By PETER EGWUATU
The Chartered Institute of Stockbrokers, CIS has pledged to monitor the ongoing delisting process of stock broking firms on the Nigerian Stock Exchange, NSE ahead of planned demutualization of the exchange.
Furthermore, the CIS disclosed plans to engage the new leadership of the Central Bank of Nigeria (CBN) to review issues surrounding margin loans and ensure that processes of capital formation through loan is sustained and mutually beneficial.
The President of CIS, Mr. Albert Okumagba disclosed this while responding to questions from news during a press briefing in Lagos. Okumagba, stated that CIS will continue to play a leading role in advocacy to protect members and their businesses, stressing that discussions around demutualisation of the NSE and ownership interest have reached advance stage.
Demutualisation is the process where a stock exchange shares are listed in other stock exchanges around the world. In other words, it is the process of making a stock exchange a public entity where its shares could be traded in its own exchange as well as other exchanges in other jurisdiction.
He assured that the CIS would protect stockbroking firms in the exercise by ensuring that their equity made over the years would be captured in the whole process. On the on-going delisting of some stockbroking firms, the President said, “we will monitor the process to make sure that our members are not affected by reduction of registered stock broking firms. We have good relationship with NSE and we would make sure those members who operate as dealers in the platform have the best operating environment.”
Okumagba, while fielding questions to newsmen, lamented that there was no appropriate structure on ground for obtaining margin loan in the last 10 years.
“The CIS is working with Asset Management Corporation of Nigeria, AMCON, Securities and Exchange Commission, SEC, NSE and Federal Ministry of Finance in addressing issues of margin loans. There is progress in resolution of issues around margin loans and the engagement will continue.
“The structure is not yet in place in the last 10 years but we will review what has been done. We plan to engage the new leadership of CBN to ensure that processes and structures on how margin loan should be handled is put in place. Constructive engagement would address these grey areas,” he assured.