NSE cuts FG bonds transaction fees

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In furtherance of its commitment towards encouraging more investments in government bonds, the Council of the Nigerian Stock Exchange has reduced the transaction charges in the sub-sector.

 

 

A statement made available to our correspondent on Tuesday, said, Federal Government bonds floated in the primary market in form of new issues, will attract an annual listing fee of N20m, irrespective of the bonds listed by the Debt Management Office of the Federal Government.

 

 

In the secondary market, the NSE, according to the statement, will charge N1 per million on daily trading, per million of the underlying charge on sell side only, while the Central Securities Clearing System, will also charge N1 per million of the underlying trading, charged on both buy and sell sides and the stockbrokers get N5 per million of the underlying traded, charged on both buy and sell sides.

 

 

On the state, local government and corporate bonds, the annual listing fees for new issues, according to the statement, remains on a sliding scale with no charges, ranging from a minimum of N189,000, for issues less than N50m, to a maximum of N4.2m, for issues higher than N200bn.

 

 

Under the new regime, the application levy will be 0.15 per cent for issues up to N2bn; 0.1per cent for issues above N2bn, while the CSCS will get 0.0125 per cent.In the secondary market, the NSE will now charge N5 per million of the underlying traded stocks, charged on the sell side only, while the CSCS charges N10 per million of the underlying traded stocks, charged on both buy and sell sides, and stockbrokers also earn N10 per million of the underlying traded, charged on both buy and sell sides.

 

 

Speaking recently during a review of the capital market in 2009 and projecting into 2010, the Director-General of the NSE, Prof. Ndi Okereke-Onyiuke, listed the challenges militating against the growth of the stock market in the country, which include the incidence of multiple tax regimes on businesses and investors.

 

 

According to her, ‘‘Over time, the NSE has brought to the fore, challenges militating against stock market development in Nigeria. The challenges include the incidence of multiple regimes on businesses and investors and the slow pace in the implementation of the privatisation programme, especially those earmarked to be consummated through the stock market. The Exchange urges the National Assembly to expedite action on all bills on tax, oil and gas reforms, privatisation and capital market reforms currently before it.

 

 

”The Exchange appeals to the government to review the tax structure holistically, with a view to streamlining the tax system and remove the incidence of multiplicity of taxes by the three tiers of government.‘‘ 

 

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(Source: Punch)

 

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