 6.70 3.87%

3M

26.77 17.47%

8.00 4.65%

04/08

May

June

July

UNILEVER

PE 35.76

65.00 -3.15 -5.94%

3M

F

1.34 2.76%

1W

0.60 1.22%

PE 47.29 0.00 0.00%

1W

04/08

May

June

July

DIAMONDBNK 1YtD

PE 3.87

8.20 -1.17 -15.60%

3M

0.02 0.32%

-0.02 -0.31%

1W

04/08

May

June

July

FLOURMILL 1YtD

3M

10.00 14.49%

1.33 1.71%

1W

04/08

May

June

July

HONYFLOUR 0.29 7.53%

3M

0.42 11.29%

-0.04 -0.96%

1W

04/08

May

June

July

NASCON -4.49 -30.24%

3M

-2.06 -16.59%

0.24 2.37%

1W

04/08

May

June

July

PRESCO -2.99 -7.67%

3M

0.81 2.30%

-0.82 -2.23%

1W

04/08

May

June

July

UACN 3M

17.20 38.39%

1.98 3.30%

1W

04/08

May

June

WAPCO

July

F

136.73 4.94 4.30%

3M

10.75 9.85%

PE 14.80

1W

-0.06 -0.05%

-0.09 -0.23%

1W

04/08

May

June

July

ETI 1YtD

PE 5.00

18.60 2.10 12.81%

3M

5.65 44.00%

1.62 9.60%

1W

04/08

May

June

FO

July

259.94 147.13 158.43%

3M

98.45 69.55%

11.10 4.85%

04/08

May

June

July

INTBREW -1.20 -4.24%

3M

2.41 9.75%

1.02 3.91%

1W

04/08

May

June

NB

July

189.00 19.99 12.11%

3M

36.00 24.16%

0.00 0.00%

04/08

May

June

July

PZ 0.12 0.33%

3M

1.92 5.45%

1W

04/08

May

June

July

3M

June

1W

July

ZENITHBANK 3M

08/08

M T W T

F

PE 7.22

27.40 0.00 0.00%

0.09 0.54%

25.00 0.05

19.23 1YtD

F

PE 7.73

21.31 -1.47 -8.08%

04/08

May

08/08

M T W T

16.70 0.09

12.00 1.32 8.61%

-0.88 -2.32%

June

July

FBNH

04/08

July

08/08

M T W T

F

04/08

May

June

July

08/08

M T W T

F

04/08

May

June

July

2.05 8.93%

08/08

M T W T

F

1W

04/08

May

PE 7.14

17.29 -0.82 -5.03%

2.43 18.62%

3M

1.08 7.50%

1W

04/08

May

June

July

GLAXOSMITH

-7.64 -10.91%

3M

-3.44 -5.22%

1W

04/08

May

June

July

JBERGER

2.10 3.26%

3M

3.26 5.14%

1W

04/08

May

June

July

NESTLE

08/08

M T W T

1250.01 -72.00 -6.09%

39.99 3.74%

3M

PE 38.51 4.90 0.44%

1W

04/08

May

June

July

SEPLAT

08/08

M T W T

PE --

735.00 94.67 15.65%

9.47 1.37%

3M

56.47 8.78%

1W

04/08

May

F

699.47 56.47

590.00 1YtD

F

1110.00 4.90

916.00 1YtD

F

PE 9.64

76.45 3.58 5.67%

08/08

M T W T

66.65 3.26

59.18 1YtD

F

PE 21.68

74.97 -7.59 -10.84%

08/08

M T W T

62.41 3.44

58.50 1YtD

F

15.48 1.08

11.50 1YtD

08/08

M T W T

June

July

08/08

M T W T

F

-0.05 -0.20%

1. 52-week low price 2. Year low price 3. Current price 4. Year high price 5. 52-week high price 6. Current price 7. 5-day price change 8. PE ratio 9. 1-year price change 10. 3-months price change 11. 1-week price change 12. Daily price movement over 3 months.

13. 30-day moving average 14. Daily price movement over last week

1 2 TICKER

4

3

19.23 1YtD

5

25.23 0.018

June

July

08/08

M T W T

F

PE 7.29

27.406 0.23 0.92%

3M

2.90 12.99%

7 0.01

1W

0.04%

10

12

June

1.01 7.22%

04/08

May

9

May

PE 13.41

1W

LEGEND

UAC-PROP 1YtD

F

PE 28.34

43.98

5.81 63.22%

3M

08/08

M T W T

37.12 0.88

30.08 1YtD

F

PE 35.17

1W

3.01 25.10%

08/08

M T W T

185.00 0.00

140.00 1YtD

F

PE 43.63

31.50

1YtD

15.98

08/08

M T W T

27.12 1.02

17.98 1YtD

F

PE 51.81

1W

15.00 1.01

8.00

08/08

M T W T

240.00 11.10

35.00 1YtD

F

18.49 1.62

12.40

CCNN

08/08

M T W T

08/08

M T W T

119.94 0.06

87.50 1YtD

F

PE 28.47

67.85 6.01 10.73%

1.05 2.70%

08/08

M T W T

62.00 1.98

42.58 1YtD

F

PE 4.42

49.00

3M

08/08

M T W T

36.01 0.82

32.00 1YtD

F

PE 9.94

15.10

-8.07 -16.82%

08/08

M T W T

10.36 0.24

10.07 1YtD

F

PE 12.18

4.50

1YtD

PE 23.30

51.66

08/08

M T W T

4.14 0.04

2.56 1YtD

F

PE 23.48

92.00

39.91 -0.09

35.96

08/08

M T W T

79.00 1.33

63.91 -11.00 -12.22%

F

6.33 0.02

5.86

CAP

08/08

M T W T

08/08

M T W T

49.85 0.60

42.50 1YtD

F

PE 13.86

1W

0.92 1.32%

08/08

M T W T

180.00 8.00

146.26 1YtD

F

PE 15.71

48.05

3M

08/08

M T W T

35.98 2.22

32.15 1YtD

F

PE 16.66

1W

-26.64 -27.42%

08/08

M T W T

173.00 12.78

102.00 1YtD

F

PE 25.38

1W

1YtD

110.00

08/08

M T W T

196.20 6.10

162.00 1YtD

F

PE 2.97

2.95

70.54 0.00

67.80

08/08

M T W T

2.02 0.01

1.85 -0.68 -25.19%

F

230.00 5.90

185.00

CADBURY

08/08

M T W T

08/08

M T W T

7.90 0.41

6.65 1YtD

F

1.20 3.64%

1W

08/08

M T W T

30.01 0.99

15.51 1YtD

F

PE 24.49

36.89

14.31 71.95%

08/08

M T W T

27.30 0.30

9.32 1YtD

F

PE 16.35

2.73

3M

08/08

M T W T

2.54 0.01

1.95 1YtD

F

PE 9.31

31.80

12.32 56.31%

08/08

M T W T

30.44 1.83

22.67 1YtD

F

PE 4.83

4.59

1YtD

PE 42.50

34.20

08/08

M T W T

4.25 0.02

3.01 1YtD

F

PE 6.25

1.33

34.20 1.20

13.87

08/08

M T W T

1.00 -0.12

0.93

ASHAKACEM

11 14

13 May

21/07

June

July

25/07

M T W T

F

VM6

MARKET DATA

VM | Monday, August 11, 2014 | Issue 005

MARKET SNAPSHOT +160% SLIPPING +150%

LEADING

12

+140% +130%

The relative size of each individual stock’s bubble chart is determined by its market capitalization.

For indices, the relative size of each bubble chart is the total value of the capitalization modified values of each constituent stock.

+120% +110% +100% YEAR-TO-DATE RETURN

+90% +80%

27

+70% +60%

28

+50%

29

+40% 8

+30%

15 33

+20% 2

+10% 0%

19

39

-10%

31

7

14

36

34

26 13

5 23

-20% -30%

1

4

38 22 32 200

21 30 24

16 17

10

3

25

6

18 11

9

37 35

40

-40% LAGGING -10%

0%

-5%

Indices

YtD, %

ASI

1.58% -0.03%

NSE30

1.73% -0.11%

NSEBNK

3.28% 0.13%

NSEINS

-2.28% -0.08%

NSECNSMRGDS

1.36% -0.51%

WtD, %

5% +10% WEEK-TO-DATE RETURN TRADING BREAKDOWN

BY SECTOR

DtD, %

Sector 3.07%

%

Financial Services

75 \ 76

Conglomerates

6\8

Oil & Gas

6\6

Others

13 \ 10

2.06%

-1.41%

FGN Bond Index -5.54%

-2.73%

4.63%

NSEOILGAS 1.86%

45.16%

0.53%

NSELOTUSISLM -0.13%

-2.00%

0.40%

NSEINDUSTR -0.91%

12.9

2930

12.8

2924 2918

Market Value YTD Return

12.7 12.6

2912

7.44%

-6% -4% -2% 0%

2%

4%

6%

2906 12.5 04/08 06/08 08/08

8%

+15%

+20%

IMPROVING +25%

GLOBAL INTEREST RATES & INFLATION TARGETS Central Last Date % Inflation Rate Bank Change Change Target China 6.00% 05.07.2012 -0.31 4.00% Japan 0-0.10% 05.10.2010 -0.20 2.00% UK 0.50% 05.03.2009 -0.50 2.00% USA 0-0.25% 16.12.2008 -0.75 2.00% Eurozone 0.15% 05.06.2014 -0.10 <2.00% Brazil 11.00% 02.04.201 +0.25 4.5% +/-2.0% Canada 1.00% 20.07.2010 +0.25 2.0% +/-1.0% Egypt -0.50 8.25% 05.12.2013 India 8.00% 28.01.2014 +0.25 Indonesia 7.50% 12.11.2013 +0.25 4.5% +/-1.0% Malaysia 3.25% 10.06.2014 +0.25 Mexico 3.00% 06.06.2014 -0.50 3.00% +/-1.0% Morocco 3.00% 28.03.2012 -0.25 Nigeria 12.00% 10.10.2011 +2.75 6.00% - 9.00% Qatar 4.50% 10.08.2011 -0.50 Russia 8.00% 28.07.2014 +0.50 5%* Thailand 2.00% 12.03.2014 -0.25 0.5% - 3.0% Turkey 8.75% 24.06.2014 -0.75 5.00% * +/- 1.5 pct point uncertainty band

# TICKER

WTD

YTD

1 DANGCEM

2.63

6.40

2 NB

0.00 12.11

3 GUARANTY

6.40

9.69

4 NESTLE

0.44

-6.09

5 ZENITHBANK

-0.20

0.00

6 FBNH

7.50

-5.03

7 WAPCO

-0.05

4.30

8 STANBIC

-3.19 34.33

9 GUINNESS

3.21 -16.87

10 ETI

9.60 12.81

11 UBA

5.47 -13.66

12 FO

4.85 158.43

13 OANDO

1.11

2.13

14 ACCESS

-1.80

2.08

15 TRANSCORP

1.45 28.80

16 UNILEVER

1.22

17 FLOURMILL

1.71 -12.22

18 UBN

5.80

-6.97

19 PZ

-2.32

0.33

20 CADBURY

0.00 -27.42

21 UACN

3.30 10.73

22 DANGSUGAR

-0.11 -20.35

23 DIAMONDBNK

-0.31 -15.60

24 INTBREW

3.91

-4.24

25 JBERGER

5.14

5.67

26 FCMB

0.47 10.68

27 7UP

12.84 77.49

28 ASHAKACEM

3.64 56.31

29 MOBIL

7.98 49.14

30 TOTAL

4.65

31 GLAXOSMITH

-5.22 -10.84

32 FIDELITYBK

0.50 -25.19

33 CONOIL

22.18 23.50

34 STERLNBANK

-4.35 -12.00 5.32 -29.71

36 PRESCO

-2.23 -7.67

37 OKOMUOIL

6.58 -19.74

38 CAP

-0.23 -16.82

39 NEIMETH

-8.47 -1.82

40 MAYBAKER

-1.22 -36.47

NSEASI

42,598.46

42,62 42,40 42,18 41,96 41,74

Date

Deals

Turnover Value

Traded Stocks

Fr Advanced Stocks

Declined Stocks

Unchanged Stocks

All Shares Index Value

1

04.08.2014

5,480

287,650,341

4,936,264,068.76

113

29

26

58

41,801.51

2

05.08.2014

5,788

257,005,662

3,635,951,100.93

117

35

13

69

42,292.93

3

06.08.2014

5,736

323,913,132

4,874,077,861.67

117 \ 119

19 \ 29

38 \ 29

60 \ 61

42,339.84

4

07.08.2014

4,637

201,385,464

3,012,919,333.14

123 \ 118

34 \ 24

18 \ 34

71 \ 60

42,612.33

5

08.08.2014

4,648

360,020,617

3,725,588,006.50

129 \ 103

30 \ 19

25 \ 36

74 \ 48

42,598.46

The \ arrow signifies week-on-week change in value. This week’s value is shown on the left of the \ sign, and last week’s value on the right.

Mo

Tu

S&P 500

Index

Week Opening

Week Close

Change

WtD

MtD

QtD

YtD

1

All Shares Index

41,801.51

42,598.46

796.95

1.58

1.19

0.27

3.07

2

NSE 30 Index

1,909.01

1,946.39

37.38

1.73

1.30

0.76

2.06

3

NSE Banking Index

427.85

441.52

13.67

3.28

1.87

2.00

-1.41

4

NSE Insurance Index

146.18

144.4

-1.78

-2.28

-2.29

-1.65

-5.54

5

NSE Consumer Goods Index

1,056.28

1,070.19

13.91

1.36

1.15

1.13

-2.73

6

NSE Oil/Gas Index

468.13

493.37

25.24

4.63

5.01

5.37

45.16

7

NSE Lotus Islamic Index

2,777.80

2,805.84

28.04

0.53

0.25

-2.39

-2.00

8

NSE Industrial Index

2,711.50

2,736.06

24.56

0.40

0.84

2.60

7.44

We

Th

Fr

1,931.59

1,940 1,930 1,920 1,910 1,900 Fr

Mo

Tu

FTSE 100

INDEX PERFORMANCE

3.87

35 SKYEBANK

MARKET SNAPSHOT Turnover Volume

-5.94

We

Th

Fr

6,567.36

6,685 6,655 6,625 6,595 6,565 Fr

Mo

Tu

JSE FTSE

We

Th

Fr

50,674.61

51,40 51,20 51,00 50,80 50,60 Th

Fr

Mo

Tu

We

Th

COMMENTARIAT

VM | Monday, August 11, 2014 | Issue 005

VM7

CORPORATES

PayPal’s second bounce of the ball

Union Bank leaps again Net Loans (% Assets) UBN-NG

Peers

70% 60% 50% 40% 30% 20% 10% 0

2009

2010

2011

2012

2013

TTM

Data visualisation by Publican Media Union Bank head office, Marina

N HIS RESUMPTION as chief executive of Union Bank in 2013, Emeka Emuwa declared that: ‘When you mention the name Union Bank, one of the first things that come to people’s minds is ‘Big, Strong, Reliable. Indeed, Union Bank was once all these. Our long-term goal is that Union Bank will be all three again – big, strong and reliable. But for today, our focus is on being reliable.’

Since then the former Citi-

O

Bisi Onasanya, CEO, First Bank, (left) shakes hands with Efi Dahan, PayPal regional director at signing of partnership

T IS NO LONGER news that PayPal has started operations in Nigeria. At a big launch in July, Efi Dahan, regional director for Israel and Africa at PayPal, announced a partnership with First Bank and urged global payments processing companies to end the online discrimination against purchase orders that originate from Nigerian IP addresses.

Where many have not connected the dots is that eBay, the online auction company, which owns PayPal is prepping to launch its services in Nigeria. With the payments

I

Source: Dailypost.ng

channel in place, all that remains is the logistics angle.

That is being looked into.

Malvina Goldfeld, PayPal’s head of business development for sub-Saharan Africa, observed that while Nigeria has 63 million active Internet users, only 1 per cent of that number make online transactions, which are expected to reach $1 billion this year. This would translate to 630,000 customers making $1,590 in online purchases.

The opportunity for growth is vast in both the buyer population and total spend per buyer.

She went on to say that

‘though challenges remain including abysmal infrastructure, port delays, other supply chain woes and the task of persuading shoppers to trust websites with their bank details, a lot of the merchants that we work with already ship to Nigeria. I think that the growth of e-commerce will push the logistics customers to up their game.’

It does not take genius to see that DHL, FedEx, and the other courier companies would be deep in discussions with eBay to finalise logistics for global online purchases from Nigeria on the auction site. ;

Source: UNION BANK and CUSTOMS STREET ADVISORS

bank Nigeria chief executive has led the bank on an arduous, steady crawl up the banking league tables. As banks non-interest income has come under pressure from regulatory restrictions, they are turning back to good old loan book expansion. Union Bank is not left behind.

According to Oyinkan Adewale, the bank’s chief financial officer and Citibank Nigeria alum, Union Bank would grow its loan portfolio by 30 per cent in the second

half of 2014. It grew loans by 10 per cent in the first six months.

In April, Atlas Mara, the investment vehicle of Bob Diamond, ex-Barclays Bank CEO, bought 9.1 per cent of the bank. Keffi Group, founded

by Jide Zeitlin, a former global chief operating officer of Goldman Sachs is another prominent investor. He was part of the Union Global Partners Limited consortium to invest $750 million in the bank in July 2011. ;

MTN to sell towers

Small print at Stanbic IBTC’s H1 2014 investor presentation LMOST HIDDEN away as the last bullet point of slide 31 (Moving forward) of Stanbic IBTC’s half year presentation to analysts and investors is a single line mention that the bank would ‘raise Tier II capital of up to N30 billion.’

No further details are given.

A

Whichever way one looks at it N30 billion is not chump change.

All the more reason why investors are asking why Sola David-Borha, the chief executive of the South African bank’s Nigerian operations, included it almost as an afterthought. ;

Company in the News:

Sola David-Borha, Stanbic IBTC CEO

MTN vendor stand

Diamond Bank

Consensus detail DIAMOND BANK PLC Buy 4 7 0 0 0

Outperform

Consensus Sell

Buy

Hold Underperform Sell Unchanged

Mean consensus Number of Analysts Average target price Last Close Price Spread / Highest target Spread / Average Target Spread / Lowest Target

TN GROUP, THE telecom operator, has revealed that it is in an advanced stage to sell its tower business in Nigeria.

Sifiso Dabengwa, MTN’s chief executive, announced that it would be disposing of 8,640 existing and 543 towers-under construction at a presentation of the company’s H1 results.

MTN would subscribe to 51% controlling equity in the new externally managed venture.

The company has been aggressively pursuing cost reduction in Nigeria. It has focused these on two areas: reduction in dealer commissions and marketing expenses, as well as reviews of rents and utility bills. ;

M

OUTPERFORM 11 9,66 NGN 6,40 NGN 77% 51% 25%

0 Data visualisation by Publican Media Source: Thomson Reuters

MTN Expenses in Nigeria 58.3%

EBITDA margin 58.3%

58.3%

350M 300M 250M

H1 H2 313,904

200M

312,473 165,121

150M 100M

154,042

50M 0

Dec 2012

131,440

Dec 2013

165,121

Jun 2014

Data visualisation by Publican Media Source: MTN.com

VM8

ARENA

VM | Monday, August 11, 2014 | Issue 005

ART AS AN ALTERNATIVE INVESTMENT

Artist dossier: Malick Sidibé

Oliver Enwonwu is the director of leading Lagos gallery, Omenka and president of the Society of Nigerian Artists. oliver@omenkamagazine.com

AST WEEK, WE analyzed auction results for celebrated Nigerian artist, Yusuf Grillo, taking a look at indications of future values for his paintings. In the past we have also looked at photography as a good investment asset in the collector’s portfolio.

This week, we will explore the life and work of one of the most iconic figures in African photography, Malick Sidibé.

In achieving our objectives, results of auction sales of his work from major international auction houses such as Bonhams, The Auction Room and Christies will be examined.

Malian photographer, Malick Sidibé is best known for his black-and-white studies of popular culture in Bamako. Born in 1935 into a Peul (Fulani) family in a small village in Soloba, he graduated from school in 1952. He later completed his studies in Design and Jewelry at the École des Artisans Soudanais in Bamako. In 1955, he served an apprenticeship at Gérard Guil-

L

Malick Sidibé, Hercule Africain (1970), silver gelatin print

lat–Guignard’s Photo Service Boutique, known famously as Gégé la Pellicule. The following year, he took up photography as a profession.

In 1958, he opened his own studio called Studio Malick in Bamako, specializing in documentary photography and focusing on the youth culture of the Malian capital. By the 1970s, he had turned his attention towards studio portraiture.

Sidibé gained increased photography recognition through the first meeting on African photography held in Mali in 1994. His work has since been exhibited extensively across Africa, Europe, the United States and Japan.

Sidibé has also received several awards including the Hasselblad Award for photography (2003), 52nd Venice Biennale’s Golden Lion (2007), and the ICP Infinity Award for Lifetime Achievement (2008). His works are in the collection of several prominent institutions and museums and form part of the Jean Pigozzi Contemporary African Art Collection (CAAC).

In a fitting tribute, in 2006, Tigerlily Films made a documentary, Dolce Vita Africana on him at work in his studio in Bamako. The documentary also features him discussing his work at a reunion with many of his friends and former photographic subjects.

Close observations of prices

for photographs on the international market by Malick Sidibé reveal an increasing interest from collectors. In November 2002, Christie’s Paris, Photographies included Les Nouveaux Circoncis by Sidibé in its sale, which realized the sum of €1,880 (N183,227).

This rise in interest from collectors has led to growing prices for the photographer’s work. In April 2010, Christie’s New York sale of Selections from the Baio Collection of Photography included Sidibé’s Les Vrais Lycéennes, Bal Fin d’Année, Lycée de Filles (1966). It sold for $2,500 (N372,165) against its presales estimate of $2,000 (N297,732).

Malick Sidibé, Yokoro, (2006), gelatin silver print

Subsequent sales of Sidibé’s work include Le deux amis (1971) which fetched a princely sum of €3,250 (N654,403) at Christie’s Paris October 2012 sale, Rendez-vous Interieurs contemporains. The photograph was previously estimated at €2,500 (N503,387).

The year 2013 was also an eventful one for Malick Sidibé on the auction market. Some of the highlights include Bonhams’ May 22, 2013 Africa Now sale, where a set of three signed photographs, Yokoro (1970), Danseur Mérengué (1964) and Les deux soeurs en même tenue (1977), each made in gelatin print, sold for £2,250 (N534,850, including buyer’s premium). An-

other important highlight is the sale of Hercule Africain (1970), silver gelatin print, at £2,233 (N530,809) previously estimated between £2,000 3,000, (N475,422 - 713,133).

The photograph was sold at The Auction Room with almost all the photographs selling approximately 20% above their initial estimates.

In 2014, Sidibé’s Yokoro (2006), gelatin silver print was sold for $5,000 (N804,760, including buyer’s premium).

This result underscores the growing appreciation for Sidibé’s life work, which spans about 6 decades, as well as an increasing global interest in photography from the continent. ;

HUMAN RESOURCES

Counterintuitive compensation scales UDE FEJOGWU, principal analyst at Thaddeus Investment Advisors & Research, has a different take on bankers’ compensation. He writes that in Nigeria there is no direct relationship between wage increases for bank employees and increased productivity, earnings, and return on equity. This flies in the face of popular wisdom.

In Europe and North America the debate has been mainly around salaries and

J

Team spirit. The female football team of Source: gtbank.com Ansar-Ud Deen Girls High School, Itire huddle together at the GT Bank sponsored Heritage Cup, Season 2

Published by

EDITOR: MIDENO BAYAGBON GROUP BUSINESS EDITOR: OMOH GABRIEL

In Association With

CONTENT DIRECTION: OBIORA TABANSI ONYEASO DESIGN & ILLUSTRATION: PUBLICAN MEDIA

bonuses paid to top bankers.

It has never dipped down to question the take-home pay of the rank-and-file.

But Fejogwu has the numbers to back up his argument.

Admittedly, he uses an arcane system, proprietarily named the Thaddeus employee value added ranking (TEVAR).

They are worth looking at.

In 2013, First Bank decreased its average salary per head by 12 per cent, and productivity climbed up by 3 per cent. In the same year,

GT Bank cut its average salary per head by 26 per cent, while increasing head count by 24 per cent. There were no adverse consequences because staff at the bank increased productivity by 14 per cent. Sterling Bank has ranked the lowest paying bank for two years in a row though it made a slight increase in average salaries by 7 per cent in 2013. Its employees raised productivity by 14 per cent.

On the other side of the coin, Access Bank increased

Vanguard Markets features unbiased, in-depth coverage of corporate and market developments across a wide range of business sectors.

Every week, Vanguard Markets delivers essential business analysis and commentary on Nigerian companies, regional economies, and global markets.

Vanguard Markets is published by Vanguard Media Limited in association with Customs Street Advisors Limited, a specialist communications consultancy.

its average employee salary by 34 per cent during the period while TEVAR dropped 8 per cent. On the same note, Zenith Bank raised average salary per head by 29 per cent, and saw its staff productivity decline by 10 per cent.

Fidelity Bank raised salary per head by 12 per cent and experienced a whopping 63 per cent slide in employee productivity.

The moral of the story must be that you can pay premium and still get monkeys. ;

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Website: www.vanguardngr.com ISSN 0794-652X