Bears Trend As Equity Market Sheds N242bn

The domestic equity market on Monday opened the week bearish, shedding N242 billion as profit taking activities persisted during the day. Market capitalisation of listed equities declined by 0.66 per cent to N36.605 trillion from N36.847 trillion reported on Friday. The NGX All Share Index also depreciated by 441.95 basis points to 66882.64 points from 67324.59 points recorded the previous day. A review of the transactions during the day showed that Ikeja Hotel led the gainers table in percentage terms, gaining 10 per cent to close at N2.75 per share. JohnHolt followed with a gain of 9.70 per cent to close at N1.81 per unit. Cornerstones Insurance increased by 9.49 per cent to close at N1.50 per share, Regal insurance gained 8.57 per cent to close at N0.38 per unit, Tantalizer up by 6.67 per cent to close at N0.32 per unit. On the contrary, Caverton Business Solutions topped losers chart, dropping by 9.87 per cent to close at N1.37 per share, AccessCorp trailed with 9.86 per cent to close at N15.55 per share, Oando Plc dipped by 9.70 per cent to close at N10.70 per unit, TIP fell by 9.65 per cent to close at N1.03 per unit, RTBriscoe dropped by N0.38 per unit. Volume of trades declined as investors traded 408.194 million shares valued at N5.442 billion in 7707 deals against 1.028 billion shares worth N4.354 billion exchanged hands the previous day in 6370 deals. Transactions in the shares of AccessCorp led market activities with 113.391 million shares valued at N1.781 billion, United Bank for Africa followed with account of 59.615 million shares worth N1.049 billion, Unity Bank traded 27.790 million shares valued at N28.426 million, Universal Insurance exchanged 17.572 million shares cost N3.901 million, Transnational Corporation of Nigeria exchanged 16.789 million shares cost N103.697 million.

Unity Bank Suffers N35bn Loss On FG’s FX Policy

Unity Bank Plc’s profit in the first half of 2023 was impacted by foreign exchange revaluation on the back of Nigeria’s recent FX liberalization policy, resulting in the lender suffering a revaluation loss of N35 billion within the period. In the retail lender’s financials for the period, notwithstanding the FX liberalization policy and its impact on the bottom-line, the bank grew its FX trading income significantly by 17 per cent to N239.8 million from N204.4 million in the corresponding period of 2022, underscoring the Bank’s strategic focus on diversifying and growing its earnings portfolio. According to the bank, deposits grew to N333.38 billion, representing a marginal increase of 2 per cent compared to N327.42 billion recorded in the first half of 2022 in its Half-Year unaudited financial statement submitted to the Nigeria Exchange Group Limited. The net loans portfolio reduced significantly by 31 percent to N198.6 Billion as at 30 June 2023 from N289.4 Billion as at 31st December 2022. The Bank’s NPL Ratio remained moderate at below 3 per cent while liquidity ratio stood strong at over 45 per cent. The Managing Director/CEO of Unity Bank Plc, Mrs. Tomi Somefun noted that the significant disruptions which characterized the operating environment has impacted the positions of the Bank to the extent that we have constraints in income generation on the back of revaluation of the bank’s net foreign liabilities occasioned by the Naira devaluation during the period. Mrs. Tomi stated: “In the light of the prevailing FX revaluation in the financial system, what we have is a market-driven impact which is adjustable envisaged from the positive economic outcomes of the government policies in the near term. “Be that as it may, the negative shareholders’ fund has improved considerably through the injection of N135 billion which moderated the negative shareholders’ fund from (-ve) N275 Billion in December 2022 financial year-end to (-ve) N178 Billion as at the end of June 2023, after absorbing the FX revaluation loss suffered in the second quarter of 2023. “We are however, focused with clear-cut plans to close out on our recapitalization programme very soon to enable us do business as expected in the fast-growing markets in Nigeria” She further stated that while we remain optimistic that the government’s policy initiatives will lead to cause correction in the market, the Bank has accelerated measures to ramp up asset creation and liability generation in the short and medium term. “The Bank is aggressively driving its retail growth in every segment of the market, expanding strategic partnerships; and growing commercial banking business to develop new and sustainable income lines for the Bank as well as pay sufficient attention to fast-paced process automation, cost and resource efficiency, targeted value chain relationships, and product marketing to enhance value creation in the market.