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SEC joins EFCC, CBN, NDIC to investigate banks

By Peter Egwuatu
The Securities and Exchange Commission (SEC) has joined Economic and Financial Crimes Commission (EFCC), the Central Bank of Nigeria (CBN) and Nigeria Deposit Insurance Corporation (NDIC) to investigate banks and other companies engaged in carrying out capital market transactions.Ag. Director General of the SEC, Ms. Daisy Ekineh revealed this to newsmen in Abuja.

According to a statement, the Acting DG, said, “ It is worthy to note that the commission  is part of the teams comprising the Economic and Financial Crimes Commission (EFCC), the Central Bank of Nigeria (CBN) and Nigeria Deposit Insurance Corporation (NDIC) which are undertaking special investigation exercises of the banks. Indeed the Commission’s staff have been very instrumental in uncovering aspects of the investigations that relate to capital market transactions.  Our staff will therefore continue to participate actively in the different teams until the ongoing exercise is completed.”

In addition to the foregoing, and specifically as it concerns the capital market, she revealed that the commission is currently undertaking on-site target inspection of registered entities in the market scattered in different parts of the country.

According to her “ The exercise is meant to ascertain the state of health of firms operating in the capital market, as a follow up on off-site returns periodically submitted to the commission by the firms.”

Ekineh,  reiterated the commission’s determination to ensure that no stone was left unturned in the collective efforts to ensure the continued stability, transparency and efficiency of our market. “ We will continue to collaborate and work with other relevant agencies to ensure that the integrity of the market is not brought to question while the interest of all stakeholders, especially the investor is protected at all times” she added.

The acting SEC DG said, “ Given the current global financial meltdown, it is instructive for all hands to be on deck to ensure that the integrity and orderly growth of our market is not compromised.”

Some of the step taken to make the market attractive and vibrant, according to her was on reactivation of bond market. Speaking to newsmen last week , she said , “ The commission has over the years supported any initiative aimed at reactivating the bond market.

The bond market as it is known provides viable alternative investment outlets for interested users of funds and investors.  The federal and state governments have however in recent times been very active in this area of the market while the corporate segment has recorded virtually no activity.  The Commission, in a focused bid to reverse this undesirable situation, has put in place the necessary framework to ensure that the bond market is actively resuscitated.  The framework includes extensive draft rules which have been exposed to the market in order to ensure wide consultation.”

In addition to the consultation with stakeholders she said, “ we are currently engaged in discussions with relevant agencies of government to offer incentives and address identified bottlenecks and other factors that may either discourage prospective investors or hamper the successful achievement of the objective to actively resuscitate the nation’s bond market.  Specifically, the CBN has agreed in principle at a recent meeting, to remove the 10% cap earlier placed on banks’ participation in sub-national and corporate bond offers in order to enable the banks invest substantially therein.  It is also worthy to note that substantial progress has been achieved in securing tax holiday in respect of corporate bonds.  The market will be kept abreast of further developments in this regard.”

Ekineh said, “ As part of the current restructuring exercise aimed at strengthening our capital market, the commission recently approved the discontinuation of the periodic renewal of registration by capital market operators and investment exchanges.It is believed that this discontinuation will enhance the profile of our market processes and its attractiveness as viable investment destination for both local and foreign participants.

As a direct consequence therefore, the Commission is set to strengthen its monitoring capacity in order to address post registration issues.  The relevant rules are currently being reviewed and will subsequently be exposed for necessary inputs from the market before they are finalized and forwarded for approval by the relevant authorities.”


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