By Philemon Adedeji
The provisions of the Investments and Securities Bill recently passed by the House of Representatives is expected to inspire confidence of both local and foreign investors as they can be assured that the regulators have been sufficiently empowered to deal with malpractices that undermine confidence in the market.
This was stated by the Chairman House of Representatives Committee on Capital Markets and Institutions Hon. Babangida Ibrahim during an interview in Abuja.
Ibrahim stated that foreign investors and market participants will also be attracted to the Nigerian market because they will have comfort in the fact that the Bill seeks to mirror standard investor-protective provisions and practices in advanced jurisdictions, which the foreign participants are already familiar with.
On the reason for the new Bill, the Lawmaker stated that the current enabling law for the Nigerian capital market, the Investments and Securities Act, No. 29 of 2007 (“ISA”) was signed into law by late President Umar Musa Yar’adua in June 2007 (15 and half years ago) before the global financial crisis of 2008/2009.
Global financial regulators he said, have made major changes in their regulatory instruments following the crisis to address some of the obvious gaps that contributed to the global economic disruption of the time, adding that such global shifts and other current trends in capital markets regulation have made it imperative to make major improvements to the Act to align our market with international standards.
According to Ibrahim, the Bill seeks to repeal the ISA and introduced new provisions that empowers the SEC to collaborate with other regulatory bodies in the financial sector to manage and mitigate systemic risks as it confers new investigative and enforcement powers on the apex regulator, SEC, to effectively regulate the Nigerian capital market. It introduces the framework for regulation of new products including financial and commodities derivatives and financial market infrastructures, which are expected to lead to increased activities, and thus, deepen the Nigerian capital market.
“The Bill introduces stiffer sanctions in the form of increased fines and jail terms, which are commensurate with the severity of offences, and also serve as deterrence to potential future offenders. For instance, a jail term of not less than 10 years has been provided to address the menace of Ponzi schemes and illegal investment schemes that have caused heartache for thousands of Nigerians who have been victims of such scams. Other offences such as market manipulation, insider trading, false statements in prospectuses etc. are also subject to severe punishment.
“The Bill will ensure the diversification of the Nigerian economy away from a mono product oil economy through the strengthening of the Nigerian commodities ecosystem with the trading of warehouse receipts and commodities contracts on the Commodities Exchanges.
“The Bill also contains legal framework for registration and regulation of new types of critical market infrastructures such as central counterparties, which will be responsible for managing the risks emanating from transactions in derivatives and other financial instruments, thereby ensuring the safety and integrity of our markets and boosting investors’ confidence,” he stated.
The Lawmaker disclosed that Federal Government agencies, Subnational, Supranational will be able to better access the capital market for both revenue bonds and project tied bonds as the Bill now contains adequate provisions that enable both corporates and governments to issue new instruments to develop the infrastructural requirements of the country.
According to him, “The bill will generally revitalise the Nigerian capital market, as it introduces regulation of new businesses, products and services that will deepen the market while equipping the apex regulator with appropriate powers to protect the market and enforce the provisions of the Bill.
“In every sense of the word, this bill is truly a market inspired Bill. Inputs were received from all segments of the Nigerian capital market – the Securities Exchanges, Commodities Exchanges, the Central Counterparties, Capital Market Operators and Trade Associations, Chartered Institute of Stockbrokers, Capital Market Professionals such as the Legal Practitioners as well as Shareholders Associations.”
Ecobank declares N182.92bn PAT in Q3 2023
Ecobank Transnational Incorporated, has recorded a profit of N182.92 billion in its third quarter 2023 results.
According to the results posted on the Nigerian Exchange Limited (NGX) website, the Bank announced a 59 percent gross earnings growth in Q3 2023 Results.
The Gross earnings also grew by 59 percent from N761.30 billion to N1.211 trillion.
According to the results, profit before tax stood at N262.17 billion.
Meanwhile in its second quarter results Pre-tax profit increased to N92.52 billion from N56.89 billion profit in Q2 2022.
The increase in second-quarter profits helped its half-year profit before tax to rise by 38 percent to N150.31 billion compared to N108.96 billion in the same period last year.
Market capitalisation gains N44.16bn as NGX ASI advances by 0.11%
Since the recent announcement of recapitalisation by the Central Bank of Nigeria Governor, the market had continued to see a rise in investment moves amongst banks thereby boosting the market capitalisation of the NGX.
As at yesterday’s trading, the NGX Market CAP recorded a gain of N44.16billion in Naira terms while the NGX All-Share Index (ASI) advanced by 0.11 percent.
Compared to the previous day’s gain of 0.34 percent, which closed at 71,284.56 basis points, the NGXASI now stands at 39.25 percent.
The total volume of stocks traded also advanced by 49.77 percent to close at N540.09 million, valued at N10.24 billion and traded in 6,516 deals. GTCO was the most traded stock by volume and value, with N67.23 million and N2.60 billion units traded.
At the close of trading, the market recorded 25 gainers, 31 losers, and 55 unchanged. NNFM topped the gainers list, while NSLTECH topped the list of losers.
Naira hits N831.47/$1 in official market
The Nigerian naira appreciated against the dollar on Wednesday, 29th November 2023, closing at N831.47/$1 at the official market.
The positive trajectory aligns with expectations among experts, who anticipated that the Central Bank of Nigeria’s (CBN) recent initiative to clear a portion of its FX backlog would boost confidence in the currency.
The domestic currency appreciated 6.06 percent to close at N831.47 to a dollar at the close of business on Wednesday, data from the NAFEM where forex is officially traded, showed.
This represents an N50.41 gain or a 6.06 percent increase in the local currency compared to the N841.14 it closed on Tuesday.
The intraday high recorded was N1159/$1, while the intraday low was N700/$1, representing a wide spread of N459/$1.
According to data obtained from the official NAFEM window, forex turnover at the close of the trading was $140.35 million, representing a 18.88 percent growth compared to the previous day.
However, the naira weakened at the parallel forex market where forex is sold unofficially, the exchange rate depreciated by 0.26 percent, quoted at N1160/$1, while peer-to-peer traders quoted around N1159.47/$1.
The Central Bank of Nigeria (CBN) has said it has made tranche payments to 31 banks to clear the backlog of foreign exchange forward obligations.
The apex bank also disclosed that it has set up foreign exchange frameworks to address the FX issues.
Governor of the CBN, Yemi Cardoso, disclosed this on Friday at the bankers’ dinner in Lagos.
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