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Unlisted OTC MARKET | |
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Saturday, April 07, 2018 /07:28 AM / NASD Plc
The Apex regulator of the capital
market in Nigeria, the Securities and Exchange Commission [“SEC”] reconfirmed
that the code of corporate governance applies to ALLPublic Companies in
Nigeria. During this week, SEC held a special orientation session for unlisted
public securities that trade on NASD OTC Securities Exchange. The Code is
intended to facilitate sound corporate practices and behaviour and be a dynamic
document that defines minimum standards of expected corporate governance.
SEC highlighted the responsibility of
the Directors in ensuring compliance with the Code but also enthusiastically
encourages shareholders in public companies to assess the level of compliance
of their company. In implementing the code and measuring compliance SEC
specifically requires all public companies to submit:
1. A corporate governance score
card within one month of year end. This essentially is a
self-appraisal from each company’s compliance with the Code.
2. Quarterly (unaudited) financial
statements within a month of the end of each quarter.
3. Annual audited financial
statements within 3 months of the end of each financial year.
We at NASD heartily welcome the
extension of this requirement to Unlisted public companies. Greater
transparency into the governance and financial performance of public companies
leads to more efficient price discovery and investor confidence.
Our preliminary check on OTC traded
securities in November 2017 indicated that 12 out of the 36 companies scaled a
basic test (tagged NASD BLUE stocks). A second review of compliance with
The Code is due in April 2018 and we look forward to a greater number of
companies meeting standards set.
The Week in Review
The NASD OTC Market ends the week in
with a decrease in market metrics, as the NASD USI decreased
by 1.09%, closing at 656.55 points (as against 663.82 points last Friday). Consequently,
total market capitalisation shed 1.09% this week, closing lower at N444.30 billion compared to N449.23 billion last Friday.
First Review of NASD OTC Securities to Hold In April 2018
Last
year, we commenced a classification of NASD OTC admitted securities into
categories that reflect the level of financial disclosure, adherence to
corporate governance standards, dematerialization of shares and liquidity of
the 36 securities trading on the OTC Market. At the end of this exercise, Twelve (12) Securities
were ranked in the Blue Category, Eight (8) in the Pink Category, and Fifteen (15) were in the Red Category.
In line with efforts to promote transparency,
NASD will conduct a first review of all securities on the OTC Market on Friday, 27
April 2018. This review will update the categorisation
rankings in response to changes in compliance levels.
We believe that this service will enhance transparency
on the inherent value in such companies, improve levels of investor confidence
and also, improve activities on the OTC Market.
Trade Summary
Top Performing Participating
Institutions
Market in Numbers (YTD)
Macroeconomic Indicators
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