From Guardian.
SEQUEL to the recent announcement made by the Securities and Exchange Commission on major increases in minimum capital requirements for registered capital market operators expected to take off by January 1, 2015, the apex regulators, yesterday, approved an extension of the deadline for compliance by nine months, to 30th September 2015.
This is coming on the heels of the plea by some capital market operators for an extension of the recapitalisation deadline due to the ongoing uncertainties in the country, which had hampered market growth and development.
According to a statement by the SEC made available on the website, “the Board of the Securities and Exchange Commission at its meeting of 22nd December 2014 reviewed the status report on the level of compliance by capital market operators, with the new minimum capital requirement which has a compliance deadline of 31st December 2014.
“The Board expressed satisfaction with the efforts made by all operators, particularly those who have complied with the new requirements.
“The Board however took cognizance of the effect of the global economic situation and approved an extension of the deadline for compliance with the new minimum capital requirements by nine months, to 30th September 2015.
It continued:” The list of capital market operators who have so far complied is now available on the commission’s website via the following link (CMOs New Minimum Capital Requirement) and will be updated regularly.
It added: “We commend the commitment of all stakeholders to building a world class capital market that enables Nigeria realize its aspiration of a prosperous and peaceful nation.”
SEC recently announced major increases in minimum capital requirements for capital market functions under a new minimum capital structure that is expected to take off by January 1, 2015.
The apex capital market regulator increased minimum capital base for broker/dealer 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.
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.
Also, dealing members of the exchange are contending with minimum operating standards recently introduced for all the three classes of dealing members including broker dealers, brokers and dealers.
The new standards address the five broad areas of manpower and equipment; organisational structure and governance; effective processes; global competitiveness; and technology.