With three weeks to the December 31 deadline, ailing capital market operators are making last-minute efforts to raise funds to comply with the new minimum capital requirements and operating standards.
Sources said many operators had either indicated readiness or filed additional evidence to clarify earlier queries and validate their compliance with the requirements.
The Securities and Exchange Commission (SEC) gave December 31, to operators that failed to meet initial recapitalisation deadline to comply.
Also, operators who were disqualified for non-compliance or inability to substantiate claims of compliance by the audit firms will be allowed to return to the market once they show evidence of compliance within the stipulated period.
At the expiration of the deadline, the licence of operators that fail to meet recapitalise will be cancelled.
A stockbroking chief said the operators were coordinating efforts through the trade groups to assist some firms with unresolved issues.
SEC had in December 2013 announced major increases in minimum capital requirements for capital market functions under a new minimum capital structure that was initially scheduled to take off by January 1, last year. It, however extended the deadline to September 30, last year.
Minimum capital base for broker/dealer was increased by 329 per cent from the existing N70 million to N300 million. Broker, which operates with capital base of N40 million, will now be required to have N200 million, representing an increase of 400 per cent. Minimum capital base for dealer increased by 233 per cent from N30 million to N100 million.
Also, issuing houses, which facilitate new issues in the primary market, will be required to have minimum capital base of N200 million as against the current capital base of N150 million. The capital requirement for underwriter also doubled from N100 million to N200 million. Trustees, rating agencies and portfolio and fund managers had their minimum capital base increased by 650 per cent each from N40 million, N20 million and N20 million to N300 million, N150 million and N150 million.
A Registrar will have a minimum capital base of N150 million as against the current requirement of N50 million. While the minimum capital base for corporate investment adviser remained unchanged at N5 million, individual investment advisers will have to increase their capital base by 300 per cent from N500,000 to N2 million.