Zero al­lo­ca­tion to SEC will af­fect cap­i­tal mar­ket – ASHON

Daily Trust - - CAPITAL MARKET - Sto­ries from Kay­ode Ogun­wale, La­gos

The As­so­ci­a­tion of Stock­broking Houses of Nigeria (ASHON) said that zero-al­lo­ca­tion to the Se­cu­ri­ties and Ex­change Com­mis­sion (SEC) in the 2014 budget could stall cap­i­tal mar­ket de­vel­op­ment.

Mr. Emeka Madubuike, ASHON Pres­i­dent, told the News Agency of Nigeria (NAN) in La­gos re­cently that the com­mis­sion might not carry out any cap­i­tal in­ten­sive project this year.

Madubuike said that all the cap­i­tal mar­ket de­vel­op­ment ini­tia­tives aimed at restor­ing in­vestor-con­fi­dence would be af­fected by lack of funds.

Ac­cord­ing to him, the cap­i­tal mar­ket com­mit­tee pro­grammes aimed at tak­ing the mar­ket to the next level have re­mained un­re­alised due to budget lim­i­ta­tions.

Madubuike called for quick res­o­lu­tion of the lin­ger­ing im­passe in the in­ter­est of the mar­ket.

“The prob­lem should be re­solved by the ex­ec­u­tives as soon as pos­si­ble to avoid tak­ing the mar­ket back and front,” he said.

The ASHON boss, who said that he could not ex­plain how the com­mis­sion sur­vived in 2013, added that zero bud­getary al­lo­ca­tion was a threat to the reg­u­la­tion of the cap­i­tal mar­ket reg­u­la­tion.

Mr Olal­eye Wil­liams, the Man­ag­ing Di­rec­tor of Glob­alView Con­sult & In­vest­ment Ltd., said that the de­vel­op­ment had shown that the com­mis­sion should be a self-spon­sor­ing agency.

“I think the point is be­ing well made that the SEC should not only be a sel­f­reg­u­lat­ing reg­u­la­tor but also a self-spon­sor­ing, self­sub­sist­ing rev­enue cen­tre,” Wil­liams said.

He said that cap­i­tal mar­ket oper­a­tors needed to be more care­ful to avoid penal­ties be­cause SEC would rely on penal­ties to gen­er­ate rev­enue.

NAN re­ports that the Na­tional As­sem­bly had for the sec­ond con­sec­u­tive year, made zero al­lo­ca­tion to SEC, even as the two cham­bers ap­proved a har­monised 2014 Federal Budget of N4.695 tril­lion.

The Na­tional As­sem­bly had also in 2013 budget de­clined to make any ap­pro­pri­a­tion for the com­mis­sion.

The budget, which was passed on April 10, had 12 clauses, one of which barred SEC from ex­pend­ing any money un­less ap­proved by the Na­tional As­sem­bly.

NAN re­calls that the Na­tional As­sem­bly’s zero al­lo­ca­tion bud­gets fol­lowed the im­passe be­tween the House of Rep­re­sen­ta­tives and SEC.

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