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Efficient operation of capital market key to national development — Gbajabiamila



Capital markets have been described as avenues for increase in values of assets and wealth creation whose proper and efficient operation is essential to sustainable national economic growth.

This was stated by Speaker of the House of Representatives, Hon. Femi Gbajabiamila during a public hearing call/submission of memoranda on the Investments and Securities Bill and the Chartered Institute of Stockbrokers Bill in Abuja Tuesday.

Represented by Hon. Peter Akpatason, Hon. Gbajabiamila stated that capital markets provide funding for new and existing businesses to innovate, expand, adapt to market changes and strides and also allows small and large scale investors to contribute to growth of enterprises and by so doing create wealth and economic development.

According to him, “Both bills for consideration today are in keeping with our commitment to the legislative agenda of the 9th House of Representatives to pursue far reaching reforms of critical institutions in our country. Our ultimate goal is to ensure that these institutions are properly grounded to perform their functions, execute their mandate and serve the best interest of the Nigerian people.

“The need to ensure that the operations of the capital market and the entire industry sector are sufficiently fair and transparent to ensure investor confidence is particularly of concern. It is often said that capital is cowardly and will run at the slightest risk. In this new global economy, when investors have the option to quickly move money across industries, nations and countries, we cannot allow deficiencies in the system that cause investors to worry about the safety of their investments.

”I am delighted that many industry stakeholders have convened in this public hearing today to participate in this public hearing and I urge you to take full advantage of this public hearing to make well thought out contributions so that final legislation that emerges from this process can adequately reflect the talents and expertise of the men and women who operate and regulate the capital market in Nigeria.”

In his remarks, Chairman of the House Committee on Capital Markets and Institutions, Hon. BabangidaIbrahim said the ISA Bill seeks to repeal the existing Investments and Securities Act 2007 and to establish a new market infrastructure and wide ranging system of regulation of investments and securities businesses in Nigeria especially in the areas of derivatives, systematic risk management, financial market infrastructure and Ponzi scheme and platforms.

Other areas the bill seeks to address are alternative trading systems, inclusion of National Pensions Commission as part of the board of the Securities and Exchange Commission, deletion of the provisions on merger control in the current Act and amendment of the criteria of borrowing by sub nationals and strengthening and enforcement powers of the Securities and Exchange Commission in line with the requirement of the International Organisation of Securities Commissions, IOSCO.

He said the Bill is also to determine the type of trainings required of an operator to perform professional functions in the capital market and also provide certification for persons deemed to have met the qualifications standards.

“The Act will achieve transformation of the market, from manual to automation, from manual to multiple securities exchanges, influx of foreign professionals into the country and also need to harmonise standards. The bill will also achieve expansion of products range in the market, equities, bonds, sukuk, derivatives and an advent of electronic share issuance.

“Occasions such as this gives us an opportunity to brainstorm, work together and proffer solutions on challenges within the capital market. The Securities and Exchange Commission as regulators of the capital market are saddled with responsibilities of ensuring a well regulated capital market, one that is dynamic, fair, transparent and efficient for the nation’s economic development” he stated.

Hon. Ibrahim stated that the House of Representatives and indeed the Committee on capital market are committed to ensuring that the SEC delivers on its core mandate of due registration of the players in the capital market, market integrity avoid systemic risk, guarantee inspection, investigation of breaches, due surveillance, market development and law enforcement and rules making.

“This Committee is indeed proud of these bills as they seek to ensure a more robust, vibrant, prosperous and more developed capital market and also to ensure that the capital market is well institutionalised and accountable.

“We hope the resources of Nigerians in the capital market will remain safe, accountable and prosperous. The capital market is a veritable tool for wealth creation and we will ensure this is true for Nigerians. If there was any time we need to rally for the economic good of Nigeria it is now and this is the time.”

Also speaking, Director General of SEC, Mr. Lamido Yuguda stated that having operated the current enabling Act since July 2007, the Commission has observed areas requiring review in order to strengthen existing provisions, remove ambiguities, introduce new provisions that would enhance the international competitiveness of the Nigerian capital market and reposition the market to catalyze National economic transformation.

Yuguda said, “Given the market’s evolution since the passage of the ISA 2007, it was the consensus of the major stakeholders in the capital market community that a complete overhaul of the ISA through a new Bill is necessary in order to achieve the objective of consolidating the efficiency, transparency and viability of the market.

“It is also noteworthy that the Nigerian Capital Market Masterplan (2015-2025), which was launched by the Commission in 2014, strongly recommends the holistic strengthening of the Legal and Regulatory Framework underpinning capital market operations.

“The Commission is delighted to state that the Investments and Securities Bill 2022 enjoys the overwhelming support of stakeholders in the Nigerian capital market. There is a collective resolve in the capital market community to work together towards the enactment of this Bill during the life of the 9th National Assembly.”

The SEC DG listed some of the highlights of the major innovations and changes in the Investments and Securities Bill 2022 to include: Establishment, objectives, functions and powers of the SEC; Inclusion of the National Pensions Commission on the board of the SEC and its membership; Registration/regulation of exchanges and financial market infrastructures; Management of Systemic Risk; and Public Offers, Sale of Securities and Invitations to the Public.

Other major highlights according to Yuguda are: Mergers, Take-Overs and Corporate Restructurings; Collective Investment Schemes; Investor Protection Fund (IPF); Commodity Exchange and Warehouse Receipts; Issuance of Securities by Federal, State, and Local Governments and their Agencies and Establishment, Jurisdiction, Authority and Procedure of the Investments and Securities Tribunal.

Yuguda asserted that it is a well-known fact that efficient capital markets are indispensable to the functioning of a modern economy stating that noeconomy can achieve any meaningful advancement without the important role capital markets play in supplying medium to long term finance.

“There is no doubt that Nigeria needs and in fact deserves an internationally competitive and well-functioning capital market to facilitate the on-going economic diversification. The passage and enactment of the Investments and Securities Bill 2022 will be a pivotal step in this direction. The Commission therefore enjoins and appeals for the buy-in of key stakeholders to make this aspiration a reality” he added.

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capital market

Stock market recovery short-lived as investors lose N199bn



Investors in the Nigerian equities market lost N199 billion at the close of trading on Tuesday.

Before Monday’s N70 billion gain, investors had endured over two weeks of consecutive bearish trading sessions.

Yesterday’s loss followed the dip in the value of stocks like Honey Well Flour, FBNH, Oando and FTN Cocoa Processors, amongst others on the trading floor today.

After five hours of trading at the capital market, the equity capitalisation decreased to N56.1 trillion from N56.3 trillion posted by the bourse on Monday.

Similarly, the All-Share Index (ASI) decreased to 99,311.54 from 99,665.05 achieved by the bourse the previous day.

The market breadth was negative as 16 stocks advanced, 24 declined, while 75 others remained unchanged in 7,324 deals.

Sunu Assurances Nigeria led other gainers with 10 percent growth in share price to close at N1.10 from its previous N1.00 per share.

Japaul Gold and Ventures, CAP, and Omatek Ventures also raised their share prices by 9.58 percent, 9.38 percent, and 9.21 percent respectively.

On the flip side, Honeywell Flour Mills led other price decliners as it shed 9.89 percent off its share price to close at N3.19 from its previous N3.54 per share.

First Bank of Nigeria Holdings (FBNH), Oando, and FTN Cocoa Processors equally shed their share prices by 9.88 percent, 9.82 percent, and 9.40 percent respectively.

On the volume index, Transcorp traded 125.700 million shares valued at N1.8 billion in 467 deals followed by United Bank for Africa (UBA) which traded 55.486 million shares worth N1.27 billion in 685 deals.

Access Holdings traded 51.473 million shares valued at N883.2 million in 958 deals.

On the value index, Transcorp also recorded the highest value for the day trading stocks worth N1.89 billion followed by UBA which traded equities worth N1.27 billion in 685 deals.

Access Corp traded stocks worth N833 million in 958 deals.

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MRS Oil Nigeria seeks shareholders’ approval to delist from NGX



The Board of MRS Oil Nigeria Plc will, at the company’s Extraordinary General Meeting (EGM), request shareholders’ endorsement to voluntarily delist from the Nigerian Exchange Limited (NGX).

The decision to exit from the NGX was contained in the notice of an Extraordinary General Meeting to be held in Lagos on May 21, 2024.

The company will also seek shareholders’ approval for its Memorandum and Articles of Association (MemArts) to be modified to allow for a share buyback and share capital reduction.

This will be carried out in accordance with applicable laws and regulations at the discretion of the board.

It will also seek an understanding that following the conclusion of voluntary delisting and while the company remains public, the board is empowered to facilitate the admission of its shares on the NASD OTC Securities Exchange.

This action ensures compliance with the Securities and Exchange Commission (SEC)’s rules on trading in unlisted securities.

According to the statement signed by O.M Jafojo, Company Secretary, as part of special business, the company will request the shareholders to consider, and if thought fit, pass, with or without modification, the following sub-joined resolutions as special resolutions:

“That the voluntary delisting of all the Company’s issued shares from the daily official list of Nigerian Exchange Limited (the ‘Voluntary Delisting’) be and is hereby approved, on such terms and conditions (including but not limited to timing of implementation, arrangements for dissenting shareholders (if any) and the fulfilment of specific conditions precedent to effectiveness (if any)), that the Board of Directors of the Company (the ‘Board’) deems appropriate in connection with the Voluntary Delisting; and subject to obtaining all requisite regulatory approvals.

“That the Memorandum and Articles of Association (‘MemArts’) of the Company be and are hereby amended to authorize the Company to undertake a share buyback and share capital reduction.

“That the Company be and is hereby authorised to undertake a share buyback and share capital reduction in connection with any of its issued shares which may be purchased from dissenting shareholders where necessary as a consequence of the Voluntary Delisting; on such terms and conditions, in such volumes and at such times as the Board deems fit; subject to, and in accordance with, applicable laws and regulations.

“That the MemArts of the Company be amended upon completion of the share buyback and share capital reduction, to reflect the Company’s updated share capital.

“That upon conclusion of the Voluntary Delisting, and whilst the Company remains a public limited liability company, the Board be and is hereby authorised to take all such action as may be required, to admit the Company’s shares on the NASD OTC Securities Exchange in order to ensure that dealings in the Company’s shares are implemented in accordance with the Securities and Exchange Commission’s Rules on Trading in Unlisted Securities.”

The company will also seek approval to authorise the board to take all such lawful actions and steps (including but not limited to entering into/executing such agreements and documents, appointing professional advisers and other parties, complying with directives of any regulatory authority) deemed necessary to give full effect to the above-referenced resolutions.

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Bearish trend halted as investors gain N70.87bn



Investors in the Nigerian equities heaved a sigh of relief as the losing streak on the bourse was halted on Monday, April 22, 2024 as investors recorded a profit of N70bn at the end of trading.

This followed the boom in the share value of stocks like Japaul Gold, GTCO, FTN Cocoa, Universal Insurance Company and RT Briscoe amongst others on the trading floor today.

After five hours of trading at the capital market, the equity capitalization increased to N56.367 trillion from N56.296 trillion posted by the bourse on Friday, last week.

Similarly, the All-Share Index (ASI) grew to 99,665.05 from 99,539.75 achieved by the bourse the previous day.

The market breadth was negative 16 stocks advanced, 18 stocks declined, while 85 stocks remained unchanged in 8, 298 deals.

Japaul Gold and Ventures Plc led other gainers with 9.58 percent growth to close at N1.83 from its previous price of N1.67, Guaranty Trust Holding Company (GTCO), FTN Cocoa Processors, and Universal Insurance Plc are amongst other gainers that also grew their share prices by 9.55 percent, 8.76 percent, and 8.57 percent respectively.

On the flip side, The Initiate Plc led other price decliners as it shed 10% off its share price to close at N1.80 from its previous close of N2.00. Prestige Assurance, Omatek Ventures, and VitaFoam Nigeria Plc are amongst other losers that also shed their share prices by 9.84 percent, 9.52 percent, and 9.26 percent respectively.

On the volume index, Guaranty Trust Holding Company (GTCO) Plc traded 50.158 million units of its shares in 630 deals, valued at N1.1774 billion followed by Access Holdings Plc which traded 48.067 million units of its shares in 951 deals, valued at N815.925 million and United Bank for Africa (UBA) Plc which traded 41.746 million units of its shares in 776 deals, valued at N956.455 million.

On the value index, GTCO recorded the highest value for the day trading stocks worth N1.773bn in 630 deals followed by UBA which traded equities worth N956bn in 776 deals and ACCESSCORP which traded equities worth N815m in 951 deals.

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