Just as calm seems to be returning to the capital market, a quiet war is brewing as stockbrokers have kicked against the decision of the Securities and Exchange Commission (SEC) to appoint members into the council of the Nigerian Stock Exchange (NSE).
Already, the NSE council has written to SEC expressing its rejection of the appointment. A source who was privy to the council meeting on Tuesday when the appointment was rejected, said members were undivided in their position.
“It was an unanimous decision and the council has already written to the Commission on its position. We are trying to make the Commission see reasons,” the source said.
SEC last week muted the idea of allowing the interim administrator and interim president of the council, Emmanuel Ikhazobor and Balama Manu, to remain as council members at the expiration of their tenure.
The duo was appointed by SEC in the wake of the sacking in August of the former director general of the NSE, Ndi Okereke-Onyiuke. Their tenure was supposed to end with the assumption of office last week of the new NSE chief executive officer, Oscar Onyema.
Guiding the new CEO
However, SEC said its decision to allow its appointees remain on the council was for them to guide the new CEO until he fully takes charge.
A statement by SEC’s spokesperson, Lanre Oloyi, stated that the appointment was to speed up the ongoing restructuring process and prepare the Exchange for eventual demutualisation, which would allow its shares to be listed and traded.
According to SEC, all its nominated members shall be on the Council pending the election of a new council.
“We expect the restructuring exercise to be quickly concluded so that elections can be conducted to establish a new council. We are hopeful that by that time all the cases in court would have been disposed of, so as to allow the interim president to conduct elections without any legal impediment,” the commission said.
SEC said it derived its powers from Section 35 (1) of the Investment and Securities Act 2007 which states, “The Commission may, where it deems appropriate, issue directives to a securities exchange, capital trade point, or any other self regulatory organisation.”
No interference
The source, however, said the section does not clearly state that the Commission can make such appointments and thus interfere in the running of the Stock Exchange.
“That section only deals with market operations and not governance issues. What the stockbrokers are saying is that the memorandum and article of association (MEMART) establishing the Stock Exchange does not provide for SEC to appoint members to council.”
On the position of the Commission now that stockbrokers are challenging its position, Mr. Oloyi said this was a temporary arrangement.
“This is just an interim arrangement. We have only asked that the Exchange should consider public interest in constituting membership of the council.”
He said the outgoing interim administrator has one month to fully handover to the new CEO, after which he will serve as deputy to the interim president.
“This transitional arrangement is until a new council is properly constituted by the Stock Exchange. I cannot tell you how long this will take. You know there are a lot of cases in court,” Mr. Oloyi added.
He said SEC was committed to building a vibrant capital market that would be of benefit to the entire economy.
Source : 234next
