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AELP Link to Boost Trading Between NGX and Other African Exchanges

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capital market - Investors King

Cross-border trading from one African securities exchange to another comes a step closer today after the African Securities Exchanges Association (ASEA) signed a contract to procure an order-routing system. Seven of Africa’s leading securities Exchanges are working together in the African Exchanges Linkage Project (AELP) to boost pan-African investment flows and bring more liquidity to African markets.

The contract is for the design and rollout of the AELP Link technology platform for routing orders and trade confirmations between stockbrokers on the seven Exchanges participating in the pilot phase of the AELP. The Supplier is DirectFN, a global IT firm experienced in capital markets solutions across the Middle East and many emerging and frontier markets, which was awarded the contract after a competitive bidding process that attracted applications from top international suppliers in 18 countries.

The AELP is a joint initiative by ASEA and the African Development Bank (AfDB) aimed at unlocking Pan-African investment flows, promoting innovations that support diversification for investors, and addressing depth and liquidity in the markets. It is funded by a grant from the Korea-Africa Economic Cooperation (KOAFEC) Trust Fund managed by the African Development Bank.

Speaking on the development, Mr. Temi Popoola, Chief Executive Officer, Nigerian Exchange (NGX) Limited, said: “At NGX, we are optimistic that today’s milestone will further hasten efforts at capital market integration across Africa. The work of the AELP is significant, as it will serve to ultimately boost Pan-African investment flows, promote innovations that support the diversification needs of investors in Africa, and help address the lack of depth and liquidity in Africa’s financial markets. We, therefore, take this opportunity to commend the efforts of ASEA and AfDB, and reiterate our continuing support of the AELP.”

With the AELP Link, investor orders in one market will be channeled by a domestic stockbroker to a stockbroker on the foreign market where the security is listed, to enter into that market for execution in the foreign market. African Listed Securities to be accessed through the AELP Link include all securities that are available for cross-border investors.

Equity investments available include Africa’s most promising and profitable businesses as well as some global leaders among more than 1,050 companies listed. Investors will also buy or sell corporate and government bonds, Exchange Traded Funds (ETFs), and derivatives where these are listed on the participating exchanges and the sponsoring stockbroker provides access.

Commenting, Dr. Felix Edoh Kossi Amenounvé, President of ASEA and CEO of the BRVM, said: “We are excited with this big step towards free movement of investments across Africa and free flow of capital. Our aim is to open new opportunities for individual and institutional investors to invest productively into Africa’s growth story. The Exchanges continue to support African enterprises and governments to raise long-term capital for African jobs, business growth, infrastructure, and development.”

Dr. Walid Al Ballaa, the Managing Director, of DirectFN, said: “With innovative technology and focus to bring digital maturity in building digital relationships through the AELP-Link technology platform establishment, DirectFN feels equally excited to assist practically in realizing the goals across the participating African Exchanges and to enable the African capital market ecosystem digitally to create a positive impact on the overall economy.”

The AELP exchanges are Nigerian Exchange (NGX), Casablanca Stock Exchange, The Egyptian Exchange, Johannesburg Stock Exchange, Nairobi Securities Exchange, Stock Exchange of Mauritius and Bourse Régionale des Valeurs Mobilières (stock exchange for the West African Economic and Monetary Union’s eight West African countries).

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Capital Market

NGX to Host Inaugural TechNovation Conference

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Nigerian Exchange (NGX) Limited is set to host the inaugural edition of its TechNovation Conference on Thursday, 30 September 2021.

NGX TechNovation Conference is a flagship event that provides a platform for local and global technology leaders to syndicate conversations around technology, partnerships and innovation that can advance technology adoption in the Nigerian capital market.

With the theme, “Technology, Platforms and Markets”, the event will be hosted by the Chief Executive Officer (CEO), Nigerian Exchange (NGX) Limited, Mr. Temi Popoola, CFA and will feature leading industry experts across the public and private sectors including the Director General, Securities and Exchange Commission (SEC), Mr. Lamido Yuguda; Dr. Segun Aina, President, Africa Fintech Network; and Olugbenga Agboola, Co-Founder and CEO, Flutterwave.

Key topics to be addressed during the conference are: The Future is Digital – Digital Transformation, New Tech and Emerging Markets; The Path to Exponential Growth – New Technology, Platforms, Emerging Markets, Data & Regulation; and Beyond Tech – Partnerships, Business Models and Innovation. Interested participants can register online at www.ngxgroup.com/ngx-tech-con.

Some of the other confirmed speakers at the event include; Iyin Aboyeji, Founder & General Partner, Future Africa; Bayo Adekanbi, Chief Transformation Officer, Data Science Nigeria; Dayo Obisan, Executive Commissioner (Operations), SEC; Abasi Ene-Obong, CEO, 54Gene; Oremeyi Akah, Chief Customer Experience Officer, Interswitch; Ini Akpan, Country Manager, Opay; and Andreas Itern, Co-Founder & CEO, F10.

The advancement and exponential growth of technology around the world has signaled a new wave of opportunities for forward thinking organisations. NGX remains committed to leveraging technology to provide a broad range of services including but not limited to smart capital formation. TechNovation will, therefore, serve as a platform that can create opportunities for smart business leaders looking to tap into the next level of growth and competitive advantage.

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Capital Market

SEC Implements 100% Custody Requirement in Collective Investment Schemes

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Nigeria’s Securities and Exchange Commission (SEC) has announced that it has commenced implementation of 100 percent custody requirement in the Collective Investment Schemes (CIS) sector to protect investors.

The Director-General of the SEC, Mr Lamido Yuguda said this in a statement that the custody requirement covered all Funds and Portfolios being managed by registered Fund/Portfolio Managers.

He explained that all clients’ assets managed under discretionary and non discretionary mandates were to be held under independent custodial agreement and custodial banks.

According to Yuguda, this was in addition to CIS, Mutual Funds, authorised for public offering.

Yuguda said that although it was a natural operational requirement of CIS, the SEC was having some new enforcement and insistence on the compliance that has been in the books, but have not been implemented before now.

“For example, we have the collective business sector where you have the fund managers. We have a dichotomy between public funds, which are funds that are publicly traded, and you can see the unique values on the stock exchange and in newspapers daily.

“There are also private, which are investment agreements between fund managers and specific investors. A lot of these funds in the privately held fund management mandates are in our custody.

“The investment manager before now did not only have the investment management responsibility for the fund, but also kept the securities and cash as whole shares in this investment.

“The risk is that if the investment manager should go bust, then the investor loses and that is not acceptable in financial markets around the world. I think with the introduction of total custody in that sector, we are likely to see a massive uptake of these kinds of products.

“We have released some regulations recently in this area for the different types of fund managers, and I think this is an area that is now becoming increasingly attractive to investors and is also receiving the attention of the commission”.

According to Yuguda, with the SEC having 100 per cent custody agreement in the CIS sector, any investor in the capital market should be confident that their investments were secure.

He added that it was a good thing for the market and an area that can bring about a lot of growth in the market because it offered a very good opportunity to save.

The SEC D-G also said that the commission was also looking at the market to see how it could formulate regulations that would help investors protect their investments.

“We have a Fintech division in the commission that was set up purposefully to understand these new types of investment structures and to collaborate with Fintech firms that wish to register as capital market operators and offer services to the investing public. “This is a developing area, and we intend to issue new regulations from time to time,” he added.

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Capital Market

Chemical and Allied Products Plc Lists Additional 88,259,520 Ordinary Shares After Merging With Portland Paints

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CAP Paint - Investors King

The Chemical and Allied Products Plc (CAP Plc) on Friday announced listing of 88,259,520 ordinary shares of 50 kobo on the Nigerian Exchange Limited (NGX).

The announcement came few weeks after CAP Plc and Portland Paints merged to deepen market reach and enhance quality of production.

In a statement released by CAP, the company said “Trading License Holders and the investing public are hereby notified that the resultant Scheme shares of 88,259,520 ordinary shares of 50 Kobo each were listed on the Daily Official List of Nigerian Exchange Limited (NGX) on Friday, 17 September 2021.

“With the listing of the additional 88,259,520 ordinary shares, the total issued and fully paid up shares of CAP Plc has now increased from 700,000,000 to 788,259,520 ordinary shares of 50 kobo each.

“In addition, the entire 793,415,535 issued and outstanding shares of Portland Paints were delisted from the NGX’s Daily Official List effective, 17 September 2021 in accordance with the terms of the Scheme.”

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