The Removal of the Director General and President of the Nigerian Stock Exchange by SEC
With the news of the removal of the Prof. Ndi Okereke-Onyiuke and Alhaji Alinko Dangote, Director General and President of the Nigerian Stock Exchange (NSE) respectively by the leadership of the Securities & Exchange Commission (SEC) on the 5th August, 2010 has been characterized with all sorts of controversies.
This came as a shock as most investors are looking towards brighter days as the NSE recently approved the operation of the Asset Management Company (AMC) as a positive tool to revive the bearish market.
Interestingly, NSE is a self regulatory authority of the Nigerian Stock Market and a non-governmental organization with board of council steering the affairs of the exchange. They also see to resolve any financial dispute involving the shareholders/investors and the market operators.
The Securities and Exchange Commission on the other hand is also a self regulatory body that oversees the running of the Nigerian capital market and registration of all financial companies according to the Companies and Allied Matters Act, CAMA. They also receive all high or sensitive stock transactions records from all the stock broking firms as part of compliance to the rules and regulation governing the market.
Firstly, let’s look at the causes that led to the sacking of the two top helmsmen of the NSE.
There has been a bitter face off between the Director General and the President of NSE overtime. This has been evident with the ongoing litigation, allegations of financial mismanagement, governance challenges, and the inordinate delays in the implementation of the succession plan for the exchange. Just recently, Alhaji Alinko Dangote publicly came out with the bomb shell that the NSE is broke. This further fuelled the non confidence imposed on them by the worried Nigerian investors.
According to the D.G of SEC, Ms. Arunma Oteh, yesterday (August 5, 2010) declared that “the removal of the Director-General of the Nigerian Stock Exchange (NSE), Prof. Ndi Okereke-Onyiuke and its’ President, Alhaji Alinko Dangote was in the best interest of the capital market and investors as enshrined in the Investment and Securities Act (ISA) 2007”.
Do you think that the leadership of SEC was hasty in their decision to remove the aforementioned individuals without due investigation into the matter before releasing the sledge hammer? Or was it done in good faith to protect the Nigerian Capital market according to the words of the Ms. Arunma Oteh? Also, would you concur to the appointment of a forensic expert, Mr. Emmanuel Ikhazoboh to head the NSE in the interim without vast experience of the Nigerian Stock Market?
With the ongoing NSE shake-up, are we going to experience another twist as it was done in the banking industries by the Sanusi Lamido Sanusi led CBN? The difference between the NSE shake-up and that of the CBN Reforms was that the former did not investigate in the allegations rocking the NSE before taking actions.
Would you conclude that these actions by SEC would bring about a Plus or Pains to the Nigerian Capital Market as Nigerian investors are not certain with the uncertainties of the Nigerian Capital Market?