Mr Oluwaseyi Abe, is immediate past President and Chairman of Governing Board of the Chartered Institute of Stockbrokers, CIS, and Managing Director/CEO, Magnartis Finance and Investments Limited. In this interview, Abe offers insights into current developments in the capital market, the state of economy in Nigeria and his stewardship at CIS among others.
By Peter Egwuatu
HOW can we encourage more foreign investors to come to the Nigerian capital market?
We need to encourage foreign investors through legislations that will enhance confidence in our environment. For instance, our laws on sanctity of contracts must be enforced; we need improved security network and workable fiscal and monetary policies in order to provide the much-needed enabling environment for local and foreign investors at individual and corporate level.
In the light of recent high-profile infractions in the market, what regulatory and enforcement frameworks have been put in place by the institute as a Self Regulatory Organization (SRO) to checkmate abuses and ensure professional integrity?
We have our disciplinary processes that ensure proper handling of erring members through fair hearing. This complements what is obtainable on the different platforms across the capital market space. All of us have zero tolerance for infractions because we are obligated to ensure investor confidence.
What can be done to encourage companies to list in the stock market?
We must accord priority to investor education with emphasis on the benefits of listing companies in the stock market. Investors must be educated on liquidity generation and risk – return trade-off. Also, there is a need to review listing fees across all platforms to make our stock market attractive and competitive. We must continually create healthy competition among our listed companies through innovative criteria such as corporate governance and shareholder value among others. These will ginger the listed companies in the valley of indecision to brace up for outstanding performance. When the existing quoted companies are operating online optimally and meeting the expectation of their shareholders at least at the minimum, they will serve as beacons of hope to potential companies who shall take advantage of the benefits of listing to seek quotation in the stock market.
With many rules and codes, is there any fear of over regulation in Nigeria’s capital market?
Rules and regulations are meant to guide human conduct. We need those rules as the market continues to evolve. We cannot operate optimally in the global space without strengthening our regulations. These rules are designed to protect investors and uphold market integrity in the final analysis.
You have just concluded your tenure as the CIS President, what are the high points of your achievements? What are the challenges and what would you have done differently?
We have been able to refocus and reposition the institute greatly. We have returned the institute to profitability though there is room for improvement. We got our Council’s approval to confirm Honourary Fellowship for four eminent Nigerians for the first time in the history of the institute. Some retired army generals are now part of us as stockbrokers under the Honourary Fellowship provision. At 25, the institute acquired a befitting secretariat at highbrow Ikoyi area of Lagos. This is in spite of our challenging operating environment. We have also commenced the Specialised Professional Certification (SPC) to lessen our rigorous barrier for entry into stockbroking profession. This is in line with global best practices to encourage specialisation.
We have increased awareness through “Operation Catch them Young’ by partnering with tertiary institutions. We have recorded significant improvements in members’ participation in the institute’s functions, an indication of renewed confidence. We have re-launched the Nigerian Stockbroker Magazine . We have held successful national workshops that received federal government’s nod. With all humility, I can say we have done well. Our successes are also predicated on the support from all stakeholders. It is a collective effort and I have no doubt that my successor will keep the flag flying.
Where do you see stockbroking in Nigeria in the medium-to-long -term and how will the enlarged scope of Chartered Institute of Securities and Investment (CISI) Bill impact the capital market?
CIS has built an enviable profile as a force to be reckoned with. Quite a lot of people are showing interest in our affairs. Going forward , we are now on a better pedestal to play our advocacy roles in the economy. The CISI Bill will unite all players and professionals in the entire financial market by putting everyone under the same monitoring radar. This will enhance cooperation and sanity in the market.
What is your assessment of the outlook for the economy?
The outlook is very bright. All the indices are there for everyone to see. In fact, they are favourable to Nigeria. But there are downside risks, things that must be put in place to unlock the potentials of our economy and which invariably are left undone may hamper our economic growth and development. There is compelling need to depoliticize policy making and implementation. By implication, we must downplay the act of reading political meanings to everything. We must put professionalism above personal interest. Skill and competencies of every professional must be accorded priority without prejudice to the issue of integrity. These are necessary variables that can drive economic growth and development. When we get the basics right, it permeates all levels of decision making.
How do you see the regulatory structure at the capital market, especially with the recent happenings at the Securities and Exchange Commission (SEC)?
In my personal opinion, government should reduce too much involvement in the affairs of our capital market regulators for enhanced independence of these institutions. This will enable our regulators to play larger roles expected of them in the entire capital market space.