The Securities and Exchange Commission has announced plans to develop the Collective Investment Scheme sector of the Nigerian capital market.

The apex capital market regulator is taking the step against the backdrop of the fact that the CIS sector remains a thriving sector in major countries. SEC said it had, therefore, become important for stakeholders to make concerted efforts towards improving the segment in Nigeria.

SEC, in a statement on its website on Wednesday, said that since the CIS remained a veritable tool for investors’ risk diversification. In line with this plan, the body said it had planned a stakeholders’ interactive session to bring about various initiatives aimed at growing the sector.

It said, “There will be an interactive session on the development of the CIS sector, and there are also plans to introduce stricter regulatory regime for the collective investment scheme sector, such as ensuring that custodians and fund managers submit half yearly report of their various funds and benchmarking the performance of the various funds.

“The commission is also considering classifying funds into fully regulated collective investment scheme, professional collective investment scheme or specialised collective investment scheme.”

The interactive session, which would also have the Director-General of SEC in attendance, acording to the statement, will also see the commission introducing certification and continuous professional development.

The notice said the interactive session, scheduled for Thursday, willhave SEC officials with fund managers, trustees and custodians of unit trust schemes, the Nigerian Stock Exchange, NSE, Central Securities Clearing System, CSCS and the Fund Managers Association of Nigeria, among others, in attendance at the commission office, in Lagos.

It added that among issues to be discuss would be the fact that managers of mutual funds and other collective investment schemes in the capital market will soon be required to attain certain professional qualification and adopt the International Financial Reporting Standards, for their funds, according to a proposal put forward by the SEC.

The notice also indicated that the commission was also considering classifying funds into fully regulated collective investment scheme, professional collective investment scheme or specialised collective investment scheme.

“The commission is also considering other initiatives to develop the sector, saying that the interactive session will afford it the opportunity to discuss with stakeholders on likely reduction in funds’ expenses, especially in area of management fees and custodian fees,” it added.

The commission further hinted that it was considering a number of incentives that would motivate growth of the various funds.

The distribution and sales points of the various funds and the report on migration to Custodians will also be among the major issue to be considered by stakeholders at the session, the statement said.

Source: Punch/Udeme Ekwere