The Securities and Exchange Commission, SEC, has refuted the claim that the Nigerian capital market is one of the most expensive in the world, saying that cost of transaction in the market is quite friendly.
The Acting Director General of the SEC, Ms. Mary Uduk, made the claim at Capital Market Correspondents Association of Nigeria (CAMCAN) 2018 workshop with the theme: “Exploring Green Bond Market for Economic Development” in Lagos.
Represented by Emomotimi Agama, Head, Registration and Market Infrastructure Department, SEC, Uduk said that the Nigerian capital market is cheap compared to other jurisdictions, adding that the Commission has succeeded in reducing the cost of transaction from one percent to 0.3 percent in the last 10 years.
She stated: “For the past five to 10 years, the SEC has gradually reduced its fees and cost. The Commission has reduced cost of transaction from one percent to 0.5 percent and now, to 0.3 percent.
“Some may say that the SEC is government institution and therefore gets support from the government, but I will like to let you know that the government does not in any way support us. We have continued to reduce cost just to make sure that the market is more attractive. Particularly for bonds, the SEC charges next to nothing for the issuance of bonds.
“So, it is not really about the cost; if you do a comparative analysis of cost in the Nigerian market vis-a-viz other jurisdictions, you will realise that our market is quite cheap. What the SEC does is to encourage what is necessary and important to investors.”
On corporates and municipals that default on utilisation of bond proceeds, she said: “The dynamics is that the market punishes any defaulter; not the regulators. Not until we take corporate governance serious and we have the market punish issuers that did not do what they ought to do, we have not started.”
She assured that the commission would continue to provide enabling environment for the issuance of green bonds, as well as sustain its partnership with CBi and FSD Africa in an effort to sustain the issuance of green bond and expand the scope of capacity building in the green bond space.