SEC To Reject Incomplete Filings

SECThe Securities and Exchange Commission (SEC) Nigeria has directed all capital market operators and issuers to ensure that any application filed with the Commission complies fully with the requirements of its Rules and Regulations.

A statement signed by the management of SEC said that the directive is pursuant to the powers conferred on it by the Investments and Securities Act (ISA) 2007.

It directed that all supporting documents, in the approved format, should accompany applications at the time of filing as any incomplete filing would be rejected outright.

“Consequently, all market operators/issuers shall ensure that deficiencies or queries raised on their applications are promptly addressed within a reasonable time frame or as may be stipulated by the Commission.

“A comprehensive checklist for filing all offer applications is available on the SEC website for proper guidance” the statement added.

Capital Market Focus Is On Wealth Creation – Oteh

oteh2The Director General, Securities and Exchange Commission (SEC), Arunma Oteh has said one of the roles of the capital market is to create wealth and allocate resources to the most competitive companies.

She says the stock market helps in addressing some of the income inequalities that Nigeria faces today, helps in creating jobs for the unemployed and facilitates an eco-system, starting from venture capital and private equity that can easily exist through the stock market.

On Channels Television’s business programme, Business Morning, Ms Oteh stated that inline with the theme of the World Economic Forum On Africa, “Forging Inclusive Growth and Creating Jobs”,  Nigerians could contribute to wealth creation and inclusive growth through investments in the Nigerian Capital Market.

Ms Oteh noted that financial responsible citizens were very critical to the Transformation Agenda that President Goodluck Jonathan was leading, explaining that “if we know how to spend, save and invest, we can plan for our retirement or for future health challenges” adding that the SEC was doing its best to ensure that the average Nigerian is very familiar with the workings of the capital market.

She further noted that the SEC had come up with a number of Financial Literacy Programmes, like partnering with Nollywood and the creation of mutual funds.

“The SEC has been emphasising the need for Nigerians to look at investing through mutual funds as an alternative to investing directly. It helps in diversifying your risk rather than investing your funds in one company,” she said.

She also urged Nigerians to get involved in the Financial Literacy Programme of the government.

 

Investor Protection Fund To Commence Compensation – NSE

The Nigerian Stock Exchange has confirmed that the board of trustees of the Investor Protection Fund will pay the first batch of aggrieved investors whose claims of losses have been verified, early 2014.

The Head, Legal and Regulation Division of the Nigerian Stock Exchange, Ms Tinuade Awe, who was the guest on Channels Television business programme, Business Morning, said that the verification exercise is still ongoing and the monies will be released as soon as the Securities and Exchange Commission, SEC, approves the guidelines.

Meanwhile, the Chairman of the Progressive Shareholders Association, Mr Boniface Okezie who was also part of the programme has asked the regulators to hasten the verification processes and release the funds.

He however took a swipe at what he described as negligence on the part of the regulators in carrying the shareholders along in the constitution of the board of trustees of the fund.

The Nigerian Stock Exchange had in September 2012, inaugurated a board of trustees headed by Dr. Gamaliel Onosode to manage the Investor Protection Fund.

Onyereri Explains Need For AMCON Act Amendment

The Chairman, House Committee on Banking and Finance, Jones Onyereri, has said that the controversial amendment to the Asset Management Corporation of Nigeria (AMCON) act is necessary so as to avoid issues in the future.

At a public hearing organised by the Committee on Banking and Currency there were proposals which sought to amned parts of the AMCON act which the Securities and Exchange Commission opposes.

The amendment is aimed at strengthening AMCON as an institution to be able to carry out its functions efficiently. However, the Security and Exchange Commission opposed section 60(c) of the proposed amendment which seeks to exempt AMCON from complying with the provisions of the Investment and Securities Act 2007.

Speaking on Channels Television’s Business Morning, Mr Onyereri explained that the decision to amend the act was based on a need to codify the existing agreement between the parties involved. “It has become necessary having studied the coalition model.

Mr Onyereri added that “we have seen the need to have a legal framework to back up the agreement” so there would no issues in the future.

GSK Drops Plan To Raise Stake In Nigerian Unit

GlaxoSmithKline UK (GSK UK) has dropped a scheme to increase its stake in GSK Consumer Nigeria, following opposition from minority shareholders.

The decision to abandon a scheme of arrangement that would have increased its indirect ownership in the unit to 75 percent is a fresh setback for Britain’s biggest drugmaker, which is battling a corruption scandal in China.

The company said on Monday it had agreed to consult shareholders and the Securities and Exchange Commission (SEC) about the proposal, including whether it should be implemented by way of a tender offer.

SEC is reported to have barred  GSK UK from voting during court-ordered general meeting tomorrow (Tuesday) to consider its proposal to raise its stake from 46.4 per cent to 75 per cent in Glaxosmithkline Consumer Nigeria Plc.

SEC is also reported to have fixed the company’s share price for the possible tender offer at a minimum of N60 per share, compared with the N48 initially approved.

GSK UK had last November come up with the proposal to  invest more in  its Nigerian subsidiary but that investment would only come after increasing its holding to 75 per cent, which the board of GSK Nigeria accepted

Minority shareholders however opposed the move, saying it is a ploy to alienate them  and delist the company from the Nigerian Stock Exchange in future just like the way Coca Cola Hellenic Bottling Company South Africa used its controlling stake in Nigerian Bottling Company Plc to delist the company last year.

IMF Warns Of SEC’s Operational Deficiencies

Inherent administrative and operational deficiencies will continue to constrain the effectiveness the Securities and Exchange Commission (SEC).

These concerns were raised by the International Monetary Fund (IMF) in its country assessment report of securities regulation in Nigeria which highlights major lapses in the structure and operations of the SEC.

According to the report, while there are comprehensive legal provisions to ensure a robust governance structure for SEC as the commission does not have sufficient internal policies, relating to its core functions.

Of equal concern to IMF is the legal or practical power of the Minister of Finance and the Senate, which it says has the potential to undermine the SEC´s independence.

The IMF advises SEC to implement a major overhaul of the capital requirements applied to broker-dealers, by raising their initial capital requirements and ensuring that they maintain sufficient risk-based capital on an on-going basis.

SEC Inaugurates Proceedings Committee On Capital Market Rules

The Securities and Exchange Commission (SEC) has inaugurated an administrative proceedings committee to check violations of capital market rules.

Chairman of the board of SEC, Dr. Suleyman Ndanusa has warned capital market operators to observe the rules and regulations guiding the market, saying violators will be dealt with in accordance with the law establishing the commission.

He emphasised the need for conflicts to be resolved in order not to threaten the financial stability of the capital market.

Addressing members of the committee, Dr. Ndanusa says there is a need to build trust and increase confidence of people in the capital and financial markets.

He notes that the re-launch of the administrative proceedings committee is aimed at protecting the interest of investors, in addition to providing an opportunity for a fair hearing to aggrieved parties.

SEC’s Director-General and chairman of the re-launched administrative proceedings committee, Ms Aruma Oteh, pledged the commitment of the committee to uphold the laws of the commission.

She described the committee as an important instrument that will ensure the enforcement of capital market regulations.

For some of the shareholders who witnessed the inauguration of the committee, the re-launch of the administrative proceedings committee will serve as a booster to investors’ confidence in the capital market.

The administrative proceedings committee is a quasi-judicial body established for the purpose of resolving disputes in the capital market and sanctioning of violators.

Centre For Social Justice Urges NASS To Avoid Scrapping SEC

The Centre for Social Justice, a civil society organization has advocated the need for the National Assembly to delete Clause 10 of the proposed 2013 Appropriation Act on the ground that passing the clause into law will amount to scrapping of the Securities and Exchange Commission (SEC) without repealing the law establishing the commission.

Speaking in Abuja at a forum to review the proposed amendments to the act, lead director of the centre, Mr Eze Onyekpere, noted that SEC’s budget does not form part of the core 2013 budget as presented to the National Assembly.

According to him, “the clause ought not to have been inserted in the 2013 Appropriation Act.”

He added that the clause amounts to a total shut down of the business of the commission with a potential negative impact on the capital market.

The centre therefore appealed to the National Assembly to delete the clause which mandates the Securities and Exchange Commission not to expend any revenue for recurrent or capital purposes without prior appropriation and approval by the National Assembly.

 

Reps Warn Jonathan Not To Fund SEC

The feud between the House of Representatives and the Presidency over the non-allocation to the Securities and Exchange Commission (SEC) in the 2013 budget appears to be deepening as the lawmakers have written to the President, asking that funds must not be released to the commission in any guise.

The federal lawmakers demanded that no fund must be released to the regulatory agency of the Nigerian capital market unless the National Assembly approves it. They also warned SEC not to spend funds that it generates internally or externally without authorisation from the lawmakers.

The letter dated 27th March, 2013, which was addressed to the Minister of Finance, Dr Ngozi Okonjo-Iweala, emphasised that President Goodluck Jonathan should not fund the operations of SEC either from public coffers or even private sources.

The Secretary to the federal government and the board of SEC were also sent copies of the letter.

Part of the letter made available to Channels Television reads: “You will recall that the Securities and Exchange Commission had submitted its budgetary proposals for 2013 to the house. You will also recall that no approval was passed back to the Securities and Exchange Commission.

“Further to this and most importantly, the National Assembly has vide the 2013 Appropriation Act, item 9, Part E, Clause 10 stated thus: all revenue however described including all fees received, fines, grants, budgetary provisions and all internally and externally generated revenue shall not be spent by the Securities and Exchange Commission for recurrent or capital purposes or for any other matters, nor liabilities thereon incurred except with prior appropriation and approval by the National Assembly.

The House further states: “The net effect of the National Assembly’s resolution Item 9 Part E Clause 10 of 2013 Appropriation Act; it is ultra vires any authority or person (Mr. President inclusive) to finance the operations of Securities and Exchange Commission from public coffers or even private sources.”

The letter advised SEC to refrain from making any expenditure until a budget has been approved by the National Assembly  and not to source and spend any monies whatsoever as this will be a clear infringement of the constitution of the Federal Republic of Nigeria and shall be viewed as such.

Following investigations into the near total collapse of the capital market, the House of Representatives in 2012, passed a resolution mandating President Jonathan to remove Ms Oteh from office for not possessing the requisite professional qualification prescribed in the Securities and Exchange Commission Act for appointment to the office of director-general.

So far, the resolution has not been honoured even as Presidency spokespersons have described the resolution as advisory and not incumbent upon the President to implement.

The embattled SEC DG, who was sent on compulsory leave by SEC’s board, was recalled by the Presidency after she was acquitted of allegations of financial misappropriation and disharmony in the Commission.

Ms Oteh resumed weeks later despite protest by the commission’s workers.

NASS’s Resolutions Do Not Bind Executives – Chukwuma Ezeala

Lawyer, Chukwuma Ezeala while speaking on Channels Television’s Breakfast Show Sunrise Daily, on Friday stated that the National Assembly’s resolution to remove the Director General of Security and Exchange Commission, Aruma Oteh is not binding on her.

Mr. Ezeala explained that resolutions of the House do not bind the Executives and that only laws passed by the National Assembly is binding on them.

“If the preposition of the DG qualification is a problem then the court should be notified to find out what should be the qualification?” He said; calling it an “interpretation of status.”

He referred to the 2013 Appropriation Act which states that, “all revenues however described including all fees received fines, grants, and all internally generated and external generated revenues shall not be spent by the SEC for capital purposes or any other matters except prior, appropriation and approval by the National Assembly.”

He disclosed that the way out is if the presidency or the Senate and Executive feels the exercise of discretion of appointing the DG is right, they should insist on their right and if the House of Rep maintains things weren’t done properly, then they should go to court for proper interpretation.

 

Oando Extends Right Issue Due To NIPOST Strike

Oando Nigeria PLC has extended its right issues till February 20th.

The company said the extension is as a result of the industrial action at the offices of the Nigerian Postal Services (NIPOST) which caused an outright closure of NIPOST’s offices nationwide, thus making it difficult for circulars to be dispatched to most of its shareholders.

According to the company, the extension has been approved by the Securities and Exchange Commission (SEC).

The right issue of N4.5 billion ordinary shares of 50 kobo each at N12.00 per share opened on Friday December 28, 2012 but will now close on Wednesday, February 20.

SEC Approves Imo’s Application On N18.5bn Balance of Bond Proceeds

The Securities and Exchange Commission (SEC) has approved an application by the Imo state government to change the use of the N18. 5 billion bond proceeds floated by the former governor of the state, Mr Ikedi Ohakim.

While disclosing this with journalists in Owerri the Imo state capital, the state’s Commissioner for Finance, Mr Chike Okafor said the approval followed the consent of all the bond subscribers and trustees at a meeting held in Lagos last year.

He added that the Okorocha led administration had earlier applied to SEC to redirect the balance of the proceeds to the “construction of 27 modern general hospitals in each of the 27 local government areas of the state as well as the construction of the 305 modern primary and secondary schools in all the 305 wards in Imo State.”

Speaking on other plans for state’s economy for 2013, the Commissioner claimed that the Okorocha led administration is planning to make industrialization a key to the economy of the state in order to increase the state’s internal generated revenue.

This he claimed will enable the state government to deliver the dividends of its campaign promises.