FMDQ

FMDQ Group has listed priorities to be pursued by the company in 2022 to enhance the growth and development of the fixed income markets.

Ms Kaodi Ugoji, Group Chief Operating Officer, FMDQ Group, said the top priorities were the launch of the Bilateral Repurchase Agreement (Repo) market with collateral management service and development of a thriving derivatives market.

She said the imminent introduction of exchange-traded derivatives products, starting with fixed income furtures products also ranked as priority.

Ugoji said on Tuesday in Lagos that the company would ensure immediate activation of FMDQ Clear’s CCP services for financial market transactions (cash and derivatives).

She added that the company would extend the FMDQ Depository services to new asset classes and customer segments.

She said the  FMDQ Securities Exchange Ltd. initiated Repo with Collateral Management Project to promote liquidity in the money markets and deepen the Nigerian fixed income markets.

Ugoji noted that the “Repo Project” would focus on enhancing/standardising the Repo market in Nigeria by facilitating on-system trading/reporting of Repo.

She said it would also focus on the introduction of centralised collateral management and straight-through-processing settlements to minimise counterparty risk.

She said the Repo project, when launched, would promote liquidity in the secondary fixed income markets; provide a low-risk option for short-term cash investment and promote price discovery in the money market, among others.

Ugoji added that the group would deepen the private markets and improve supply chain financing to support small and medium-sized enterprises.

Speaking further, she said the company would introduce Exchange-Traded Derivatives (ETD) in the course of the year.

“The introduction of the FMDQ Exchange-Traded Derivatives (“ETD”) Market is being planned with Federal Government of Nigeria Bond and Short-term Interest Rate Futures contracts as the pioneer ETD products,” she said.

On overview of fixed income market activities in 2021, Ugoji said the total turnover in the fixed income market for full year 2021 was N140.74 trillion against N146.88 trillion achieved in 2020, representing a year-on-year decrease of 4.18 per cent.

“Money Market (mainly Repurchase Agreements [Repos]) (35.61 per cent) and Open Market Operation (“OMO”) Bills (27.79 per cent) were the highest drivers of fixed income market turnover.

“This jointly accounting for 63.40 per cent of the total fixed income market turnover for FY2021,” she said.

She explained that following engagements with market participants, the decline in fixed income market activity might be attributed to CBN’s implementation of the cash reserve ratio.

This, she said, impacted the liquidity and volatility in fixed income market yields.

“The volatile fixed income market evidenced in the uptick in FGN Bond yields in 2021 (average increase of 2.11ppts), led market participants to maintain a ‘wait and see approach’ to avoid realising losses on fixed income securities,” she said.

FMDQ Securities Exchange Ltd. has approved the quotation of the MeCure Industries Ltd Series 1 and Series 2 Commercial Papers (CPs) on its platform.

This is contained in a statement by FMDQ Exchange on Friday in Lagos.

The statement said that the Series 1 (N0.49 billion) and Series 2 (N1.44 billion) were under the company’s N20 billion CP issuance programme on the FMDQ platform.

Commenting on the quotation, Mr Samir Udani, the Chairman/Chief Executive Officer, MeCure Industries Ltd., said the issuance would help the company meet its short-term working capital and funding requirements.

Udani added that it would strengthen the company’s commitment to building and shaping positively, the healthcare industry in Nigeria.

Also speaking on the transaction, the sponsor of the CP and a Registration Member (Quotations) of the Exchange, Mr Femi Ademola, Executive Director, Cordros Capital Ltd, said the company was proud to sponsor the CP.

“Cordros Capital is proud to have sponsored the quotation of the MeCure Industries Ltd., N0.49 billion Series 1 and N1.44 billion Series 2 CPs, under the N20 billion CP programme.

“This transaction has provided an alternative source of funding to the issuer and will assist in bolstering its working capital. Hence, positioning it as a leader in the pharmaceutical industry,” Ademola said.

MeCure Industries is a leading human therapeutics company in the pharmaceutical industry in Nigeria.

The company pioneered the development of novel products and launched the pharmaceutical industry’s first tablet in a capsule formulation called ‘Liquitab Floatcap’.

FMDQ Group is Africa’s first vertically integrated financial market infrastructure group, strategically positioned to provide registration, listing, quotation and noting services; integrated trading, clearing & central counterparty, settlement, and risk among others.

FMDQ Securities Exchange Ltd has approved the registration of NECIT Nigeria N20 billion commercial paper (CP) programme on its platform.

The Managing Director/Chief Executive Officer, NECIT, Mr Emmanuel Iheagwazi, said this in a statement m on Monday in Lagos that NECIT was pleased to announce the registration of the N20 billion CP programme.

NECIT Nigeria is an indigenous company that deals in manufacturing of car lubricants and engine oil, as well as the importation and sale of base oil.

“As a leading indigenous player in the lubricant blending industry in Nigeria, access to short-term funds is critical to meeting our working capital needs.

“The approval of this CP programme by FMDQ Exchange represents a major milestone in our near-term growth aspirations and with this support, our capacity to unlock value for all stakeholder has been further enhanced,” he said.

Iheagwazi said  the short-term finance would be raised via CP issues within the approved CP programme limit and quoted on the FMDQ Exchange for visibility of the issue and issuer, and the desired transparency for investors.

Also speaking, the sponsor of the CP Programme, Boston Advisory Ltd., represented by the Managing Director, Mr Rotimi Balogun, expressed commitment to the development of the Nigerian debt capital market.

“At Boston Advisory, we remain committed to an all-inclusive development of the Nigerian debt capital market; a market where the vast majority of bankable companies in Nigeria will have equal access to short term funds at cheaper rate.

“We ultimately seek to be a frontliner in arranging growth/expansion capital for mid-tier companies, and we are indeed delighted to work with NECIT in making this a reality,” Balogun said.

FMDQ Exchange has sustained its efforts in supporting issuers with tailored financing options to enable them achieve their strategic objectives, deepen and effectively position the Nigerian debt capital market for growth.

FMDQ Group is Africa’s first vertically integrated financial market infrastructure group, strategically positioned to provide registration, listing, quotation and noting services; integrated trading, clearing & central counterparty among others.