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  • Jonathan congratulates Adesina, Oteh on appointments

    Jonathan congratulates Adesina, Oteh on appointments

    Former President Goodluck Jonathan has congratulated Dr Akinwumi Adesina and Ms Arunma Oteh on their appointments at the African Development Bank (AfDB) and the World Bank.

    These appointments, Jonathan said, serve as a testimony to the fact that his administration had a good economic team.

    Akinwunmi, who was Jonathan’s Minister of Agriculture and Rural Development, has just assumed duty as the president of the AfDB while Oteh, who was the director-general of the Securities and Exchange Commission, was appointed as the treasurer and vice president of the World Bank.

    In separate letters of congratulations to Adesina and Oteh, which Jonathan personally signed, the former President described them as high achievers and Nigeria’s worthy ambassadors.

    On Adesina’s choice as AfDB chief, Jonathan said: “Given your exemplary record of performance, while serving as the minister of Agriculture and Rural Development in my cabinet, I have no doubt that you will deploy your energy and the bank’s resources to ensure that Africa experiences a new era of accelerated development.

    The former President, in a letter to Oteh, praised the former SEC chief’s profound knowledge of capital markets, describing her as conversant with the challenges of the economies of emerging markets.

  • Adesina, Oteh: We had a good economic team, says Jonathan

    Adesina, Oteh: We had a good economic team, says Jonathan

    Former President Goodluck Jonathan has congratulated Dr Akinwumi Adesina and Ms Arunma Oteh, who were recently appointed into top positions in the African Development Bank (AfDB) and the World Bank respectively.

    These appointments Jonathan said serves as testimony to the fact that his administration had a good economic team that managed the affairs of the country.

    Akinwumi who was President Jonathan’s Minister of Agriculture and Rural Development has just assumed duty as the President of the AfDB, while Oteh, who was the Director-General of Securities and Exchange Commission, was appointed as the Treasurer and Vice President of World Bank.

    In separate letters of congratulations to both Adesina and Oteh which Jonathan personally signed, the former President described them as high achievers and Nigeria’s worthy ambassadors.

    On Adesina’s choice as AfDB chief, Jonathan said: ““Given your exemplary record of performance, while serving as the Honourable Minister for Agriculture and Rural Development in my cabinet, I have no doubt that you will deploy your energy and the bank’s resources to ensure that Africa experiences a new era of accelerated development.”

    “You were not only a critical voice in my economic team, you also walked the talk, and earned the praise of our countrymen and women, by ensuring that Nigeria’s quest for self-sufficiency in food production became achievable dream.

    “I am particularly pleased with your emergence as the AfDB boss; a development, I believe, has come as a reward for having served your country meritoriously”, the former President said, adding that “It also attests to the fact that my Administration had a good team that managed the affairs of the country.”

    Similarly, the former President in a letter to Oteh praised the former SEC boss’ profound knowledge of capital markets, describing her as being conversant with the challenges of the economies of emerging markets.

    “I am delighted that you are going to your new job, fresh from the experience of having led the recovery and growth initiatives of the Nigerian Bourse in the wake of the decline, occasioned by recent global economic recession and financial crisis.

    “I am particularly pleased that you are being rewarded and elevated on the world stage, after serving your country meritoriously, at a time I was the President. This is a clear testimony to your capacity, high integrity, and tenacity of purpose. It is also a vindication of the decision of my Administration to stand by you, believing in your
    abilities and competence, even when questions were being raised in some quarters over your choice.

    “I am convinced that the experience you gathered as Director-General of the Securities and Exchange Commission of Nigeria (SEC) gave you deep insights on how to tackle the peculiar challenges of a developing nation. The World Bank can draw from this to ensure that its future partnerships with emerging economies in Africa and other parts of the world are anchored on policies that will lead to sustained growth and development, which is a sine qua non for lifting millions of people in the developing world out of mass poverty, ” Jonathan stated.

  • Oteh, former NEC DG appointed World Bank VP

    Oteh, former NEC DG appointed World Bank VP

    The immediate past  Director-General, Nigerian Security and Exchange Commission (SEC), Ms. Arunma Oteh, was yesterday named  Vice President and Treasurer of the World Bank.

    President of the World Bank, Jim Yong Kim who announced the appointment said she was selected through an international competitive search.

    He  hailed  Oteh’s  transformation of the Nigerian capital markets industry into a major global presence as SEC DG.

    She is due to assume duty on September 28.

    Her  responsibilities include: maintaining  the World Bank’s global reputation as a prudent and innovative borrower, investor and risk manager; managing  an extensive client advisory, transaction and asset management business for the Bank; and engaging , in her capacity as one of the World Bank’s key representatives, with outside stakeholders including global private sector financial institutions, the financial media and the sovereign debt and reserve managers in client countries, as well as ratings agencies.

    She is also expected to collaborate extensively with the Finance Partners throughout the WBG, including with IFC and MIGA, expanding shared approaches, in particular around innovative financing for development and for key new projects.

     Oteh  was a member of the Board of the International Organization of Securities Commissions (IOSCO) ; Chairperson of the Africa Middle East Regional Committee of IOSCO and Group Vice President, Corporate Services, at the African Development Bank Group (AfDB).

    Oteh has confirmed her appointment on Twitter where she thanked Nigerians for their support.

  • Aruma Oteh fetes less privileged

    Few weeks after she left office as the Director-General of the Security Exchange Commssion,Aruma Oteh celebrated her birthday.

    The former SEC DG who was a year older last Saturday, January 24, rather than allow the day go unnoticed, took time to fete with the internally displaced in Abuja, the federal capital territory.

    Other dignitaries that rocked the day with her include Prof Joe Irukwu,SAN ,Chairman, Elumelu Foundation, Mr Tony Elumelu, Business mogul, Chief Femi Otedola, Managing Director, First City Monument Bank, Mr. Ladi Balogun among others.

    Highly cerebral,Oteh assumed office in January 2010,she  was appointed by the late President Umaru Musa Yar’Adua in 2009 but resumed in January 2010. She had a running battle with the House of Representatives as lawmakers called for her removal after she accused the leadership of a committee of demanding bribe from her commission.

    She would certainly be remembered for rescuing the capital market from the doldrums in which it was mired as a result of sharp practices that were rife and the global financial crisis soon after she assumed office.

  • Oteh: Storm in a tea cup

    Oteh: Storm in a tea cup

    The formal handover ceremony this week for the retired Director-General of the Securities and Exchange Commission (SEC), Ms Arunma Oteh, marks the end of an eventful five-year tenure laced with intrigues but also some compelling achievements. TAOFIK SALAKO profiles the tenure of the erstwhile DG.

    THE last days of her tenure unearthed the hues and cries that had all along coloured her tenure. Former Director General of Securities and Exchange Commission (SEC), Ms Arunma Oteh, came into the apex capital market regulator at a trying period for the market; in January 2010, the immediate period after the grueling recession of 2008 and 2009. As she bowed out last Monday, the market appeared to heave a sigh of relief. With the appointment of erstwhile Executive Commissioner, Operations, SEC, Mr. Mounir Gwarzo, as the acting Director General, the market paused momentarily and recorded its first gain of the year. The All Share Index (ASI), Nigeria’s country index and a valuebased market-wide index that tracks prices of all quoted equities, recorded modest gain of 0.30 per cent while aggregate market value of all quoted companies also rose by N30 billion.

    Prior to the formal handover, the market had sustained a free fall that saw investors losing about N1.6 trillion in the first seven days of the year. Nigerian stock market recorded the worst performance among the world’s stock markets in 2014. With a full-year return of -16.14 per cent, investors lost some N1.75 trillion in 2014. Aggregate market value of all quoted equities closed 2014 at N13.226 trillion as against its opening value of N11.477 trillion for the year. It was not a fitting parting gift for Oteh whose tenure had also seen the market recording impressive performance in the previous years. From a market capitalisation of N4.99 trillion in January 2010, the market had peaked at over N14 trillion in 2014. Nigerian equities had set a new high in 2013 with a capital gain of more than N4.25 trillion and average full-year return of 47.19 per cent, its best performance since 2007. Aggregate market capitalisation of all quoted equities on the NSE closed 2013 at N13.226 trillion as against its opening value of N8.974 trillion for the year. In 2012, the market had recorded average return of 35.45 per cent, equivalent to capital gains of N2.44 trillion. The market appeared to play the same old tricks, which Oteh had played to rouse the sentiments against the previous management of SEC and Nigerian Stock Exchange (NSE), on her.

    The downtrend was an anti-climax. At a time she needed to show up the market as evidence of her reforms, since what most elementary investors understand is the up and down value of the market, the market played the cruel joke on her. This did not help her quest for extension of her tenure or outright second term. Meanwhile, with little variations, the downtrend now as it was in 2008 and 2009, was induced by a combination of internal and external factors. The intrigues that also characterised the formal handover and appointment of acting director general evoked the memories of the manoeuverings that had dogged the tenure of the former Director General. While Oteh’s tenure ended on Wednesday January 7, the apex capital market regulator was left in quandary as the presidency buzzed with intense lobby for the extension of her tenure. The intervening period between the expiration of her tenure and appointment of acting Director General-four days, left the SEC in limbo and could expose the agency to litigations, in the event of any major transactions during the period. The Investments and Securities Act (ISA) 2007, the main body of laws regulating the capital market, provides for five-year tenure for Director General of SEC in the first instance, renewable for similar term of five years only. Section 5, subsection 1 stipulates that the Director-General and the three full time commissioners shall be appointed by the President upon the recommendation of the Minister and confirmation by the Senate.

    Oteh made spirited attempt for extension of her tenure, as a stop-gap for eventual renewal of the five-year tenure. With the backing of the Chief Anyim Pius Anyim’s office of the Secretary General of the Federation, which got the Minister of Finance to make a recommendation for extension of tenure, she closed in on the Presidency and almost had the extension. While she met with President Goodluck Jonathan two days before expiration of her tenure, on Monday, sources in the know said she had seen a probable letter of extension of tenure. A somewhat confident Oteh returned to SEC awaiting the formal announcement of the extension. But the other voices had the better ear of the President. Latching on to discontent among capital market operators and staff of SEC, the declining market performance and more importantly, the political albatross created by Oteh’s previous face-off with the National Assembly, the opposing stakeholders impressed the need for outright change on the President. In the midst of his campaign for reelection on February 14, President Jonathan reasoned with the opposing stakeholders and rejected the recommendation for extension. According to sources in the know, the complaints against Oteh centered on her management style and personality. In spite of obvious achievements, many stakeholders had complained about her style of management. Some had alleged she was intolerant and unreceptive to others’ ideas while the grudging staff of SEC had complained of favouritism. But in an election year, Oteh’s undoing was the face-off with the National Assembly. The extension of tenure reopened old wounds. A public inquiry on the capital market by the House of Representatives in 2012 turned into a public spat between Oteh and the lawmakers, with one thing leading to another one. The lawmakers had raised issues on the qualification of the erstwhile director general and her financial prudence. Oteh shot back accusing the lawmakers of extortion, blackmail and corruption. She particularly accused the chairman, House of Representatives Committee on Capital Market and other Institutions, Hon. Herman Hembe, who was heading the inquiry, of corrupt practices, alleging that he had collected money from SEC for a foreign trip but neither made the foreign trip nor return the fund to SEC. The allegation led to the resignation of Hembe as chairman of the inquiry. A new ad hoc committee was constituted to complete the inquiry. The report of the House of Representatives’ Ad Hoc Committee on the Near Collapse of the Nigerian Capital Market roundly indicted Oteh and called for her sack. Resolution 19 of the House of Representatives ad hoc committee on capital market, which was adopted by the House, stated that: that the appointment of Ms Arunma Oteh be terminated forthwith as Director-General of Securities and Exchange Commission as her appointment is in violation of Section 3 (2) a and Section 38 (1) (b), 2 and 3; Section 315 of the Investment and Securities Act, 2007 in that she did not have 15 years experience in the Nigerian capital market as required; she has shown incompetence in the management of human and material resources at her disposal in Securities and Exchange Commission; lack of transparency in managing Project 50, regulatory failure in some of the recent mergers, acquisitions and approvals of transactions by Securities and Exchange Commission and general inability to carry along her staff, board, and management in decision making in Securities and Exchange Commission, and questionable staff recruitment policies. It had earlier identified as some of the key reasons for the near collapse of the market in the past and lack of public confidence in the market to include conflict of interest and misconduct of the current leadership of SEC, loss of credibility of the entire SEC management team led by Arunma Oteh and lack of statutory qualification by Oteh among others as reasons for deficiency in the marketplace. The report called on the Ministry of Finance to reorganize SEC and sanction erring staff of SEC that were culpable in the deterioration at the capital market. The Senate subsequently adopted the position of the lower chamber. The National Assembly relied on its interpretation of the ISA which states that “a person shall not be qualified for appointment to the Board of the Commission unless he is a fit and proper person and-(a) in the case of the Chairman or Director-General of the Commission, he is a holder of a university degree or its equivalent with not less than 15 years cognate experience in capital market operations”. The National Assembly obviously in its interpretation took the capital market operations to be Nigerian capital market and cognate experience to be similarly related. Neither the National Assembly nor Oteh sought for the judicial interpretation of the provision. Oteh’s qualifications generally met the letters of the provision. With a first class honours degree in Computer Science from University of Nigeria, Nsukka, Oteh also obtained a Masters Degree in Business Administration at the Harvard Business School. She worked for many institutions including Centre Point Investments Limited, a Nigerian capital market operator. She later joined African Development Bank (ADB) in 1992 where her almost two decades included portfolios such as investment and capital market operations, treasury and corporate management. By 2006, she was a top management staff as vice president, corporate management. But what stuck most was the allegation bordering on management style and financial prudence. At its meeting in June 2011, the Board of SEC had directed her to proceed on compulsory leave to enable an independent investigation to be undertaken in respect of the Project 50 programme which was carried out by the commission in 2011. The decision of the board was arrived at after consideration of the report of its Audit and Finance Committee which had been directed to investigate the sources and uses of funds for the Project 50 event. Amongst its conclusions, the committee recommended an independent audit of Project 50 and that the key actors in the management of the funds should be asked to step aside to allow an unhindered investigation. Pricewaterhouse Coopers was invited to conduct an investigative audit. She was subsequently exonerated and recalled back to duty by a letter from the office of the Secretary General of the Federation. As against report of the National Assembly’s inquiry, which was made public, the report of the Pricewaterhouse Cooper was not made public. Many stakeholders kicked, including the staff of SEC who staged massive protest against her reinstatement. The impasse between the National Assembly and the Executive arm impaired the workings of SEC and the capita market. The National Assembly neither approved any budget for SEC nor considered any submission from the agency since its 2012 resolution. SEC was therefore unable to push through important legislative reviews, including amendment of the Companies and Allied Matters Act (CAMA) among others, which would have facilitated such landmark initiatives such as full dematerialization, e-dividend and e-offering. But many stakeholders agreed the former director general contributed her quota to market development. Oteh led several reforms in rules, regulations, institutional capacity, market structure, products, disclosures, compliance and enforcements among others. Under her watch, SEC reviewed and published a new corporate governance code, which became mandatory rather than voluntary as was the case before the review. The apex capital market regulator has also demonstrated strong determinations toward stringent enforcement regime. It has not only taken various enforcement actions against operators and issuers with respect to inadequate filing of periodic returns and other market infractions, it has taken the clean-up fights to the operational base of illegal fund managers which hide under amorphous names to dupe unsuspecting investors. In a landmark regulatory action, Oteh’s SEC stood her ground to enforce corporate governance changes in a multinational, Africa-originated bank-holding group, which had sacked a whistle blowing director. The director was reinstated and the group made far-reaching changes to its board and governance structure. SEC also broadened the market space with the introduction of Sukuk (Islamic bonds) in the Nigerian capital market to provide issuance variety. SEC also championed the adoption of International Financial Reporting Standards (IFRS) by quoted companies, with effect from December 31, 2012. With the support of the supervising Federal Ministry of Finance, the Federal Government also removed Value Added Tax (VAT) from capital market transactions. She actively supported the reforms at the Nigerian Stock Exchange (NSE), where she had wielded the big stick and sacked the former director general, Dr (Mrs) Ndi Okereke- Onyiuke, and instituted new management and council. She has been a strong advocate of women financial inclusion. Under Oteh, SEC has also in the last few years modified and introduced several rules and regulations to enhance corporate disclosures, market depth and governance. These also included new rules and regulations by the NSE, which must be approved by SEC. These included initiatives like market-making and whistle blowing among others. Even in the end, the issues of her qualifications and experience and management style continued to shadow her steps. Many market operators who spoke in the wake of appointment of the acting Director General urged government to consider experience and qualification in the appointment of a substantive director general. A release by SEC, justifying the almost immediate redeployment of staff by the acting director general, added a cruel irony to the send forth. After justifying that the “redeployment exercise was strategically done to strengthen the regulatory mechanism of the commission”, the release concluded that the acting director general had in a meeting with the staff assured that “the present management is committed to returning the organization to its traditional core values experienced a decade ago and would undergo corporate rebranding to alter battered image suffered in the past. He also mentioned that the present management is aware about the rights of staff that had been violated in the past few years resulting in an in-house strife but reassured that the issue of human rights would be paramount under the new regime. In addition, he said the era of fighting has passed, because there will be nothing to fight for. The issues on ground have been amicably resolved, so there would be no need to fight again. In conclusion, the publication mentioned that the redeployment came out within 48 hours of assumption of duty of the acting director general. This shows the timeliness of the redeployment and the way the acting director general has a clear and deep understanding of the workings of the SEC due to the fact that he previously worked in the commission”. For Oteh, the storm simply refused to go away.

  • I have laid the foundation for virile capital market, says Oteh

    Former director general, Securities and Exchange Commission (SEC) Ms Arunma Oteh, said she had used her five-year tenure to lay the foundation for a virile capital market that will help to solve Nigeria’s pressing financing challenges.

    Oteh’s tenure ended last week’s Wednesday. She handed over to an acting director general, Mr. Mounir Gwarzo, on Monday.

    Presenting her scorecards, Oteh said she handed over a better SEC that has been positioned to drive inclusive economic growth and provide impetus for national infrastructural development.

    According to her, when she joined SEC in January 2010, she was absolutely certain about why the SEC was important and what it’s role and what the agenda was. This enabled her to articulate a new vision in one phrase of “building a world class market”.

    She said she was able to lay the foundation for a capital market that will help tackle national infrastructure challenges and which will help people who are setting up businesses, who own businesses raise millions of naira in capital.

    “To have a vision and have everyone being able to connect and align around it for me whether it is capital market operators, shareholders and other stakeholders for me was very rewarding. But I don’t think it would have been possible without each and every one of you accepting the challenge to try something in a different way or to do something in a way that you are not quite sure of,” Oteh said.

    She explained that the aim of her policies was to build a meritocracy so that it is the viable businesses that get funded, not necessarily the ones that have connections.

    She noted that Nigeria’s socio-economic challenges could only be tackled when people can feel that they are included, that they have economic access; that they can create wealth and that the income inequalities that people see around can be addressed.

    “And I believe that the capital market is the answer and what we have done in the last five years is to lay a foundation; there is still a lot of work to be done,” Oteh said.

    She therefore appealed to staff to continue to work hard and support the leadership to ensure that the brand that has been built is not eroded.

    Earlier in a statement endorsed by her, Oteh had outlined her achievements to include restoration of investors’ confidence, promotion of corporate governance and deepening the market.

    On investors’ confidence, she outlined that through strong enforcement actions and improvement of rules and regulations, and investor education, she was able to encourage investors’ participation. Creative initiatives include partnership with Nollywood to produce movies, an annual integrity award to promote integrity and capital market knowledge.  SEC established the National Investor Protection Fund and strengthened its Administrative Proceedings Committee

    On deepening and broadening of the market;  the market witnessed significant product innovation, improved listing rules, landmark bond market reforms (which brought it almost at par with the equities market and made it attractive enough for Triple A issuers such as African Development Bank (AfDB) and International Finance Corporation (IFC) to issue bonds), introduction of  Exchange Traded Funds (ETFs), widening of participation in the markets through licensing and coming – on – stream of other capital trade points like National Association of Securities Dealers (NASD) and Financial Market Dealers Quotation (FMDQ) that have expanded market access.

    Also, in the area of restoring market integrity through zero tolerance for rule infractions, SEC’s enforcement machinery was significantly strengthened to respond to this new emphasis. In addition to other measures, an 18-man Nigeria Police Force team was deployed as a resident enforcement team at the SEC to respond to enforcement matters with speed and promptitude. This was unprecedented in the history of the apex regulator.

    In the area of strengthening of disclosures and transparency; SEC, under her leadership strengthened disclosure requirements and spearheaded the implementation of international financial reporting standards for listed companies.

    As far back as 2011, under Oteh’s leadership, the SEC published a new code of corporate governance for the Nigerian markets which was aimed at standards improvement in line with international best practice.  In addition to a significant improvement in corporate governance, the code is now mandatory.  SEC’s role in revamping corporate governance at Ecobank Transnational Incorporated (ETI) was globally recognized.

    Within the SEC, capacity building took unprecedented heights intended to strengthen the capital market as a whole by specifically enhancing personnel and technological capacities at the SEC Nigeria through training and retraining of human capital.

    Pursuant to the human capital enhancement goal, she streamlined the training function at the SEC to make it more relevant and responsive to the apex regulator’s capacity needs; she instituted the SEC Learning Series with the objective to foster a culture of learning and knowledge seeking at the SEC Nigeria especially in relation to critical issues that relate to capital markets, economic diplomacy, macro economy and the larger society.

    Beyond the capital market, under Oteh’s leadership, the SEC instituted an Annual SEC Journalists’ Academy, a skills improvement workshop aimed at strengthening transparency and accountability in the markets through improved professional journalistic reportage.  A journalists’ only essay competition was also instituted to stimulate interest in reading and writing about the markets among Nigeria’s community of practicing journalists. Prize winnings at this competition are in the form of exposure to trainings in elite local and foreign learning centers. She created a forum for delivering capacity enhancement to shareholders in Nigerian companies called the “SEC Shareholders’ Academy” to enable the role of this important stakeholder public in fostering sound corporate governance in the Nigerian capital market.

    Under her leadership, the SEC also championed reforms at the Nigeria Stock Exchange (NSE) which has witnessed much more robust output and delivery in its operator/oversight role.  The initiative to revamp listing rules led to landmark transactions such as the dual listing of SEPLAT Petroleum on the NSE and the London Stock Exchange in April 2014 as well as the development of an alternative securities market.

    Oteh provided thought leadership on the role of the capital market as an enabler of socio economic development, an efficient mechanism for capital allocation, and for fostering meritocracy in the economy and ultimately peace and prosperity in the society through efficient resource allocation.

    She led a market-wide effort which culminated in the launch of the 10 year capital market master plan in November 2014 which supplies a strategic architecture for repositioning the Nigerian capital market as one of the best and biggest globally within the envisaged timeframe, re-focus the market and help double its size over time and grow the economy

    The role and reputation of the Nigerian capital market in the International arena was significantly enhanced through SEC’s greater visibility and contribution in international regulatory fora like the International Organization of Securities Commissions (IOSCO) and its Africa and Middle East Regional Committee (AMERC).  In both organizations, Arunma Oteh played influential roles in their highest decision making echelons.  The spike in the SEC’s reputation and renown has made both the apex regulator as well as Ms. Oteh serial winners of awards and laurels bestowed by local and foreign organizations.

    The stock market also witnessed appreciable growth under her leadership. From a market capitalization of N4.99 trillion in January 2010, the market peaked at over N14 trillion in 2014. The Nigerian stock market rose by 35 per cent in 2012 and a further 47 per cent in 2013, and it was among the 10 best performing markets in the world that same year.

    However, by the end of 2014, the NSE capitalization had regressed to N11.5 trillion on account of the combined macro – economic forces including dwindling confidence in the Nigerian economy by anxiety around the imminent general elections; plummet in the price of crude oil in the international spot market and decline in the exchange rate of the Naira which attended the recent adverse fortunes of crude oil, the sole foreign exchange earner in Nigeria’s mono – cultural economy and cessation of Quantitative Easing in the all important United States economy to induce divestments of foreign portfolios from the Nigerian market.

     

  • No tenure extension for SEC’s DG Oteh

    No tenure extension for SEC’s DG Oteh

    President Goodluck Jonathan has rejected a request for the extension of Securities and Exchange Commission (SEC) Director-General Ms Arunma Oteh’s tenure, it emerged yesterday.

    He has approved the appointment of a Commissioner in the Commission, Mr. Mounir Gwarzo, as acting Director-General.

    The President rejected a memo from the Coordinating Minister for the Economy and Minister of Finance, Dr. Ngozi Okonjo-Iweala, seeking a second term for Oteh.

    The memo was said to be based on the Secretary to the Government of the Federation SGF) Anyim Pius Anyim’s recommendation.

    Ms. Oteh’s controversial tenure ended on January 6.

    Although she lobbied to return, the President was said to have thought otherwise.

    It was learnt an evaluation showed that her performance was “neither sterling nor spectacular.”

    The government found that the stock market has not recovered from the 2008 financial crisis.

    The President, findings showed, rejected her return to resolve the lingering “Executive-National Assembly face-off” over her tenure.

    A source said: “Despite intense lobbying by some government officials and business players, the President stood his ground that Ms. Oteh should not come back.

    “Jonathan rejected a memo from the Minister of Finance, Dr. Ngozi Okonjo-Iweala seeking the retention of Ms. Oteh. The Minister based the case for Oteh  on a strong recommendation by the SGF, Anyim Pius Anyim.

    “To some extent, the SGF misled the Minister because the indices did not add up for Oteh as to earn a renewal of tenure. There was no convincing statistics to prove that Oteh has led the stock market to a leap recovery.

    “No one could explain why the Office of the SGF which suspended her while in office will be the one championing her retention. I think there was a tribal connotation to it.

    “The evaluation of her tenure indicated an average performance because she was rated as ‘neither sterling nor spectacular. The President chose to look beyond ethnic sentiments and stood on the side of truth and the public yearning for a change in SEC.

    “Stakeholders in the Stock Exchange Market, workers and others alike wanted a fresh breath of air in SEC. You will recall that at the peak of SEC crisis in 2012, Ms. Oteh’s commissioners even disowned her.

    It could not be ascertained if Ms. Oteh will remain a member of the President’s Economic Management Team (EMT).

    “Another source added: “She earned First Class in Computer Science from  the University of Nigeria, Nsukka, the nation might still engage her elsewhere.

    “No nation will allow a First Class brain and respected intellectual to waste away. Definitely, the Presidency may accommodate her elsewhere.”

    Gwarzo, the Executive Commissioner for Operations, graduated with a Bachelor’s Degree in Economics from Bayero University, Kano in 1987.

    He obtained a Post-Graduate Degree in Development Finance from the University of Birmingham in 1999.

    He is a Fellow of the Chartered Institute of Stockbrokers.

    A third source said: “Gwarzo will act pending the appointment of a substantive DG. The President has the discretion to appoint a DG in line with Section 5(1 and 2) of the Investments and Securities Act 2007.

    The section says: “The DG and the three full time commissioners shall be appointed by the President upon the recommendation of the Minister and confirmation by the Senate.

    “The DG shall hold office for a period of five years in the first instance and may be reappointed for a further period of five years and no more.”

    Ms. Oteh was suspended on June 12, 2012 and was recalled via a letter by the SGF.

    The reinstatement followed an audit report on SEC by PricewaterhouseCoopers.

    Her recall created bad blood between the Presidency and the House of Representatives because she was reinstated on the eve of the presentation of the Ad Hoc Committee on Capital Market’s report on the SEC’s activities.

    The crisis between the House and Ms. Oteh followed a public hearing into the capital market operations.

    During the hearing, the then Chairman of the House Committee on Capital market and Other Institutions, Mr. Herman Hembe, alleged that Ms. Oteh was not qualified to be DG.

    He said the committee also discovered how Ms. Oteh allegedly spent N850, 000 on hotel accommodation in a day and N85, 000 on a meal.

    But Ms. Oteh took exception to the allegations, saying: “This has been a Kangaroo court. Not even in Idi Amin’s Uganda did we have this type of public hearing. You had implied that as a regulator, that by having people on secondment from the private sector, it could undermine the capacity of the regulatory functions of the commission.

    “In asking the SEC to contribute N39m for this public hearing, don’t you think that you are undermining your capacity to carry out your duties?”

  • Disquiet at capital market as Oteh’s tenure ends

    Disquiet at capital market as Oteh’s tenure ends

    There is disquiet at the capital market as the tenure of the Director-General of the Securities and Exchange Commission (SEC), Ms Arunma Oteh, ends in January next year. Oteh resumed as director general in January 2010.

    The Investments and Securities Act (ISA) 2007, the main body of laws regulating the capital market, provides for five-year tenure for director general of SEC in the first instance, renewable for similar term of five years only.

    Section 5, subsection 1 stipulates that the Director-General and the three full time Commissioners shall be appointed by the President upon the recommendation of the Minister and confirmation by the Senate.

    Section 5, subsection 2 states that “the Director-General shall hold office for a period of five years in the first instance and may be reappointed for a further period of five years and no more”.

    (3) The three full time Commissioners shall hold office in the first instance for a period of four years and may be re-appointed for a further term of four years and no more.

    However, subsection 5 states that “Notwithstanding the provisions of subsections (1) and (2) of this section, the President may extend the tenure of office of the Director-General and any of the Commissioners whose term of office has expired until a successor to such Director-General or Commissioner is appointed”.

    In the alternative, the director general may be requested to appoint one of the commissioners to supervise activities in her absence. Subsection 7 stipulates that “the Director General or, in his absence, one of the Commissioners nominated by the Director-General shall be responsible for the day to day management and administration of the Commission and shall be answerable to the Board of the Commission”.

    Discussions were in hushed tones at the Abuja headquarters of SEC and within the major financial centres of Customs Street and Victoria Island. The chances of another term for the director-general was dicey, opinions were divided on Oteh’s continuity and otherwise. The tenure issue has also been coloured by the sustained depreciation at the stock market this year, which has exacerbated in recent weeks, and the grim recapitalisation that threatens to swim away most small market operators.

    Market operators, who preferred anonymity, said the downtrend has undermined one of the strongest points of the incumbent director general, who came on the heels of the grueling 2007-2009 recession and saw a rebound that took the market back to a new high. Now, the stock market has lost more than N3 trillion so far this year.

    Some operators said the claim to a reform-driven recovery has been vitiated by the sustained downtrend, arguing that the recovery was natural as the market had bottomed out after the panicky recession and Nigerian stocks were becoming most attractive given the fundamentals of the quoted companies.

    They claimed that external factors, rather than internal reforms, played the major roles in the uptrend citing the fact that the current decline has also strong link with the global crude oil crisis, activities by foreign investors and monetary management.

    Oteh also has major obstacles in the National Assembly, which has subsisting orders against her and had blocked subvention to SEC. The executive arm had ignored the legislative resolutions but it will have to return to the National Assembly to get approval for any appointment into the office of SEC’s director general. Oteh had a public spat with the lawmakers over inquiry into her propriety as director general, arguing that the public inquiry was driven by greed. In the midst of all these, she was suspended briefly, had a running battle with protesting staff of the Commission, before she was recalled by President Jonathan.

    But many stakeholders said the director general’s performance stands her in good chance for a renewal. Oteh led several reforms in rules, regulations, institutional capacity, market structure, products, disclosures, compliance and enforcements among others. Under her watch, SEC reviewed and published a new corporate governance code, which became mandatory rather than the voluntary as was the case before the review. The apex capital market regulator has also demonstrated strong determinations toward stringent enforcement regime. It has not only taken various enforcement actions against operators and issuers with respect to inadequate filing of periodic returns and other market infractions, it has taken the clean-up fights to the operational base of illegal fund managers which hide under amorphous names to dupe unsuspecting investors. In a landmark regulatory action, Oteh’s SEC stood her ground to enforce corporate governance changes in a multinational, Africa-originated bank-holding group, which had sacked a whistleblowing director. The director was reinstated and the group made far-reaching changes to its board and governance structure.

    SEC also broadened the market space with the introduction of Sukuk (Islamic bonds) in the Nigerian capital market to provide issuance variety. SEC also championed the adoption of International Financial Reporting Standards (IFRS) by quoted companies, with effect from December 31, 2012. With the support of the supervising Federal Ministry of Finance, the Federal Government also removed Value Added Tax (VAT) from capital market transactions. She actively supported the reforms at the Nigerian Stock Exchange (NSE), where she had wielded the big stick and sacked the former director general, Dr (Mrs) Ndi Okereke-Onyiuke, and instituted new management and council. She has been a strong advocate of women financial inclusion.

    Under Oteh, SEC has also in the last few years modified and introduced several rules and regulations to enhance corporate disclosures, market depth and governance. These also included new rules and regulations by the NSE, which must be approved by SEC. These included initiatives like market-making and whistleblowing among others.

    She has however been unable to realise key targets like the full dematerialization of the market, demutualisation of the NSE, new complaint management framework and important legislative reviews including amendment of the Companies and Allied Matters Act (CAMA) among others.

  • Use pension funds to address infrastructure, Oteh urges

    The National Pension Commission (PenCom), should avail the Federal Government of its  N4.5 trillion pension fund  to  end the current infrastructural deficit estimated at $2.9 trillion (N485 trillion), Director-General, Securities and Exchange Commission, Ms Arunma Oteh, has urged.

    Oteh,who described the country’s infrastructure  deficit as a national emergency, spoke at the just concluded PenCom conference on Pension Reform Act 2014 in Lagos.

    She however stated that the country also needs a world class, stable and well regulated capital market to safeguard the funds.

    She said housing is critical to the nation’s development and the government needs 17 million housing units as against the 50, 000 people that have access to housing, noting that housing is not just about shelter, but creating jobs in the country.

    She urges the PenCom Director-General, Mrs. Chinelo Anohu-Amazu to be creative about how to deploy the fund in the next 10 years so that it is not business as usual.

    She said: “Nigeria’s current challenge include huge infrastructure deficit, homing and jobs. I believe infrastructure is a national emergency for us and we can learn from countries like Ireland, Canada and Australia which have modeled their pension fund on nation’s growth.

    “Business owners consistently rack in  inadequate infrastructure and that is why fixing infrastructure will spur economic growth. The Federal Government recognises this and recently put together the National Integrated Infrastructure Master Plan (NIIMP) which estimate that we need US$2.9 (N485 trillion) over the next 30 years”.

    The SEC boss said this showed that there is a lot of work to be done, noting that this makes a strong case for what the DG PenCom can do.

    “I am not saying we should put the entire fund on infrastructure and others but I am saying let us put our money where our mouth and if we do it in a safe and sustainable manner, it will impact on nation’s growth, she said.

  • Oteh emerges West Africa’s Business woman of the year

    Director General of Securities and Exchange Commission (SEC) Ms. Arunma Oteh has been announced as West Africa’s Business Woman of the year 2014 at  the All Africa Business Leaders Awards (AABLA).

    Oteh was celebrated for her peerless vision and dedication in her role as Director General of SEC Nigeria as she has been an instrumental force in the on going growth and development of Nigeria’s economic landscape.

    In an address at the event, Joe Nazzal, head of Reserve said, “The nominees in this year’s AABLA Awards exemplify the game-changing vision that has helped to grow the West African economy, with Nigeria making incredible strides in this regard.”

    “Johnnie Walker Blue Label is proud to acknowledge all these individuals who, through their tireless innovation and pioneering spirit, have made a lasting impact on the continent’s business sector. The fact that all winners were from Nigeria emphasizes the impact the country’s business leaders are having on the continents’ business landscape” he added.

    In her remarks after receiving the award, Oteh expressed her gratitude to CNBC Africa who she said has changed the landscape of business reporting and has been connecting Africa to the world.

    “So I am really honored that I amiable to be some evidence of excellence. I also just want to say that this recognition for me means very much. I had vision, but I had a team around me, the SEc staff who tapped into that vision. We also have had capital market operators who have aligned behind our vision. I want to celebrate SEC staff, capital market operators and Nigerians.

    “This is very important to me because I think it is an outstanding category for what we do at SEC. I think what we have done is to create an enabling environment such that businesses can realize their potential but also such that our nation can realize its potential. But in doing that, what we have seen is that we have been such a role model for other countries around the world because we have been bold, we have done things people have wondered whether they should do” Oteh said.