Financial market products & services update

*Financial markets.

*Financial markets.

28 April 2016, Sweetcrude, Houston — Local and international financial market products and services update.
NIGERIA: The Central Bank of Nigeria’s (CBN) Consolidated and Separate Financial Statements for the year ended 2015 released on Wednesday showed that its net income for the year was N108.530 billion while its Group net income was N123.074 billion.
The results stated that in line with the provision of the Fiscal Responsibility Act, 20% (N21.706 billion) of the net income of the bank will be credited to its retained earnings while the balance being 80% (N86.824 billion) will be paid to the federal government.
The results revealed that the Group Operating Income increased by N287.65 billion or 64.6% to N732.51 billion from N444.86 billion in 2014. Also, the Group Operating Expenses rose by N185.72 billion or 42.8% to N618.86 billion from N433.14 billion.

FIXED INCOME: The selling in both T-bills and bonds resumed Yesterday because of an OMO auction by CBN. FAAC inflows hit the system increasing money market liquidity to N365bn. OMO rate has now adjusted higher again mirroring the recent re-pricing seen in the secondary market. Because only a small size (N56bn of 225day bill at 10.09% yield) was mopped up we did see some buy an interest in both T-bills and bonds to close the day. Irrespective, we expect today to still have a bearish bias.

FX: The CBN will intervene at the FX Market today and the intervention rate maintained at $/NGN 197.00.

JAPAN: The Bank of Japan held off on expanding monetary stimulus, as Governor Haruhiko Kuroda and his colleagues opted to take more time to assess the impact of negative interest rates.
The move comes as a surprise to the slight majority of economists surveyed by Bloomberg who had projected some action from the central bank in response to a strengthening in the yen that has cast a shadow over prospects for higher wages and investment. The currency rallied against the dollar immediately after the decision while stocks in Tokyo tumbled.

CHINA : China is considering starting trading of credit-default swaps as the number of corporate nonpayments surges, according to people familiar with the matter.
The National Association of Financial Market Institutional Investors, a central bank subsidiary which oversees interbank market bonds, last month sought opinions on CDS and credit-linked notes from market participants including banks and brokerages, according to the people, who asked not to be identified because the details haven’t been announced. China Foreign Exchange Trade System, which oversees interbank bond trading, held a meeting in Shanghai last week with some financial institutions on the products, they said.

COMMODITIES: Oil traded near the highest close in more than five months after U.S. government data showed crude output declined.
Futures slid as much as 0.9% in New York after rising 6.3% the previous two sessions to close above $45 a barrel. Production slipped for a seventh week to the lowest since October 2014, according to a report from the Energy Information Administration. Russia may take part in the Organization of Petroleum Exporting Countries’ scheduled June meeting to discuss a proposed freeze to output, according to an Interfax report.

Macro Economic Indicators
Inflation rate (Y-o-Y) for March 2016           12.80%
Monetary Policy Rate current                         12.00%
FX Reserves (Bn $) as at April 26, 2016,      27.175

Money Market Highlights
NIBOR (%)

O/N                             3.8300
30 Day                        8.0484
90 Day                        10.9076
180 Day                      12.4544
LIBOR (%)
USD 1 Month            0.4377
USD 2 Months          0.5225
USD 3 Months          0.6343
USD 6 Months          0.9119
USD 12 Months        1.06675

Benchmark Yields
Tenor     Maturity     Yield (%)

91d           28-July-16      7.95
182d        27-Oct-16        9.10
364d        20-Apr-17       11.25
2y             31-Aug-17       11.51
3y             30-May-18     11.79
5y             13-Feb-20       12.76

Indicative Currency Exchange Rates
Bid         Offer

USDNGN        197.50        199.50
EURUSD         1.1248        1.1450
GBPUSD         1.4503        1.4703
USDJPY          108.05        108.08
USDCHF         0.96205     0.9722
GBPEUR         1.2761         1.2966
USDZAR         14.3162       14.5195
JPYNGN         184.1097     184.2103
CHFNGN        203.44        205.13
EURNGN        224.51         225.88
GBPNGN        285.77         287.17

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