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The council of the
Nigerian Stock Exchange (NSE) has approved the acquisition of a new
trading platform, Emmanuel Ikazoboh, interim administrator of the NSE,
has said. Mr Ikazoboh said this on Monday during a media briefing on
his appraisal of the nation’s capital market performance in 2010. He
said discussion with global vendors on the need to upgrade the
Exchange’s trading platform commenced early last year. “An ad-hoc
committee of management and council including operators engaged with
various vendors to ensure that a new platform, which would address all
concerns relating to equities, derivatives, bond trading and
dissemination of data, was put in place. The committee completed its
job last year and I must say that council has finally approved that we
acquire a new trading platform,” Mr Ikazoboh said.

He said management
and the negotiating committees have been put in place to start
negotiating with the chosen vendor as to the costing and ensuring that
the nation gets the right trading platform in its Exchange. Mr
Ikazoboh, however, did not disclose the amount made available for the
purchase of the new trading platform.

Meanwhile, he
maintained that the exiting market infrastructure remains capable of
meeting the current needs of inventors, issuers of securities and
market operators. The total market value of 264 securities listed on
the Exchange increased by 41.12 per cent from N7.03 trillion to stand
at N9.92 trillion by year-end 2010. The NSE said the rise in market
capitalsation resulted mainly from new listings of equities and state
government bonds coupled with price appreciation by equities. Market
capitalsation had in 2009 declined by 26.5 per cent.

Foreign portfolio investment

On the extension of
trading hours, the Exchange’s head said, “I’m pleased to announce that
as a result of our trading extension one month after, we have an
increase in the number of deals by five per cent, an increase in traded
volume by 15.6 per cent and increase in traded value by 34.8 per cent.
This justifies that we should continue with our extended trading hours.
It also shows that our foreign investors have actually started trading
and increase the volume of our operation.” Mr Ikazoboh said some of the
erstwhile foreign investors are returning while new investors sought
opportunities considering the key attributes of high returns,

liquidity and
safety of investments. NSE statistics showed that purchases by foreign
investors during 2010 were N381.34 billion, representing 48 per cent of
the aggregate turnover. This is an increase when compared with the
N202.483 billion recorded in 2009.

“We have also put
in place strict enforcement of Exchange’s rules and post listing
requirements. As a result, we have suspended 74 dealing members during
the year for failure to submit audited accounts for 2008, 2009 and
2010. A total of 42 companies are placed on technical suspension for
infraction of listing rules; however, 17 are no longer on suspension.
Also, 15 companies are placed on full suspension for violation of
listing rules and seven companies are recommended for delisting,” Mr
Ikazoboh said.

Meanwhile, Binos
Yaroe, General Manager of NSE’s Listing Department, said non release of
financial forecasts by listed companies at the Exchange attracts no
sanction compared with non release of quarterly and annual results
which attracts various penalties.

CSCS performance

Onyewuchi Asinobi, Managing Director of the Central Securities Clearing System (CSCS),

said the CSCS made a turnover of N3.88 billion in 2010 as against a
turnover of N3.2 billion in 2009. This represents 21.25 per cent
increase in revenue. Mr Asinobi said a total of 437 shareholders used
their shareholding in CSCS depository as collateral to obtain loan in
year 2010 as against 1,550 shareholders in 2009 representing a decrease
of 71.8 per cent. Meanwhile, he said Thomas Murray, an International
Central Securities Depository (CSD) and Capital Market Infrastructure
Risk Rating Organisation, appraised CSCS’ operational processes and
performance in the year 2010 and rated it A- 2011 outlook The fiscal
injections relating to AMCON’s purchase of non-performing loans of
deposit money banks is expected to produce a twin effect in 2011. Mr
Ikazoboh said the move should provide further stability to the stock
market and inject significant liquidity into the banking system. “Asset
valuation of listed companies would likely improve with the
commencement of the operations of AMCON. However, the huge fiscal
injections may fuel further inflationary pressure,” he said.