09042018 - AS APC'S NEC MEETS TODAY: Oyegun, Tinubu's ‘soldiers’ head for showdown

Vanguard, MONDAY, APRIL 9, 2018 — 19
CBN to intensify liquidity mop-up as inter-bank battles
N1.2trn excess liquidity
By Babajide Komolafe
THE Central Bank of Nigeria (CBN)
is expected to intensify its liquidity
mop-up operations this week to
address the build up in excess
liquidity in the interbank money
market which rose to N1.2 trillion last
week.
Financial Vanguard investigations
revealed that the volume of excess
liquidity in the interbank money market
rose by 161 percent to N1.2 trillion
last week from N459.7 billion the
previous week. The upsurge was triggered
by inflow of N528.9 billion from
matured treasury bills as well as inflow
of N647 billion statutory allocation
distributed to the three tiers of
government by the Federal Accounts
Allocation Committee (FAAC).
As a result, average interbank cost
of funds fell by 353 basis points (bpts)
to 3.8 percent. Data from FMDQ
showed that cost of funds on
Collateralised (Open Buy Back, OBB)
lending fell by 353 bpts to 3.67
percent last week, from 7.2 percent the
previous week. Similarly interest rate
on Overnight lending fell by 400bpts
to 4.0 percent from 8.1 percent the
previous week.
Reflecting the impact of the upsurge
in market liquidity, treasury bills (TB)
Continues on Page 20
MONDAY, APRIL 9, 2018
CORPORATE PERFORMANCE UPDATE:
Earnings of 96 firms hit N7.6trn, profit up 40%
•Investors lose N650bn in post-results
By Peter Egwuatu & Nkiruka
Nnorom
THE full year 2017 (FY'17) corporate
results of 96 major companies quoted
on the Nigerian Stock Exchange, NSE
have shown a significant impact of the
recovery of the economy which started
mid last year, with their gross earnings
surging by over 22.3 percent to hit N7.6
trillion from 6.2 trillion in 2016.
Financial Vanguard's inquest into the
reports turned in to the NSE for 2017,
indicates general upbeat in gross
earnings and Profit Before Tax, PBT,
with companies drawn from various
sectors of the Exchange posting
combined profit of N1.8 trillion,
representing a huge 40 percent rise
against N1.2 trillion reported in the
corresponding period of 2016.
The results, both the earnings and
pre-tax profit of the companies,
outperformed the country's average
inflation figures which stood at 16.5
percent during the period under review.
However, despite the impressive
performance of corporates in 2017, the
stock market reaction since March 2018
when the FY'17 results started trickling
in, has been on the negative as the
market recorded bearish trend with
market capitalization dropping to
N14.753 trillion at the end of trading
last week Friday, from N15.403 trillion
at the beginning of March. This shows
that investors have lost over N650 billion
within this period.
Market operators and stakeholders
have opined that most investors had
already priced-in the full FY '17 results
of companies in the stock prices during
the market rally that occurred between
December 2017 and January 2018.
They explained that what is
happening in the market now is
basically an extended period of profit
taking as investors are no longer
interested in dividend payout, which to
some are not justifiable with the
earnings recorded by the companies.
They further stated that the lack of
clarity in the fiscal and monetary policy
Continues on page 20
PoS transactions rise
39% to N297bn in
2mths
PAGE.22
NSE: Bargain hunting to
prevail ahead of QI‘18
earnings release
PAGE 27
Investors Forum
UBA Plc: Strong fundamentals
may spike investors
sentiments
PAGE 26