16 January 2013

Nigeria: NSE Unveils Six Market Makers for Bonds Trading

Retail trading in bonds on the Nigerian Stock Exchange (NSE) will formally commence on February 1, following the unveiling of six Fixed Income Market Makers(FIMM) by the Chief Executive Officer of the NSE, Mr. Oscar Onyema, Tuesday.

Efforts to commence retail trading of bonds on the exchange had been on since last year with the Debt Management Office appointing a Stanbic IBTC Stockbrokers as the Federal Government broker.

Onyema on Tuesday unveiled the six FIMM, out of the 14 that applied, to facilitate retail bonds trading. The successful ones are: Capital Bancorp Limited; Cordros Capital Limited; ESS/Dunn Loren Merrifield; FSDH Securities Limited; Greenwich Securities Limited and GTB Securities Limited.

The NSE CEO noted that the stockbroker for Asset Management Corporation (AMCON) would be announced before the roll out of the programme on February 1, 2013. According to him, unlike the market making for equities, where they a basket of securities, the FIMM will not have any particular basket but would make market in all the listed bonds.

The Executive Director, Business Development of the NSE, Mr. Haruna Jalo-Waziri:"This is a great milestone and a major step in turning the market around as this will make the market more liquid in the retail side as well as promote portfolio diversification."

According to Jalo-Waziri, the six FIMM went through a very rigorous process and met the additional net capital requirement of N500 million.

"We also examined their compliance history and looked into their operational capabilities, technology and processes. They were taken through exercises, debated the appropriate market structure to be used and The Exchange further went through the approval of the Securities and Exchange Commission (SEC) in the selection process," Jalo-Waziri said.

Meanwhile, trading at the stock market remained positive with the NSE All-Share Index rising by 1.29 per cent to close at 29,309.70, while the market capitalisation added N35 billion to close at N9.374 trillion. At the close trading, 50 stocks appreciated compared with eight that depreciated.

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