DEMUTUALISATION NIGERIAN STOCK EXCHANGE PDF

The Nigerian Stock Exchange (NSE) has finally crossed a major hurdle in its demutualization processes as President Muhammadu Buhari has. The Nigerian Stock Exchange (NSE or The Exchange) is pleased to announce that its members have approved the demutualisation scheme of the Exchange. The Nigerian Stock Exchange (NSE or The Exchange) is pleased to announce that its members have approved the demutualisation.

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Exchanges demutualise in reaction to competition and technological innovations. It is good for the market and investors. Atock believe that the current size of the capital market constrains its role in national economic development. After the passage of the second reading in both chambers, the Bill was commuted to the relevant Committees on Capital Market for further legislative action. SEC explained that with demutualisation, the NSE should be exposed to robust corporate governance, enhanced efficiency and transparency associated with publicly quoted companies.

The NSE is currently registered as a company incorporated by guarantee. Up till the early s, most of world stock exchanges were non-profit, mutual organizations limited by guarantee and monopolized by members and stock brokers. Doing Business in Nigeria. It was re-incorporated as a company limited by guarantee in December and has operated as such ever since.

Please turn on JavaScript and try again. Unegbu said government must encourage local investors to invest in the market by creating the right environment. Experts at different fora have argued that demutualising the exchange would widen excange retail investor base and help to de-risk and detach the market from the apron string of foreign investors who exit the market at any slightest volatility.

For instance, of the 64 members of the World Federation of Exchanges, 56 have demutualized. Liquidity is not usually cited as a primary reason for demutualisation.

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Amid bearish results, hope rises for stock market with demutualisation

Foreign investors are significant players in the equities market often dictating the pace of market activity. Regrettably, despite being the largest economy in Africa, Nigeria Stock Exchange established 58 years ago, is yet to demutualize.

These, in a nutshell, are the benefits of a demutualised securities exchange. You may only share Stears Business exchnge using our sharing buttons.

Members Approve Nigerian Stock Exchange Demutualisation Process

Glaringly, a significant part of the current problem with the capital market is low confidence especially on the part of the domestic investors. The bill was eventually passed into law by the Senate on December 22, and the House of Representatives on February 1, The loss, amounting to Police denies personnel absconded from Boko Haram fight 26th December The demutualization of the Exchange will bring the Nigerian capital market on a par with other international jurisdictions, result in enhanced governance, transparency and visibility whilst attracting strategic partners, investors and good quality issuers.

The African Party – Is Australia invited? Finally, since ownership rights can now be exchanged through shares, it will improve investor participation in the ownership of the Exchange. Demutualisatoon demutualised exchange may take the form of a public company listed on its own exchange like the Australian Stock Exchange or remain private like the Toronto Stock Exchange.

It will ensure that the Nigerian market becomes more efficient and competitive as it will remove conflict of interest in decision making, which characterises mutual organisations. Those who have endorsed the bill so far include; the Finance Minister, Mrs. The members of the exchange, upon the conversion and re-registration of the exchange to a public company limited by shares, may only be liable to pay tax on dividends declared by the exchange.

That the National Council and Management be and are hereby authorized to do all such things and exercise all such powers as may be necessary or incidental to achieving the objective specified in I above, subject to applicable laws and regulations and obtaining the approvals of Members demutialisation the relevant regulatory authorities.

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Mutual organisations are not organised along the exchane of profit making as they exist strictly to serve the interest of their members. Demutualisation is the process of converting the Nigerian Stock Exchange NSE from an organisation which exists for the benefit of its members, to one which is public, and investor owned.

Your email address will not be published. It is not a government initiative but that of the stock exchange itself. Demutualisation then is the process demutualissation which a mutually-owned organisation transforms to a shareholder-owned entity.

NSE restructures ahead of demutualisation plans 9. NSE demutulisation ahead of demutualisation plans. Following the resolution, the chairman, House of Representatives Committee on Capital Market and Institutions, Yusuf Tajudeen, sponsored a bill, which was first read in the House on March 29, Legal prudence requires that if demutualisation is to happen, it must be allowed and regulated under Nigerian law. CAN advises el-Rufai to stop chasing shadows over threat to arrest Enenche.

Helsinki Stock Exchange followed in Police arrest 2 armed robbers in Yenagoa. Local institutional investors such as pension funds and mutual funds are less active in the equities.

Members Approved NSE Demutualisation Process

The issues addressed here are not regarding the benefits of demutualisation, as research has shown that in comparison with mutual exchanges, demutualised and publicly listed exchanges certainly operate more efficiently when it comes to size, liquidity and financial performance. Specifically, members of the Exchange authorised the National Council and Management of the Exchange to proceed with the process leading up to the demutualisation of the Exchange subject to applicable laws and regulations and obtaining the approvals of members and the relevant regulatory authorities.

As at March 7,it has listed companies with a total market capitalization of about N8.

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