The recent intervention in the banking sector by the Central Bank of Nigeria (CBN) should be seen as a proactive measure to instil public confidence in the system and a similar thing should be done in the capital market, CBN Governor Sanusi Lamido Sanusi said in Abuja yesterday. He spoke at the opening of the 13th African Securities Exchange Association (ASEA) conference.

Sanusi was represented by the CBN Director of Research, Charles Mordi. He said the conference came at a time the global financial crisis has presented countries with new challenges for development. He said capital market regulators should devise a regulatory environment that secures and protects the rights of all players in the market.

He said there should be "improvement in infrastructure, addressing the problem of market speculations, manipulations and over-pricing of shares and removing delay in issuance of share certificate where it is still in operation."

According to him, the current global financial crisis has led to the reform of the international financial system, saying however that the effect of the global financial crisis is still lingering across the globe.

"Governments across the world have been compelled to take various measures to protect their financial systems from collapse. The development in the financial industry has brought a new thinking in regulation and supervision," he said.

He also said, "These reform measures aimed at repositioning the financial sector have focused more on the urgent need for increased risk management procedure, curtailing current practices and enhancement of corporate governance. In Nigeria, these are the vital issues that are been addressed by the CBN in collaboration with other relevant regulators in the financial industry to ensure stability."

He said experience from other nations have shown that capital market have provided the needed supports for economic development. He cited the examples of India, Indonesia and other countries.

He said there is a need for strong agents "that would bring about vibrant capital markets that are well regulated and that comply with international best practices."

He called for a regulatory environment that secures and protects the rights of all players in the capital market, together with efficient measures that would promote effective capital market operation in the African region.

Sanusi also called for privatising of state-owned enterprises. He said there is a need for the West African sub region to embrace capital market integration and harmonisation of securities market. "The Securities and Exchange Commission in Nigeria, the regulator of the capital market, has the responsibility to ensure the stability of the system and a duty to safeguard the interest of investors and other stakeholders", he said.

He said there is a need for efficient risk management system and strong corporate management practices. CBN, he said, would continue to deploy and employ more robust risk supervisory framework in line with the global best practice. "Also, the CBN will continue to collaborate with SEC as well as other stakeholders in ensuring public confidence", he said.