Trading on the equities sector of the Nigerian Stock Exchange (NSE), closed upbeat yesterday, occasioned by renewed bargain-hunting in some blue chip stocks
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Following Access Bank and Diamond Bank‘s merger in 2018, the latter had loans and advances of about N787.8 billion out of which N219.9 billion in loans were impaired.
Oil and gas-related loans made up a significant chunk of the loans and were estimated at about N302.6 billion, most of them distressed.
Of the total oil and gas loans, $66.4 million was owed by Japaul Oil and Maritime. The loans had gone bad and accumulated unpaid interest of about $11.2 million.
When Access Bank took over the loans, Japaul agreed to a restructured rollover of both the principal and interest.
The restructured rollover, just as many Nigerian companies with huge debts, involves negotiating the extension of the loans by one to three years and if lucky, reducing the interest rates. In return, the bank books new fees (which are often paid in advance of the restructuring) and then gets to avoid huge provisioning mandated by the central bank.
Japaul Oil changes to Japaul Gold - The Nation Newspaper thenationonlineng.net - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from thenationonlineng.net Daily Mail and Mail on Sunday newspapers.
The All-Share Index (ASI) gained 381.78 absolute points, representing a gain of 1.10 per cent to close at 35,225.22 points. Similarly, the overall market capitalisation value also appreciated by N200 billion to close at N18.411 trillion.
The uptrend was driven by price appreciation in medium and large capitalised stocks – Dangote Cement, Lafarge Africa, Zenith Bank, Guaranty Trust Bank and Guinness Nigeria.
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Market sentiment, as measured by breadth, was positive, as 29 stocks gained, relative to 14 losers. Lasaco Assurance recorded the highest price gain of 10 per cent to close at 33 kobo. AXA Mansard Insurance followed with a gain of 9.38 per cent to close at 70 kobo while FTN Cocoa Processors rose by 8.33 per cent to close at 52 kobo.
Specifically, the market capitalisation rose by N199 billion or 1.09 per cent to close at N18.410 trillion compared with N18.211 trillion achieved on Monday. Also, the All-Share Index gained 381.78 or 1.10 per cent to close at 35,225.22 from 34,843.44 on Monday. The uptrend was driven by price appreciation in medium and large capitalised stocks amongst which were Dangote Cement, Lafarge Africa, Zenith Bank, Guaranty Trust Bank and Guinness. Market breadth was positive with 29 stocks gainers in contrast with 14 losers. Lasaco Assurance dominated the gainers chart in percentage terms, improving by 10 per cent to close at 33k per share. AXA Mansard trained by 9.38 per cent to close at 70k, while FTN Cocoa rose by 8.33 per cent to close at 52k per share.