Nigerian Banks’ Stocks Drop to 4-year low as Investors Lose N684bn in 10 Hours

Nigerian Banks’ Stocks Drop to 4-year low as Investors Lose N684bn in 10 Hours

The stocks of Nigerian banks took a record four-year tumble at the close of business at the stock exchange on Wednesday, Leadership is reporting.

The Nigerian Stock Exchange Banking 10 Index fell 7.6 per cent as of 1:31 p.m. in Lagos, the biggest retreat since November 2012 on a closing basis, extending a 6.6 per cent slump.

Guaranty Trust Bank Plc, the country’s biggest lender by market value, declined 9.6 per cent, while Zenith Bank Plc dropped 8.9 per cent. United Bank for Africa Plc retreated 9.5 per cent.

According to the Nation newspaper, investors in the banking sector lost N684 billion within 10 hours on Wednesday.

The Average loss in the banking sector more than doubled the overall average loss in the entire market. Seven banks were among the top 10 losers, the newspaper reported.

Stanbic IBTC led the losers with 9.70 per cent. United Bank for Africa declined by 9.47 per cent. FCMB Group dropped by 9.36 per cent. Skye Bank depreciated by 8.40 per cent while Access Bank dropped by 6.88 per cent.

Central Bank of Nigeria Governor Godwin Emefiele said May 24 the bank would introduce a flexible exchange-rate regime to boost investments after a scarcity of dollars contributed to inflation reaching an almost six-year high of 13.7 per cent.

President Muhammadu Buhari, who has consistently kicked against the weakening of the currency since his inauguration appears to have shifted ground saying he will keep a close watch at the recent measure taken by the CBN.

“The market may have been shocked by the body language of the president from his weekend broadcast when he mentioned that he was encouraging the CBN to initiate a flexible foreign exchange market regime, but also said he was against devaluation,’’ Pabina Yinkere, an equity analyst at Vetiva Capital Management Ltd told Leadership.