By Providence Obuh

Securities and Exchange Commission SEC, the apex regulatory agency of he Nigerian Stock exchange , stepped up efforts for the demutualisation of The Nigerian Stock Exchange (NSE), when it issued “Exposure draft rules on demutualisation of exchanges in Nigeria.”Shareholders in this interview have further backed the move.  

Mr. Adebayo Adeleke, General Secretary, Independent Shareholders Association of Nigeria, ISAN

We have always agreed that the Nigerian Stock Exchange should be demutualised, the council of the exchange has lacked the courage and the will power to pull the demutualisation bill through and it is not unconnected with personal interest because quite a number of them are trying to personally manipulate and manoveur shares when it is eventually demutualised.

I think that is why they have not been able to pull that through. With the SEC coming out to give out some guidelines will bring out some issues, I think the issue is not about capital members or current members of the exchange being allotted certain percentage because that is where we are having challenges. When you say shares are made available then there is no reason why you should allot certain percentage to anybody, you allow the market to determine the flow of that particular shares.

People have right to buy and sell, there are normal processes of allocation of shares. We are in tune with the demutualisation, we are okay if SEC has suddenly found the courage to do the needful which Arunmah Oteh failed woefully to do after five years. We are also saying that the entire product can be fine- tuned such that the possession of the shares will go through the normal course where people have access. You can restrict people in terms of stealing but we dont want one person to corner it.

Mr. Boniface Okezie, President of the Progressive Shareholders Association of Nigeria

I don’t have any disapproval of demutualisation as long as the process will carry all Nigerians along and as long as soon as they demutualise; one person will not own Nigerian Stock Exchange, convert it as his own private estate but that the whole thing will go round to all Nigerians; everybody in the 774 local governments will have equity and be a stakeholder as soon as they demutualise the exchange and no individual or single organisation will own more than five percent but the NSE and dealing member will have at least 30 percent stake holding because the dealing members are owners of the stock exchange.

If that has been carried out, for me it’s alright and that will foster growth. Stock exchange is non-governmental, non profit organisation, so if it is demutualised and quoted as Plc, they will begin to make money because now it belongs to private people. Nigerians who own equity will have the council on the board on merit. It will foster growth in the capital market and people will have confidence.

Even if you are bringing government, they shouldn’t have more than five to ten percent given to them. That is at the federal level so that the government can nominate somebody to be on the board, because government raises bond and equity on the market which qualifies it to nominate somebody to represent its interest on the board.

This is the only way but they should go back   to the working paper by the former DG of the exchange, it has degree of SEC to demutualise the exchange. The demutualisation must come from within the exchange. If there is a working paper already given to the council by the former DG and council for approval, what SEC should do is to revisit the working paper and find out the understanding they have reached in the past and start from there to work out the demutualisation process not imposing new ideas.

The idea should be regenerated so that no Nigerian will be marginalised or sidelined. The paper is already there. They should go back and revisit that paper, if they work on that template it will be better for everybody and it will attract confidence among foreign investors and would be foreign investors and the local investors as well, so there is going to be transparency in that order. But if they go against that agreement earlier reached then they might be open to something else.