BUSINESS
Non-Interest Capital Market has Great Potential – SEC
By Tony Obiechina, Abuja
The Securities and Exchange Commission has said that the Non Interest
Capital Market has so much potential in Nigeria as it has the prospect
of attracting a large pool of untapped investor base who have apathy
to conventional instruments, to participate in capital market as well
as the existing investors who seek to diversify their portfolio.
Director General of the SEC, Mr. Lamido Yuguda stated this at a Joint
IFSB/SEC Nigeria Virtual Seminar on Investor Protection and
Transparency in Islamic Capital Markets held Weekend.
Yuguda said the level of activity in Non-Interest (Islamic) capital
market that is currently being witnessed in Nigeria affirms the
overwhelming acceptance of NICM products by the investing public.
He stated that recently, the Market witnessed the entrance of
institutions offering Islamic capital market services/products and
also witnessed the issuances of FGN into the Sukuk market with latest
issuance of FGN SUKUK oversubscribed by over 400 per cent. This he
said, further buttressed the need to enhance the SEC’s investor
protection mechanism in order to ensure transparency in the market.
The SEC boss stated further that investor protection is the principal
plank of regulation and transparency, a building block that enhances
the growth of the capital market adding that the knowledge gap that
often exists between the market Players and investors demand for more
transparency, and the risks faced by investors requires reasonable
level of protection by the regulator in order to build confidence and
trust in the market.
According to him, “Capital markets all over the world thrive on trust,
it is believed that enhancement of investor protection and increased
transparency will have a multiplier effect on investments and
sustainable growth of the economy.
Additionally, in ensuring that investors are well protected, Yuguda
said a framework for complaint management was put in place to
fast-track and streamline the dispute resolution process in the
market. This is to foster and secure investors’ confidence in the
market.
“It is worthy to also note that the 10-year strategic Masterplan
(2015-2025) for the Capital Market includes a section on NICM that
recommends various initiatives aimed at developing this sector. While
some of these activities and programmes have been implemented, a lot
more work is ongoing to unlock the full potential of Non-interest
Capital Market.
“It is a well-known fact that the pandemic has brought about a new
normal to the global economies – including the Nigerian Capital
Market, hence this Seminar couldn’t have come at a better time. The
need to promote and increase awareness of investor protection
mechanism and transparency requirements are considered essential to
engendering investor confidence and trust in the financial system,
which is crucial for the growth and development of the market.”
With respect to NICM, he said the provision of two levels of shariah
review and certification is meant to further serve as added measure
towards investor protection. This is coupled with the requirement for
continuous review\certification of the shariah expert throughout the
tenor of the transaction.
He said, “We are happy to note that Non-Interest financial activities
are developing exponentially across all sectors of the Nigerian
Financial System. Indeed, we expect that the Market will soon witness
substantial investment from the pension industry which will be a game
changer that would spur more issuances of NICM by corporates and
other categories of issuers.”
Yuguda said the SEC Nigeria has not relented in its efforts to
discharge its primary mandate of regulating and developing the
Nigerian Capital Market; protection of investors has been one of our
key focus. Numerous initiatives being implemented in this regard
include the establishment of the National Investor Protection Fund
(NIPF) aimed at compensating investors who incur losses arising from
the insolvency, bankruptcy or negligence of a Capital Market Operator;
the e-Dividend registration and payment system, Dematerialisation and
Direct Cash Settlement system all aimed at ensuring an efficient
process of securities transaction and elimination/minimising cases of
unclaimed dividend.
The purpose of the seminar which is the second collaboration between
the SEC and IFSB in 2021, is to enlighten stakeholders on the
protections available to investors and of the level of transparency
inherent in the Non-Interest Capital Market (NICM).
By Tony Obiechina, Abuja
As the Monetary Policy Committee (MPC) meets on Monday, a financial expert, Prof. Uche Uwaleke, says the committee will likely increase the baseline lending rate by another 100 basis points.
Uwaleke, a Professor of Capital Market and the President of Capital Market Academics of Nigeria, said this in an interview with the News Agency of Nigeria (NAN) on Sunday in Abuja.
NAN reports that the MPC, under the leadership of Mr Yemi Cardoso, had increased the Monetary Policy Rate (MPR) by 400 basis points in February and 200 basis points in March,
This led to a cumulative increase of 600 basis points, moving the MPR from 18.
75 per cent to 24.75 per cent, in line with aggressive tightening of the CBN to target spiralling inflation.According to Uwaleke, we should expect another increase of at least one percentage point.
“Inflation rose year-on-year in March in spite the hike in February, and the exchange rate has yet to stabilise.
“So, MPC will still be concerned about the need to narrow the negative interest rate.
“Again, following the IMF/World Bank spring meetings last April, the CBN has received praise from the IMF and some global rating agencies such as Fitch for its monetary policy tightening stance.
“MPC will be mindful of that in order not to create a different impression, especially when the Bretton Woods Institutions are urging the apex bank to do more,” he said.
He, however, urged the committee to retain the prevailing rates to mitigate the impact of its aggressive policy tightening on Nigerians.
“If I were a member of the MPC, I will vote for a hold position as the aggressive policy rate hike is taking a toll on output.
“Production is stiffled because of the very high cost of funds. Moreover, the seeming over reliance on the MPR as a tool to tame inflation does not appear to be making any meaningful impact.
“This is due to the significant non-monetary factors driving inflation in Nigeria, such as high cost of energy, transport as well as insecurity in the food-belt regions of the country,” he said.
By Tony Obiechina, Abuja
The Development Bank of Nigeria (DBN) has announced its sponsorship of the 10th edition of the Okpekpe International Road Race, scheduled to take place on May 25th, 2024, in Edo State.
This enduring partnership underscores DBN’s commitment to advancing sports and promoting tourism development in Nigeria.
The Okpekpe International Road Race is a prestigious event that attracts athletes from around the world.
It is recognized by the World Athletics and serves as a platform for showcasing talent and promoting physical fitness.The 10-kilometer race which is the first to be granted a gold label status in Nigeria is set in the scenic hills of Okpekpe town near Auchi, highlighting the beauty of Edo State and its significant economic benefits to the local community.
Managing Director/CEO, Development Bank of Nigeria Plc, Dr Tony Okpanachi in a statement released on Monday, 20th May 2024 said “DBN is honored to support the historic Okpekpe International 10km Road Race for the seventh consecutive year.
“Our involvement in this event reflects our broader mission to foster community engagement, promote health and wellness, and stimulate economic growth through sports. The Okpekpe Race is more than just a competition; it is a celebration of resilience, unity, and excellence.
“I am very certain that DBN’s sponsorship will play a crucial role in ensuring the race’s success. Our support extends beyond financial contributions, it emphasizes our strong dedication to corporate social responsibility and our commitment to the holistic development of Nigerian society.” he added.
According to him “Supporting the Okpekpe International Road Race aligns perfectly with DBN’s mission of driving sustainable development, empowering communities, and fostering economic growth. Sports as we all know serve as a unifying force and a catalyst for economic and social development, and we are proud to play a role in this transformative event.”
Mr. Okpanachi further stated that since its inception, the Okpekpe International Road Race has grown in prestige, becoming a cornerstone of the global athletics calendar.
He, however, urged Nigerians to participate in the race festivities, support the athletes, and experience the rich culture and hospitality of Edo State.
By Tony Obiechina, Abuja
The Commissioner for Insurance/CEO, Mr. Olusegun Ayo Omosehin, and his management team have met with the members of the Constitutional Committee on “Mobilisation and Diversification” of the Revenue Mobilisation Allocation and Fiscal Commission ( RMAFC) led by Engr.
During their working visit to NAICOM Headquarters, Mr. Olusegun Ayo Omosehin, in his opening remarks, reaffirmed the critical role of the insurance sector regulator in supervising, regulating, and safeguarding the interests of insurance policyholders.
He highlighted insurance’s pivotal role in mobilising savings for long-term developmental projects and enabling businesses to thrive while managing risks effectively.
He also stressed the Commission’s commitment to ensuring insurance companies meet their obligations, thus contributing to the sustainability of the economy.
Speaking, Mohammed Baba emphasised the importance of revenue generation, institutional expansion, and employment creation for Nigerians through collaborative efforts.
The Commissioner for Insurance also acknowledged President Bola Ahmed Tinubu’s ambitious goal of growing the Nigerian economy to One Trillion United States Dollars ($1 trillion) by 2026.
He expressed the insurance sector’s intent to significantly contribute to this objective. Additionally, he mentioned ongoing efforts to embed insurance within the National Credit Scheme to ensure its sustainability.
Mr. Omosehin stressed the need for continuous advocacy and sensitization of government institutions about the vital role of insurance in national economic development.
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