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SEC Implements 100% Custody Requirement in Collective Investment Schemes

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Nigeria SEC- Investors king

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

NGX Lifts African Alliance, Royal Exchange Trading Suspension

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African Alliance insurance - Investors King

The Nigerian Exchange Limited (NGX) has lifted the suspension placed on trading in shares of African Alliance Insurance Plc and Royal Exchange Plc following their failures to filed their audited financial statements for the year ended 31 December 2020 and unaudited financial statements for the quarter ended 31 March 2021.

The companies were among the four companies suspended on 2 July 2021. However, the suspension was lifted after the two companies filed their audited financial statements and unaudited financial statements as required. The other two companies are the Niger Insurance Plc and the Tourist Company of Nigeria Plc.

NGX disclosed in a statement published on its website.

The statement reads, “African Alliance Insurance Plc and Royal Exchange Plc, two (2) of the four (4) listed companies that were suspended on 2 July 2021, have now filed their Audited Financial Statements for the year ended 31 December 2020 and Unaudited Financial Statements for the quarter ended 31 March 2021.

“In view of the companies’ submission of these financial statements, and pursuant to Rule 3.3 of the Default Filing Rules, which states that; “The suspension of trading in the issuer’s securities shall be lifted upon submission of the relevant accounts provided The Exchange is satisfied that the accounts comply with all applicable rules of The Exchange. The Exchange shall thereafter also announce through the medium by which the public and the SEC was initially notified of the suspension, that the suspension has been lifted”, Trading License Holders and the Investing Public are hereby notified that the suspension placed on trading on the shares of African Alliance Insurance Plc and Royal Exchange Plc was lifted on Monday, 4 October 2021.”

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Insider Dealing: Indimi Acquires an Additional 5.1 Billion Ordinary Shares Worth N3.3 Billion in Jaiz Bank Plc

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Alhaji Indimi - Investors King

Alhaji (Dr.) Muhammadu Indimi, the billionaire founder of Oriental Energy Resources, purchased additional shares of 5,076,923,077 in Jaiz Bank Plc, according to the statement published on the Nigerian Exchange Limited.

Indimi acquired the 5,076,923,077 ordinary shares at N0.65 per share, representing an investment of N3.3 billion or $8 million in the bank. The declaration is in line with the Nigerian Exchange Limited insider dealing disclosure instituted to enforce transparency across the Exchange.

The statement reads “Trading License Holders and the Investing Public are hereby notified that additional 5,076,923,077 ordinary shares of 50 kobo each of Jaiz Bank Plc (Jaiz Bank) were on Monday, 4 October 2021, listed on the Daily Official List of the Nigerian Exchange Limited (NGX).

“The additional shares listed on NGX arose from Jaiz Bank’s private placement of 5,076,923,077 ordinary shares of 50 kobo each to Alhaji (Dr.) Muhammadu Indimi at N0.65 per share.”

The billionaire previously owned 3,233,813,044 ordinary shares in the bank. He now holds 8,310,736,121 shares, representing 24.06 percent in the bank. Alhaji Indimi is Jaiz Bank’sAlhaji (Dr.) Muhammadu Indimi, the billionaire founder of Oriental Energy Resources, purchased additional shares of 5,076,923,077 in Jaiz Bank Plc, according to the statement published on the Nigerian Exchange Limited. largest shareholder.

On Monday 4, October 2021, Jaiz Bank listed the 5,076,923,077 on the Nigerian Exchange Limited (NGX). With the listing, the bank’s total issued and fully paid-up shares has now increased to 34,541,172,377 ordinary shares of 50 kobo each, up from 29,464,249,300.

Indimi is the founder and chairman of Oriental Energy Resources, a Nigerian oil exploration and production firm established in 1990.

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Airtel Nigeria to BuyBack N61.24 Billion Worth of Shares

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Airtel Financial Results - Investors King

Airtel Africa, a leading provider of telecommunications and mobile money services, with offices in 14 nations across Africa, on Monday announced that its subsidiary Airtel Networks Limited (‘Airtel Nigeria’), a leading provider of telecommunications services in Nigeria, has initiated a process under which it seeks to buy back the 8.27 percent minority shareholdings at an offer price of N55.81 per share.

The company disclosed in a statement filed with the Nigerian Exchange Limited and seen by Investors King.

According to the statement if all holders agreed to sell their shares, the total buy back is estimated at N61.24 billion  (c$148.1mn using an exchange rate of 413.38 NGN/USD).

Therefore, the telecommunication giant, disclosed that this represents an open offer to all shareholders.

A share buyback or repurchase is the re-acquisition by a company of its own shares. It represents an alternate and more flexible way of returning money to shareholders.

Share buyback sends a positive signal as the company is investing in its own shares because it is positive about its own future prospects.

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