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.

Mohammed Shosanya

The Senate Committee on Capital Market has confirmed Dr. Emomotimi Agama as the Director-General of the Securities and Exchange Commission.

The Committee chaired by Senator Osita Izunaso, also approved the nomination of Frana Chukwuogor as Executive Commissioner (Legal and Enforcement),Mr Bola Ajomale as Executive Commissioner (Operations) and Mrs. Samiya Usman as Executive Commissioner (Corporate Services).

President Bola Tinubu had on April 19 this year appointed Agama as the DG of SEC to take over from Lamido Yuguda.

His appointment as SEC DG has been hailed by capital market stakeholders who described him as a technocrat that would boost the birthing of the Tinubu administration’s $1tn economy.

Speaking after his confirmation, Agama, a technocrat and insider of the commission said he will accelerate the development of the capital market in a manner that would boost wealth creation, attract investments and create jobs for Nigerians.

According to him,his team was appointed by President Tinubu to change the narrative of the capital market and reposition it to the path that would boost economic growth.

He said: “We are bringing on board innovation, development. We are going to change the narrative of the Nigerian capital market. We are going to turn it around. That is the essence of our appointed by Mr. President. With this team, we assure Nigerians that we’re going to do the best that the President has the desire to do.

“So, we should all wait to see what is going to happen. Our desire is to move this market forward. And to help in achieving the President’s $1tn economy in the shortest possible time.

“Yes, the President is going to be a year in office in a few days. That is remarkable because as an anniversary giver, the President has given us to Nigerians to do the best to change the market.”

He described the capital market as the barometer of the economy, noting that the Commission would implement innovative polices and programmes that will create world-class companies in such a way that will ensure redistribution of wealth.

He said:”You must understand that the capital market is actually the barometer of any economy. And without a strong capital market, then, of course, the economy will not do very well. The intention of this management is to make sure that we mainstream the capital market in the Nigerian economy.

“And in doing that, we’re going to be able to provide employment, change the narrative, and create companies that are going to be top world-class companies in such a way that there will be what we call redistribution of wealth.

“The President has an intention to change the lives of Nigerians. And the capital market is one of the vehicles that the President intends to use to achieve that. That is why the President has set up a team like this to be able to do that.”

Mohammed Shosanya

The Securities and Exchange Commission has pledged to work with the Economic and Financial Crimes Commission in a bid to ensure that trading manipulations are reduced in the virtual space.

Acting Director General of the SEC, Dr. Emomotimi Agama,stated this Tuesdaywhen he received a team from the EFCC led by the Executive Chairman Mr. Ola Olukoyede in Abuja.

Dr. Agama stated that as apex regulator of the capital market, the SEC is ready to co-operate with the EFCC in order to achieve the national objective of making sure that illegality is not allowed to thrive.

He said:“It is a great pleasure to receive you here today. This is a testament to the relationship we have and the value you place on the SEC and the best interest of Nigeria. We believe this will be the beginning of greater things to come. My desire is for us to strengthen the existing Memorandum of Understanding we have and ensure it is more effective in dealing with current issues.

“We believe this form of co-operation is in the best interest of Nigerians. Only last week, met the fintech community and we made it clear to them that the SEC will not condone illegal trading on any platform especially P2P. it’s a dangerous trend and we cannot allow it continue. This collaboration is very necessary for us to get out of this forex crisis”.

He disclosed that the Commission is planning an economic regulatory hub where it can upload requests and other regulators/sister agencies would be able to respond immediately thereby reducing incidences of delay.

“We plan to create an economic regulatory hub we can upload requests and other regulators can respond immediately. Time to market is very important in the work we do and we need to have information and responses in a timely manner.

“We will do all we need to do to ensure our markets are free from manipulations. We will enforce where necessary to send a strong message that it is no longer business as usual.

“We are examining our virtual regulations to cover all areas and are open to reviews to have a better document and a well regulated market. we are striving to close all the gaps and this co-operation will enable us block every gap in our bid to regulate the virtual space and give comfort to Nigerians.

Agama disclosed that the Revised Capital Market Master Plan which the Commission is currently implementing is geared towards stimulating the economy and attracting FDIs.

He said: “The opportunities in the capital market are enormous and we are yet to tap the full potentials for economic growth. The economy has a lot of issues and the capital market is one of the avenues that can lead to economic emancipation. The President has said he wants to re-engage the youths and that is why we are making efforts to ensure that our markets have the right products that can attract them.

“Whatever we can do together to improve the market and economy and send a strong message to the bad actors, we are willing to do it. It is a win win for all of us and I assure you of our determination to work with you to ensure that economic saboteurs are not allowed to thrive.

Speaking earlier, the Chairman of the EFCC, Mr. Ola Olukoyede said forex malpractices and crisis are injurious to any economy adding that the role virtual traders are playing in destroying the Nigerian economy through their activities needs to be checked.

He described the SEC as critical in the area of regulatory compliance stating that the Commission is ready to use the instrumentality of the Commission to stimulate the economy.

“We are enforcers and not regulators and that is why we need the SEC to ensure people play by the rules. We have done a lot in discouraging people from forex malpractices.

“The mandate of the EFCC is to enforce all economic and financial crimes in Nigeria and this is a herculean task and that is why we are collaborating with other relevant government agencies. We need to ensure people play by the rules and ensure compliance in a bid to attract Foreign Direct Investments to our economy.

“If people have trust in us and know people play by the rules, it will attract them. And the EFCC is working to ensure people play by the rules.

Olukoyede stated that fighting corruption is a collaborative effort that the EFCC cannot do alone emphasising the need for other agencies to lend their co-operation.

He commended the SEC on its guidelines on virtual assets and pledged the willingness of the EFCC in ensuring compliance by stakeholders.

Mohammed Shosanya

The Securities and Exchange Commission (SEC Nigeria) has exposed New Rules on Issuance and Allotment by Private Companies Securities in the country.

It declared that any person who issues or allots securities without its prior approval or violates any provisions of its regulations will be liable to a penalty not less than N10 million in the first instance and a further sum of N100,000 for every day the violation continues.

The recommended fine is contained in the proposed new rules on the issuance and allotment of private companies and securities prepared by the Securities and Exchange Commission.

The rules apply to debt securities issuances by private companies either by way of public offer, private placement or other methods as may be approved by the commission; registered exchanges and platforms which admit debt securities issued by private companies for trading, price discovery or information repository purposes; registered capital market operators who are parties in issuances and allotment of debt securities of private companies.

The commission which set out stringent punishment for those who violate the regulation, stated: “Any person who issues or allots securities without the prior approval of the Commission, or violates any provisions of these rules shall be liable to any one or more of the following sanctions:

i. A penalty of not less than N10 million in the first instance and a further sum of N100,000 for every day the violation continues;

ii. Suspension, or withdrawal of the registration of the capital market operator(s) involved;

iii. Disgorgement of proceeds/income from the transaction; and iv. The Commission may ratify or rescind a transaction if it is in the interest of the public to do so; v. Any other sanction the Commission deems fit in the circumstance”.

The commission,in the document stated that a private company may list its securities on a registered securities exchange, adding that such securities must be listed not later than 30 days after completion of allotment.

SEC explained that for a private company to be eligible to issue securities under the regulations it must be a company duly incorporated under Companies and Allied Matters Act (CAMA), or other enabling Laws with at least three years track record of operation.

The regulations pegged the maximum amount a private company can raise within a one-year period at N15 billion provided that where a private company intends to undertake any further debt securities issuance, it shall be required to re-register as a public company.

It added that the issuing house would, within 21 working days of allotment, file with the commission a summary report containing post allotment information; summary of applications received; list of allottees of 50,000 units of securities or more and list of all allottees acquiring 5 per cent or more of the securities on offer; list of all applications received including list of those rejected and the basis for rejection, among others.

According to the proposed rule,for a private company with existing debt securities held by qualified investors, the company “shall no later than three months from the date of issuance of these rules, file an application for the registration of the securities to the Commission through the securities exchanges.

Failure to comply with this provision shall attract a penalty of not less than two million Naira and a further sum of N100,000 for every day the violation continues”.

It added that a private company “shall not offer its equity securities (shares) to the public under any circumstance. b) Debt securities issued under these rules, shall be sold only to qualified investors. c) Only registered capital market operators shall be parties to debt securities issuances under these rules. d) No private company or any person acting on its behalf shall offer, sell or allot securities to the public without the prior clearance of the securities exchange and registration of the securities by the Commission. e) Securities purchased in a public offer pursuant to these rules shall only be traded on a registered securities exchange”.

On the utilization of Proceeds, the Commission held that issuers are prohibited from using the proceeds of the issues for purposes other than those stated in the offer document without its prior approval, adding that “the issuer shall file with the Commission not later than 90 days after the conclusion of an issue on the appropriate SEC Form, detailed information on the utilization of proceeds.

Evidence of such utilization shall be provided as appendix to the report.The rendition shall be on a quarterly basis until issue proceeds are fully utilized”.

“The issuer is prohibited from using the proceeds of the issue for purposes other than those stated in the offer document without the prior approval of the Commission.

“The issuer shall file with the Commission not later than ninety (90) days after the conclusion of an issue on the appropriate SEC Form, detailed information on the utilization of proceeds.

“Evidence of such utilization shall be provided as appendix to the report. The rendition shall be on a quarterly basis until issue proceeds are fully utilized.”

The commission said the rules were made pursuant to “Section 43 (1) (b) of the Business Facilitation (Miscellaneous Provisions) Act 2022 which amends Section 67 (1) of the Investments and Securities Act and empowers the Commission to prescribe regulation for the issuance and allotment of private companies’ securities”.