By Peter Egwuatu
Three months after the take off of the securities lending scheme on the Nigerian Exchange Limited, NGX, results have shown mixed fortunes for the shares of the blue chip companies that headlined the scheme.
The blue chip companies in the securities lending market included GTCO Plc (Guaranty Trust Bank holding company), Zenith Bank Plc, MTN Communications Plc, Dangote Sugar Refinery and United Bank for Africa, UBA.
Data obtained from the Exchange shows that a total of 31.095 million ordinary shares of GTCO at a price of N27.10 per share valued at N885 million were available for lending in August, but the price had dropped to N24.95 per share as at the end of trading on Monday November 29.
Similarly, a total of 43 million shares of Dangote Sugar at N17.20 per share worth N774 million were pledged to the scheme for borrowing in August but as at Monday the price had dropped to N16.45 per share.
However, for a total of 77.33 million ordinary shares of Zenith Bank worth N1.875 billion pledged at N22.95 per share in August but by end of trading on Monday the price had risen to N24.20 per share.
For MTN, a total of 11.196 million ordinary shares at N175.00 per share worth N1.84 billion were made available in August but the price had risen to N190.00 per share as at November 29.
Also UBA has 45 million shares at N7.65 per share worth N340 million in the market in August but it price has moved to N8.00 per share as at Monday, 29th November 2021.
But in overall, the investors who borrowed securities (shares) in five blue chip companies listed on the NGX have gained 1.9 per cent return on investment in the first three months of the scheme.
A review of the securities lending status of the Exchange showed that the market opened with a total of 207.6 2 million ordinary shares of blue chip companies valued at N5.76 billion in August 2021 and rose to N5.84 billion at the end of trading on Monday 29, November 2021, indicating that the borrowers have gained over N8 million in the three months.
The securities lending and borrowing of shares and bonds by investors are done for a period of time under an agreed arrangement.