SEC to stop trading of public shares on unrecognized trading platform

IN its efforts to deepen the Nigerian Capital Market further, the Securities and Exchange Commission (SEC) has take a bold step in ensuring that the public shares are no longer trading in unrecognized trading platform.
Speaking at the SEC Second Quarter Capital Market Committee (CMC) Meeting press briefing in Lagos, the Director General of SEC, Mounir Gwarzo said the committee is partnering with company secretaries of unlisted company to ensure that their shares are available for trading on recognized trading platform.
Expressing his dissatisfaction over trading of shares outside registered trading platform, Gwarzo said it is not necessary for the companies to get listed before it can make it share available for trading on recognized trading platform.
He said the CMC discussed to encourage the company secretaries that are not listed to trade their shares on recognized trading platform, saying “our rules stated that no share of public company’s either listed or unlisted should be trading outside the registered trading floor of SEC, it is an offense for those shares to be exchange outside a recognized platform.”
According to him, there is trading platform for the securities that are not quoted which will give room for right price and will eliminate manipulations in the system.
He said the directive is in the interest of investors to have those shares been traded on the recognized trading platform, the company not necessary has to be listed but it is very important for those shares to be traded on recognized platform.
Currently, the Nigerian capital market have four registered trading platform which comprises: the Nigerian Stock Exchange (NSE), NASD OTC, FMDQ OTC and Abuja Security and Commodity Exchange.
In a related development, Gwarzo stressed that SEC is talking with the Central Bank of Nigeria (CBN) on the duo-licence model that will enable Capital Market Operators (CMOs) to have access to the discount window of Central Bank.
He said the commission is in a face to face interaction with CBN on the duo-licence model for the stockbrokers.
According to Gwarzo, This will enable an operator to have a license in accessing the discount window of Central Bank in such that they will be able to benefit from the liquidity that will come out of it.
“All what we required from CBN is to stage what type of securities that operators needs to put forward.”
The director-general noted that one of the key challenges we are having in the capital market particular the CMOs is the access to liquidity, saying “Our discussion with the CBN is yielding positive and we commend the central bank for their commitment and dedication to the project but the discussion will keep on going.”
He attributed the current uptrend witnessing in the capital market to foreign exchange rate stability, lower inflation rate and fixed income rate.
He noted that these factors influenced the participation of foreign investors in the market.
He stated that the constant interventions by the CBN in the foreign exchange market and the introduction of the Investors’ and Exporters’ Window (I&E) positively affected the stock market performance and the companies in terms of their ability to obtain foreign exchange for importation of inputs and the purchasing power of the citizen. This ultimately improved companies’ profitability.
Gwarzo said that the commission is providing an enabling environment for capital market operators to operate well.