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SEC Nigeria Q3, 2018 CMC Meeting: Key Resolutions

Capital Market	4224 VIEWS
Capital Market
4224 VIEWS

Friday, November 16 2018 7.00AM/Bukola Akinyele, WebTV

At the end of the Q3, 2018 Capital Market Committee meeting the Acting Director-General of the Securities and Exchange Commission of Nigeria, Mary Uduk briefed capital market correspondents on the following key resolutions reached at the meeting;

Multiple Subscription

On Multiple subscriptions and forbearance for shareholders with multiple accounts, The CMC agreed that the forbearance window should be extended by another year from the December 31, 2018 deadline previously communicated.

Transmission of Shares

The Commission announced a two-pronged approach to addressing the intractable challenges associated with transmission of shares related to the estate of deceased investors.

The first step would involve engagement with and enlightenment of the Probate Registry with a view to providing solutions to the cumbersome process of transmitting shares.

Secondly, Rules would be developed around the time frame for transmission shares and the fee structure.

E-Dividend Mandate and Direct Cash Settlement

In order to boost the e-dividend mandate and Direct Cash Settlement initiatives, we would engage NIBSS on behalf of the capital market community to facilitate identity validation and account validation in an effort to enhance market processes.

The Commission will also work with other major stakeholders in setting up a committee that will look into and proffer solutions to problems around identity management in the Nigerian capital market.

Margin Lending

The Commission is also collaborating with the CBN to update regulations on margin lending. We understand the expectations of the market on these issues and our deliberations would address them appropriately.

Commodities Eco-system

In furtherance of the commitment to develop a vibrant Commodities eco-system, we have commenced the implementation of measures to strengthen regulatory capacity by establishing a Commodities Division.

An interesting development in the commodities sector is the innovative solution developed by AFEX and its partners regarding the use of Blockchain Technology to streamline the process of financing agriculture to Smallholder farmers and other players in the commodities markets.

Fintech Roadmap

We formally inaugurated the Fintech Roadmap Committee, Chaired by Mr. Ade Bajomo. The Committee is expected to develop a FinTech roadmap for the capital market within the next three months.

Capital Market Curriculum

Our collaboration with NERDC to institute a stand-alone capital market curriculum for basic and senior secondary education in Nigeria has reached an advanced stage, as the Planning and Writing Workshop took place during the week.

Financial Literacy

The Financial Literacy Committee, has developed a webpage dedicated to providing relevant financial literacy material on the capital market and the financial sector for investors. A link has been created on the Commission’s website.

Electronic Distribution of Annual Accounts

On the Electronic distribution of annual accounts by public companies to shareholders, it was reported that the shareholders have largely accepted the new initiative and are willingly providing their email addresses.

Trading with Securities on Unlisted Public Companies

To grow the market for trading in securities on unlisted public companies, the Commission is making concerted efforts in collaboration with CAC and other stakeholders to assist public companies that are yet to register their securities to do so without much difficulty.

In order to enhance investors’ confidence in the market, the Commission is stepping up efforts to ensure that public unlisted companies provide quarterly and annual performance reports. This would assist investors to make more informed investment decisions.

As part of efforts to eliminate underhand dealings, the Commission is set to take enforcement actions against any persons engaged in trading in the shares of public unlisted companies outside a recognised securities exchange as provided by the Rules.

Registration of Trade Groups

With respect to the registration of Trade Groups (TG), currently 6 TGs have registered with the Commission while those yet to do so were urged to comply with the directive. In the same vein, CMOs were enjoined to register with their respective trade groups.

Minimum Operating Standards

The Committee on Minimum Operating Standards has also submitted its final report and a timeframe for implementation of the standards would be announced soon.

E-IPOs

The final report of the e-IPO Committee in order to issue guidelines and develop the rules for e-IPOs, is expected to be submitted in two weeks.