The Nigerian Stock Exchange (NSE) management has hit back at claims that its trading system is obsolete and urged the country’s Securities and Exchange Commission (SEC) rather to support building confidence in the market. According to reports in Nigerian media, the NSE’s Assistant General Manager and Head of Corporate Communications, Sola Oni, on behalf of Director General Prof Ndi Okereke-Onyiuke, said the NSE uses the NASDAQ OMX system used in 30 countries and one of the best in the world.
She appeared to refer to remarks apparently made in Nairobi by the Director General of the SEC, Arunma Oteh. Mrs Okereke-Onyiuke said the NSE is a dynamic organisation that keeps upgrading its standards according to international best practices. She reportedly cautioned that Government officials should refrain from making statements capable of affecting the delicate balance in the exchange, saying its gains should be supported through confidence building. Mr Oni said the exchange had asked the Commission several times to use usual channels, instead of newspaper pages, to discuss issues.
According to Mr Oni, the NSE All share Index had climbed 30% in the last five months, from 20,817 points to 27,227 points, and trading activity was soaring. “Before the global meltdown, our market was one of the best in the world. But when the crisis came, our market over corrected itself and its fundamentals became low. Consequently, the market became grossly undervalued. Today, it is paying off because the market has become a tourist centre for local and international investors. Almost on daily basis we receive enquiries and welcome visitors”,
Mrs Okereke-Onyiuke confirmed that the SEC had approved the commencement of the new second-tier Alternative Securities Market called ASM/Primpex Market. This will benefit companies who want to be traded, but do not meet the requirements of a full listing. She said: “The ASM is a way of restructuring the second-tier securities market to enable companies takes full advantage of listings; they could migrate to the main market as soon as it is practicable.”
She also denied any leadership tussle over her succession, as she is set to retire in November 2010, aged 60. She said the succession plan for the exchange is seamless, and follows the corporate governance principles of the best privately run exchanges in the world. The SEC has called for an independent company to oversee the search for the new DG.
The 17-strong NSE Council, which includes 8 stockbroking members, is also considering changes to the exchange’s Memorandum and Articles of Association which would allow the exchange to demutualize, in line with a resolution taken at an AGM in November 2006. The exchange would move to having its own shareholders, operating for profit and possibly even listing. The SEC is hoping for a strong role to oversee the demutualization, but responsibility currently rests with the Council.