Nigeria Content Online

JP
Morgan, a United States investment banking and securities firm, has
said it is still managing $500 million of Nigeria’s foreign reserves,
in collaboration with Zenith Bank.

Tosin
Adewuyi, the bank’s senior country officer in Nigeria, said the
collaboration, which has been on since 2006, is still ongoing.

“Zenith
Bank Nigeria joint venture is still very much on. Nothing has changed
since then,” Mr. Adewuyi said at the sidelines of a workshop between
the Nigerian Stock Exchange, the London Stock Exchange, Thomson
Reuters, and JP Morgan, held yesterday in Lagos.

“The Central Bank, in October 2006, gave 14 Nigerian banks, with their international asset manager partners, $500 million each, totaling $7 billion, out of the country’s foreign reserves, to manage on behalf of the country

The
14 global asset managers and their local counterparts were Black Rock
and Union Bank; J.P. Morgan Chase and Zenith; HSBC and First Bank; BNP
Paribas and Intercontinental Bank; UBS and UBA; Credit Suisse and IBTC
Chartered Bank; Morgan Stanley and GTB; Fortis and Bank PHB; Investec
and Fidelity; ABN Amro and Access Bank; Cominvest and Oceanic Bank; ING
and Ecobank; Bank of New York and Stanbic Bank; and Crown Agents and
Diamond Bank.

Mr. Adewuyi said despite the drop in Nigeria’s foreign reserves, the arrangement still subsists.

Deepening presence

He added that JP Morgan may consider deepening its presence in the country.

“We view Nigeria as a key market for us in Africa. In Africa, pretty much Nigeria comes into number two,” he said.

He, however, said the bank is not considering buying into any of the rescued banks.

“While
we are not purchasing a local bank, we do have relationship with some
of them and helping to build capacity. We don’t run a retail bank in
Nigeria, at least not now. Not to say, in the next two or three years,
we don’t see that as a viable model. But so far, we support banks,
corporations, and government behind the scene internationally,” Mr.
Adewuyi said.

Ibukun
Adebayo, head of primary markets, Middle East, and Africa of the London
Stock Exchange (LSE), said it was collaborating with the Nigerian Stock
Exchange to enhance its development. He said the Stock Exchange has
performed as expected, considering the fallout of the global financial
crisis.

“The
Nigerian Stock Exchange is doing exactly what the London Stock Exchange
is doing, which is keeping interest in the market. We (LSE) get a lot
more support from our regulators. In the UK, we operate under a more
flexible environment. We don’t have rigid rules,” Mr. Adebayo said.

He said LSE operates under codes which need not be rigidly adhered to, provided there is proven effort to comply.

“That
flexible approach to regulation means that we have actually works very
well and that has attracted a number of investments,” he said.

He
explained that unlike Nigeria, investors in the UK capital market have
a responsibility to the companies in which they invest.

“We
have the investors’ stewardship code, which effectively means that
there is covenant between investors. We don’t want you here today and
gone tomorrow. You have to shadow a certain amount of dedication to a
company over a period of time,” Mr. Adebayo said.

This arrangement, he said, helped to mitigate the repatriation of
funds from the UK market during the global financial crisis in 2008.