onegentleguy:


The problem is not with the CBN governor. ...it is with with the gov't at the center. It is majorly from the fiscal policy end.
Yes, certain policies from the monetry end may have come at a cost in the past, but if u understand what has been playing out with the stages of monetary formulation @ the moment, u will know that Emiefula has been trying to do our leaders a favour with his interventions to give them the time to patch up the mismatches in the fiscal end.
The disconnect to the real sector which has largely impeded growth has been broadly the result of fiscal policy failures. ...and which the monetary end works to patch up.

I can tell u that the several policies from the emperor have been quite timely. ...without which we would've been in a far worse situation by now.

Let me give u a fine example;

The recent policy guide(LDR, OMO intervention etc) aimed @ curbing down the high interest rate and its impending effects on the growth of the country is a big plus.
In retrospect, the move which sought to broker a balance btw growing the domestic front(real growth with human capital and infrastructural developmental support in view) as well as the international front(FPIs and FDIs with naira stability in view) couldn't have come at a more better time. ...especially when the gov't(fiscal) efforts have been tilted towards borrowing for consumption than production.
The long-term impact of double digit rate is a serious drag to real growth and globally, No economy can ever grow in that situation. Rates need to peg @ single digits and that my dear, is what the apex bank has sought to do.

Understandably, investors like u and I, PFMs, asset managers and even the banks may not like some of these moves, but the CBN isn't there to put policies that will favour us.(U should align urself to reap from the any arbitrage oppurtunity from different policy guides) The CBN is there (in an auxiliary capicity to the fiscal end) to put out policies that can help spur/support domestic growth.

Now let's look @ the recent policy on CRR.
At 1st, the interpretation of it might be that the policy was a draw back on the series of recent intervention to encourage lending to the real sector.
In retrospect, u can not ask the banks to lend N65 for every N100 of deposit pool(65% LDR peg in view) and @ the same time, ask them to keep a little more funds with u(now N27.5 for every N100 they accumulate) given the 500bps/5% increment in CRR from 22.5% to 27.5%.
Though the LDR to CRR differential which in this case will be @ circa N7.5 or 7.5%[ie.(N100-N65) - (N27.5)] still pegs a positive, it also connotes less funds for banks to play with(trading activities in view), hence, a strain on CoF(funding cost).

However, people need to understand that most banks are already ahead or close to the threshold for LDR peg and the thing about EFFECTIVE CRR(current standing with CBN) means that some banks may well have exceeded the said 27.5% peg.
Again, the squeeze in liquidity(the aftermath of the CRR hike) means that less funds can now play the fixed income space hence an increase in that window.(I expect a reversal to the recent drop in the FI space)
Though less funds will now pursue the FI window opportunity(sterilized additional 5% in view), the increased rate will help compensate for the lowering of available funds to play that space.
Additionally, the policy means that banks will likely get a little more value for their available funds(interest income in view) as they seek to erk out a little more interest to their lending stream. ...this should limit any concern around funding cost and interest expense.
I expect that banks with higher LDR threshold(>65%) will seek to lower their lending quest and free up funds for other plays.
The banks will always find a way to balance things up.

There is a need to look @ what could've been the intent behind the move. ...and whether there should be any concern on the affected assets(bank stocks) VALUATION from an investing perspective. ...and on that note, there are no major concerns.
The KEY is to weigh in on the yields after raking off inherent risk from feasible REWARD and see what level of impact it captures.
People will always overreact. There is absolutely no need to fret.

If I can erk out the time, I shall do an article with an in-depth analysis on this CRR matter.

Salah

Calebbold:


Which kind of impressive result? The result is just neutral to say the least...

2018 EPS is 2.90 while 2019 EPS is 2.55..

aremso:


if jim give me 20 to 35％ cap appreciation zoom i bail out i may not wait for div, i will go and wait for Jim when he will humbly pass my area then i will show him shege

thebargainhunte:


CRR is to curb inflation from rising. You know from next month we are going to have increase in VAT.
If they reduce their dividend declarations, people will bash bank stocks.

Willie2015:


U got it right....
Thats the opportunity some of us are waitin for...
From this Jan endin to the next 3 weeks is critical ....
Both 4 dividend & cap appreciation....
B/4 result start rollin in ....
Picked up some Nestle well below N=1300 today....
Waiting for GTB & Zenith below N=30 & N=20

bigjay01:



Pastor na waa for you ooo
Who are the majority shareholders in CAP Plc?

emmanuelewumi:



UACN owns 64% of CAPL shares

currentprice:
there is nothing to worry about in d mkt, dont panic to let go ur fundamental sound stock yet.

monthly chart will still close engulfing and next month will be higher.

veecovee:


... loco

Calebbold:


Which kind of impressive result? The result is just neutral to say the least...

2018 EPS is 2.90 while 2019 EPS is 2.55..

locodemy:


Why Loco?

Just take away 2.15kobo from wapco,I will be back

Mcy56:

Maybe it was my interpretation of it. Apologies if you don't mean it that way sir.
.......but the point I was trying to make in a nut shell is to get the next direction of market based on FA/TA/GA or even SA instead of dwelling on the past.

emmanuelewumi:



That was what we told him at the other place. He should leave those in market alone, some of us love torn shirts.

seemples:


Oga mi, all these I told you so, I nor tell you so since when is unbecoming of you oo ... like e never tire you? Or you're up to sth else

currentprice:
EKuu Vitafoam and WApco new 52 weeks high o

Mcy56:
Access was sold down to 9.60.
A bid of 4M and 500k at N10 were on ground now.
This access is gradually turning to jijo stock.
It's well.

PuristForest:


Access making a momentary pull back to w4, should hit 13.2 - 13.8 at Q3. Not so bothered

Chibuking81:
Brent crude has bounce back, currently on 59.56 dollar. https://oilprice.com , it is a good news to stock market, especially this time because earning season do not need distraction.

locodemy:


Must It be Wapco?
I am only looking for a favourable opportunity.

PETERiCHY:


ONIFA the grave digger after seeing this news

fxuser:
Pull backs
- look for support
- note price rejections of day low (like hammers)
- shallow pb show strong defense (tweezer bottoms)
- patience
- month end profit taking expected
-

PETERiCHY:


ONIFA the grave digger after seeing this news

PETERiCHY:


ONIFA the grave digger after seeing this news

PETERiCHY:


Better quickly repurchase your WAPCO coz after release of their 2019 FY results it will trade around N26 that's 50% profit from the current.

TREASURY BILL & BARGAIN HUNTER TAKE NOTE!

emmanuelewumi:



Who is this Onifa guy?

Coolcash1:


PETERU, YOU LIKE TO LOOK FOR FIGHT.....

YOU AND THIS YOUR FUNNY MEMES....

veecovee:

What has cap got to do with uacn?

Coolcash1:


PETERU, YOU LIKE TO LOOK FOR FIGHT.....

YOU AND THIS YOUR FUNNY MEMES....