Author Topic: STOCK EXCHANGE ATTRACTS N2.3TN IN FIVE YEARS, SAYS SEC  (Read 2682 times)

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STOCK EXCHANGE ATTRACTS N2.3TN IN FIVE YEARS, SAYS SEC
« on: July 02, 2008, 04:30:49 PM »

Nigeria?s stock market attracted new investments worth N2.3tn in the last five years as the market gains appeal from foreign investors, the Director-General of Securities and Exchange Commission, Mr. Musa Al-Faki, has said.

The investments were in form of equity issuance? the sale of new equity or ?stocks? by a firm to investors.

Al-Faki said in Abuja on Tuesday that the interest generated in the capital market underpinned the decision to introduce the electronic allotment of share certificates to investors.

Giving the breakdown of equity issuance in the market, Al-Faki said, ?The aggregate value of annual new issues, which stood at N195.42bn in 2004 increased to N552.78bn in 2005 and N707.39bn in 2006. In 2007, new securities in the market reached N1.94tn. ?From January to May 2008, the market has recorded N393.85bn in equities issuance.?

According to him, the size and fast growth in new issues have made e-allotment imperative.

The director-general said the new system, when fully implemented would eliminate the risk of loss of share certificates and remove cost of printing of share certificates.

?It will enable investors to access their shares immediately after SEC?s clearance. The investors can then exercise any investment action they may wish to. The long processing periods currently experienced in share certificate verification will also be eliminated,? he added.

Al-Faki reiterated that the market had recorded tremendous growth in the last few years, with investors reaping significant gains.

He explained that the gains were buoyed by Nigeria?s financial sector reforms, including the banking sector consolidation, insurance and the pension reform.

?The market has also witnessed considerable foreign interest. Seven banks floated GDRs worth over $2bn in 2007 with impressive subscriptions. Three Nigerian banks are now listed on the London Stock Exchange,? he said.

He described the e-allotment as another effort towards improving the efficiency of the capital market and enhancing investors? confidence that was in line with the demands of globalisation and international best practices.

He explained that the e-allotment would replace the traditional practice of manual issuance of share certificates.

?It is simply a direct credit system into an investor?s account with the CSCS,? he added.

The Minister of Finance, Dr. Shamsuddeen Usman, commended SEC for the initiative, adding that the innovation would reduce transaction period.

Usman who was represented by an official of the ministry, Mr. Jibril Zarewa, noted that the rapid growth and development of the capital market had rendered the manual handling of capital market activities cumbersome, inefficient and ineffective.

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STOCK EXCHANGE ATTRACTS N2.3TN IN FIVE YEARS, SAYS SEC
« on: July 02, 2008, 04:30:49 PM »

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