The Investors, Issuers & Intermediaries Engagement/Education Sub-Committee (the “Sub-Committee”) of the Debt Capital Markets Development Project (“DCMD Project”), vested with the mandate to create awareness in the Nigerian debt capital markets, facilitate issuers & investors readiness and champion corporate governance, among others laudable mandates, organised a webinar session themed: – “Short-term Financing Option in the Nigerian Debt Markets: Commercial Papers” (the “Session”) which held on Wednesday, November 18, 2020.
The Session which was hosted by FMDQ Securities Exchange Limited focused on demystifying a viable short-term financing product – Commercial Papers – available for corporates to meet their working capital requirements as well as other short-term financing needs, elucidating on the value propositions, structure, procedures, documentation requirements, and key stakeholders in the market, whilst affording participants the opportunity to acquire insights and make further enquiries from seasoned and well experienced subject matter experts across the financial markets ecosystem.
The Session featured the delivery of a welcome address by Ms. Tumi Sekoni, Managing Director, FMDQ Securities Exchange Limited, a presentation by Mr. Kobby Bentsi-Enchill, Executive Director & Head, Debt Capital Markets (West Africa), Stanbic IBTC Capital Limited, a plenary session and a closing remarks by Mr. Tayo Onadele, Managing Director, Financial Datanet House Limited. The DCMD Project webinar session was moderated by Mr. Tosin Osunkoya, Co-Managing Partner, Comercio Partners Limited.
The Session commenced with a brief address by Ms. Tumi Sekoni welcoming all participants and providing an overview of the DCMD Project, the mandate of the Sub-Committee and objective of the Session, to sensitise corporate issuers and other key stakeholders within the various sectors of the economy on the need to explore short-term financing options in the Nigerian debt markets, through the Commercial Papers market which would be of great benefit to issuers, investors and the economy at large. Ms. Sekoni disclosed that the Commercial Papers market has grown tremendously since the restructuring of the market in 2014 to a market with circa N3.00trn registered Programmes and about N2.00trn worth of Commercial Paper issuances and quotations. She also highlighted that the current low interest rate environment creates an opportunity for corporates to raise debt finance through the market whilst profiting from the benefits of the market which includes quicker time-to-market, opportunities to build a sound credit history and create investor confidence leading to favorable pricing on subsequent issuances, thus, ensuring capital optimisation, improved cost of capital, brand reputation and global visibility for issuers.
In his presentation on Short-term Financing Option in the Nigerian Debt Market – Commercial Papers, Mr. Kobby Bentsi-Enchill, gave a detailed overview of the Nigerian Commercial Papers market, regulations and governance, documentation requirements, benefits of establishing Commercial Paper Programmes, various transaction parties, and case studies in the market, amongst others.
Mr. Osunkoya moderated the plenary session which geared towards insightful talking points, including but not limited to, the roles of intermediaries in the commercial papers market, strategic initiatives to increase participation in the market (capital markets operators’ roles), how to drive liquidity in the markets, etc. The panel session also gave existing issuers in the market the opportunity to recount their experience in the issuance and quotation of Commercial Papers – time-to-market, documentation requirements, cost, and benefits to their organisations. The panelists included:
- Kobby Bentsi-Enchill, Executive Director & Head, Debt Capital Markets (West Africa), Stanbic IBTC Capital Limited
- Ayotunde Owoigbe, Partner, Banwo & Ighodalo
- Jumoke Olaniyan, Vice President, FMDQ Securities Exchange Limited
- Ishmael Nwokocha, General Manager, Corporate Treasury, MTN Nigeria Communications PLC
- Sola Ismail, Head, Revenue Management, Nigerian Breweries PLC
- Narayan Agarwal, Chief Financial Officer, Dufil Prima Foods PLC
After a very informative and educative deliberation, Mr. Tayo Onadele ended the session with a closing remarks, thanking all participants for attending the Session, even after its initial postponement due to unexpected events and circumstances. Mr. Onadele also thanked the DCMD Project Office for facilitating and organising the Session.
The Session was attended by about two hundred (200) participants cutting across various sectors in the economy – Fast Moving Consumer Goods (FMCG), oil & gas, information technology, manufacturing, financial services, etc. and was streamed live on the FMDQ Group YouTube Channel.
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