Bloating domestic bond market worries SEC

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 Stanley Opara

The Securities and Exchange Commission has expressed concern over the bloating domestic bond market, which appears to be crowding the investment space and hampering growth of other investment instruments.

As at August 2017, the market capitalisation of Nigeria’s domestic bonds market stood at N7.4tn, representing a growth of 11.5 per cent from August 2016, when the figure was estimated at N6.64tn.

The Director-General, SEC, Mr. Mounir Gwarzo, expressed the commission’s worry at the Capital Market Committee press briefing held in Lagos on Monday.

Speaking on the e-dividend registration process driven by the commission, Gwarzo maintained that the deadline remained December 31, 2017 and will not be extended because of the extensive underwriting, carried out by SEC Nigeria.

He noted that 2.1 million Nigerians had registered, which is below the target, adding that, “Due to this, the commission had to engage the bankers and registrars to explore ways of increasing the number of people registered.”

The SEC DG said from January 1, 2018, the fee of N150 would be attached to the e-dividend registration, while imploring the media and other stakeholders to help create the needed awareness.

Speaking on expected new listings from the telecommunications, power and other sectors of the Nigerian economy, he said the SEC had a robust rule-making process, to attract new  listings to the stock market.

“The commission had done a lot in ensuring that the undue bottlenecks and red-tape impeding seamless listing processes were addressed. The SEC had been in discussion with the Bureau of Public Enterprises and Bureau of Public Procurement to harmonise steps and measures to woo more companies to list in the market,” Gwarzo said.

On the proposed MTN Nigeria listing, the SEC DG said the commission’s team and financial advisors for the company (MTN), had engaged in series of meetings and was looking forward to reaching the necessary compromises, so that the long-awaited listing could come through.

“What MTN is looking at doing had not been experienced in this market. We are looking forward to working with the company, but we cannot insist that it happens today or tomorrow,” Gwarzo said.

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