Nigeria’s Exchange Reports 1,622.03% Increase in Listing Activities in 2017

L – R shows Afolabi Oladele, Director Portfolio Management Department, Debt Management Office (DMO); Mark Eddo, Communicator & Founder, Mark Eddo Media; Oscar N. Onyema, Chief Executive Officer, The Nigerian Stock Exchange (NSE); Babatunde Raji Fashola, SAN, Hounourable Minister, Power, Works and Housing; Eme Essie Lore, Country Manager, International Financial Corporation (IFC); Gokul Mani, Head Primary Markets, London Stock Exchange (LSE) and Elias Kagumya, Director, Risk Management, The African Export-Import Bank during NSE – LSE Dual Listing Conference, Themed: “Attracting Global Capital to Drive Nigeria’s Economic Reforms and Sustainable Growth” on Friday in Lagos.

June 2, 2018

By InvestAdvocate

Lagos (INVESTADVOCATE)-The Nigerian Stock Exchange (NSE) in 2017 recorded a 1,622.03 percent increase in listing activities from from N2.59 billion in 2016 to N44.51 billion in 2017, Oscar Onyema, chief executive officer (CEO) of the NSE said on Friday at the NSE, London Stock Exchange Group (LSEG) fifth dual listing conference in Lagos Nigeria with the theme “Attracting Global capital to drive Nigeria’s Economic Reforms and sustainable Growth” 

Onyema in his opening remarks said over the last few years, Nigeria’s economic landscape has been particularly challenging for the capital market. The combined effects of the 2015 national elections, slump in commodity prices, global economic slowdown, recession and FX market illiquidity resulted in a dearth of Initial Public Offers (IPOs) in the Nigerian capital market.

According to the CEO of Nigeria’ Exchange, between 2014 and 2016, capital raised on the NSE fell by 95 percent from N43.95 billion to N2.59 billion. “However, in 2017 we saw a significant rebound as listing activity (IPO and Follow on offers) increased 1,622.03% from N2.59Billion in 2016 to N44.51 Billion in 2017,” he added.

He noted that the Nigerian capital market is not peculiar in this regard as global listing activity IPOs and Follow-On offers in 2017 came to c$818 billion from 1,483 IPOs and 3,529 FOs a rebound of 17.99 percent from a 22.32 percent dip in 2016.

He disclosed that the African Equity Capital Markets (ECM) recorded an increase in volume and value in 2017 with 49 percent growth in total ECM transaction value and 17 percent growth in IPO volumes from the 2016 four-year low. “Market recovery was largely driven by South Africa, with contribution from Egypt, Tunisia and renewed listing activity in Namibia,” Onyema added.

The CEO of the NSE said the 2017 Primary markets activities were dominated mostly by supplementary offers, listings by introduction, debt issuances, mergers and divestments. “The market recorded an uptick as Equity market capitalistion grew by 42.12 percent in 2017 closing the year at N13.62 trillion compared to N9.54 trillion in 2016. With these feat, The NSE emerged the star of Sub-Saharan Africa markets and one of the top three best performing World Federation of Exchanges’ markets of 2017 globally,” he affirmed.

Onyema noted that the Nigerian economy exited recession with a marginal growth of 0.83 percent in 2017 and is expected to grow by 2.5 percent in 2018 based on the World Bank’s projections.

He says the optimistic outlook is evident in the NSE’s trading activities with cumulative transactions from January to April increasing by 114.22 percent from N509.38 billion recorded in 2017 to N1.091 trillion in 2018. “Evidently showing that Nigeria remains top of mind on the African continent for investors!,” the NSE CEO affirmed.

According to him, the NSE continues to increase its product offerings to the investing public with the listing of securities such as the $300 million Diaspora Bonds and $3 billion Eurobonds in 2017, the N100 billion Federal Government Ijarah Sukuk and the Sovereign Green Bond; adding to the nation’s funding options to catalyse the rebound of the Nigerian economy and offer investment alternatives to the vast majority of Nigerians.

“It is noteworthy to mention that Nigeria’s inaugural issue in the Green Finance market earned a credential as the first ever Sovereign issuance in Africa. This represents a new stage in development of Nigerian capital markets and opens the way for further corporate issuance and international investment. The NSE is playing a key role to help develop this enormous opportunity for Nigeria and fulfill one of Nigeria’s Exchange key objectives as a member of the UN Sustainable Stock Exchange Initiative.

He further affirmed that the theme of the conference is quite topical for the Country at this time. As the Government grapples with the task of articulating a clear economic blue print for the short to midterm within which credible fiscal and monetary policies can emerge, the reality of the need to leverage and embrace the globalisation of economies and financial markets becomes clearer.

“Our collaboration with the London Stock Exchange is deliberate and strategic. It is geared at encouraging seamless cross-border access between our Capital Markets to ultimately drive deeper capital markets that enable capital formation for Businesses and Governments; create larger liquidity pools and greater competitiveness for our investors; and enhance capacity and promote diversity of investment products to meet the needs of a wide range of investors and issuers.This is evidenced by the FGN Sovereign FX denominated $1 billion Eurobond on The Nigerian Stock Exchange and London Stock Exchange recently, and a strong pipeline of corporate Eurobonds,” Onyema added.

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