SEC To Engage CBN On Margin Lending

The Securities and Exchange Commission (SEC) on Friday March 22, 2019 said it has commenced engagement with the Central Bank of Nigeria (CBN) on margin lending.

The Acting Director General of the commission Ms Mary Uduk disclosed this to financial journalist at the post Capital Market Committee (CMC) meeting in Lagos on Friday.

She explained that “deliberations are still on going on the inclusion of bank shares in the margin list”

Responding to questions on if the discussion with CBN will yield the desired result for the stock brokage community in view of past experiences on margin lending. The Acting Executive Commissioner in charge of Operations, Isiyaku Tilde, noted that the commission discovered that there has been zero activities since the rules guiding margin lending was introduced after the financial crisis in 2008 and 2009.

He said the expectation of the commission is that after all necessary things has been put in place to prevent past negative experience, the aim is to get the segment of the market active. Parts of the areas to look out for includes risk base and capacity of participating operators.  Other highlights of the meeting that was held on Thursday March 21, 2019, according to the Acting SEC director general, is the plan to constitute a technical committee that will address mutual issues of concern between the commission and the Corporate Affairs Commission (CAC).

Adding that the existence of harmonious relationship between the two agencies is very vital to the development of the Nigerian capital market. She said the commission has made progress in attempting to resolve the issues around transmission of shares related to the estate of deceased investors. “This process has commenced with the Lagos State Probate Registry and the Commission, with the support of relevant stakeholders, shall carry out an engagement/enlightenment programme for the probate registry”.

On the issue of Electronic Initial Public Offer (E-IPO) she said the draft framework for its implementation has been developed and presented at the CMC meeting. Pointing out that they have exposed the framework and rules guiding the E-IPO, and stakeholders now have up till Friday, March 29, 2019 to review and send their suggestions for improvement.

To showcase the immense potentials of the commodities ecosystem to the economies of sub-nationals, Ms Uduk said the commission, in collaboration with the commodities ecosystem implementation committee, is planning activities to sensitize members of the Nigerian Governors Forum, especially now that general elections are over. “To this end, an international conference is being proposed to hold in September 2019, with experts from within and other jurisdictions expected to be in attendance”.

While she commented on the 3rd in the series of the commission Budget Seminar where the role of the capital market in effective budget implementation were discussed, which culminated with the first Awards Night in recognition of individuals who have partnered with the commission towards achieving the initiatives in the SEC 10-year Capital Market Master Plan.

Photo Caption: Acting Director General of the commission Ms Mary Uduk