The Securities and Exchange Commission, (SEC) said that the deadline for recapitalisation of capital market operators remains September 30, 2015.
Director General of the commission, Mr. Mounir Gwarzo, who confided in Vanguard after the second quarter Capital Market Committee, CMC meeting in Laos said “September 30, 2015 is sacrosanct and every operator is expected to meet the minimum capital requirement.
According to him “ Already, a committee from the NSE and Central Securities Clearing System , CSCS is already working toward that deadline and in the next two to three weeks, we will know those that will meet the target. The committee is up and doing, having only two weeks to conclude the process.
Meanwhile, the Association of Stockbroking Houses of Nigeria (ASHON) had expressed fears that the persistent downward trend at the nation’s stock market would affect stockbrokers’ recapitalisation plans. Mr .Emeka Madubuike, ASHON President, said in Lagos that continuous dilution in the value of equities was a big threat to the exercise. “The major issue we have in this recapitalisation programme is the dilution in value because the market has lost over 33 per cent since October,” he said.
Madubuike said that some members who had shored up their capital using equities were in danger of going below the new capital base announced by the Securities and Exchange Commission (SEC) in 2013. He said that most stockbrokers’ assets were in equities, noting that the lull in the Nigerian Stock Exchange (NSE) would affect their capitalisation exercise.
Madubuike said that “there are people who, as of December, had met the requirement and are in danger of going below the required level due to the slide in the market. “This is something we need to talk about if the trend continues in the next few weeks, whether to use a prior date as the valuation date,” Madubuike said.
He said that the association had drawn the attention of the commission to the development, noting that it would engage SEC if the trend continued.The ASHON president said that the association’s major objective was to ensure that all members remained in the market, operating at one level or the other.
Madubuike, however, warned that people should not be frustrated out of the market in the name of capitalisation. He said that the classification of the new capital base for stockbrokers would help the market because people would be accommodated. Madubuike said that people would make business decisions to determine at what level they wanted to operate, whether as a broker/dealer, broker or dealer or stockbroker.
SEC on Dec. 19, 2013 issued a new capital requirement for capital market operators with Dec. 31, 2014 as deadline but the deadline was extended to Sept. 30, 2015. Vanguard
