Financial sector contributes N4.2 trillion to NGX’s five-year turnover

•Pays N466 billion dividend last year

The financial sector has solidified its position as a leading force in the Nigerian Exchange Limited (NGX), contributing N4.2 trillion or 51 per cent of the N8 trillion stocks traded on the Nigerian Exchange Limited in the past five years.

Data from the NGX have shown that the exchange-traded N8 trillion stocks between 2019 and 2024.

Out of the N8 trillion, trading in financial sector shares made up 51 per cent of the figure, amounting to N4.2 trillion within the period.

Also, the sector paid an impressive N466 billion in dividends to shareholders in 2023, underscoring its critical role in wealth distribution.

In 2023, investors in six banks received approximately N366.93 billion in final dividends, reflecting the sector’s solid performance.

The financial sector also saw a notable increase in foreign capital inflows, which rose from four per cent in mid-2023 to an average of 16 per cent by November 2024. The surge in foreign investment highlights growing investors’ confidence in the sector’s profitability.

The sector’s strong performance was supported by improved asset quality, with the non-performing loan (NPL) ratio staying below the regulatory threshold of five per cent in the face of challenges such as currency depreciation and high inflation.

As a result, the financial sector continues to play a key role in the Nigerian Exchange Limited’s (NGX) overall growth.

In 2024, the NGX all-share index (ASI) experienced a remarkable 37.65 per cent increase, closing at a record 102,926.40 points, further underscoring the financial sector’s contribution to the market’s robust growth.

With the sector’s contribution to the economy, the exchange has urged the government to implement policies that encourage more companies to list, fostering greater citizens’ participation in wealth creation.

According to the Chief Executive Officer of the NGX, Jude Chiemeka, encouraging more companies to list on the exchange would provide citizens with the opportunity to participate in the wealth creation process.

Chiemeka emphasized that it would also have a positive impact on government revenue.
“Listed firms are often recognised for their tax compliance, and their presence on the exchange would thus contribute to boosting the government’s tax base.

“This aligns with NGX’s ongoing advocacy for policies that facilitate company listings on the exchange, aiming to foster broader economic benefits and a thriving capital market.

“It is important for the government to encourage more companies, we need more policies that will encourage companies to list to get more taxes and boost their revenue,” he said.

The exchange, he said, in collaboration with the Securities and Exchange Commission (SEC), has worked to simplify the listing process, aiming to attract more issuers to list their companies and securities.

NGX has actively sought to attract technology companies, including unicorns, to list on the exchange to revitalise the market and provide investment opportunities.

The initiatives reflect NGX’s commitment to fostering a vibrant capital market that supports economic growth and enables citizens to participate in wealth creation, it stated.