State of the Market

please i want to the problems of Nigerian capital market. thank you
Posted by: Gloria

Let both the CBN governor and the NSE know that as both regulators of Banks and the Capital Markets and the Financial Institutions they should carry along the all the Nigerian shareholders of these financial institutions.Let them consider those who invested all their hard -earned income in the capital market.The values of their shareholdings are drastically melted down now.They should not make people regret ever investing in the capital market.It is a long term thing ,yet it is capital formation that engenders economic growth,engine of development and find ways of moving the capital market forward. The financial instititions and the capital market should be stabilized,sanitazed and given all the encouragements to grow.Let them co-ordinate and stop heating up the market,putting fear and panic in the market and the banks.Please let the EFCC moderate their level of their involvements in all these critical areas.Let them intervene wherwe,when and if it becomes inevitable and unavoidable. Finally please let the private placements -the firms should be supported to list their shares - some of these companies have done private placements for one to two years now.Reduce the fees and let them list their shares by introduction.Take measures that will make both primary and secondary markets to be vibrant once again.
Posted by: Azijekwe Nathan.C

Great information and was a great read. However, with regard to margin loans, the brokerage firms and the banks were reckless or better yet lacked the skills to manage margin loans. Mr. Wale Agbeyangi noted in his presentation that a customer is given three notices after a margin alert before their stocks are liquidated. Why that long?. Normally, margin stocks are liquidated within 3 days of the first alert if the customer does not bring in funds to cure the margin call. This is why these brokerage firms and the banks are in so much mess. When a customers fails to respond to a margin call, it means they do not have the funds and the brokerage firm must take steps to protect the customer and their firm. Margin parameters are set automatically when you buy stocks on margin in most international exchanges, and the trigger is pulled automatically when a customer fails to respond with the 3 day window. I believe that because most of the brokerage firms in Nigeria operate their customers accounts manually, they did not have the ability to respond to these margin issues in a timely manner. Reading these presentations, it appears that the NSE will remain in the current bearish state for awhile. Again great work,
Posted by: Chuckwumah Biosah

Dear Editor, First I have to commend Proshare for its high standards. I have been following recent events at the NSE, particularly those relating to whether Dangote should take up the mantle of leadership or not. I have to say, with the greatest sense of responsibility, that if the NSE was a transparent institution that has high corporate governance standards, Dangote should never have been allowed to assume the Presidency. And it is irrelevant that the rules permit him so to do. Here is a man accused (though cleared by the same NSE that he serves on, not by an independent investigator) of chronic manipulations (the AP case is still fresh in every one's memory). How then can the market regain the confidence of investors when a person who, rightly or wrongly, has been mentioned in connection with shaking the market's confidence (insider dealings, true or false) be allowed to be appointed, elected or acclaimed, the leader of that market? What's the message being relayed to the investing public? I am ashamed that Dangote did not recuse himself and declare that he be not considered for the position. Yet, if he was so desperate for the leadership and did not do so, why did the other Council members not declare him unfit fir the position? Why should AP and other aggrieved parties who have an axe to grind with him now believe in a system that allowed him ascend to such an exalted position? In law, there is a maxim that "justice must not only be done but be seen to be done". What we have here is 'justice undone' Please publish this as food for thought for souls like me who may be thinking about the declining CORPORATE GOVERNANCE standards at the NSE and, indeed, in many other organisations accross this land. Vincent M. Okwechime. Abuja, Nigeria
Posted by: Vincent M. Okwechime.

This is a good development for the Nigerian Financial systems. However, the average bank customer may not understand the long term benefit of the CBN's action and may opt for total withdrawal of their funds. If this happens, we may witness a run on these banks which in itself may smell disaster. The CBN therefore has a lot of sensitisation to do if this action is to yield its desired result.
Posted by: Dan Ezuzu