SINGLE SHARES REGISTRY, REGISTRARS WARN CBN AGAINST GRAVE IMPLICATIONS
The proposed idea of adopting single shares registry for companies and banks quoted on the Nigerian Stock Exchange (NSE) has drawn flaks from chief executive officers of registrars who warned of the grave implications of ceding all bank equities to a single entity, thereby creating a monopoly.
The experts reminded authorities of the Central Bank of Nigeria (CBN) and the Securities and Exchange Commission (SEC), joint promoters of the controversial single registry, that the policy runs contrary to the SEC's direct responsibility to guard against anti-competition practices in the Capital Market.
A statement issued by the corporate members of the Institute of Capital Market Registrars, after their meeting, last week, further warned against creation of redundant capacity, ultimately resulting in shrinkage of Registrars' branch network, staff and other service complement.
The communiquÃ©, signed by the Registrar/Chief Executive of the institute, Dr. David Ogogo, and obtained exclusively by Daily Sun noted with dismay what it described as 'persistent attempt to single out registrars as the problem of the capital market, as evidenced by the campaign of calumny, name-calling and outright misrepresentation of facts, as they relate to the practice of share registration in Nigeria.'
According to the release, bank equities accounted for 66 percent of market capitalisation of NSE, and any attempt to create a single registry out of bank equities would immediately result to anti-competition practices, job losses, and shrinkage of branch network of registrars.
'The implication of ceding all bank equities to a single entity would be to immediately create a monopoly, which runs contrary to the SEC's direct responsibility to guard against anti-competition practices in the Capital Market.'
The Institute further states 'The effect of stripping the bank securities from Registrars will be the immediate creation of redundant capacity, ultimately resulting in shrinkage of Registrars' branch network, staff and other service complement.'
It would be recalled that the at a recent training workshop organised by CBN for financial reporters in Benin, the apex bank muted the idea that it was considering the option of enunciating single registry policy for banks quoted on the exchange but it did not give reasons as to why it is planning to adopt new policy just as it was silent on details on the modalities.