SEC guidelines made banks’ recapitalisation transparent – DG

The Director-General of the Securities and Exchange Commission, Dr Emomotimi Agama, has stated that the guidelines issued by the commission before the banking recapitalisation exercise increased transparency of the process, making it easier for Nigerians to participate.

He also explained that the recapitalisation exercise was a crucial measure by the government to strengthen the banks.

The SEC DG disclosed this in a statement issued by the commission on Sunday.

In March, the Central Bank of Nigeria announced new capital requirements for the country’s banks, which were aimed at strengthening the financial institutions and achieving President Bola Tinubu’s $1tn economic target.

It urged the DMBs to expedite actions to increase their capital base to strengthen the financial system against potential risk.

The SEC framework is a direct response to the CBN’s recent directive for banks to bolster their capital base.

Currently, banks are still raising funds via the capital market and other means to raise the stipulated amount.

Highlighting the achievement, Agama explained that the commission provided clarity before the recapitalisation exercise commenced because the current management of the commission is interested in integrity and transparency of processes”

According to him, “That clarity came out of the regulations that the SEC brought up to support the banking recapitalisation. It is a very important step by the government to strengthen the banks and indeed provide capacity for the banks to lend to the real sector for us to drive the economy, as provided for by the Renewed Hope Agenda Initiative and the design of the President to turn out a $1tn economy.

“And so it was important that all institutions that are concerned with this activity, come together and provide the needed guidance for the banks to be able to run the programme. This is about the second time that the SEC will be tested in its capacity to be able to handle this. The first was in 2004 as you are aware, during the Soludo recapitalization exercise, the SEC was tested, and we came out of the test positive, this time around, it will not be different.”

The SEC boss noted that the processes could only get better as the commission had learned a few lessons from the previous exercise, adding those lessons had led to creating an environment that makes it seamless, including the introduction of the guidelines, and the needed technology to help deal with it.

“So the guidelines, as it were, have brought about stability, transparency to the recapitalization process and public offerings have increased. And of course, you see the interest being galvanized by the actions of the SEC in trying to make sure that this is a success.

“And I can tell you without doubt, the information we have received thus far shows that we are actually on the right course, and we are happy that that is happening. We’ll continue to give support to the Central Bank of Nigeria and to every institution that understands the value and the premise of the capital market.

“The capital market is indeed the barometer of the economy. And the SEC at this juncture is ready to live up to that bidding. I want a more sustainable industry”, he added.

Agama said the commission is cooperating with the Central Bank of Nigeria, the Federal Inland Revenue Service, as well as the Office of the National Security Adviser to ensure that there is a safe environment for investments to thrive with special focus on attracting the youth populace to the market.