On 5^th August 2010, the Securities and Exchange Commission intervened in The Nigerian Stock Exchange (NSE) as a result of developments in the Exchange which were eroding investor confidence and undermining the integrity of the Nigerian Capital Market.

 

The intervention which was to safeguard the interest of the public and protect the integrity of the Exchange involved:

i) a directive that the Council member elected as President of the Exchange in defiance of a court order cease acting as president pending the outcome of the litigation;

ii) a directive that Council members elected in defiance of a court order cease acting as members of the Council pending the outcome of the litigation;

iii) the removal of the Director General, Professor Ndi Okereke Onyiuke as Director General and Chief Executive Officer;

iv) the appointment of an interim administration consisting of an Interim President of the Exchange, Mallam Ballama Manu and an Interim Administrator of the Exchange, Mr. Emmanuel Ikazoboh, working with those members of the Council not affected by the court actions.

One of the mandates of the interim administration was to ensure a rigorous, transparent and credible process for the selection of a new Chief Executive Officer and Executive Directors of the Exchange.

 

The Commission is pleased to note that this mandate has been satisfactorily executed and commends the Interim President, the Interim Administrator, and all the members of the Council, for the excellent work done in this regard. The new Chief Executive, Mr. Oscar Onyema, will assume duties on 4^th April 2011.

However, the task of the interim administration is not yet completed. A lot more work will need to be done to put The Stock Exchange on a sounder footing so as to achieve the objectives for which the Securities and Exchange Commission intervened.

In order to speed up this work, the Securities and Exchange Commission has, in the public interest, and pursuant to section 35 (1) of the Investments and Securities Act (ISA) 2007, directed the Council to admit some professionals, as public interest members, to strengthen the Council and support the new management team.

All the SEC nominated members, including Messrs Ballama Manu and Emmanuel Ikazoboh, shall be on the Council pending the election of a new council and are charged with working with existing Council members to achieve the following:

(a) restructuring the Exchange to ensure good corporate governance practices;

(b) concluding the ongoing initiatives/plans regarding the trading platform and other infrastructure of the Exchange aimed at making it a world class Exchange;

(c) guiding the new Management team over the next few months to settle; and

(d) preparing the Exchange for its demutualization including the restructuring of the legal framework.

We expect the restructuring exercise to be quickly concluded so that elections can be conducted to establish a new Council. We are hopeful that by that time all the cases in court would have been disposed of so as to allow the Interim President to conduct elections without any legal impediment.

The Commission has also directed that a one month transition period commencing 4^th April 2011 be allowed to enable proper handover by the Interim Administrator to the new Chief Executive Officer. After the transition period Mr. Ikazoboh will continue on the Council as deputy to the Interim President.

Finally, the Commission wishes to thank the Council of the Exchange for the cooperation given to the Interim President and Interim Administrator and hope that the same will be extended to the new Management team and the Public Interest Members.

LANRE OLOYI

HEAD, MEDIA

SECURITIES AND EXCHANGE COMMISSION (SEC)

3rd APRIL, 2011