The Nation Newspaper

Tag: Stockbrokers

  • Stockbrokers’ institute woos new members

    Stockbrokers’ institute woos new members

    The Chartered Institute of Stockbrokers (CIS) has launched a nationwide enlightenment and engagement campaign to discuss the institute’s programmes and membership processes with relevant stakeholders across the nation.

    A team from the CIS was at the Accounting Department of University of Calabar in collaboration with the Nigerian Universities Accounting Students Association (NUASA) to discuss on how students can make livings in the capital market during and after their studies.

    The career talk with the theme “Students capacity building for professionals coping in the 21st Century”, exposed the participants to the concept of the capital market, its relationship with the economy, the regulators, operators and investment opportunities. The team from the CIS gave prominence to an array of career opportunities in the capital market and exposed the participants to the various professional programmes being run by the CIS and how these future accountants can take advantage of these programmes to make a career in the market.

    Second Vice President of CIS, Mr Dapo Adekoje, spoke extensively on the Institute’s Professional Diploma Programme as a fundamental opportunity for the youths to launch themselves into the capital market. Adekoje explained that there were incentives that would make the budding accountants participate in the examination and the institute has been working very closely with the National Universities Commission (NUC) to accredit some of the programmes for enhanced mobility of the beneficiaries in terms of job opportunities and career enhancement.

    Adekoje specifically encouraged the students to work towards achieving additional qualification that would make them self employed in future. He further stated that the securities and investment profession could only be practised by holders of CIS qualification either the Professional Diploma or the main professional examination.

    Thereafter, a book launch and interview were held at the Cross River Broadcasting Cooperation where Adekoje re-affirmed the Institute’s plan to empower young ones with financial literacy and entrepreneurial skills. According to him, the skill would enable them to create wealth for their clients and themselves.

    The students expressed gratitude to the institute for the opportunities provided by the Career Talk and they pledged to take advantage of the Professional Diploma Programme to join the members of the financial district as soon as possible.

    Making a presentation titled: “Mass Unemployment: The way forward, life after college, your plan, your future”, the institutes’ Marketing and Media Liaising Officer, Mr Olumide Coker, said unemployment in Nigeria was one of the most critical problems being faced by the youths. Coker explained that the years of corruption, civil war, military rule and mismanagement have hindered economic growth of the country. He also noted that Nigeria was endowed with diverse and infinite resources, both human and materials which were yet to be fully tapped.

    According to him, unemployment has social consequences as it increases the rate of crime. He said secondary school graduates consist of the principal fraction of the unemployed accounting for nearly 50 per cent while unemployment rate within the age group of 20 to 24 years and 15 to 19 years are 40 per cent and 31 per cent.

    Also, there are strong indications that the CIS may sign an agreement with Covenant University on  the training of youths for career in entrepreneurship.

    Already, the institute has chosen the university as one of the major institutions in Nigeria for regular investor education for youth entrepreneurship development.

    In furtherance of the strategic plan to formalise the joint efforts in entrepreneurship training, the Principal Officers of the CIS had visited Covenant University on the request of the Vice Chancellor, Prof Charles Korede Ayo.

    Specifically, the visit was aimed at strengthening already relationship with the university on the strategy to grow future employers of labour.

    Acting President and Chairman, CIS, Mr Oluwaseyi Abe, explained that both CIS and Covenant University have the same goal in the area of entrepreneurship development and there was a need to move a step further by allowing the mutual goal to concretise into exposing the university students to the institute’s professional Diploma Programme in Securities and Investment.

    Abe noted that the programme would not only enable them to make a career in the capital market and indeed the financial market but empower them to be self-employed.

    According to him, Covenant University students at any level can undergo the professional Diploma programme in order to have a strong foundation in the capital market operation. Abe announced that the programme and some others being offered at the institute were on the last stage of accreditation by the NUC. He explained that there were incentives to encourage students towards participating in the examination.

    Responding, Ayo explained that the university placed premium on training of its students to be self-employed as a practical way of creating and empowering employers. He noted that both the institute and university could work together in realising this goal.

    According to him, any form of relationship with the CIS would be a major advantage to the students as this would be beneficial at all levels of qualifications. He stated that both the Covenant University and CIS have a common Vision of entrepreneurship development  and this shall be mutually beneficial.

    Ayo remarked that the institute’s programme would be greatly beneficial to the existing students.

    The institute has embarked on aggressive enlightenment programme directed at various strata of the society to build investor confidence and send a positive signal to career opportunities for the youths in the market.

    Only recently, NUC’s Executive Secretary, Prof Julius Okojie hosted the institute’s team in Abuja and assured them of the willingness of NUC to accredit the institute’s programme very soon. Already, NUC has constituted a four-man committee to midwife the implementation.

  • ‘Demutualisation central to NSE, stockbrokers’ value creation’

    ‘Demutualisation central to NSE, stockbrokers’ value creation’

    The Nigerian Stock Exchange (NSE) and its dealing members are working to realize the demutualisation of the Exchange to unlock values for the dealing members and widen the economic benefits of the Exchange to the general citizenry.

    President, Nigerian Stock Exchange (NSE), Mr. Aigboje Aig-Imoukhuede, at the annual general meeting of the Exchange in Lagos, said that the dealing members and the larger capital market committee are working towards the demutualisation of the Exchange.

    According to him, it is only the realization of demutualisation that all stakeholders can deeply participate in the creation of wealth within the NSE as an economic entity.

    Chief executives of stockbroking firms also met on Saturday to discuss the demutualisation of the Exchange among other issues.

    Aig-Imoukhuede said the priority of the council and management of the Exchange this year is to deepen the market in terms of issues and participation while also creating an enabling environment that is attractive to investors.

    “We are working with government in the area of economic policy, to ensure that the government is aware that the financial markets are critical to the successful implementation of government policy,” Aig-Imoukhuede said.

    He noted that the NSE as an institution had in 2014 recorded impressive growth along key financial indices with total assets rising by over 30 per cent while net assets grew by 29 per cent.

    He pointed out that the growth in net assets was driven by a consistent rise in trading revenue and other income. The NSE recorded an operating surplus of N3.95 billion, representing a significant increase of 21 per cent from 2013 and closed the year with accumulated funds of N17.49 billion.

    “We achieved record revenues, thanks to a focused business model and the completion of several strategic initiatives. These initiatives have strengthened and improved the functioning of our market, leading to significant gains in profitability and efficiency,” Aig-Imoukhuede said.

    But the stock market generally was down in 2014. With average return of -16.14 per cent, quoted equities lost a whooping N1.75 trillion during the year.  Aggregate market value of all quoted equities closed 2014 at N11.477 trillion as against its opening value of N13.226 trillion.

    Chief executive officer, Nigerian Stock Exchange (NSE), Mr. Oscar Onyema said the outlook for the Nigerian capital market remains positive in spite of the current headwinds.

    “We will continue to deliver on our strategic commitments, drive operational excellence and create value for the exchange and our various stakeholders,” Onyema said.

     

  • EFCC probes 10 stockbrokers, others over shares fraud, impersonation

    The Economic and Financial Crimes Commission (EFCC) is investigating 10 stockbroking firms and 12 individual stockbrokers and officials as part of a large-scale crackdown on shares fraud that has seen 31 stockbroking firms and several stockbrokers internally investigated and sanctioned by the Nigerian Stock Exchange (NSE) over the past 42 months.

    Two official reports on shares fraud, also known as unauthorised sales of investors’ shares, obtained at the weekend by The Nation indicated that the NSE, Nigeria’s only stock exchange, had invited the EFCC to further investigate and prosecute 12 stockbroking firms and 21 stockbrokers and officials, who were primarily indicted by the internal investigations of criminal financial fraud.

    The EFCC has already concluded investigations and charged two stockbroking firms and nine persons to court while the anti-fraud agency is currently investigating 10 stockbroking firms and 12 persons connected with the firms or individually cited for shares fraud.

    All the cases referred to the EFCC were initially investigated and indicted by the Disciplinary Committee of the Council of the Exchange, NSE’s adjudicatory body which deals with heinous market infractions and investors’ complaints.

    The reports indicated that the all the firms and officials were allegedly indicted by the disciplinary committee for unauthorised sale of investors’ shares while some others were also indicted for issuance of dud cheques, impersonation and illegal conversion of dividend warrants.

    An official of the NSE at the weekend confirmed the cases under investigation by the EFCC, noting that the two reports were up to date and accurately represented the state of affairs as at press time.

    The investigations and prosecutions by the EFCC highlighted the anti-fraud campaign at the stock market to checkmate hard-pressed stockbroking firms and unscrupulous officials, who fiddled with investors’ shares.

    A report on shares fraud over the past 42 months indicated that 31 firms were investigated for unauthorised sale of shares. The report by the NSE covered the period between January 2012 and June 15, 2015.

    The report showed that nearly half of the shares frauds have been completed and the indicted stockbroking firms made to restitute the investors, a general reference to order to buy back the shares or pay the investor the value of the shares and all his entitlements.

    According to the report, 15 stockbroking firms and four individuals have pending cases, although the NSE has taken preemptive measure of suspending the stockbroking firms and stockbrokers. The pending cases have been referred to the disciplinary committee of the council of the NSE.

    Among the stockbroking firms under EFCC investigation are Lakesworth Securities Limited, Byfotel Trust & Securities Limited, Gosord Securities Limited, Securities Solutions Limited, ITIS Securities Limited, Mact Securities Limited, Giljohn Investment Limited, First Equity Securities Limited, Omas Investment & Trust Limited and Mayfield Investment Limited.

    The report also listed the names of 12 officials that are also being investigated.

    The NSE had launched an online whistleblowing portal through which investors and other stakeholders can tip off the Exchange on perceived or known infractions.

    The online portal, known as X-Whistle, allows members of the public to submit information without disclosing their identity while it also provides reference that allows the whistleblower to track NSE’s response and investigation on the tip off.

     

     

  • Stockbrokers to engage government on investment education

    The Chartered Institute of Stockbrokers (CIS) would engage the new administration of President Muhammadu Buhari on the need to integrate capital market operations into the entrepreneurial schemes of various government agencies, especially the National Youth Corps Scheme (NYSC).

    The CIS stated that such investment education and empowerment would avail fresh graduates more comprehensive exposure to the capital market operations and provide them with necessary knowledge to take useful decisions.

    The Federal Government has institutionalized entrepreneurial training in the NYSC scheme to enable the fresh graduates develop a new capacity aside from their academic background. This is part of the strategy to promote self-employment for the youths by de-emphasizing dependence on white collar jobs

    Head, research and technical, Chartered Institute of Stockbrokers (CIS), Mr Arinze Nwobu, who led a team in continuation of the institute regular enlightenment programme for youths at the 2015 Lagos State NYSC orientation camp Batch B , said the fresh graduates can make a career in the capital market.

    According to him, many of the young graduates could make career in the capital market after their NYSC primary assignment as it will broaden their scope on the capital market operations. Already, CIS has been at the forefront of investor education for the NYSC members every quarter. Many of the fresh graduates lack in-depth information about opportunities provided by the capital market and how they can take advantage of such.

    Nwobu said that serving graduates who had passed through universities and polytechnics are eligible and qualified to explore the benefits and opportunities in the capital market and could later take up jobs as stockbrokers, securities analysts, investment bankers and portfolio managers who are currently the major players in the capital market.

    He therefore urged the Corp members to take advantage of the programmes of the institute by enrolling for the CIS professional examination while serving the Nation.

    While appreciating the CIS, State Coordinator, NYSC Lagos, Mr. Cyril Akhanemhe remarked that it was quite thoughtful of the Institute to have brought great opportunity for the Corp members.

    He urged the Corp members to take advantage of exploring the opportunities available to them during their service year.

     

  • Stockbrokers seek waivers on forex penalties

    Stockbrokers and dealers at the Nigerian Stock Exchange (NSE) have filed a joint appeal with the Securities and Exchange Commission (SEC), seeking waiver of penalties imposed on the operators for their failure to render weekly report on foreign-exchange transactions over the past four months.

    A reliable market source said the stockbrokers, under the auspices of Association of Stockbroking Houses of Nigeria (ASHON), has started discussion with SEC on waiver of penalties imposed from January 2015 till May 15, this year.

    SEC had imposed penalties on the market operators for failure to comply with rules and guidelines on anti-money laundering reporting. Stockbrokers are expected to report any foreign-originated and foreign-exchange based transactions to capital market authorities.

    A source said the apex capital market regulator might consider the joint appeal in order to encourage group compliance since ASHON has taken on the responsibility of mobilising and sensitising operators on the weekly report.

    SEC had last year granted waivers to public companies on the outstanding penalties over the failure of the affected companies to file their returns to the apex capital market regulators between 2008 and 2013.

    The waivers followed a dialogue between SEC and the Nigeria Employers’ Consultative Association (NECA).  Specifically, SEC granted 100 per cent waiver of all penalties imposed on public companies from 2008 to 2010 and 40 per cent waiver on outstanding penalties from 2011 to 2013.

    The engagement between SEC and NECA was sequel to complaints by companies, which had said they were not aware of the provisions on filing of returns.

    SEC had slammed penalties on the companies that failed to comply with SEC rules on filling requirements as stipulated by the Investment and Securities Act (ISA) 2007.

  • Ajaegbu, Umaru others join stockbrokers’ council

    Stockbrokers have elected nine distinguished financial markets’ operators into the council of the Chartered Institute of Stockbrokers (CIS) as part of efforts to enhance the professionalism and practice of stockbroking in Nigeria.

    The new council members included the President, Institute of Chartered Accountants of Nigeria (ICAN), Mr Chidi Ajaegbu, Managing Director, Ashaka Cement Plc, Mr Kwairanga Umaru and Managing Director, Vetiva Capital Management Limited, Mr Chuka Eseka.

    Other members included Managing Director, Arthur Steven Asset Management Limited, Mr Olatunde Amolegbe, Managing Director, Network Capital Limited, Mr Oluropo Dada,  Chairman, Investigating Panel of the CIS, Mr Muiz Kareem; General Manager, Stanbic IBTC Holdings Plc, Mr Yusufu Modibo, Deputy Managing Director, Fund Quest Financial Services Limited, Mr Olabisi Oni and chairman of CIS’s Professional Development Committee, Mr Oyewole Oyeniyi. Their election was endorsed after the institute’s recent annual general meeting.

    Ajaegbu, a fellow of CIS and ICAN, is ICAN’s golden jubilee president and founder and chief executive of Mutual Alliance Market Limited. He holds Master’s Degree in Banking and Finance from University of Lagos. Kwairanga is a consummate banker and veteran stockbroker.  He holds an MBA from Liverpool John Moores University, UK and M Sc in Corporate Governance. He has served in various capacities in the financial and real sector of the economy.  Eseka is a frontline investment banker and securities strategist. He is a chartered accountant and stockbroker with over 23 years industry experience.

    Amolegbe holds an MBA and M Sc in Corporate Finance from University of Ilorin and Russel-List University in the United Kingdom. He has been instrumental to development and implementation of investment policy strategy over the years. Dada holds M Sc in corporate governance from Leeds Beckett University, United Kingdom. His working experience covers banking, finance, stockbroking, issuing houses activities, investment advisory, general administration etc.

    Kareem, an Economist, holds an MBA from Obafemi Awolowo University, Ile Ife and Kensington University Glendale, USA respectively. He qualified as an Authorised Dealing Clerk in 1985 and became a fellow in 1993. Modibo holds both Master’s in Banking and Business Administration. He has been into the capital market and banking operations since 1984. Oni holds MSc in Economics.

     

     

    He was the best graduating student in the Associateship examinations of the Chartered Institute of Bankers in 1997 and CIS in 2004 respectively. Oyeniyi holds an MBA from Obafemi Awolowo University, Ile Ife. He is an Associate member of Certified Pension Institute of Nigeria among others.

     

  • Stockbrokers, others can’t hold more than 20%

    Stockbrokers, others can’t hold more than 20%

    Stockbrokers, who constitute the largest members of the Nigerian Stock Exchange (NSE), may have to sell down their shareholdings within five years under the demutualisation of the Exchange, according to the final rules on  the matter by the Securities and Exchange Commission (SEC).

    As against earlier ceiling of 40 per cent in the draft rules and regulations, the final rules approved by SEC, obtained by The Nation, indicated that the aggregate equity interests of members of any specific stakeholder group, such as stockbrokers and broker-dealer in the demutualised securities exchange, should not exceed 20 per cent.

    The rules also retained the provision that no individual or entity must directly or in- directly own more than five per cent of the issued shares or voting rights in a demutualised securities exchange.

    The rules, according to Section 313 of the Investments and Securities Act (ISA) 2007, describe “related entities and persons” as a person or entity that is related to the entity or person that owns the equity or the voting rights.

    They stipulate that the securities exchange should initiate a process for determining the accurate list of members of the Exchange prior to the commencement of demutualisation.

    “The stakeholder groups who are shareholders of the Securities Exchange shall with effect from the date of demutualisation shall reduce their cumulative shareholding in the demutualised Securities Exchange to no more  than 20 percent within five years,” according to the rules. The 20 per cent ceiling is however an improvement on the draft rules, which stipulated a ceiling of 10 per cent within five years.

    The demutualisation of the Securities Exchange should include an exchange of membership rights in the Securities Exchange for ownership of shares in the demutualised Securities Exchange.

    The rules allow the Exchange to give equity interest to a strategic investor subject to establishment of the facts that the strategic investor has technical expertise through previous experience in managing other Exchanges and the aggregate number of shares to be offered to the strategic investors shall not be more than 30 per cent of issued and fully paid up capital of the securities exchange.

    However, if the Exchange is in need of funds, it could issue a higher number of shares subject to approval of the Commission.

    As part of preconditions for demutualisation, a securities exchange shall prior to demutualisation submit the names and profiles of members of its committee on demutualisation, a valuation report, the draft Memorandum and Articles of Association of the Securities Exchange, the proposed rules of the demutualised Securities Exchange, the proposed allotment and the basis of the proposed allotment of shares to the initial shareholders of the  Securities Exchange, a list of the directors proposed as the Board of the Securities Exchange, an implementation plan stating the process to be adopted for effecting the demutualisation of the Exchange, including but not limited to the treatment of the rights and liabilities of the existing members of the Exchange and the proposed plan for the independent management of the commercial and regulatory functions of the demutualised Securities Exchange and timelines for implementation of necessary structures to ensure the functional treatment of commercial and regulatory functions for a “No Objection” clearance by SEC.

    Any changes to the information provided under the preconditions must also be filed with the Commission for a “No Objection” clearance.

    The demutualised Exchange is expected to implement its plan for the independent management of its commercial and regulatory functions within one year of approval by SEC.

    On corporate governance, demutualised Exchange shall have a board of sufficient size relative to the scale and complexity of its operations and the board must be composed in such a way as to ensure diversity of experience without compromising independence, compatibility, integrity and availability of members to attend meetings.

    At least one third of the board shall be independent directors as provided for under the SEC Corporate Governance Code or any other applicable Corporate Governance Code while all appointments of directors and executive management shall require the prior written approval of the SEC.

    Besides, the demutualised Exchange shall be required to comply with the SEC Code of Corporate Governance for public companies and any other applicable corporate governance code.

    Demutualisation is the changing of a member-owned stock exchange, otherwise known as mutual exchange, to a corporate entity owned by shareholders. In a mutual exchange, the three functions of ownership, management and trading are concentrated into a single group, hence the broker members of the exchange are both the owners and the traders on the exchange and they further manage the exchange as well.

    In a demutualised exchange, the three functions of ownership, management and trading are clearly separated. The new rules by SEC simply defined demutualisation as “the process through which a member owned organisation becomes a shareholder owned company”.

    The NSE has been locked in intense grip of demutualisation with divergent views on the necessity, procedures and timing and other details of the exercise. The release of the draft culminated a four-year exercise to provide amenable template for the demutualisation.

    Established as Lagos Stock Exchange (LSE) in 1960, the stock exchange was conceptualized as a limited by guarantee not-for-profit organisation thriving on the goodwill, reputation and integrity of its members. While Nigeria’s doyen of accounting, Mr. Akintola William, is the only surviving initial signatory to the founding memorandum of the NSE, the membership list of the NSE has always included “the movers and shakers” of the Nigerian economy. Beside stockbroking firms and other capital market operators that are dealing members, members of the NSE currently included Alhaji Aliko Dangote, Chief Ernest Shonekan, Mr. Gamaliel Onosode, Mr. Oba Otudeko, Otunba Adekunle Ojora, Mr. Pascal Dozie, Chief Phillip Asiodu, Rear Admiral Allison Madueke (rtd.) and Senator Udo Udoma among others. Altogether, the NSE has some 360 individual and institutional members including some 255 active dealing members.

    Several State Investment Companies are also institutional members of the NSE, giving the States inputs into the operations of the NSE. These included Adamawa Securities Limited, Kaduna Investment Company, Kano State Investment and Properties Limited, Katsina State Investment and Property Development Company Limited, Kwara State Investment Corporation, New Nigerian Development Company Limited, Niger State Development Company Limited, Sokoto Investment Company Limited and Yobe Investment Company Limited among others.

    It is believed that the new rules have been previewed by the Federal Government. The Federal Government recently said it has opened discussions with key stakeholders in the capital market on the demutualisation of the NSE.

    The Federal Government, which played a major role in the founding of the private members-owned NSE in 1960, said it had held talks with the NSE and SEC on the possible guidelines, options and approaches for the demutualisation of the Exchange.

    Minister of State for Finance, Ambassador Bashir Yuguda, confirmed the discussion between the government and other stakeholders on the demutualisation.

    According to him, government is engaging stakeholders such as SEC and the NSE because of the importance it attaches to the capital market and the import of such demutualisation on the market.

    He noted that the engagements and discussions with the stakeholders were geared towards ensuring that government comes up with the right policy for the demutualisation.

    President, Nigerian Stock Exchange (NSE), Mr. Aigboje Aig-Imoukhuede, also said the discussions on the demutualisation of the Exchange are ongoing noting that the exercise is of critical importance to the NSE and the entire capital market.

    According to him, giving the position of the NSE, the demutualisation of the Exchange will require input from both the government side and the private sector.

    Nigerian shareholders had expressed supports for the demutualisation of the NSE, describing the release of the draft rules for the demutualisation by the SEC as a step in the right direction.

    Shareholders’ leaders who spoke to The Nation said the demutualisation of the Exchange would open up the marketplace for popular ownership and enable minority shareholders who have been part of the growth of the market to benefit from ownership of the market.

     

  • NSE to remove low-level stockbrokers

    NSE to remove low-level stockbrokers

    • Sticks to December 31 deadline for new standards

    Stockbrokers and dealers at the Nigerian stock market will face a litmus test of minimum operating capacity in the New Year as the Nigerian Stock Exchange (NSE) begins implementation of its minimum operating standard (MOS) requirements.

    A circular dispatched to stockbroking firms on the eve of the Yuletide holidays, a copy of which was obtained by The Nation, indicated that stockbrokers will be reclassified under four categories according to operating capacity in 2015 while other stockbroking firms that fail to meet requirements for any of the four categories will be exited from the market.

    Also, existing stockbrokers that fail to meet the first three levels of operating standards will be reclassified as sub-brokers, partially recognised operators, and they will lose their membership of the Exchange.

    Contrary to expectations that the Exchange may delayed the implementation, the circular, authorised by the broker-dealer regulation department of the Exchange and titled “Implementation of the NSE’s Minimum Operating Standard Requirements (MOS)” stated that the “deadline for compliance with the MOS remains December 31, 2014”.

    The implementation of the MOS deadline placed stockbrokers, which also face similar recapitalisation deadline from the Securities and Exchange Commission (SEC), in a tight position. There is ongoing strong lobby for extension of the deadline by SEC, which has not issued any statement on the extension as at press time.

    The new standards relate to all the three classes of dealing members including broker-dealers, brokers and dealers and address the five broad areas of manpower and equipment; organizational structure and governance; effective processes; global competitiveness; and technology.

    According to the circular, dealing members shall cease to submit monthly MOS compliance level reports to the Exchange and instead, no later than March 31, 2015, each Dealing Member is required to submit one final MOS compliance level report in the prescribed templates previously provided by the Exchange. Dealing members that do not comply by March 31, 2015 will immediately be suspended from trading until they comply.

    Also, commencing in April 2015 and until the beginning of the fourth quarter of 2015, the Exchange will conduct thematic reviews and examinations to evaluate each dealing member’s level of compliance with the MOS.

    Dealing members that have partially complied by the fourth quarter of 2015 may be provided additional timelines to comply as appropriate.  However, the accommodation of additional timelines may be accompanied by penalties as appropriate.

    According to NSE, following the thematic reviews and examinations, stockbrokers that are not in compliance with the MOS by the fourth quarter of 2015 will be advised to reclassify from broker-dealer status to a classification with lower MOS requirements. These include splitting the functions and becoming either a broker or dealer or becoming a sub-broker, a quasi operator with no membership of the NSE.

    Other stockbroking firms that fail to meet any of the four categories will be directed to “exit the market in an orderly manner”.

  • Stockbrokers in emergency meeting as market panics

    Stockbrokers in emergency meeting as market panics

    Barely 10 working days to the deadline for new capital base, stockbrokers are scrambling for workable solutions to stem the panic in the stock market.

    The stock market had lost N595 billion within the first three trading sessions this week as stockbrokers piled up sell pressure from investors and personal trading accounts.

    Chief executives of stockbroking firms met this week to discuss the current challenges at the capital market. The meeting was at the instance of the Association of Stockbroking Houses of Nigeria (ASHON), the umbrella body for all stockbroking firms.

    ASHON has strong endorsements from the Chartered Institute of Stockbrokers (CIS), the statutory chartered regulatory body for the stockbroking profession and the Association of Issuing Houses of Nigeria (AIHN), the main body of primary market operators.

    Reliable sources at the top-secret meeting said stockbrokers were worried about the continuing decline in the stock market, which could both undermine their personal recapitalisation plans and the emerging investors’ confidence in the stock market.

    A source indicated that the emergency session, which was called within a five-hour notice, deliberated on the impending deadline for recapitalisation and further erosion of stockbrokers’ assets by the bearishness at the stock market.

    Stockbrokers were worried that the implementation of the recapitalisation deadline could compound the negative market situation as several small and medium stockbroking firms, which serve as foot soldiers to retail domestic investors, may be unable to meet the deadline. The current efforts to raise funds have been hampered by the downtrend as well as the current banking regulatory regime, which bars commercial banks from investing in unrelated financial services.

    While the market downturn has been driven by foreign portfolio divestments, the sell pressure from anxious domestic investors and cash-scrambling capital market operators have exacerbated the downtrend in recent trading sessions.

    Aggregate market value of all quoted equities on the Nigerian Stock Exchange (NSE), which opened this week at N10.156 trillion, closed on Wednesday at N9.562 trillion, indicating a loss of N595 billion. Nigerian equities had lost N814 trillion last week.

    The Securities and Exchange Commission (SEC) has insisted on the December 31, 2014 deadline for capital market operators to comply with new capital requirements for their various functions. The apex capital market regulator had announced major increases in minimum capital requirements for capital market functions under a new minimum capital structure that is expected to take off by January 1, 2015.

  • Stockbrokers woo new members

    The Chartered Institute of Stockbrokers (CIS) has stepped up its membership drive with the recent signing of a Memorandum of Understanding (MOU) with Laurel Ventures.

    Under the MOU, Laurel Ventures would deploy its technical and professional knowledge to mobilize over 150,000 potential applicants for the institute’s Professional Diploma in Securities and Investment and Associates Chartered Stockbrokers professional certification.

    By the MOU, Laurel Ventures would train over 150,000 young Nigerians annually and present them to CIS for certification as a prelude to launching the young Nigerians into the financial world. This is expected to assist in actualizing the National Strategy for Financial Inclusion and Savings.

    The long term plan is to develop young entrepreneurs. The institute would recognize Laurel Ventures as a non-exclusive representative with associated benefits of agreed discount for its efforts among others. The beneficiaries would also create financial planning houses for the operators in the entire financial market and the government sector.

    Managing director, Laurel Ventures, Professor Taiwo Asaolu, commended the institute for the bold initiative aimed at creating job opportunities for young Nigerians.

    Vice president, Chartered Institute of Stockbrokers (CIS), Mr Dapo Adekoje advised all the companies that have signed MOU to mobilize young Nigerians to make a career in the financial market to take advantage of the unique marketing opportunities provided by this training programme.

    President, Chartered Institute of Stockbrokers (CIS), Mr Albert  Okumagba had earlier said that the ultimate objective of launching the young Nigerians to this new professional opportunity was to provide the much needed back up staff for all operators within the ambit of the financial market including insurance, pension fund operators and other categories.

    Laurel ventures specializes in professional consultancy services.  The company also creates opportunities for business, advancing corporate goals and engages in general trading. The CIS is saddled with the duty of determining what standards of knowledge and skill are to be attained by those who aspire to become professionals in stockbroking, portfolio management, asset management, investment management and allied fields of specialization. The new qualification is expected to be the minimum for the back-up staff in the financial market in a foreseeable future.