Archive for the 'Regulators' Category
March 1st, 2011 by Tom Minney
Investor confidence in Egypt is likely to be further undermined after Egyptian officials again delayed the reopening of the Egyptian Exchange (EGX – www.egyptse.com) from today (1 March). It was announced late on Monday that trading would not start today at 10:30am but would again be put off until Sunday, 6 March. There have been repeated delays to the reopening.
The exchange is expected to face strong selling pressure when the shortened trading session begins and this could trigger new measures to stop volatility and cause the bourse to halt trading very quickly after it does open. According to reports, trading on stocks will be carried on within a pre-set price range and will be halted for half an hour in there is a 5% change in value, while if a share price moves by 10% the price will be fixed until the end of the trading session. If the EGX 100 index moves by 5% trading will halt for half an hour, if it changes by 10% trading will halt for as long as decreed by the EGX Chairman.
State-run Middle East News Agency (MENA) carried a statement by exchange officials that the market would reopen on 6 March to “allow investors to profit from the government’s support to guarantee stability in the bourse.” Officials have refused some demonstrators’ demands last Sunday to cancel trades made during the 2 days before the EGX closed on 27 January, when share prices plummeted.
Investigations are continuing into business leaders close to former President Hosni Mubarak who were prominent in leading listed companies and also who owned many shares and may be trying to rearrange their finances.
Karim Helal, Managing Director of brokerage CI Capital was quoted by Associated Press saying the delays harm sentiment: “No doubt, it is certainly eroding investor confidence, and we’re losing credibility by the day in international markets. If the decision is to allow the market to absorb losses, it won’t make a difference. It will just make it worse.”
There have been sharp falls in other stock markets across the Middle East and North Africa, as pro-democracy demonstrations have been increasingly widespread and persistent. Escalating violence in Libya is pushing up oil prices, while fears there could be pressure in Saudi Arabia have also added to worries about global oil prices and the economic recovery, damaging sentiment on exchanges worldwide.
February 28th, 2011 by Tom Minney
The Egyptian Exchange (www.egyptse.com) is set to reopen tomorrow (1 March) after it closed on 27 Jan. in the popular uprising that saw President Hosni Mubarak resign on 11 Feb. It was due to open earlier, but delayed because strikes were devastating the banks on which it relies for clearing and settlement. Some selling is anticipated.
An announcement by Egypt’s Cabinet yesterday (27 Feb.) confirmed the opening and also that Ziad Bahaa El-Din, chairman of Egypt’s Financial Supervisory Authority, resigned yesterday. On 19 Feb. the FSA had announced that new trading rules will be in place to prevent exchange volatility. Daily share price movement will be limited to 1%, trading sessions are cut from 4 to 3 hours, and the cash reserve requirement for brokerages is cut from 10% to 5% of their capital.
According to a report on Bloomberg, market participants expect selling pressure. Walaa Hazem, who helps manage $1 billion in Egyptian equities and fixed income as vice president for asset management at HC Securities & Investment in Cairo, is quoted as saying: “The market should have opened much earlier. Locking people’s money is something very bad. This will put selling pressure on the market, in addition to the regional turmoil and the economic slowdown.”
Shares in the Middle East and worldwide continue under pressure as unrest sweeps across North Africa and the Middle East including Bahrain, Algeria, Yemen, Iraq, Oman, Morocco and Jordan. High oil prices may dampen hopes for a global economic recovery. According to Bloomberg today: “Saudi Arabia’s benchmark Tadawul All Share Index plunged 5% yesterday, to the lowest since June 6, on concern soaring oil prices, triggered by the Libyan clashes, may stall the global economic recovery. However, share indices moved slightly upwards in Sunday trading in Kuwait, Abu Dhabi and Jordan.
The Bloomberg GCC200 Index of companies in the Persian Gulf has tumbled 9.5% since Jan. 27, the last day shares in Egypt traded. Global depository receipts of Orascom Construction Industries also slid.”
Egypt’s unrest and resulting impact on tourism, business and investment could slow economic growth this fiscal year to about 4%, down from an earlier estimate of 6%, according to Finance Minister Samir Radwan.
However, many investors see there can be better outcomes from long-term stability and democracy. Global Depository Receipts of Orascom Construction Industries, Egypt’s biggest publicly traded builder, rose 3% in London on 25 Feb, so they have only fallen by 10% since 27 Jan. Orascom Telecom Holding SAE gained 0.9% in London since 27 Jan, says Bloomberg. It also quotes Walaa Hazem saying that some industries, including food and telecommunications, will be in a “better position” than others when the market opens. “People are still going to eat and talk on the telephone,” he said, singling out fixed-line operator Telecom Egypt. He says that key banks “won’t have good growth stories but they have strong balance sheets.”
Ahmed Ezz (chairman of Egypt’s biggest producer of steel) and Yasseen Mansour, (chief executive officer of Cairo-based real-estate developer Palm Hills Development SAE) who were both seen as close to former president Mubarak, are among executives referred by Public Prosecutors for trial on corruption charges. Both companies said their operations are run independently of the chairmen.
Bond yields are also higher than before the unrest, although there have been fluctuations. According to Bloomberg data, the yield on Egypt’s 5.75% dollar bond due 2020 has dropped 29 basis points to 6.92% percent after reaching a high of 7.21% on 31 January, compared to 5.16% at the start of the year. Yields on treasury bills have reached 2-year highs since 11Feb.
On 27 Feb, Egypt sold 2 billion pounds ($340 million) in 91-day bills and LE 3 bn in 273-day notes in an auction, falling short of its target of raising LE3.5 bn.
Bloomberg quotes Moustafa Assal, MD of Cairo-based Beltone Financial’s fixed income unit: “The high yields, especially on the longer-term notes, are a big concern because the Government is becoming unable to cover its intended issuances. They will not come down unless there’s political stability.”
Bloomberg also quotes Amro Halwani, senior equity sales trader at Shuaa Capital PSC in Saudi Arabia: “With no clear end to the geo-political turmoil in the region, local investors are erring on the side of caution. The regional uncertainty, with Libya this week’s reason to sell, has pushed fundamentals out of the picture. The surge in oil is an ongoing threat of a possible derailing in the global economic recovery, and gave investors a reason to move away from riskier assets.”
February 14th, 2011 by Tom Minney
Africa’s newest stock exchange is the Rwanda Stock Exchange (RSE), launched on 31 Jan to start trading the shares of brewer Brasseries et Limonaderies du Rwanda BRALIRWA (www.bralirwa.com). The exchange replaces the Rwanda-Over-The-Counter (OTC) market which has operated since 31 Jan 2008.
Prime Minister Bernard Makuza launched the RSE and said it is a key development milestone, according to news reports: “Building a strong financial system is a key element of Vision 2020; the Government will continue to facilitate the development of the capital market.” Finance Minister John Rwangombwa said Government had sustained a stable macroeconomic environment over the years and laid the appropriate environment to attract both domestic and international investments.
The RSE was formed as a dormant company after a March 2007 decree that established the Capital Markets Advisory Council (www.cmac.org.rw) to set up and regulate the transitional process towards a full stock exchange. CMAC had run the ROTC and would now be transformed into a Capital Markets Authority to act as regulator. The legal framework aims to comply with standards of the International Organization of Securities Commissions (IOSCO).
BRALIRWA IPO
Bloomberg agency reported that BRALIRWA shares surged 62% when trading began on the RSE on 31 Jan. It quoted Robert Mathu, Executive Director of CMAC, saying the stock first traded at 220 Rwandan francs ($1.67).
The Rwandan Government aimed to raise RwFr 22.1 billion (US$37.3 million) from selling its 30% stake in BRALIRWA. Of this 128.6 mn shares, or 25% of the company, were sold in the public offer at RwFr 136 francs (22.9 US cents) per share. The Government said this was a discount to the valuation of RwFr 170 each share, in order to encourage buyers.
Government was to sell the remaining 5% of its shareholding to Heineken Group, which earlier bought 70% of the brewer from the Government. BRALIRWA sells beers such as Amstel, Guinness, Mutzig and local brand Primus and has an estimated 95% market share and also bottles Coca Cola products. Net annual revenues are reported at around $93 mn.
The offer reportedly attracted $80 mn in bids. MBEA Brokerage Services Rwanda was lead transaction advisor. The IPO campaign included investor education, TV and radio ads and Rwanda’s first research reports.
Co-transaction advisor Renaissance Capital sold 60% of the international tranche offering to international and local investors across several continents. There were share orders from Africa, Europe and the United States and the international portion was oversubscribed more than 5 times.
The shares ended the week on 11 Feb at RwFR 189, according to the market report from CMAC.
Future share offers
Bloomberg reports that the Government is discussing the sale this year of its 10% stake in MTN Rwanda, 55% owned by South Africa’s MTN Group Ltd. Minister Rwangombwa said another shareholder with a 35% stake will probably also offer its shares in public offer.
State-owned Banque de Kigali, Rwanda’s biggest lender by assets, will sell shares in May 2011 and cement-manufacturer Ciments du Rwanda Ltd., Rwanda Commercial Bank (BCR) and insurance company SONARWA are among other companies partly owned by the State who may sell stock through the RSE.
Contract to Kenya’s central depository
Rwanda contracted Kenya’s Central Depository and Settlement Corporation (www.cdsckenya.com) for a year. The company said it will train staff of the central Bank National Du Rwanda (BNR). The bank aims to procure and install a system to run a central depository for the equity market using its own staff by the end of the contract. CDSC has handled the BRALIRWA IPO and many of the biggest share offerings in East Africa, including Safaricom.
Kenyan depositories and share registrars are competing to offer their services more widely in the region.
Market structure
CMAC’s Mr Mathu told East African Business Week that the law establishing Capital Markets and the law regulating the market were to be published before end of January.
Previously the Government owned majority shares in the dormant RSE, but now it has reportedly reduced this to “at least 20%”. The private sector, including stockbrokers, holds the majority. Mr Mathu said: “We would like to see a stock exchange that is going to be pro-business, active and capable of providing a very efficient service to the investors both domestic and international.” Stockbrokers have welcomed their inclusion in the ownership of the stock exchange saying it will hold them responsible for protecting the bourse.
According to statistics from CMAC, bonds worth RwFr 26 bn have been issued and listed for trading on the ROTC, including 7 treasury bonds (RwFr 25 bn) and one Commercial Bank of Rwanda (BCR) corporate bond of RwFr 1bn. Bonds traded on the secondary market have so far generated a turnover of RwFr 654.4 mn. Two Kenyan companies, Kenya Commercial Bank (KCB) and Nation Media Group (NMG), are cross-listed.
February 14th, 2011 by Tom Minney
The Egyptian Exchange (www.egyptse.com) has decided to postpone its reopening until Wednesday 16 February. The stock exchange, based in Cairo, closed on 27 Jan after the main EGX 30 Index fell 16% in a week, and was due to open again yesterday (Sunday 13 Feb). The decision to delay the opening comes on the back of talks with regulators, stockbrokers and the Misr for Central Clearing, Depository and Registry (MCDR, www.mcsd.com.eg).
When the exchange reopens steps are expected to be in place to stop precipitous falls and price fluctuations. Many foreigners had sought to take out money and it is not yet clear how sentiment will shape up following the resignation of former President Hosni Mubarak on 11 Feb and the army take over pending democratic elections scheduled for six months time. The EGX says it is working on technical requirements needed to start trading as well as procedures to be used as soon as the trading begins. Telecommunications and Internet services may also have been disrupted.
The Wall Street Journal reported yesterday (13 Feb) that late yesterday the Central Bank of Egypt (www.cbe.org.eg) said that banks in Egypt will close on Monday and Tuesday due to workers’ strikes and the birth of Prophet Mohammad. Its emailed statement reads: “Amidst the strikes of worker in some authorities, including public banks … the central bank has decided to close banks on Monday Feb. 14 and Tuesday Feb. 15 on the occasion” of Prophet Mohammad’s birth.
Meanwhile schools and universities were reported to be reopening over the past weekend and many industries had said they were back and working close to normal by 7 Feb.
January 14th, 2011 by Tom Minney
According to media reports, Zimbabwe’s Indigenization Minister Saviour Kasukuwere is declining to give permission for leading gold miner Duration Gold (www.durationgold.com) to raise US$7 mn by listing on the Toronto Stock Exchange (www.tmx.com).
According to a report in businessdigest of the Zimbabwe Independent newspaper, the minister wants an empowerment plan detailing how Duration will empower black Zimbabweans in line with the Government’s 2010 economic empowerment regulations under which foreigners must sell controlling shareholdings to black Zimbabweans.
He also apparently believes the money could be raised locally on the Zimbabwe Stock Exchange.
The minister confirmed that Duration had written for permission to list but told the newspaper “I cannot comment on anything”.
The company is an investment by Clarity Capital (www.claritycapital.com), a US-based fund founded in 1996 by Allan Dolan, that claims on its website: “Clarity has the capital and in-house expertise to create and grow successful businesses. We don’t just invest in promising ventures, we incubate and operate them.
“Clarity specialises in the minerals, life sciences, energy and creative industries sectors. Our entrepreneurial team of over 25 technical and commercial experts, from scientists, engineers and geologists to accountants, lawyers and financiers, are passionate about building value. Our goal is to deliver returns of 5 to 10 times our invested capital over a 3- to 5-year period.”
A fellow company, Whetstone Minerals, is listed on the TSX. According to the news report, Duration intended to retain 30% of the capital raised outside Zimbabwe for head office expenses. The newspaper does not report any comment or confirmation from the company.
Duration’s website describes it as “a Zimbabwe focused, private, emerging gold producer and explorer. The Company, majority owned by Clarity Capital and its employees, currently has a global resource base of 4.2 million oz of gold. Formed in 2006, Duration partnered with two long standing Zimbabwean mining families, the Muirs and the Thompsons, and now owns 5 core assets with historic production of 4.6 million oz. Each core asset has the potential to produce over 1 million ounces of gold. Duration is licensed to market and sell its gold on the open market. It sells gold at international spot prices and receives freely transferable foreign currency in return. The company is cash flow positive and generates a healthy EBITDA from its current operations.
Duration’s objective is to develop its existing asset base into a 350,000 oz per year producer, based on 5 bankable feasibility studies targeted for completion by 2014. Acquisition of additional producing and advanced stage assets will also bolster the company’s annual production.”
Zimbabwe’s economic regulations gazetted in March 2010 gives the Minister authority to approve and disapprove deals involving foreign equity participation. He previously sought to block the sale of Barclays Bank subsidiary, Custodial Financial Service, on grounds that the bank did not comply with indigenisation and economic empowerment regulations. This deal was part of the sale by Barclays Bank plc of its African custody businesses to Standard Chartered Bank.
January 6th, 2011 by Tom Minney
There has been much buzz about investing in Africa and the growth figures show that the markets make sense. According to today’s (6 Jan) daily chart by The Economist (www.economist.com), on IMF forecasts Africa has 7 of the world’s top 10 places for fastest growing economies for the 5 years from 2011-2015. (The magazine’s ranking excludes countries with less than 10 million poeple as well as Iraq and Afghanistan, which could both rebound strongly in the years ahead). Ethiopia, a non-oil economy with Africa’s second-biggest population, heads the list.
Looking back over the 10 years to 2010, sub-Saharan Africa was home to 6 out of the 10 fastest-growing economies. According to the editorial: “Over the period the simple unweighted average of countries’ growth rates was virtually identical in Africa and Asia. Over the next five years Africa is likely to take the lead. In other words, the average African economy will outpace its Asian counterpart.”
All the more reasons for regulators and those running the continent’s capital markets and private equity funds to make capital flows more effective and encourage local populations to have a bigger part in the growth. They should concentrate on streamlining regulations and tax systems that make it hard and costly to do business, and reduce the costs and time for doing business help people focus on productive growth.
December 30th, 2010 by Tom Minney
The useful businessdigest of the Zimbabwe Independent (www.theindependent.co.zw) newspaper has published two revealing interviews by Paul Nyakazeya with the CEO of the ZSE, Emmanuel Munyukwi, and the CEO of the Securities and Exchange Commission, Alban Chirume, as well as other market experts on the trends and undercurrents on the Zimbabwe Stock Exchange (www.zse.co.zw) in 2010 and 2011. Here are some extracts:
The Stock Exchange CEO
ZSE CEO Emmanuel Munyukwi says in his interview that 2010 could have been “a much better year” compared to 2009 had it not been for the indigenisation regulations gazetted in March. Munyukwi said the market was bullish in the first quarter, trading was mixed after the empowerment regulations were announced, but it recovered in the last quarter: “In April we raked in about US$5 million while months before that we were raking in more than US$20 million a month. Since the regulations were gazetted, we have seen a negative impact on trade.”
Munyukwi said he had endured a stressful time during Zimbabwe’s lost decade keeping interest alive in a stock market disconnected from the rest of the world. This year “the market performed better, some counters that most investors would not buy on the first go performed really well.” He forecast that market capitalisation could end 2010 above US$4 billion not much change on the year which opened at US$3.97 bn.
The market in brief (figures Zimbabwe Independent):
From 4 January to 30 November a total of 6.2 billion shares were traded worth US$3.6 billion. Foreign buying was US$1.1 million against foreign selling of US$0.17 million. Beverages giant Delta Corporation had the biggest market capitalisation at US$731 million, followed by Econet Wireless Zimbabwe (US$435 mn) and Innscor Private US$292 mln).
ZSE Winners.. (year to 17 December)
National Tyre Service: up 140%
DZL & Zimplow: up 120%
Colcom: up 118%
Hwange: up 114%
..and Losers (year to 17 December)
PG Industries: down 69%
African Sun: down 78.3%
RedStar: down 80%
TN Holdings: down 83.6%
Zeco: down 85%
The Economist
Economist David Mupamhadzi told businessdigest that the performance of the ZSE will continue to be driven by the performance of the economy. The anticipated strong performance of most key sectors of the economy in 2011 would boost the market.
“However, political developments will also play a big role in influencing the performance of the ZSE.” He said reports of an election in 2011 could encourage some investors to “wait and see” and added: “Furthermore, depending on the prevailing political conditions, especially linked to the constitution, referendum and the much talked-about elections, the ZSE could take a serious hammering if there is no peace and stability in the country.”
The Regulator
SEC CEO Alban Chirume (AC) from his interview on the benefits of demutualizing the ZSE:
“We are interested in the reform of the exchange by way of complying with the Act and SI (Statutory Instrument) 100 of 2010. Corporatisation of the exchange which will result in the separation of trading rights, ownership and management (independent board and executive management) will meet the requirements of our regulations. We are keen to see that process moving faster. The stock exchange can advise where it is and when they expect the process (of demutualisation) to be completed… The current status could be working to the detriment of the market. Liquidity inflow is also a function of the confidence that investors have in a market. We need to build that confidence ourselves.”
December 16th, 2010 by Tom Minney
The International Finance Corporation (www.ifc.org), a member of the World Bank Group (www.worldbank.org), and East Africa’s Securities Industry Training Institute (SITI), based at the Uganda Securities Exchange (www.use.or.ug) have signed an agreement to broaden training. This will boost opportunities for market participants, regulators and others in East Africa’s capital markets sector, with the aim of strengthening and supporting the growth of securities markets in the region.
SITI will be licensed to use IFC-developed securities markets training material for the next 10 years to train and certify thousands of securities market participants in Kenya, Rwanda, Tanzania, and Uganda. The material is developed by the Efficient Securities Markets Institutional Development (ESMID) Programme, a joint project by the Swedish International Development Cooperation Agency (www.sida.se), which provided $5.5 million, the IFC and the World Bank.
IFC Principal Investment Officer Aida Kimemia said in a press release: “Supporting the development of securities markets is a priority for IFC in Africa. This agreement will make available world-class training materials to thousands of people in East Africa, improving their skills and knowledge and giving them the tools that will support broad economic growth in the region.”
Joseph S. Kitamirike, Chairman SITI board and CEO, Uganda Securities Exchange, said: “We at SITI are very pleased to have cooperated with IFC to develop the training materials. We know that they are cutting edge and will help us develop the personnel we need to grow the securities markets in East Africa. On the strength of this successful cooperation with IFC, we are confident we will undertake more activities of this nature that will ensure proper market development.”
The ESMID programme aims to help develop well-functioning securities markets in Africa, with a goal of supporting key economic and social development needs with high developmental impact, such as infrastructure, housing, and microfinance. Despite efforts over the last 12 months this blog has been unable to contact the East Africa office directly to find out more, as the officers do not seem to reply to emails or phone messages.
Its funded programmes are to help simplify regulations and procedures for issuing and trading bonds; strengthen market infrastructure; build capacity of market participants; facilitate the regionalization of securities markets; and support demonstration transactions. In East Africa, it reportedly works with central banks, securities regulators, stock exchanges, and market participants, such as brokers, dealers, investment banks, and institutional investors. It also works in Nigeria, according to the website.
The ESMID-developed training material consists of 3 courses and 5 seminars: Fundamentals Securities Course; Securities Certification Course; Officers and Directors Course; Bond Trading Seminar; Corporate Finance Seminar; Corporate Governance Seminar; Bond Underwriting Seminar; and Portfolio Management Seminar.
The courses, which will be required for licensing of market intermediaries, have already benefitted more than 700 course participants in East Africa.
The IFC, a member of the World Bank Group, is the largest development institution focused on the private sector in developing countries. It says “our new investments climbed to a record $18 billion in fiscal 2010.”
November 30th, 2010 by Tom Minney
The Nigerian Senate’s Capital Market Committee summoned the Director General of the Securities and Exchange Commission (www.sec.gov.ng) Arunma Oteh and the Interim Administrator of the Nigerian Stock Exchange (NSE – www.nigerianstockexchange.com) Emmanuel Ikazoboh to appear at hearings on 29 November. According to a news story in the Daily Independent (www.independentngonline.com) newspaper, they felt they had not received sufficient responses to inquiries and wanted a report on activities.
The Senate has been sending queries since the 4 August dismissal of NSE Director General Ndi Okereke-Onyiuke. They also feel that the SEC acts as if it is independent of supervision, especially by the Senate. One example was that the audit of the NSE, dated October 8, was only received by the Committee a month later, unsigned by KPMG the auditor. When other queries were also not answered, the Capital Markets Committee returned the audit and the SEC reportedly said it was the best they could do.
Last week the House of Representatives Capital Market Committee summoned the two to a public hearing to discuss amendments to the Investment and Securities Act to ensure the autonomy of the SEC. There have been reactions, according to the report: The SEC has only submitted its financials to its supervisor, the Finance Ministry. This, the House reportedly said, makes it unable to effectively perform its oversight functions in the interest of national good. The last published account by the SEC is believed to be that of 1991/92.
The committee was apparently concerned “that the provisions and expenditure for board member allowances were quite significant and alarming for a public sector agency.” House Capital Market Committee Chairman, Umar Jubril, reportedly disclosed that the SEC generated N16 billion (US$106 million at current exchange rates) in 2006, N13 bn (2007), N8 bn (2008), and N3 bn (2009).
However, a market source reportedly told Daily Independent that the total figure should be about N68.5 bn, judging from computations from publicly available data, including fees from private placements approved by the SEC, mergers and acquisitions, and recovery costs of proceedings.
The House of Representatives Committee on Capital Markets has also directed the SEC to reverse its decision sacking Prof Okereke-Onyiuke, according to news reports last week. The committee asked the SEC to look into her letter of voluntary retirement (16 June, to be effective 15 Dec) and allow her to proceed on her terminal leave as stated in her notice. NSE has also been ordered to forward its audited 2009 report and both first and second quarter 2010 reports to SEC for onward transmission to the National Assembly.
October 11th, 2010 by Tom Minney
Nigeria’s Securities and Exchange Commission (www.sec.gov.ng) has commissioned a forensic audit into affairs of the Nigerian Stock Exchange (www.nigerianstockexchange.com). The SEC released a statement on 6 October which says the members of the NSE Council, including the former CEO, paid themselves N 1.35 billion (US$8.93 million) in illegal “productivity/surplus” bonuses, according to local news reports.
The SEC has reportedly directed that the Interim Administrator of the NSE, Emmanuel Ikazoboh should take steps to recover all such shared “bonuses” from the Council members.
According to a report from the NSE Auditors, Messrs Akintola Williams Deloitte, who had wanted to qualify the NSE accounts for the year to December 2009 on the basis that “an accrued N1.2 bln had been distributed to employees and council members as bonuses and share of surplus respectively in the current year. This is contract to section 26(3) of Companies and Allied Matters Act, Cap C20 LFN 2004 and section 6 of the Memorandum and Articles of Association of the Exchange, which stipulated that the income and property of the exchange shall applied solely towards the promotion of the objects of the Exchange and no portion therefore shall be paid or transferred directly or indirectly by the way of dividend, bonus or otherwise.”
The SEC statement says similar payments had been made since 2006, through to 2008:
2006 – N160.8 mln was shared by 18 members of the members.
2007 – N710 million shared by 16 members.
2008 – N480 million was shared by 18 members of the council.
The immediate past president, Oba Otudeko, got the lion’s share of the bonus of N238 million followed by the former director general of the exchange, Ndi Okereke-Onyiuke with N146.8 million, Dr. Raymond Obieri N110 million, Erastus Akingbola N80 million, Alh. Mohammadu Koguna N67 million while Mr. Godwin Obaseki and B. E. Sobamowo, Nduka Nwonye got N64 million each. Billionaire Alhaji Aliko Dangote, ordered to stop acting as NSE Council President in August, has reportedly already returned N40 million in bonuses, the first to do so.
The SEC had appointed law firm Aluko & Oyebode and the accounting firm KPMG to investigate the allegations of financial mismanagement at the Exchange. Independent Investigators commenced work on Thursday August 5, 2010 by securing data and document sources.
The matter of bonuses had held up the audit of the accounts for the year to December 2009. NSE’s External Auditors, Messrs Akintola Williams Deloitte (Mr Ikazoboh was the former CEO) had eventually signed off an unqualified set of accounts after previously wishing to add a qualification based on the fact that an accrued sum of N1.2 billion was distributed to employees and council members as bonuses and shares of surplus respectively.
According to the SEC statement issued by Mr. Lanre Oloyi, Assistant Director/Head Media, SEC, the NSE Council approved the 2009 audited accounts of the NSE at its meeting on 28 September 2010. The Investment and Securities Act mandates that these be submitted to the SEC,which Mr Ikazoboh did on 30 September.