FMDQ grows market turnover by 33% to N137.40trn

Despite Nigeria’s challenging debt capital market, FMDQ OTC Securities Exchange saw its turnover grow remarkably by 33 percent or N33.8 trillion year-on-year to N137.40 trillion in 2015, from N103.60 trillion in 2014.

This figure saw the forecast of N125 trillion turnover for 2015 surpassed by 10 percent. In the first half of 2015, the Dealing Members achieved an overall Over-The-Counter (OTC) market turnover of N58.60 trillion and by December 2015, this rose significantly by 134 percent or N78.8 trillion to close at N137.40 trillion.

The most actively traded products were Treasury Bills (T.bills), accounting for the largest share of the market turnover at 35 percent, followed by Foreign Exchange (FX) (including FX derivatives) with a share of 25 percent and Repurchase Agreements (Repos)/Buy-Backs at 23 percent.

Unsecured Placements/Takings and Federal Government of Nigeria (FGN) bonds, on the other hand, had a smaller share of the market, accounting for 9 percent and 8 percent, respectively. The turnover represents trades executed between dealing members, dealing members and clients, and dealing members and the Central Bank of Nigeria (CBN).

FMDQ with a vision of becoming number one in Africa in the fixed income and currency markets by 2019 and a mandate to develop the Nigerian debt capital market (DCM), through empowering the financial markets to be innovative and focused on enhancing the liquidity of fixed income instruments, continues to strive to ensure the realisation of these goals towards making the Nigerian financial markets globally competitive.

2016 is expected to be exciting for the Nigerian financial markets, as a result of FMDQ’s planned initiatives for the year.

These initiatives include but will not be limited to: offering a more diversified products portfolio, including short-term and Islamic (Sukuk) bonds; the quotation of private companies’ bonds; integration of FMDQ markets to include securities dealing and investment banking firms in the fixed income secondary markets; introduction of a new membership category – Specialist Dealing Members; Capacity building and financial markets education for FMDQ stakeholders; financial markets support for economic development; Nigerian debt capital market (DCM) transformation, and introduction of OTC Derivatives

FMDQ, like in 2015, is optimistic about the year ahead, albeit with caution, considering the expected challenges the financial markets will likely face, and remains committed to initiating and engaging in initiatives that will develop and make the FMDQ markets globally competitive by improving liquidity, transparency, governance and efficiency in the Nigerian capital market. To achieve success in its objectives, FMDQ will continue to work collaboratively with and garner the support of its stakeholders.

“We look forward to working with our stakeholders to deliver an improved market in 2016,” FMDQ stated in its recent spotlight on the debt capital market.