To further digitize the Nigerian capital market, the Securities and Exchange Commission (SEC) has given hint of its plan to introduce electronic Initial Public Offering (e-IPO) in 2019.
This was disclosed by the Executive Commissioner, Corporate Services of SEC, Henry Rowlands, at a seminar for finance correspondents in Uyo, Akwa Ibom State.
His comments reaffirm an earlier disclosure by the commission that it was engaging the Nigeria Inter-Bank Settlement System (NIBSS) to facilitate identity and account validation to improve market processes. Acting SEC Director General, Mary Uduk, stated this during the third quarterly Nigerian Capital Market Committee (CMC) meeting, which communique said SEC was awaiting the final report of the e-IPO Committee to enable it issue guidelines and develop the rules for e-IPOs.
According to Rowlands, digitizing the capital market is designed to make it more efficient and competitive in order to serve stakeholders, especially investors much better. He noted that some countries like Kenya and South Africa among others had commenced the electronic stock market launch.
Earlier in her opening remarks, Uduk stated that 2.55 million accounts had been mandated under the e-Dividend Mandate Management System (e-DMMS), which was developed to reduce the quantum of unclaimed dividends in the market as well as enable direct payment of dividends to investors into their nominated bank accounts.
“To further boost investors’ confidence, enhance transparency and eliminate fraud in the market, the Direct Cash Settlement (DCS) initiative was introduced. DCS is an initiative that allows proceeds from sale of investors’ shares to settle directly into their accounts as against the system whereby the proceeds go to brokers’ accounts before they pass them to the investors. From inception, the process has been voluntary, but was made compulsory from September, 2017,” Uduk said.
