Stories by Amaka Ifeakandu
Lagos
FBNHoldings Plc has said that its subsidiary, Kakawa Discount House Limited, would kick off Merchant Banking operation before the end of this year.
Managing Director of FBNHolding designated, Mr Urum Kalu. Eke who disclosed this over the weekend at the Nigerian Stock Exchange (NSE)’s bell ringing ceremony said the company has concluded its merchant banking licence and it will start operation by the end of the year.
Kakawa Discount House applied for the licence in December 2014 but was granted final approval by the Central Bank of Nigeria (CBN) on May 19, 2015. The Chief Executive Officer of the Company, Mr Bello Maccido had at the annual general meeting said that the Merchant banking licence would allow the company to use additional windows to sell investment banking products.
“To have a merchant banking licence will be beneficial to the shareholders in the medium to long-term,” adding that the licence would also leverage the company’s capacity to pay enhanced dividend to shareholders in the nearest future.
Maccido said that the company in 2014 increased its holding in the Kakawa Discount House to 100 per cent from 46 per cent.
He pointed out that there are currently two licenced merchant banks in the country, namely FSDH Merchant Bank Ltd and Rand Merchant Bank.
On the performance of the capital market, Eke said that globally market indexes are low and investors’ confidence is also going down. He said that though some local investors in Nigeria have lost interest in the market but there are indications that investors confidence in the market would return in future for the benefit of the entire country, insisting that the nation’s economy is still very resilience and banking industry is very sound. Speaking further he said “at FBN Holdings we are optimistic that the market will return back.
This is the best time to invest in stocks. I am positive that with all the reforms across the sectors the stock market will pick up again”. He also expressed optimism that investors would in future buy shares of FBNHoldings, adding that any stock that has sound fundamentals should not trade at the level FBNHolding is trading today. He noted that by the time reforms in the various sectors added to the growth of the economy the market would start growing again.
