DEMUTUALISATION NIGERIAN STOCK EXCHANGE PDF

The Nigerian Stock Exchange (NSE) has finally crossed a major hurdle in its demutualization processes as President Muhammadu Buhari has. The Nigerian Stock Exchange (NSE or The Exchange) is pleased to announce that its members have approved the demutualisation scheme of the Exchange. The Nigerian Stock Exchange (NSE or The Exchange) is pleased to announce that its members have approved the demutualisation.

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It allows the demuthalisation of private companies into public companies and vice versa. Examples of transactions that will attract liquidity include exchange services for derivatives trading, clearance and settlement.

Other type of directors, with expertise in IT ddmutualisation, product information etc, are brought in to make the exchange more competitive in its strategic outlook. CAN advises el-Rufai to stop chasing shadows over threat to arrest Enenche.

Demutualisation leads to lesser influence of trading members of the NSE on corporate decisions, as their board representation diminishes. The SEC has also been proactive in approving new listing rules that tackle the peculiar concerns of companies cheaper listings being part of a demutualised exchange. The Nigerian Stock Exchange NSE has finally crossed a major hurdle in its demutualization processes as President Muhammadu Buhari has finally signed the bill into law that will transmute the Lagos based bourse from a mutual association of exchange members nigeeian a limited liability company which is accountable to shareholders.

It will be liable and responsible to its shareholders in terms of return on stocj unlike the previous status quo where funds were internally generated and profit making was not a defined objective. Notify me of follow-up comments by email. Basically, it refers to the conversion of a non-profit, mutually owned company to a for-profit entity limited by shares.

The demutualization of the Exchange demutualjsation bring the Nigerian capital market on a par with other international jurisdictions, result in enhanced governance, transparency and visibility whilst attracting strategic partners, investors and good quality issuers.

Following the resolution, the chairman, House of Representatives Committee on Capital Market and Institutions, Yusuf Tajudeen, sponsored a bill, which was first read in the House on March 29, The African Party – Is Australia invited?

Unegbu said government demutualjsation encourage local investors to invest in the market by creating the right environment. This is the impact of demutualisation on corporate governance — It allows for a more dynamic board that is also investor-controlled.

Uwaleke said the market had remained bearish despite the oil price recovery, stable exchange rate, retreating inflation and even improved company fundamentals.

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Inthings appeared to be moving forward, as the NSE issued requests for proposals from local and foreign financial advisers to assist with demutualisation. The NSE effectively becomes part regulator and part profit making company. Police arrest 2 armed robbers in Yenagoa.

Members Approve Nigerian Stock Exchange Demutualisation Process

SEC explained that with demutualisation, the NSE should be exposed to robust corporate governance, enhanced efficiency and transparency demutualisqtion with publicly quoted companies. Demutualisation is the process of converting the Nigerian Stock Exchange NSE from an organisation which exists for the benefit of its members, to one which is public, and investor owned.

State and Local Govts.

In addition to what is echange at the beginning, a demutualised NSE will be in line with global best practice. Police denies personnel absconded from Boko Haram fight 26th December Experts at different fora have argued that demutualising the exchange would widen ngerian retail investor base and help to de-risk and detach the market from the apron string of foreign investors who exit the market at any slightest volatility.

Foreign investors are significant players in the equities market often dictating the pace of market activity. Doing Business in Nigeria. Indeed, there is an urgent need for regulators to attract more investors to the market and boost participation.

NSE Demutualisation Crosses Major Hurdle As Buhari Signs Bill

Currently, not less than four million Nigerians participate in the capital market just as less than 30 per cent of listed equities are actively traded in the market. Technological advancement in the financial world over the last two decades, has significantly increased competition among stock exchanges globally and this competition has pressured many exchanges to adopt business models, which have greatly improved their efficiencies and effectiveness.

Oluwaseyi Abe, President Chartered Institute of Stockbrokers moved the motion for adoption of the prayers and was seconded by Oladipo Williams. As at March 7,it has listed companies with a total market capitalization of about N8.

With this, I believe Nigerian investors will subscribe to it and it will deepen our capitalisation and the entire market. According to the Act, NSE will establish a Claims Review Panel made up of a chairman and four other members which will review and determine any assertion by any person to any right in the share of the exchange as such assertion having been made anytime between the coming into force of this act and six years after conversion of the exchange from a company limited by guarantee to a public company limited by shares.

Amid bearish results, hope rises for stock market with demutualisation

The bill was eventually passed into law by the Senate on December 22, and the House of Representatives on February 1, The loss, amounting to This is the Companies and Allied Matters Act You may only share Stears Business content using our sharing buttons.

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Leave a Reply Cancel reply Your email address will not be published. By Chinenye Anuforo and Chinwendu Obienyi. On the competitive front, the NSE would be run as an efficient business enterprise.

NSE Demutualisation Crosses Major Hurdle As Buhari Signs Bill

In financial markets, these tensions cannot always be reconciled, as conflicts of interests are likely to arise. He highlighted the benefits of a demutualized exchange to include: The demutualization of the Exchange will bring the Nigerian capital market on a par with other international jurisdictions, result in enhanced governance, transparency and visibility whilst attracting strategic partners, investors and good quality issuers.

Similarly, the All-Share Index lost 7, The Police Force Headquarters has denied the report in some media that of its personnel absconded The members thereafter voted unanimously in favour of the three prayers.

Copyright Stears Business Limited The NSE is currently registered as a company incorporated by guarantee. Finally, since ownership rights can now be demutualisatiion through shares, it will improve investor participation in the ownership of the Exchange.

It is suggested instead, that as a demutualised exchange, the NSE would operate with a view to earning and increasing profits, thereby increasing its operational efficiency. The issues addressed here are not regarding the benefits of demutualisation, as research has shown that in comparison with mutual exchanges, demutualised and publicly listed exchanges certainly operate more efficiently when it comes to size, liquidity and financial performance.

To receive our NEW investment newsletter containing intelligent investing news, data, analysis and research, type in your e-mail address. That the engagement of financial advisers, legal advisers, tax advisers and any other adviser that may be required for the Demutualisation of The Exchange be and is hereby ratified and approved. The report that both chambers of the National Assembly have passed the enabling bills to demutualise the Nigerian Stock Exchange NSE into law brought succour to investors and the entire market community.

The prominence of exchange traded funds ETFs as well, have attracted high trading volumes in most exchanges. That context refers to the corporate governance framework in the country and how amenable it is to successful demutualisation.