Osinbajo urges financial regulators to check capital market risks

From left: Chairman BUA Group, Abdul Samad Rabiu; Chairman, Nigerian Exchange Limited (NGX Abubakar Mahmoud; Vice President Yemi Osinbajo; and Chief Executive Officer, NGX, Temi Popoola, at the Conference.

. As NGX promises to leverage technology for market growth

To increase investors’ confidence in Nigeria’s equities sector, the Federal Government has advised financial services regulators to check what it described as excessive risk premium of the capital market.

Vice President Yemi Osinbajo, who gave the charge, said such a move will reassure foreign investors of their investment mechanisms and other regulations that would help them channel resources in and take them out with the least possible constraints.

Prof. Osinbajo spoke yesterday at the maiden edition of the Nigerian Exchange Limited (NGX) Capital Market Conference, themed: “The Future Ready Capital Markets; Innovating for Nigeria’s Sustainable Recovery,” held at Transcorp Hilton, in Abuja.

While lauding the digitization efforts of NGX, he charged The Exchange to continue to collaborate with all government agencies and regulators, such as the Central Bank of Nigeria (CBN, the Securities and Exchanges Commission (SEC), and National Pension Commission (PENCOM), to de-risk the market.

He argued that such an increased collaboration among key players towards driving productive investments would accelerate an elevated and digitized capital market and sustainable development of the economy.

FinTechs will buoy capital raise

Osinbajo also encouraged the Exchange to woo financial technology (FinTech) unicorns to the local bourse to give investors more opportunities to benefit from their growth and create wealth further for the economy.

He said that sustaining the Fintech ecosystem requires existing and emerging financial services startups to have access to the capital market, while Nigeria develops robust venture capital and private equity funds to support small businesses that have significant growth potential.

The Vice President noted that as a demutualised entity, there is a need for the Exchange to redefine the market for international competitiveness.

He said: “Your strategic focus on technology to bring a new crop of young investors, who engage in commerce and banking activities through digital processes, puts us at an auspicious position to bring in youth investors to the capital market.”

Agreeing, a former CBN Governor, Sanusi Lamido Sanusi, said if well explored, the capital market could create sustainable funding for fintech companies.

He also called for active involvement of all stakeholders to promote a robust public private partnership arrangement that would attract huge private sector funding and drive the growth of the capital market.

NGX will continue to deepen and increase access to financial services for Nigeria through technology while championing the infrastructural development and the economic growth of the country.

Earlier, the Chief Executive Officer, NGX, Temi Popoola, said the Exchange is working out modalities to address major constraints inhibiting the participation of FinTechs in the market.

He assured stakeholders that the Exchange would leverage its robust technology to drive the capital market and create wealth for investors.

“We are convinced that the big part of the discourse is around technology. We will leverage technology to create a capital market that is vibrant enough to drive all the challenges we have.”

“Taking this forward, NGX will continue to deepen and increase access to financial services for Nigeria through technology while championing the infrastructural development and the economic growth of the country.”

Also speaking, the NGX Chairman, Abubakar Balarabe Mahmoud, said the Nigerian capital market has the capacity to drive economic development and wealth creation through innovation and digitalization.

“As shown by the conclusion of diverse speakers and panellists, an elevated capital market can strongly contribute to the government’s developmental agenda especially around the improvement of the economy,” Mahmoud said.

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