Okereke-Onyiuke, stockbrokers meet over capital market crisis
By Udeme Ekwere and Ifeanyi Onuba
The Director-General, Nigerian Stock Exchange, Prof. Ndi Okereke-Onyiuke, met with chief executive officers of stockbroking firms on the floor of the NSE on Tuesday, over the capital market crisis.
Briefing the press after the closed door meeting, the Managing Director/Chief Executive Officer, Compass Securities Limited, Mr. Emeka Madubuike, said that the stakeholders deliberated on ?how to move the market forward.?
According to him, ?We have thoroughly reviewed the market and looked into the solutions that were brought up but are yet to be fully implemented, and discussed ways to ensure that they are properly worked on.
?It was jointly agreed that the Federal Government should take a cue from the response of governments in other developed countries to financial crises rocking their economies, and act accordingly, by addressing the perceived imbalance in the Nigerian financial system.?
He also said that the meeting centred on ways to rebuild investor confidence and ensure liquidity in the market, adding that the market fundamentals were still strong.
Madubuike, however, said discussions between the market operators and the Federal Government were on-going.
Meanwhile, shareholders of companies listed on the NSE have called on the Federal Government to put in place direct measures, capable of reviving the market.
They said investors had suffered huge losses, which made it imperative for government to intervene in the market and save the system from total collapse.
Speaking in separate interviews with our correspondent on Tuesday, the shareholders said rather than wait for banks to bail out the market, government should, as a mater of urgency, look for ways to tackle the downward slide, which had made the market lose about N3.8tn within the last seven months.
The House of Representatives on Monday in Abuja disagreed over whether it was necessary for the Federal Government to set up an intervention fund for the capital market.
While the lawmakers, led by the Chairman of the Senate Committee on Capital Market, Alhaji Ahmed Wadada, were disposed towards having an intervention fund of about N500bn as a precautionary measure.
The Chairman of the Board of the Securities and Exchange Commission, Senator Udo Udoma, and his team had opposed the idea.
Although, he (Udoma) had agreed that government and regulatory authorities were worried over the crash in stock prices, he said, ?Our situation has not reached a point where we need an intervention fund.?
But the shareholders, while reacting to this development, said inconsistency in government policies had contributed to the market crisis.
A shareholder in one of the blue-chip companies, Mr. Adeleke Omotayo, said, ?If government had put in place a stabilisation fund, this would have done the magic. The intervention has not brought the needed result because the stabilisation fund was suspended.?
What the market needs, according to him, is an immediate solution to stem the downward slide.