… Jim Ovia Loses About $64m
Global and domestic concerns are mounting following reports that Nigerian businessman, Mr Jim Ovia has lost about to $64 million in paper net worth over the last 6 months as the stock price of Zenith Bank, the tier-one Nigerian commercial bank where he is the largest shareholder, shed 33% in value within that period. This report which was originally published by Forbes has fuelled apprehension in business circles with regards to the current standing of the bank in terms of its stock price.
According to Forbes, on the 8th of February this year, Zenith Bank was trading at a share price of N24.4 ($0.06). However at the close of trading on Thursday, its share price had dropped to N16.35 following consistent daily losses over the past few weeks. Ovia, who is the founder, chairman and largest shareholder of the bank with a 9.4% stake, has seen the value of his 2.94 billion shares drop from $200 million, to $136 million.
Peter Aderemi, a Lagos-based Investment Analyst said this development raises serious concerns because as he puts it Forbes is a highly rated global media outfit and given the fact that ” Mr Jim Ovia is the highest share holder in Zenith, for his share value to drop so drastically is of concern to stakeholders in the bank and the larger economy”. But another analyst believe that the bank has got to take pre-emptive steps to assure its customers that all is well, stressing that a strategic step that aligns with both the short term and long term priorities of Zenith bank has to be put in place to stem growing concerns among critical stakeholders and customers.
The detailed Forbes reports had maintained that the last few months have been a bit of a disaster for many companies listed on the Nigerian Stock Exchange. It said: “The stocks of several blue-chip stocks such as Zenith Bank, Dangote Cement, Transcorp and United Bank of Africa among several others have hit one-year-lows as foreign portfolio investors who dominate the equities market have been pulling out funds from the Nigerian capital markets while waiting for policy signals that could lift growth in the economy several weeks after President Muhammadu Buhari won re-election.
“Foreign investors are not exactly complicated. All they are looking for a broader catalyst like government policy or macro announcement that suggest growth for the economy is becoming better. Buhari’s government has been slow in providing a coherent economic policy that will give foreign investors some sort of comfort, so they are taking to the hills,” says Ademola Adeleke, an Abuja-based stockbroker.
“Jim Ovia, 65, is the founder of Zenith Bank, one of the largest and most profitable commercial banks in Nigeria. He is the chairman and largest individual shareholder. Apart from his shareholding in Zenith Bank, Ovia is one of Nigeria’s largest property owners. In 2015 he featured in FORBES’ ranking of Africa’s 50 Richest with a fortune that was estimated at $550 million at the time.”