NGX Group to launch E-Offering Platform as SEC Reiterates Commitment to Innovation and Digitalization

The Director General of the Securities and Exchange Commission (SEC), Dr. Emomotimi Agama, has reiterated the commission’s resolve to ensuring total digitalization of the Nigerian Capital Market to ensure innovation and modernization for seamless transactions. He was speaking Wednesday at a Market engagement and press conference organized by the Nigerian Exchange aimed at engaging Stakeholders in the Capital Market ahead of the launch of the E-Offering Platform.

Dr. Agama highlighted the significance of the E-Offering Platform, stating that it represents a major step forward in the digital transformation of the Nigerian capital market as it aligns with the initiatives of the commission to harness cutting-edge innovation that will facilitate a more accessible and efficient capital market for all stakeholders.

“You can’t be a world class market without digitalization, you can’t be a world class market without adequate information, you can’t be a world class market with loads of unclaimed dividends. For us at the SEC, especially this new team that has been appointed by the President, we are committed to creating a market that is new, a market that is viral, a market that is full of innovation, a market that you all will be proud of that you are part of. One way of doing that is through Innovation.

“We are poised for that innovation, because we had started it long ago. But the challenge is as regulators, we issue regulations, we issue rules, the implementation of such rules and regulations is on Market regulators and Market infrastructure. How long it takes is a matter of time. But our desire as you can see was since 2019., we should have been here. But its when you wake up that is your morning, so we have started and we cannot go back.

The DG further emphasized the need for collective efforts among stakeholders to achieve the $1 trillion market capitalization goal set by President Bola Ahmed Tinubu. He underscored the importance of embracing the younger generation into the market to drive growth and ensure sustainability.

“We are not here as a market to speak to two hundred investors; it is a crying shame. We are not here to speak to three hundred investors; we are not here to speak to five hundred investors. Our population is over two hundred million. If we in this room are not able to make an impact in the number of investors that come to the market in the next five years, then we have failed,

Director General Securities and Exchange Commission (SEC), Dr. Emomotimi Agama,

“We must make sure that this market takes care of the digital age. Who are those that are investing in our market today, by our demographics are the younger people, the Gen-Zs. And what do the Gen-Zs believe in, is it paper?  No. It’s their smart phone. And there’s no way this paper can enter into the smart phone. So, you need to work for them. If you want to join the trend, you must make provision for these young persons that we are speaking to. And how do you do that without innovation, how do you do that without digitization? We must work for their world to be able to achieve the purpose for which we are here.” The DG stated.

Highlighting the critical role of the younger generation, he noted, “The Gen-Zs do not waste time. They hate delays. So, if you want to catch up with them, if you want them to embrace the market, then you must work with them, and the way to work with them is the way we are going.”

He also pointed out that the market’s growth can only be achieved through legitimate and proven processes. “It is about redeeming the times. So it is an expectation that we are able to grow this market, and we can only grow this market via processes. Legitimate processes, proven processes. So that we can be as fast as lightning even in the market,” he said.

Assuring Stakeholders of the commission’s unwavering commitment to fostering a dynamic and resilient capital market through innovative solutions and robust policies, the DG further stressed the importance of competition in driving efficiency within the market.

“Every Exchange is allowed by the rules to set this up. We encourage competition at the SEC. It’s not only NSE; if any other Exchange is qualified by our rules, then they are welcome. Competition brings efficiency. And we encourage that. But one thing we will not encourage is when you violate the regulations. The SEC under my watch and my team members will not tolerate any violation,” he asserted.”

Meanwhile, Mr. Rotimi Popoola Group CEO Nigerian Exchange stated that the platform is designed to provide a smarter, more convenient, and more efficient way to manage public offers, thereby streamlining capital raising activities on the Exchange. According to him, the groundbreaking digital tool, pending SEC approval, promises to revolutionize the process of public offerings and rights issues in the Nigerian capital market.

He also explained that the E-Offering Platform is expected to simplify the public offerings process, making it easier for companies to raise capital and for investors to participate in such offerings leveraging technology, thereby reducing the complexities and inefficiencies traditionally associated with raising capital thereby enhancing the overall market experience.

“We are talking digital, and it is very important to realize that this subject is not new in this market.  And frankly speaking we are building on the foundation that people have laid ahead of us. During Covid, the Exchange ran completely digital, so I really want to start by acknowledging these efforts.  We have come to that point where offerings can be end- to- end digitally.

“The entire market has an opportunity today that it is actually banks that are first adopting this technology. Any Bank you have heard of recently in connection with public offer has connected to this technology. So, any ban that is coming into the market today has given you an opportunity so that as you go on your mobile app, you will see their offer there.

“And when you click on that, in a few steps, you will be able to invest and it will speak to this technology that we have. It’s a big blessing because that End-To- End, removing paper from our markets, we can achieve it through the banks unlike the other kinds of offerings where your paper would have come from multiple banks. If it were to be a case of multiple banks with multiple papers for the issuer, that would be more difficult. So, it is an auspicious occasion for the market. “

MD/CEO Central Securities Clearing System Plc Haruna Jalo-Waziri commended the Nigerian Exchange for its milestone achievements in recent times, highlighting the role of innovation in market efficiency and describing the new platform as an initiative which indeed will attract younger investors to the Market  as it will go a long way  modernizing and streamlining market processes.

The event also provided an opportunity for stakeholders to express their views on the E-Offering Platform, raising questions about KYC, the role of registrars, and other related Market structures.

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