Review penalties to boost new listing, investors urge SEC, NSE

Investors in the Nigerian capital market have called on the Securities and Exchange Commission (SEC) and The Nigerian Stock Exchange (NSE) to review the penalties imposed on quoted companies to attract new listing.
They made the plea on Saturday, October 7th 2017, at an ‘investors clinic’ organised by SEC in Lagos to mark IOSCO World Investor Week 2017.
They lamented the incessant penalties on companies, which they said is discouraging companies from seeking quotation on the nation’s bourse, thereby affecting the growth and development of the market.
Sunny Nwosu, the national coordinator emeritus of the Independent Shareholders Association of Nigeria (ISAN), said that there is need for friendly policies and regulation by the capital market regulators.
Nwosu said lack of proper compensation to investors that lost their funds during the market meltdown contributed to poor investor confidence in the market, whereas brokers were given forbearance package.
He decried the commission’s move to invest the unclaimed dividend funds into special funds, arguing that shareholders were not in support of the initiative.
Also, Boniface Okezie, president, Progressive Shareholders Association of Nigeria, commended SEC for organising the clinic. He said that market regulators must pursue friendly policies and initiatives to put the market forward.
Okezie praised the commission for bringing the shareholders together to chart the way forward for market growth and development.
“If we have this type of relationship in the past, the Central Bank of Nigeria would not have nationalised the banks listed on the exchange,” Okezie said.
He said that the banks nationalisation affected investors’ confidence in the market.
“It is not only SEC that is fighting for protection, shareholders are also fighting for protection”, Okezie said.
He said that the introduction of various initiatives and zero tolerance on fraudulent capital market operators by the new leadership of the commission is commendable.
In his comments, Moses Igbrude, the ISAN Secretary said that the issue of penalties must be readdressed by market operators for confidence building.
Igbrude said that some companies has delisted from the exchange due to penalties while new companies were afraid to list.
In his reaction, Timothy Adeshiyan, the president of the Nigeria Shareholders Solidarity Association (NSSA), said that market regulators should be fair in their regulations and penalties.
Adeshiyan said that penalties were paid from the shareholders funds’ and was also discouraging investor confidence.
Mounir Gwarzo, the Director-General of SEC, had told participants earlier that the World Investor Week (WIW) is a week set aside for educating investors on their rights.
Represented by Eddy Rowlands, the executive director of market development at SEC, Gwarzo said that the commission will continue to embrace initiatives aimed at moving the market forward.
He added that the clinic will make investors to be better equipped at the end of the programme, and enlighten investors and shareholders on what regulators and market operators are doing to uplift the market.
Deji Balogun, the Chief Executive Officer, AFEX Commodities Exchange, commended the commission for taking the capital market to the younger generation.
He urged market operators to introduce new products that would appeal to the younger generation, adding that opening of stockbroking accounts for new investors should be done through smart phones in line with present realities.
Also, David Ogogo of the Institute of Capital Market Registrars said that unclaimed dividends will soon be an issue of the past.
Ogogo said that registrars will continue to work with market regulators and operators to ensure effective implementation of the 10-year Capital Market Masterplan.