The Ministry of Finance Incorporated (MOFI), the special purpose investment vehicle and asset custodian agency of the Federal Government of Nigeria, has disclosed its readiness to identify, revive and list the moribund government assets on the Nigerian exchanges for enhanced economic growth.
Amstrong Takang, managing director/Chief Executive Officer, MOFI stated this during a working visit to the Nigerian Exchange Limited, NGX, adding that “ Our aspiration is to grow MOFI’s Asset Under Management, AUM to a minimum N100 trillion from N18 trillion over the next 10 years and increase the economic impact on Nigerians.”
While briefing the capital market stakeholders on the reason behind its visit, he said: “ We have come to collaborate with the entire stakeholders in the capital market from the Chartered Institute of Stockbrokers, CIS, Association of stockbroking Houses of Nigeria, NGX and stockbrokers to see how we can revive the moribund government assets and list them on the stock exchanges in a more transparent manner that will lead to transformation and create value to the economy. MOFI will set big and play a more active role in establishing a positive economy for its contributors and beneficiaries.
He said, “We want to professionalise public wealth management. There exist an opportunity to grow our investments. But a passive approach to wealth management does not position the nation for economic development. We want to create growth across industries. There is a gap in the nation’s earning capacity and ample opportunity to position our investment portfolio.”
During the Closing Gong Ceremony, held in honour of MOFI’s engagement with capital market stakeholders at the NGX trading floor in Lagos, Takang stated that NGX), along with the CIS and the ASHON, have demonstrated their willingness to collaborate with MOFI in facilitating market development and listings.
“MOFI intends to collaborate with NGX to guide companies in meeting governance, operational, and reporting requirements necessary for listing on the Exchange. This move also contributes to MOFI’s objective of professionalizing Government Owned and Government Linked entities (GOE and GLEs)”, he added.
In his remark, Temi Popoola, CEO of NGX, commended MOFI for its role as the custodian of government investments and assets, emphasising that NGX is eager to collaborate with MOFI to facilitate capital access for listed entities and contribute to the advancement of Nigeria’s capital market. “This partnership is an opportunity for the capital market to actively play a key role in growing the economy under President Bola Tinubu’s agenda. This is an exciting time and you may have seen that our local investors really stepped up their participation in the market recently. We think that with a lot of foreign capital, together with the strengthening and enhancements that have been done, that the market is ready to support many initiatives from the government. We really look forward to working together towards the support in developing our markets”.
While expressing the institute’s enthusiasm for the partnership, Oluwole Adeosun, president, CIS pledged cooperation with MOFI, particularly in areas like capacity development and other market-related initiatives.
Sam Onukwue, chairman, ASHON, noted that the partnership’s impact on the Nigerian economy would extend beyond financial gains to encompass broader socio-economic advantages that contribute to sustainable development.
On her part, Tinuade Awe, CEO, NGX Regulation Limited (NGX RegCo), highlighted the regulatory company’s commitment to collaborating with MOFI on matters of transparency, investor protection, and mitigating systemic risks.
Also, the management of the Federal Government’s Ministry of Finance Incorporated also on Tuesday visited the Lagos headquarters of FMDQ Exchange Group.
The visit, Takang noted, is to seek private sector partnership than can help it become a true custodian of government’s investments/ business across key sectors of the economy, many of which have yielded zero or very poor returns on investments over the years.
The new management team of the MOFI, he continued, desires that various state-owned enterprises, will like their counterparts across the globe over as part of its 10-year Roadmap, within which assets under management would have soared from the current N18.5 trillion, which have been considerably eroded, to N100 trillion, or even a combined balance sheet the value of the nation’s economy. Within the period, he said, the state-owned companies would have transformed into entities that deliver on their mandates, with bankable projects capable of attracting private sector financing, rather remain perpetual appendages, drawing from annual government budget.
MOFI, he continued, is poised to actively play its role as a shareholder in government owned companies and put them in check, link that had been missing over the year, a situation, he said is responsible for erosion of value, where the companies are still going concerns today.
The partnership sought, he continued, is necessary “to ensure we deliver on our mandates,” he stressed, hinting of a plan deconstruction of its balance sheet such that it can be leveraged on.
Ministry of Finance Incorporated after concluding its ongoing asset registry programme, Takang stressed, would have become a mini-exchange, housing companies multiple sectors of the economy, even as he spoke of the possibility of diaspora financing as part of capital raising, for which it would like to have a conversation with stakeholders.
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Also contributing, Sanni Yakubu, executive director at MOFI, said its mandate is essentially to help government improve and diversify its revenue base and to engage with the larger part of the economic ecosystem- the private sector.
“The larger number of people who need housing are in the private sector. We want to partner FMDQ to bring the private sector to the table, such that it serves as a platform to deliver value,” he added.
Henry Olowo, also an executive director, MOFI noted that the MOFI is a “pretty dense vehicle that is moving slowly,” hence the need for collaboration to ensure the assets deliver as much as 10 times what they are currently doing.
While welcoming the MOFI team, Jumoke Olaniyan, acting CEO, FMDQ Exchange, described the group as a financial market infrastructure company that has since it was established 10 years ago transformed into a one-stop-shop for securities exchange.
FMDQ, she explained a good place for private companies to access Commercial Papers for capital raising; in addition to private company securities, bonds, and sukuk. While companies seeking fresh capital through its platform must commit to disclosure requirements to ensure investor confidence, private company securities do not require elaborate disclosures, which is why such instruments are not registered with the Securities & Exchange Commission (SEC).
Private companies that must raise capital, Olaniyan continued, are expected to set up Special Purpose Vehicles (SPVs), which are then registered with the SEC.
She assured the visitors that the nation’s various infrastructure challenges, especially when it comes to financing, can be addressed within the domestic economy.
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