Analyst Insight - Business Metrics

Twitter Ban: Some Key Policy and Legal Considerations for Web Platforms

Jun 20, 2021 Business Metrics

Twitter Ban: Some Key Policy and Legal Considerations for Web Platforms By Olubunmi Abayomi-Olukunle, the Lead Transactions Counsel at Balogun Harold Key Takeaways There is generally no statutory protection from civil liability for social media companies regarding third-party content. Nigeria needs to enact regulations, similar to sector 230, to protect web platforms from third-party “publisher” liabilities. A plain-vanilla Nigerian subsidiary, at this time, leaves room for more exposure. New laws in Nigeria should inform a review and update to Africa strategy. The decision of the Nigerian Government to…

Op-Ed: Arm’s length policy of Payment Service Banks in Nigeria: The need for clarity

May 26, 2021 Banjo Olaniran

CBN authorises Payment Service Banks in Nigeria to sell dollars

By Emmanuel Okoegwale (emmanuel@mobilemoneyafrica.com) In furtherance to enhance access to basic financial services for underserved and unbanked segments of the society, the Central Bank of Nigeria created a new license category, called the Payment services Bank(PSB). The key objective of setting up the PSB category, is to enhance financial inclusion by increasing access to deposit products, payment and remittance services to small businesses, low-income households and other financially excluded entities. To achieve the purpose, PSBs are expected to leverage mobile and digital channels of mobile network operators which will be…

The strange yield curve

Apr 28, 2021Apr 28, 2021 Business Metrics

The Strange Yield Curve By Coronation Research Since the beginning of the year fixed income yields have been rising. Yet the movement in rates has been unequal across durations. Long-term bond rates have risen sharply and so too have 1-year T-bill rates at auction. But short-term T-bill rates have stayed low. FX Last week the exchange rate in the Investors and Exporters Window (I&E Window) strengthened by 0.24% to close at N410.00/US$1. In the parallel, or street market, the Naira weakened by 0.62% to close at N485.00/US$1. The gap…

CBN official reserves declined by US$280m to US$34.82bn in March 2021

Apr 14, 2021 Banjo Olaniran

Foreign reserves shed $2.3bn in H1 amid rising oil price

By FBNQuest Research The Central Bank of Nigeria (CBN) data show that Nigeria’s gross official reserves declined by USD280m to USD34.82bn in March. In the name of accuracy, we should adjust this figure downwards to allow for the pipeline of delayed external payments, which the IMF estimated late last year at up to USD3bn and which the CBN has since indicated as substantially lower. We do not view the current level of reserves as a cause for alarm because of three areas where the CBN could reinforce its…

Dynamics Within the FX Market

Apr 14, 2021 Business Metrics

Nigeria’s forex inflow suffers 54% decline in January

Dynamics Within the FX Market By FBNQuest Research Today we turn our attention to Nigeria’s exchange-rate market. Over the past four years, the CBN’s fx reforms have assisted with improved liquidity. However, in light of the COVID-19 outbreak, there has been additional vulnerability to swings in oil prices as well as increased exit of foreign portfolio investors (FPIs) which have both adversely affected exchange rate stability. Demand for fx remains high and the supply is inadequate for regular uses. The CBN’s Investors and Exporters (I&E) window rate is currently…

The Argument for No Change from the MPC

Mar 23, 2021 Business Metrics

Credit to private sector hits N32.2trn in Maysector recorded marginal uptick in April – CBN report

By FBNQuest Analysts The monetary policy committee (MPC) holds its latest meeting today and tomorrow. In the earlier days of the COVID-19 pandemic rate-setting bodies globally were in easing mode and eager to provide a monetary stimulus. Indeed the MPC cut its policy rate twice in 2020. The most common decision has since been ‘hold’ although a few in the EM universe such as Turkey have shifted to a tightening stance. A third rate cut would be a surprise this week, given the persistent rise in inflation for 18 successive…

Headline Inflation Jumps to a 4-Year High, Could Rise Further

Mar 17, 2021 Banjo Olaniran

By FDS Analysts The consumer price index spiked further in February by 0.86% to 17.33%, marginally higher than FDC forecast (17.2%). This is the highest inflation level in the last 48 months. Consumer price inflation jumped sharply since September 2019 after the land borders were closed to curb smuggling and encourage local production. At the current level, headline inflation is almost 100% above the upper band of the CBN’s inflation target (9%). The inflation spiral this time is driven mainly by rapidly increasing ways and means advances (money supply saturation),…

Nigeria’s gradual road to economic recovery

Mar 2, 2021Mar 3, 2021 Banjo Olaniran

Nigeria’s gradual road to economic recovery By Lukman Otunuga, Senior Research Analyst at FXTM Africa’s largest economy has displayed resilience over the past few months. From defending against the Covid-19 menace to battling untamed inflation and shouldering domestic risks. Initially, the economic outlook was bleak during 2020 after the economy sunk back into its second recession in less than five years. Lockdown restrictions caused significant disruptions in the value chain, halted most aspects of the economy while crippling the manufacturing sector. A growing sense of alarm and unease over…

Nigeria to Appoint Fund Manager for US$37bn Infrastructure Fund

Feb 26, 2021Feb 28, 2021 Business Metrics

Economic council engages Buhari on three disturbing national issues

By CSL Analysts Earlier this month, President Muhammadu Buhari approved the establishment of a Public Private Partnership styled Infrastructure company named Infra-Co with an initial seed capital of N1tn expected to grow to N15tn in assets and capital over time. The proposed establishment will attract private sector participation in the nation’s quest to bridge its infrastructure deficit necessary for the growth across all sectors of the economy. According to media reports, the board of Infra-Co will be chaired by the Governor, Central Bank of Nigeria (CBN); Managing Director, Nigeria Sovereign Investment…

FBNQuest Capital Nigeria 2021 Research Outlook: Tentative Emergence from the Shadow of COVID-19

Feb 4, 2021 Banjo Olaniran

FBNQuest Capital Nigeria 2021 Research Outlook: Tentative Emergence from the Shadow of COVID-19 By FBNQuest Capital Global recovery via millions and millions of arms The Federal Reserve has its policy rate at practically zero and will maintain its accommodative stance this year since its employment and inflation objectives are distant following the virus’s impact. The world economy will recover following the development of the vaccine. We believe this process in G7 economies and China will experience the desired impact by the third quarter. With the anticipated recovery in demand,…