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Stakeholders defer NSE’s demutualisation

By on June 25, 2016

Stakeholders in the stock market comprising the Nigerian Stock Exchange National Council and members have deferred the demutualisation programme of the Exchange pending an Extra-Ordinary Meeting on the subject.

This resolution was made at the Exchange’s 55th Annual General Meeting held in Lagos on Thursday.

The report of the national council, the financial statements of the Exchange as of December 31, 2015, and the report of the auditors were presented to the members as part of the ordinary business of the day.

At the AGM, the members and the NSE council consented to having an EGM on the demutualisation to allow for more consultation.

Demutualisation is the process through which any member-owned organisation becomes a shareholder-owned company. The company could either be listed on a stock exchange or closely held by its shareholders.

The suggestion was supported by the President, Association of Stock broking Houses of Nigeria, Emeka Madubuike, and member, Mike Itegboje.

The speakers further urged the council and management of the NSE to fast track the demutulaisation process and pick a date for the EGM.

Speaking at the AGM, the President of council, NSE, Mr. Aigboje Aig-Imoukhuede, noted that the Exchange weathered the impact of capital flight shocks experienced globally through effective fiscal discipline and tight budgetary controls.

He said, “Although 2015 was characterised by recessionary pressures including a slump in crude oil price, uncertainty in Nigerian economic policies and significant local currency exchange rate pressures, our management and staff successfully delivered on a number of ambitious operational and strategic initiatives.

“We recorded an operating surplus of N1.86bn as a result of management diligence in managing the budget as well as strategic prioritisation and execution of key initiatives based on efficiency, scale and growth potential. Total assets of the NSE grew by over 10 per cent, while net assets grew by 11 per cent, year-on-year.

“By the end of year, the Exchange’s asset base exceeded N22.78bn, with N19.29bn in accumulated funds, providing us adequate financial flexibility to support strategy execution in key business areas for the road ahead.”

Also speaking, the Chief Executive Officer, NSE, Mr. Oscar Onyema, said the Exchange showed its resilience during the year amid prolonged economic uncertainty, diminishing commodity prices and volatile securities markets.

He said, “Despite declines in our core income streams, alternative sources of income continued to play an important role in supporting the financial performance of our business. In 2015, revenue excluding transaction fees and listing income, grew by 15 per cent contributing 40 per cent to total revenue. The greatest drivers of this growth were revenues from our proactive investment strategy and income generated from our market services business.

“Our balance sheet remains solid, with over N22.78bn in assets, representing a 10 per cent growth rate in 2015. Our liquidity metrics remain strong as well, with a current ratio 3.79 and a total liabilities -to- total assets factor of 15 per cent as of December 31, 2015.”

At the AGM, members of the Exchange re-elected to its national council Aig-Imoukhuede as the president; Mr. Muhammad Daggash; Mr. Oluwole Abegunde (representing Meristem Securities Limited); Mr. Oladipo Aina (representing Signet Investment & Securities Limited) as members of the National Council.

 

[Punch]