IN recent times, the stockbroking community has been making series of effort to gain international visibility through various programmes and collaboration with their counterparts in other markets. In this interview with Financial Vanguard, Mr. Oluwaseyi Abe, President/Chairman of the Chartered Institute of Stockbrokers, CIS, provided an insight into the quest, saying that the collaborations are to prepare Nigerian dealers to play in global space. Excerpts:
By Nkiruka Nnorom
IN recent time, the stockbroking community represented by the Chartered Institute of Stockbrokers, CIS, has been pushing for global visibility through various programmes and engagement. What necessitated this drive?
It is not a new development actually. Since the beginning of this administration, we have been trying to see what we can do better. If you look at the market, we have foreign institutional investors investing in our market. So, because the market has been opened up, it is only good to make our brokers relevant in other markets as well. And also, we just have to operate in the international standard, we need to upgrade to international standard. If you look at the Nigerian Stock Exchange, NSE, they have upgraded to global best practice.
So, if the providers of the platform are moving towards global best practice, it is better we prepare our operators as well for that global best practice and operation. That is what we are doing. Again, we need to prepare our brokers for trading sophisticated instruments in the market.
There is a believe in some quarters that dealing members firms in the Nigerian Stock Exchange, NSE, do not have the capacity, technology wise, for the kind of international operation and trading you are pursuing. What is your view on this?
That cannot be true because the adoption of technology is in two ways. One, is it within the firm itself or is it within the trading platform, that is the stock exchange and other platforms. For a stockbroking firm to operate from the NSE, there is a minimum requirement in terms of technology that you need to have and our stockbrokers are well prepared for it. We have upgraded. There is something that is called Minimum Operating Standard, MOS, at the stock exchange.
The minimum operating standard is rated within the international best standard for capital market. Our brokers have been assessed and the Exchange has made it possible for a whole lot of brokers to comply with MOS. So, in that regard, the opinion that our brokers are not ready in terms of IT infrastructure cannot be said to be true.
What is this collaboration with Chartered Institute of Securities and Investment, United Kingdom with Nigeria stockbroking firms all about?
Like I said, the collaboration is to prepare our brokers for the international market, international market in the sense that we have looked at best practices in the world and so we are trying to prepare our brokers so that they can compete effectively with their counterparts in other parts of the world in terms of knowledge, manpower and capacity.
So, even in our profession, you can see that we have set out to repeal the law establishing the chartered institute of stockbrokers and enact another law called Chartered Institute of Securities and Investment, CISI, just like the one you have in UK and the United States of America and this one provides for professionalism across all instruments whether you are FX dealer, whether you are commodity dealer, whether you are stock dealer, bond dealer or Treasury Bill dealer which is the way it is abroad. So, the first thing we have set out to do is to collaborate with CISI UK so that we can share their experience and pattern our operations in their way as well. We have even gone up to the stage that whenever our brokers go abroad, they don’t need to do much certification before they are qualified to practice there.
Away from international affiliations and global visibility, last week, the CIS held training on Commodities and Futures Exchange you are about to float. Can you give some details on this plan ?
You see, the present administration has given credence to agriculture and so what we have done as a stockbroking community is to float a commodity exchange and so we need to train and equip our brokers to be able to function in that capacity. You know that trading in commodity is different from trading in equities and bonds. So, we need to prepare our brokers to be relevant on that platform. It is supposed to make our stockbrokers multi-talented and multi-dimensional in their operations.