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NSE Unveils 13 Supplementary Market Makers

By on April 3, 2013

The Nigerian Stock Exchange (NSE) Tuesday unveiled 13 stockbroking firms as supplementary market makers (SMM) to complement the activities of the primary market makers appointed last year. The NSE also announced the commencement of the maximum 10 per cent price up and down limit for all equities in the Nigerian bourse.

However, among the 13 SMM are five firms already performing the PMM role in the market making programme. The five firms are FBN Securities Limited, Stanbic IBTC Stockbrokers, Greenwich Securities Limited, Renaissance Capital Limited and Capital Bancorp Limited.

On the other hand, the new firms are Cordros Capital Limited, Partnership Investment Company Plc, UBA Securities Limited, Capital Assets Limited, FSDH Securities Limited, Investment One Limited, Magnatis Investment and Finance Limited and FCSL Asset Management Limited.

Unveiling the SMM yesterday, the Executive Director, Business Development, NSE, Haruna Jalo-Waziri, said it was in line with the exchange’s efforts to ensure liquidity and deepen the market. Jalo-Waziri disclosed that 23 firms applied but only 13 were successful.

According to him, the SMM passed through screening based on their financial capability, compliance history, operational capability and performance history.

He explained that each of the SMM has a net liquid capital of N250 million before they were appointed, noting that for those already performing the role of PMM, they were required to have additional N250million to bring their total net liquid capital to N750 million.

He added that unlike the PMM that were allocated a basket of securities to make market on, the SMM were allowed to submit a basket of securities that were approved by the NSE based on certain criteria.

Meanwhile, all equities will witness a daily price limit of 10 per cent up and down as against the five per cent.
Before yesterday only 52 stocks that were in the market making basket record daily price swing of 10 per cent, while others outside the basket record five per cent.

But now all equities across board will witness the 10 per cent price swing. Jalo-Wairi explained that the decision to raise the price limit was informed by the feedback received in the six months of the market making programme.

( This Day)