SEC okays Conoil, NB shares, 15 others for margin lending
The Securities and Exchange Commission (SEC) , has approved the shares of Conoil Plc, Nigerian Breweries (NB) Plc and that of 15 other quoted companies on the Nigerian Stock Exchange , NSE, to be used by investors for margin lending activities.
This development is line with SEC's resolve to properly regulate the margin lending, which was a major factor that led to the market crash in 2009.
The list, as released by SEC, which is composed of securities whose shares have been adjudged by the Commission to have enough liquidity and fundamental strengths to serve as margin securities, was based on the Commission’s rules and guidelines instituted with a view to curbing excessive speculative activities of investors..
Apart from Conoil and NB, the list also includes: Cadbury Nigeria, Guinness Nigeria, Julius Berger Nigeria, UACN Property Development Company, Okomu Oil Palm, PZ Cussons Nigeria, Unilever Nigeria, and Flour Mills of Nigeria.
Others are Ashaka Cement, International Breweries, Lafarge Cement Wapco Nigeria, National Salt Company of Nigeria, Nestle Nigeria, Nigerian Aviation Handling Company, Honeywell Flour Mills and Dangote Cement among others.
According to the Commission, the margin list was part of its efforts to forestall the untoward events that contributed to the previous market decline. It noted that the regulation of margin lending will ensure that the market is founded on the principles of risk-based supervision.
The apex regulator which prides itself as being committed to building a world class market that is perceived as fair, transparent and built on integrity, however urged investors to check the margin list on its website before entering into margin lending arrangement with a broker or a bank.