Mohammed Shosanya

The Securities and Exchange Commission has assured stakeholders in the digital assets space that it is ready to provide the necessary guidance that will grow the industry, create wealth for Nigerians and lead to economic growth and development.

Director General of the SEC, Dr. Emomotimi Agama,stated this in Lagos weekend,where he also said Commission is willing to be patient in ensuring that majority of interested participants are carried along.

He said:“We need to be patient in getting everybody on board to be able to provide the guidance that is needed for us to grow this industry, we need to grow this industry together.

“Over 80 percent of our population are interested in this area and that is why the government is showing so much interest too. And if the government is interested in it, the government has a responsibility to protect the investors that will come into it”.

He explained that due to the developmental role of the Commission, the SEC will develop the market while also ensuring that investors are protected adding that the Commission is stepping up its investor education mechanism to ensure that investors get the information they require to make informed investment decisions.

He added:“We need to be able to educate people, to educate the citizens, to educate investors, to educate participants, because there’s something that we can take away in every investment, there’s a risk and that risk must be understood by the people.

“The SEC has a responsibility to share that information with people that whatever you intend to do, you must be aware of these risks. So when you get into it, and if for any reason, things go the other way, you know exactly that you were aware you just decided to do it. Of course, investment is about risk reward, and that risk reward is, the higher the risk, the sweeter the reward, the lower the risk, the less the reward” .

He said the SEC Nigeria’s Approach to Digital Asset Regulation recognises the potential of blockchain and digital assets to revolutionize the capital markets and that is why the Commission has introduced several measures to ensure that these innovations are harnessed responsibly.

According to Agama, “We introduced the Accelerated Regulatory Incubation Program (ARIP) and Regulatory Incubation (RI) Program: The ARIP and RI Program were designed to on-board firms operating in the digital asset space and provide a controlled environment to test new models, products, and services. These programs foster innovation while ensuring that robust consumer safeguards are in place. The recent approval-in-principle granted to two digital asset exchanges and five firms participating in these programs is a testament to our commitment to enabling innovation.

However, beyond the obvious economic benefits, the SEC Boss said blockchain can drive significant social change, address difficult social issues, improving user experience and settlement speed and aid in financial inclusion and encourage creativity and innovation among others.

“Blockchain can be used to solve complex social challenges, such as corruption and lack of transparency in public services. For example, using blockchain for transparent voting systems or government procurement processes can increase accountability and trust in public institutions.

“The flexibility of blockchain technology allows for endless possibilities for new applications, from social impact bonds to decentralised applications that can address specific community needs. This opens up room for creativity and innovation, particularly among Africa’s youth, increasingly driving technological change on the continent.

“Blockchain-based solutions can provide access to finance for millions of people currently excluded from the formal financial system. By reducing costs and eliminating intermediaries, blockchain can make micro-lending, remittances, and other financial services more accessible and affordable” he said.

He said blockchain enables real-time transactions and settlements, reducing the time and costs associated with traditional financial services.

Mohammed Shosanya

Director General of the Securities and Exchange Commission, Dr. Emomotimi Agama has said that the Commission has implemented various initiatives to reduce time to market with the aim of improving the efficiency and attractiveness of the Nigerian capital market, promote economic growth and development.

The SEC DG,who spoke during an interview weekend, said these initiatives include streamlined registration processes, introduction of an electronic filing system and enhanced regulatory frameworks among others.

He emphasised that shorter time to market can benefit capital market development in several ways like increased liquidity which will lead to faster listing allowing companies to access capital more quickly, increased liquidity in the market and enable companies to allocate resources more efficiently, thereby driving economic growth.

“Shorter time to market will also improve investor confidence because when the listing processes are Efficient, it can enhance investor trust and confidence in the market. A shorter time to market can make a jurisdiction more attractive to companies and investors, promoting competition and growth.

According to him,the Commission in 2019 issued a new rule on electronic Public Offering (e-PO) system which streamlines the process of issuing new securities.

This he said, allows for faster processing of applications by automating various steps, reducing manual paperwork, and facilitating broader participation adding that the implementation of e-PO is part of a broader effort to make the market more efficient and reduce time to market.

“The Commission has been actively digitizing its operations, including the submission and processing of applications for securities registration, to reduce delays caused by manual processes. This involved the use of electronic platforms for document submissions and approvals, which not only speeds up the process but also improves transparency.

“We have undertaken regulatory reforms aimed at simplifying and streamlining the approval processes. These reforms include updating rules and regulations to reflect current market realities and adopting international best practices that enhance efficiency. For instance, the Commission introduced checklist review for registration of fixed income securities, thereby shortening the review and approval timelines. The Commission launched and conducted a targeted bi-annual training for Issuing Houses to enhance time to market and fast-track review of applications” He said.

He further disclosed that in June 2024, the Commission issued a framework on banking sector recapitalization programme, which outlines the guidelines and procedures banks are required to follow to raise capital during the recapitalization period to ensure a smooth, transparent, and efficient capital raising process which is serving as a comprehensive guide for Banks/Holding Companies and market participants on the requirements of the Commission for capital raising and mergers and acquisitions as well as assist the participants navigate the recapitalisation programme effectively to ensure proper and timely review and approval of the transactions.

He said, “The major highlight of the framework is the requirement for an e-offering platform to be provided by a Securities Exchange for the capital raising exercise, which allows for end-to-end offering, subscription and payment process. This is based on our resolution to enhance time-to-market, efficiency, transparency and integrity of the recapitalisation programme. The use of e-offering platform eliminates multiple identities and reduce potential for unclaimed dividends among other benefits.

“Also, a joint team comprising the Commission, CBN and NDIC was set up to facilitate the recapitalization programme, especially in areas of capital verification, which is a pre-requisite for allotment clearance.

He expressed satisfaction with the efforts so far made and assured that the current management of the SEC would continue to do its best in unlocking the full potentials of the capital market, in aligning with the Renewed Hope Agenda of the President Bola Ahmed Tinubu led administration.

“We will continue to do our utmost best to ensure that the capital market is well positioned to drive economic development. One thing I promise and one thing we promise as a team is that Time to Market will be properly dealt with. Approvals for issuances will be done swiftly so that when companies desire to come to the market, they know exactly what time approvals will be given.

“We are also going to guide in the process of submitting their applications, which is now done electronically. If you want to do an offer, the application will be submitted electronically. What does that do? It helps with the process of review and feedback” Agama added.

Mohammed Shosanya

The Securities and Exchange Commission (SEC) says the resolution of identity management issues would help reposition the Nigerian capital market for greater potential.

The Director General of the SEC Dr. Emomotimi Agama,who stated this at a Workshop on Identity Management for the Capital Market held in Lagos, Wednesday, said the identity management system currently being developed by the market will tackle the lingering identification issues.

Dr. Agama emphasised that identity management issues when solved will provide lasting solution to the issue of unclaimed dividends, reduce the barriers of entry to the market and make the market more attractive to the youth segment whose participation is currently very low.

The SEC DG stated that the aim of workshop is to bring together stakeholders and industry players to discuss and seeks ways of addressing the lingering issue of identity management in the capital market.

These issues he said,have plagued the market for a while, contributed to the increasing quantum of unclaimed dividends which seem to have defied all efforts to stem over time, and negatively affected the attraction and competitiveness of the market.

He said “In view of the promise to stem this undesirable trend going forward, the Commission is very passionate about this initiative because its success would portend great potentials for our market.

“This journey began in the year 2018, following discussions at the 3rd Capital Market Committee (CMC) meeting of the year, on the need to address legacy identity management issues in the market. The Securities and Exchange Commission, therefore in January 2019, set up an in-house committee on the subject. The Committee was tasked with identifying issues surrounding identity management in the market, engaging with relevant stakeholders to document and proffer solutions, and make recommendations to management.

Agama said that in a report submitted by the in-house Committee to Management, it stressed the need to consolidate investors’ data and seek ways and means to finding a lasting solution to this monster plaguing the market.

Following the recommendations of the Committee, the SEC DG said the Commission, in 2021, dissolved the in-house Committee and set up a market-wide and bigger Committee, to undertake a more intensive study of the depth of the Nigerian identity crisis , and more specifically, in the capital market and articulate actionable and measurable solutions to the lingering issues: harmonise the various databases of investors in the capital market with a view to engendering data accuracy, and addressing the absence of a central repository of investors’ data for the entire spectrum of the Nigerian capital market.

According to him , “The Committee, graciously chaired by Mr. Aigboje Aig-Imoukhuede, has its membership drawn from leading market players and institutions across the Nigerian capital market ecosystem, including the chief executive officers of Nigerian Inter-Bank Settlement System (NIBSS) Plc and the National Identity Management Commission (NIMC).

“In the course of its work, the Committee engaged the services of Ernst and Young (EY) as consultants to assess the current state of the capital market identity management system, undertake a cross-jurisdictional peer review and develop a future-state identity management framework for the Nigerian Capital Market. Here at the workshop today, EY would be providing insights into the research undertaken on our market vis-à-vis other jurisdictions and proffer solutions to our identity management challenges.

He stated that the postulations and recommendations of EY shall be the subject of deliberation for all stakeholders at the workshop which is hoped to assist in proffering a lasting solution.

In his remarks, Chairman of the Committee, Mr. Aigboje Aig-Imoukhuede said the work of the committee will assist capital market operators elevate their performances and commended the SEC for its suppose to the committee.

Babatunde Solanke

Director General of the Security and Exchange Commission,SEC,Dr. Emomotimi Agama,says Nigeria needs continuous nvestor education to develop the nation’s capital market.

He said this during a meeting with the management of the Investments and Securities Tribunal in Abuja, Thursday.

He said:”We need to continue constant education in the capital market. The market is knowledge based and we are committed to ensuring that information is made available to the investing public.

“The Commission will continue to partner with relevant stakeholders to create more opportunities for learning. We will do more trainings and sensitisation because it is important we continue to learn”.

He stated that the IST is an important organ in the discharge of capital market disputes adding that as more cases are being resolved, the investing public will begin to appreciate more the role of the IST in the capital market.

He disclosed that decisions on cases brings about confidence which is needed for the nation to have a fledging capital market

He assured that the SEC is committed to partnering with the IST on the dispensation of justice and growth of the capital market.

Speaking,Chairman of IST, Mr. Amos Azi said the IST was borne out of a need to address two significant pillars of market growth, development and stability which are investor confidence and protection through a specialized dispute resolution system.

He said, “Suffice to say, this one initiative has set the pace for similar regulatory climes all over the world. There is no gain saying, the Tribunal is the bedrock of dispute resolution in the Nigerian Capital market.

“Established pursuant to S.274 of the ISA 2007, the Tribunal has given judgements on over 480 cases with monetary value of over N868billion naira”.

Azi stated that in the course of exercising its powers, the Tribunal has not only restored investor confidence in the market but has contributed immensely in the development of capital market jurisprudence by its decisions, and promoted knowledge dissemination and market enlightenment through its law reports.

“It is noteworthy to state here that the creation of the Tribunal gave a boost to the International recognition of the Nigerian capital market. You will recall that the existence of the Tribunal was part of the factors considered by the International Organization of Securities Commission (IOSCO) in admitting Nigeria’s SEC as “Appendix A” signatory to its multilateral memorandum of understanding (MMOU) in 2006″ he added.

Babatunde Solanke

The Securities and Exchange Commission has alerted remembers of the public on some fake social media accounts purporting to be those of the Director General, Dr. Emomotimi Agama.

The SEC said,it has become aware of several fraud attempts targeting the investing public and its online community.

“These scammers are impersonating the Director General of the Commission – Dr. Emomotimi Agama with the aim of luring unsuspecting members of the public into sharing personal information and making unauthorized payments”,it said.

The SEC therefore informs members of the public that neither the Director General nor any staff of the Commission Would request for personal information about their investments through private phone lines, emails or social media handles.

“Official information from the Commission is communicated ONLY through its verified email addresses, website, social media handles, and phone numbers.

“Always verify the identity of the person or entity contacting you. If unsure, do not hesitate to immediately contact us directly through [sec@sec.gov.ng] or call [+234 02094621168]” the Commission stated.

The Commission restated its committed to the protection of investors in the Nigerian Capital Market adding that it is working diligently to curb scams and other fraudulent activities.

Mohammed Shosanya

The Director General of the Security and Exchange Commission (SEC) Emomotimi Agama, has said that Nigeria’s cryptocurrency market is estimated to be worth over $400 million, with a significant portion of the population involved in cryptocurrency trading and transactions.

At the 2024 Annual Conference of the Association of Capital Market Academics of Nigeria (ACMAN) Thursday in Abuja, with the theme ‘Crypto Assets and the Nigerian Economy: Implications for Financial Markets Regulation’, the SEC DG, the volume of the cryptocurrency market in Nigeria would hit $52.5 million in 2028, indicating a 12.66 per cent increase between 2024 to 2028.

According to Agama, despite economic challenges, the country has emerged as one of the leading countries globally in terms of crypto adoption and volume of transactions.

He said, “Reports indicate that Nigeria’s crypto transaction volume reached $56.7 billion between July 2022 and June 2023, representing a nine percent year-over-year growth.

“The country’s crypto market is estimated to be worth over $400 million, with a significant portion of the population involved in cryptocurrency trading and transactions.”

Disclosing that approximately 33.4% of Nigerians own or use cryptocurrencies, the Director General said the country can take advantage of the large number to further provide financial services for the over 38 million unbanked adults. According to him, some people don’t have bank accounts but they have wallets.

He added that cryptocurrencies can also provide cheaper and more efficient methods of remittance for Nigerians in diaspora.

“Cryptocurrencies can significantly reduce remittance costs, with Bitcoin transactions cutting fees by up to 50%. Nigeria is one of the largest recipients of remittances in Africa. Cryptocurrencies offer a more efficient and cost-effective way for Nigerians abroad to send money home. With traditional remittance fees often being prohibitively high, cryptocurrencies provide a cheaper and faster alternative,” he said.

He, however, noted that despite the numerous advantages, challenges persist. He pointed out concerns over illicit activities, as highlighted by Nigeria’s Economic and Financial Crimes Commission (EFCC), which has reported cases of crypto-related scams.

According to the SEC DG, regulatory uncertainty, security concerns and financial literacy pose a serious threat to crypto use.

“The lack of a comprehensive regulatory framework has created uncertainty, which can deter both investors and innovators. Cybersecurity threats, including hacking and fraud, pose significant risks. A substantial portion of the population lacks adequate financial literacy, making them vulnerable to scams and risky investments,” he explained.

He asserted that Crypto assets present significant opportunities and challenges for Nigeria’s economy noting that a balanced regulatory approach is essential to harness their benefits while mitigating risks.

“Collaborative efforts from regulators, industry stakeholders, and the public are crucial for developing effective regulations. I encourage continued dialogue and cooperation to ensure a secure and innovative financial ecosystem,” he said.

In his remarks, Chairman of the Securities and Exchange Commission, Mr. Mairiga Katuka said the introduction of crypto presents an advantage for the markets and urged all to chart a course forward for Nigeria with its vibrant financial markets.

“Together we can drive the development of a vibrant resilient capital market in line with President Bola Tinubu’s dream on making Nigeria a prime investor destination.

“Let us work together to build a capital market that does not only see The needs of today but also anticipates the problems of tommorrow with view to finding solutions before the issues arise” he added

Mohammed Shosanya

The Securities and Exchange Commission has released its Framework on Banking Sector Capitalisation Programme, 2024.

This is in a bid to support the Central Bank of Nigeria’s recapitalisation programme towards achieving the targeted objectives.

The framework which was released on Friday serves as a comprehensive guide for Banks/Holding Companies and market participants to navigate the recapitalisation programme effectively.

The move is driven by the recent directive by the Central Bank of Nigeria for banks to raise additional capital to serve $1tn economy.

In the new CBN capital requirement, international banks are expected to raise their capital base to N500billion, national banks, N200billion and regional banks N50billion.

The Commission said the framework would help to ensure that the capital raising process is conducted efficiently, transparently, and in a manner that protects the interests of all stakeholders.

This is expected to serve as a guide to the Banks/Holding Companies issuers and Capital Market Operators in filing applications for capital raise and/or mergers and acquisitions.

Other objectives of the framework are to guide in ensuring full disclosure of material facts in compliance with the Investments and Securities Act 2007, Rules and Regulations of the Commission and other relevant laws, to ensure proper and timely review of the transactions

According to the SEC, “Following prevailing macroeconomic challenges and headwinds occasioned by external and domestic shocks, the Central Bank of Nigeria (CBN) has mandated a recapitalisation programme for banks to strengthen their asset base and support economic growth in line with the Federal Government’s target of achieving a $1 trillion economy by 2030.

“Capital market has a significant role to play in facilitating the recapitalisation programme as the Banks are expected to leverage the market to raise the needed funds and /or engage in various forms of business combinations.

“As the regulatory institution mandated to regulate and develop the Nigerian capital market, the Securities and Exchange Commission (SEC), has the responsibility to ensure a smooth, transparent, and efficient capital raise process by the banks.

“This framework outlines the guidelines and procedures banks are required to follow to raise capital through rights issuance, private placements, or other approved methods during the 2024-2026 recapitalisation period”.

The SEC stated that applications/documents are filed electronically via offerapplications@sec.gov.ng email adding that documents forwarded will be reviewed, and where there are observed deficiencies, this will be communicated to the applicants electronically.

The Commission also stated that where deficiencies are communicated, the timeline resets and in the absence of any deficiency, approval will be granted and communicated.

“Where an application is returned for being incomplete – a penalty of N1,000,000 and re-filing fee of N100,000 shall apply. This fee is payable by the Issuing House without a recourse to the Issuer or the Issue proceeds. For further inquiries or clarification, banks and stakeholders are encouraged to contact the SEC’s dedicated offer application email: offerapplications@sec.gov.ng” the Commission stated.

The Commission disclosed that the framework is an excerpt of the existing Rules and Regulations of the Commission and should be read in conjunction with the relevant provisions of the Investment and Securities Act, 2007 and the Commission’s Rules and Regulations.

“The Commission may require other documents or information as may be necessary. Where an issuer had already filed necessary documents with SEC (e.g. Memorandum and Articles of Association (Memart) or certificate of incorporation or certificate of increase in share capital, etc.) the issuer need not file the documents in subsequent transactions, provided the issuer enters into an undertaking that since the previous filing, there has been no change in the documents already filed with the Commission. Affected banks/Holding Companies are required to regularise/update their corporate information with the CAC prior to filing an application with the Commission” it added.

Mohammed Shosanya

The Director General of the Securities and Exchange Commission,Dr. Emomotimi Agama has tasked stakeholders in the capital market to embrace innovation as a catalyst for growth, increased efficiency, heightened transparency, and resilience.

He stated this in his keynote speaker at the 2024 Capital Market Solicitors Association Annual Business Summit held in Lagos recently with the theme “Revolutionising the Nigerian Capital Market through Innovative Financial Instruments for Sustainable Development”.

He disclosed that the SEC is aware of the new financial products and services that are emerging due to technology and is committed to adapting its regulations to address these innovations.

According to him, “The Commission has a three-pronged approach to regulating innovation: safety, market deepening, and solutions to problems. This has always, and will continue to help create a more efficient and reliable capital market ecosystem.

“In the efforts to support the innovation and growth in the market, the SEC had established a programme of assessment called Regulatory Incubation to help new FinTech businesses. The programme allows them to operate for one year within a highly fortified and limited regulatory perimeter while the SEC develops applicable rules that address these innovative technologies. The incubation programme helps ensure investor protection and market stability while fostering financial technology advancements in the Nigerian Capital Market”.

He reiterated that one of the cardinal objectives of the Revised Capital Market Master Plan (CMMP 2021-2025), is to leverage technology and innovation to expand the depth and breadth of the Nigerian Capital Market, to enable it contribute significantly to national economic development.

“In order to facilitate the success of the RCMMP, a major task before the Securities and Exchange Commission, is creating an enabling regulatory and supervisory environment for innovation to thrive as means of deepening the Nigerian Capital Market in terms of new products & processes” he stated.

Dr. Agama,however, cautioned that as the market embraces innovation, operators and participants must remain vigilant to the risks they entail, including cybersecurity threats, regulatory complexities, and market volatility.

“While the potential of innovation is undeniable, embracing it also comes with challenges. Hence, we must be mindful that exploration of new instruments must be balanced with robust risk management frameworks. The SEC will ensure appropriate safeguards are in place to protect investors and maintain market stability.

“Investor confidence is the bedrock of any successful market. Fostering trust in innovative instruments through transparency and clear communication will be key.

“The success of these initiatives demands collaboration by all stakeholders, including the CMSA, legal professionals, regulators, and market participants. We must create a forum for open dialogue and continuous improvement.

He commended the organisers of the event for bringing together thought leaders from diverse sectors of finance, law and the capital market, alongside regulators and operators, to exchange insights towards advancing the Nigerian capital market and by extension, the Nigerian economy.