Feb 07, 2015/SEC Press Release
The Acting Director General of the Securities and Exchange Commission (SEC), Mr. Mounir Gwarzo has reassured bond investors of the apex regulator’s determination to always act in their best interest.
He made this reassurance while welcoming the Executives of the Association of Corporate Trustees who paid him a courtesy call at the SEC Tower in Abuja.
Mr. Gwarzo gave this reassurance amidst concerns in some quarters that the plunge in global crude oil prices may affect the ability of State governments to meet up with their obligations under the Irrevocable Standing Payment Order (ISPO) required for State bond approvals.
Speaking to the Trustees, who had earlier raised the issue as their biggest concern, Mr. Gwarzo said “The decline in crude oil prices affects the revenues of State governments and it is an issue we need to look at closely especially with a view to protecting investors which is ultimately our major responsibility”.
The ISPO is an important instrument that gives bond investors comfort as funds are deducted at source from the State’s federal allocation to go into the sinking fund from which investors are paid their coupons. Mr. Gwarzo assured the Trustees that the SEC, with the support of the Coordinating Minister for the Economy, will insist on the sanctity of the ISPO considering the impact the arrangement has had on the domestic bond market so far. He also underscored the urgency for State governments to diversify their revenue base away from over reliance on oil in order to live up to their obligations while achieving the developmental objectives for their people.
Speaking earlier, the President of the Association, Funmi Ekundayo congratulated the Ag. Director General on his recent appointment and commended the SEC’s leadership for various initiatives aimed at developing the capital market. She assured the SEC Management of their continued support and cooperation as a trade group in the quest to move the market to the next level. “Our role as protectors of the investor cannot be overemphasized. In compliance with our responsibilities within the Trust Deed we ensure that investors are always protected and repaid as and when due. We are happy with the support you give us which has continued to strengthen investor confidence in the market” she said.
