WE’RE COMMITTED TO MULTI-MODAL TRANSPORT SYSTEM –FASHOLA

The Lagos State Government has expressed commitment to the development of a multi-modal transport system to boost the business of the people and accelerate the economic growth of the state.

This, it said, was in line with its aim of expanding the current scope of its partnership with the private sector in transportation.

The Lagos State Governor, Mr. Babatude Fashola, stated this, adding that the state government was set to tap into numerous opportunities presented by the maritime sector to secure a space in marine transportation business.

Fashola was quoted in a statement on Tuesday as saying this at the second annual Nigeria Transport Award and Lecture held in Lagos and organised by the Transport Day News magazine, on Friday.

The governor, who was represented by the Permanent Secretary, Ministry of Transportation, Mr. Oluseyi Coker, said communities within the coastal region were no longer challenged in the area of moving goods and services to the mainland.

VW QUARTERLY PROFIT BEATS ESTIMATES

Volkswagen AG, Europe’s largest automaker, said first-quarter operating profit rose 22 per cent, helped by record sales at the luxury Porsche and Audi brands.

Earnings before interest and taxes increased to €2.86bn from €2.34bn a year earlier, the Wolfsburg, Germany-based manufacturer said in a statement today.

Bloomberg News reported on Tuesday, that profit beat the €2.74bn average of nine analyst estimates. Revenue gained 2.7 per cent to €47.8bn.

VW said last month that its annual sales may exceed 10 million vehicles for the first time in 2014, four years earlier than planned.

That includes deliveries by MAN SE and Scania AB, the truck divisions in which VW is seeking full ownership. Those takeovers, and plans to introduce 100 new or revamped cars through next year, are part of a strategy to overtake Toyota Motor Corporation as the global leader in auto sales by 2018.

“From a strategic point of view, the product and brand position of Volkswagen AG is the envy of the industry,” said Roman Mathyssek, a Munich-based analyst at consulting company Strategy Engineers GmbH.”

DANA AIR NAMED 2013 DOMESTIC AIRLINE OPERATOR

Dana Air Limited has announced that it has emerged the domestic airline operator for 2013.

The company was given the award by the Transport & Logistics Nigeria Limited, organisers of the Transport Stakeholders’ Excellence Awards.

A statement by the company on Monday noted that the airline emerged after a thorough screening by a team of assessors and the result was subsequently confirmed by a public opinion survey.

The transport and logistics award is an initiative designed to celebrate, encourage and project transport stakeholders who have contributed significantly towards the development of logistics and transport in all ramifications.

Commenting on the award, the Chief Operating Officer of Dana Air, Mr. Yvan Drewinsky, said the hard work and dedication the airline had put into its activities were beginning to pay off.

He said, “It’s gratifying that the airline has continued to attract positive attention and has again been voted as the airline of the year by stakeholders in the transport and logistics sector.

“More importantly, Dana Air takes this award as a vote of confidence from our discerning customers and we want to re-assure them that we will intensify our efforts at building a world-class airline in Nigeria.”

‘US MARKETS ARE NOT RIGGED’- MARY JO WHITE

The United States Securities and Exchange Commission Chair, Mary Jo White, on Tuesday responded directly to allegations in Michael Lewis’ new book about high-frequency trading markets.

“The markets are not rigged,” she told a US House of Representatives panel. “The US markets are the strongest and most reliable in the world.”

Reuters reported that White’s comments come nearly a month after Lewis’ “Flash Boys: A Wall Street Revolt,” was published. The book has re-ignited a fierce debate over the role of high-speed trading, and whether it may leave some investors at an unfair disadvantage.

Lewis alleges that high-speed traders are engaged in a form of front-running, in which the firms are able to quickly identify an investor’s desire to buy stock, rush to buy it first and then sell it back at a higher price.

UBA CAPITAL’S SHAREHOLDERS APPROVE N1.5BN DIVIDEND

Shareholders of UBA Capital Plc on Tuesday approved the 25 kobo per ordinary share dividend proposed by the directors for the 2013 financial year. This amounted to a total dividend of N1.5bn.

The shareholders, who gave the approval at the company’s first Annual General Meeting in Lagos, also reelected the directors, and the Chairman, Mr. Chika Mordi.

The reelected directors are Mr. Emmanuel Nnorom, Mr. Adim Jibunoh, Ambassador J. Shinkaiye, and Mr. Yoro Diallo.

The board had recommended the dividend after the company recorded improvements in its profit in 2013.

For instance, the group’s gross earnings rose by 241 per cent to N4.573bn in 2013 from N1.342bn in 2012; profit before tax jumped by 212 per cent to N2.634bn from N844m; while profit after tax climbed by 106 per cent to N1.763bn from N1.418bn.

FBN HOLDINGS’S PROFIT DROPS DESPITE RISE IN EARNINGS

FBN Holdings has released its result for the financial year ended December 2013 with its profit before tax declining by 2.8 per cent to N91.3bn, from N93.9bn in 2012.

Similarly, the group’s profit after tax was down by eight per cent, falling to N70.6bn in 2013 from N76.8bn the previous year.

The results, however, showed that the group’s gross earnings rose by seven per cent in the year under review to N395.9bn from N370.2bn, while its net interest income at N230.1bn represented an increase of 1.5 per cent on the N226.6bn it declared the previous year.

The bank’s total assets and customer deposits rose by 19.9 per cent and 22.3 per cent, respectively.

While total assets rose to N3.9tn from N3.2tn, customer deposit advanced to N2.9tn from N2.4tn.

Highlights of FBN Holdings’ operations in 2013, according to the group, include the acquisition of ICB West Africa operations – in Ghana, The Gambia, Sierra Leone and Guinea.

GUINNESS NIGERIA RECORDS 22% DECLINE IN PROFIT

Guinness Nigeria Plc recorded a 22 per cent drop in its profit after tax for the nine-month period ended March 31, 2014, the company’s unaudited result for the period has shown.

The result, which was posted on the website of the Nigerian Stock Exchange, showed that its PAT fell to N5.943bn in the review period from N7.633bn in the corresponding period of 2013.

The result also showed that the company’s profit before tax declined by 30 per cent to N7.824bn from N11.234bn, while its revenue fell by 11 per cent to N78.019bn from N88.058bn.

A statement from the company on Tuesday quoted the Managing Director and Chief Executive Officer, Mr. Seni Adetu, as saying the tough operating environment affected the company’s revenue negatively in the review period.

He said, “High finance costs in an increasing interest rate environment negatively impacted our overall profitability in spite of this, we continue to invest in our brand portfolio and optimisation of our market logistics. We expect that these and other initiatives will lead to improved revenues and overall performance.”

NIGERIANS, WORLD’S HEAVIEST USERS OF ATMS

A new report has found that bank customers in Nigeria are the heaviest users of Automated Teller Machines in the world.

The study by EY, a global business and financial advisory firm, also shows that Nigerians have the highest sensitivity in Africa and the second highest globally to close accounts based on poor experience.

The EY’s 2014 Global Consumer Banking report surveyed over 32,000 bank customers in 43 countries, including Nigeria, Kenya and South Africa.

The study also finds that Nigerian bank customers are among those from the top three countries that use social media when making decisions on selecting a financial service provider.

After a number of years of sharp decline, confidence in the banking industry is on the rise, trust in individual banks is high and most customers across the globe are satisfied enough to recommend their main banking provider, according to the report of the survey.

Banks are providing traditional banking services well but are viewed as falling short on important aspects of the customer experience, and are also increasingly vulnerable to competition from new providers of banking services, the report states.

ACCESS BANK RECOGNISED IN CSR COMPETITIVE INDEX

A non-governmental body has recognised Access Bank Plc as the best in corporate citizenship in the first ever competitive index on corporate social responsibility in the country.

The CSR-in-Action, a registered social enterprise devoted to the advancement of social ethics, social responsibility and corporate governance in Nigeria, recognised the bank in a report it released recently.

In the Corporate Citizenship Index (3C-Index), 117 private sector companies were assessed, using six indices, which are human right, anti-corruption, community investment, economic, labour and reporting.

On a scale of 100 per cent, Access Bank scored 83.3 per cent on the Millennium Development Goals’ focus areas to emerge as the best Nigerian organisation in corporate citizenship, according to a statement by the bank.

The top five companies in the category are Access Bank, Nigerian Bottling Company, Exxon Mobil, GT Bank Plc and Procter and Gamble.

The statement quoted the Group Managing Director, Access Bank, Mr. Herbert Wigwe, as saying “We have set for ourselves the ambitious target of becoming the world’s most respected African bank. That means making sure that sustainability is part of everything we do.”

BANKS SELL DOLLAR BONDS TO FINANCE POWER PROJECTS

 The country’s drive to overcome a mismatch between demand for electricity and generating capacity is prompting banks to sell dollar bonds to finance power projects, according to a report by Bloomberg.

The Federal Government, which sold 15 power generation and distribution companies last year, is spending $3.5bn to boost transmission capacity this year by 50 per cent from 4,000 megawatts, less than a 10th of South Africa’s full capacity.

Deposit Money Banks are tapping Eurobond markets to be in a position to provide financing for projects, including power, with Sterling Bank Plc seeking to raise dollars after Zenith Bank Plc sold $500m of five-year notes on April 10.

“Nigerian banks will become regular players in the Eurobond market in the coming years,” Samir Gadio, an emerging-market strategist at Standard Bank Group Limited’s London unit said in an e-mailed response to questions on April 24.

“They will need to refinance existing issues before they mature, but also to raise more funding for the financing of power, oil and gas and infrastructure projects,” he added.

The Federal Government’s disposal of the power assets last year attracted about $2.4bn, with most of the financing arranged by local banks, Wale Shonibare, the Managing Director of Investment Banking at UBA Capital Plc, said in a Bloomberg TV Africa interview broadcast on April 25.

Demand for Zenith’s bonds was more than double the amount on sale, the bank said, without saying what the money would be used for.

The issuance, arranged by Goldman Sachs Group and Citigroup, is part of a $1bn global medium-term note programme. Zenith declined to comment beyond the statement.

Sterling Bank plans to sell a Eurobond in 2015 and will also start talks with investors to raise $200m this year, its Chief Financial Officer, Mr. Abubakar Suleiman, said.

“The amount for the Eurobond has not been determined. It is intended to help the bank finance growth,” he said.

Guaranty Trust Bank Plc, which raised $400m in November for oil and gas investments out of a $1bn bond programme, has enough short-term dollar funding, according to the Chief Executive Officer, Mr. Segun Agbaje.

TOTAL REPORTS QUARTERLY PROFIT LEAP, BUT UNDERLYING FIGURE FALLS

French oil group Total reported a 71.0-percent jump in net profit in the first quarter on Wednesday, compared with results a year ago which were hit by an exceptional charge.

The outcome amounted to $3.33 billion (2.4 billion euros) from $1.95 billion a year ago.
But the results, presented in dollars for the first time, and on an adjusted basis which is the benchmark for the oil industry, fell by 10.0 percent to $3.27 billion.

Chief executive Christophe de Margerie said that the performance was “solid” even though it was slightly lower than the result for 2013, excluding exceptional items.

In the first quarter of last year, the group took a charge of $1.6 billion on its withdrawal from a shale-sand oil project in Canada undermined by the rise of shale oil from underground resources.

In the first quarter of this year, sales amounted to $60.68 billion, showing a fall of 5.0 percent.
Net adjusted operating profit fell by 8.0 percent to $3.70 billion.

Margerie said that the effects of a steep worsening of refining margins in Europe had been contained by steps to improve performance in the company’s refining activities.

But since the beginning of the second quarter of this year, refining margins had improved from exceptionally low levels in the first quarter, and the refining climate in the United States remained favourable.

Production of hydrocarbons (mainly oil and gas) fell by 6.0 percent to 2.179 million barrels per day, but this was mainly because of the ending of a production licence in the United Arab Emirates and the disposal of an asset in Trinidad and Tobago.

Problems for security of operations in Libya and Nigeria had also caused a reduction of output.
In the second quarter, production would be affected by a high level of seasonal maintenance mainly in Britain, Norway and Thailand, the company said.

ROADS, HOUSES, POWER ESSENTIAL FOR GROWTH OF NATION’S ECONOMY, SAYS ONOLEMEMEN

The  Minister of Works, Mike Onolememen, on Tuesday said that physical infrastructure such as roads, houses, power and rail were essential for the growth of the nation’s economy.

A statement signed by Mrs Aso Uchenna, the ministry’s Information Officer, stated  that  Onolememen said this at the 2014 Architects’ Colloquium organised by the Architects Registration Council of Nigeria (ARCON).

Onolememen

It said that without adequate investment in infrastructure, the economy would be stagnated.

“Infrastructure deficit for the road sector alone is large and there is need to adequately support economic growth at current rates and meet vision 20:20:20.

“Government can only achieve this by investing on the construction of at least 14,000km of new roads annually for the next seven years.

“This is because infrastructure is key in realising the objectives of the present administration’s transformation agenda goals.’’

Onolememen said that the present administration had embarked on major reforms in the power sector, leading to the privatisation of power generation and distribution.

According to him, the Federal Government is also concentrating on building a transmission infrastructure for the power sector.

NIA CAUTIONS GOVERNMENT ON ENCROACHMENT INTO INSURANCE BUSINESS

 The Nigerian Insurers Association, NIA, has charged the federal government to stop further encroachment on the business of insurance.

Chairman of NIA, Mr. Remi Olowude, who gave the charge noted that there is a recent encroachment move on insurance business by government agencies, which try to provide insurance protection to aviation passengers and public liability for nuclear risks.

He also stated that the Nuclear Agency wants to establish fund for nuclear damage insurance, instead of seeking conventional insurance cover for the risks which are covered in international insurance market

Olowude said, “The Federal Government in 2007 divested its interest in insurance business when it sold NICON and Nigeria Re, on the understanding that such concerns are better managed by the private sector. But ironically, the same Government extracted workmen’s compensation insurance business and transferred it to Nigerian Social Insurance Trust Fund, NSITF, as Employee Compensation Scheme.

In similar vein, the Federal Government split pension business between insurance industry and PFA’s, assigning the chunk of the business to National Pension Commission, PenCom and Pension Fund Operators, PFAs; while it also moved health insurance from the insurance industry to National Health Insurance Scheme, NHIS.”

INSURANCE OPERATORS MUST RECOGNIZE OUR RIGHTS — INSCAN

The Insurance Consumers Association of Nigeria, INSCAN, has called on insurance operators to see claims payment as the right of the insurance consumer and not as a favour.

The National Technical Adviser of INSCAN, Mr. Yemi Soladoye, who made the assertion, stated that the insurance premium does not belong to any insurance company, it is money held in trust for the policy holders.

Soladoye said “We the insurance consumers in Nigeria feel that insurance business is that of collecting money from the shareholders and the policy holders mainly for the benefit of the practitioners or how else would we describe a situation whereby in 2011 the net claims paid to us was N30.7 billion but management expenses was N36.7 billion out of N163 billion generated as gross premium from the general business class.

This is 18 per cent and in fact one of the most ridiculous claims ratios in the world. In some individual company cases the gross claims ratio was as ridiculous as 3.0 per cent.

We the consumers are very much aware of the fact that – the insurance premium does not belong to any insurance company, it is money held in trust for the policy holders.”

MASSIVE INVESTMENT NEEDED TO SUSTAIN REBASED GDP

 Financial experts have called for massive investment in socio economic infrastructure so as to sustain the rebased gross domestic product (GDP) of the country. They spoke at a finance conference organised by Lagos Business School (LBS), with the theme, “Resilience of the  Nigerian Financial Industry in the Face of Changing Global Circumstances.”

Managing Director/Chief Executive, Financial Derivative Company Limited (FDC), Mr. Bismarck Rewane noted that though rebasing has made Nigeria the largest economy in Africa, the infrastructure base of the country has not changed in the last 20 years.

He said, “The reality is that the lesson from the GDP rebasing is like we have just come back from an x-ray. What the rebasing has done is to tell us much more accurately, what the structure and size of the economy is.
“The infrastructure base in 1990 is probably the same infrastructure base that you have today. The same kilometre of roads we had as at 1990, it is still the same amount of roads tarred today.

Between 1990 and today, only one bridge has been built in Nigeria and that is the Lekki-Ikoyi bridge. Between 1990 and today, no new refinery has been built. Between 1990 and today, no new port or port rehabilitation has taken place. Between 1990 and today, not one rail line or rail infrastructure has been built. Between 1990 and today, we have few scattered IPP power projects. We are still at 3,800 megawatts. So, power, roads, bridges, ports, refineries with 400 universities.”

He advised the government and financial institutions to focus on sectors that would build infrastructure. “The infrastructure gaps are so glaring that you cannot use the infrastructure of a $100 billion GDP economy, to run an economy of $510 billion GDP. If you are 20 years old, you can’t wear trousers of a nine-year old.So the winners are those who invest in infrastructure, institutional, physical and otherwise.”