The Director-General, Securities and Exchange Commission (SEC), Mr Mounir Gwarzo, has restated the commission’s resolve to promote the development of Commodity Exchanges in the country.
Gwarzo said this in a statement issued by Mr Naif Abdulsalam, the Director, Corporate Communication of SEC in Abuja, Wednesday.
He said this when he received the New Exco of the Association of Stock broking Houses of Nigeria (ASHON) at the commission.
According to him, the commission is willing to support the Lagos Commodities & Futures Exchange being midwife by ASHON.
On the suspension of some of their members by the NSE & SEC, the director-general urged ASHON to give the companies three months grace period to recapitalise before anything could be done.
“This aligns with their argument that stock brokers carry equities in their balance sheet and prices of equities have gone down thus affecting their capital,’’ he said.
The Tide sourcereports that ASHON members were suspended on account of their deficiency in Minimum Operating Standard (MOS) compliance as well as diminution in value of minimum capital requirement.
Responding, ASHON through its Chairman, Patrick Ezeagu solicited for the possibility of increasing the grace period to six months to recapitalise or reclassify.
Ezeagu also noted with concern the proposed amendment of Rule 56(1) – Function of Brokers(Harmonisation of Registration requirement for incidental functions).
He said the development would preclude brokers from providing Investment advice to their clients/Public. While acknowledging not knowing the thinking behind the proposed amendment, Ezeagu solicited for the reconsideration of the proposal.
His call was based on the backdrop of the “so called’’ value addition provided by brokers/dealers in providing investment advice to their clients.
He argued that a lot of stock broking houses had well established research desks, which helped to broadcast market information on a continuous basis.
He said the group also carried out in-depth analysis and provide opinions on complex financial issues to their clients.
He expressed their dismay on the Federal Government’s sole reliance and emphasis on monetary policy for macroeconomic management to the detriment of the capital market.
He said the association accepted to look at the Investment and Securities Tribunal funding proposal being championed by SEC and NSE.