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SEC extends operators’ recapitalisation deadline

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The Securities and Exchange Commission (SEC), Nigeria’s apex capital market regulator, has granted an extended window of 15 months to capital market operators that failed to meet initial recapitalisation deadline to comply with the new minimum capital requirements for their functions.

Director General, Securities and Exchange Commission (SEC), Mr. Mounir Gwarzo, at a briefing on Friday in Lagos on the deliberations at the Capital Market Committee (CMC), said capital market operators that were unable to meet the September 30, 2015 initial deadline for new capital requirements have been given a 15-month grace to recapitalise.

Also, operators who were disqualified for non-compliance or inability to substantiate claims of compliance by the audit firms will be allowed to come back to the market once they show evidence of compliance within the stipulated period.

“We have given a grace of about 15 months from the initial deadline of September 30, 2015 to December 31, 2016. Operators who did not meet the requirement within this period will have their operating license cancelled” Gwarzo said.

Read also: Investors get 150 extra days for free e-dividend registration

SEC had in December 2013 announced major increases in minimum capital requirements for capital market functions under a new minimum capital structure that was initially scheduled to take off by January 1, 2015. It however extended the deadline to September 30, 2015.

Minimum capital base for broker/dealer was increased by 329 per cent from the existing N70 million to N300 million. Broker, which currently operates with capital base of N40 million, will now be required to have N200 million, representing an increase of 400 per cent. Minimum capital base for dealer increased by 233 per cent from N30 million to N100 million.

Also, issuing houses, which facilitate new issues in the primary market, will now be required to have minimum capital base of N200 million as against the current capital base of N150 million. The capital requirement for underwriter also doubled from N100 million to N200 million. Trustees, rating agencies and portfolio and fund managers had their minimum capital base
increased by 650 per cent each from N40 million, N20 million and N20 million to N300 million, N150 million and N150 million respectively.

A Registrar will now have a minimum capital base of N150 million as against the current requirement of N50 million. While the minimum capital base for corporate investment adviser remained unchanged at N5 million, individual investment advisers will have to increase their capital base by 300 per cent from N500,000 to N2 million.

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Ripples Nigeria

We are an online newspaper, very passionate about Nigerian politics, business and their leaders. We dig deeper, without borders and without fears.
www.ripplesnigeria.com

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