Aug 11 2010

SEC to prosecute 260 over NSE crisis

From Azimazi Momoh Jimoh

•  AP alleges smear campaign against Otedola

ARRANGEMENTS have been concluded by the Securities and Exchange Commission (SEC) to prosecute 260 persons suspected to be guilty of various offences including insider dealings within the troubled Nigerian Stock Exchange (NSE).
SEC’s Director-General, Arunma Oteh, at a meeting with the House of Representatives’ Committee on Capital Market at the National Assembly on Tuesday declared that the commission had carried out a thorough investigation on complaints it received from many Nigerians about the activities of some persons alleged to have contributed to the crisis in the NSE.
She said: “We have also been working very hard on some of the complaints that ordinary investors have shared with us as to some of the things that happen in our market. As a result of that, we are going to take about 260 individuals and entities to the Investment and Securities Tribunal for different types of allegations of share price manipulation and insider dealings.”
Meanwhile, the management of African Petroleum Plc (AP) has alleged that a malicious campaign was being waged against the oil company and its chairman, Mr. Femi Otedola, by a suspended director of the firm who was brought on board by shareholders.
Oteh who briefed the House Committee on the damage which the crisis in the NSE had caused to investors and the Nigerian economy, said: “Like you know, our call and mandate is to protect public interest and to protect the investor, particularly what I will consider the voiceless masses of people who have seen the market in our country over the last three years as an opportunity for them to participate in developing our economy, to create wealth for themselves, whether they be local investors or international investors. As honourable members, you would recollect that at the peak of our stock market, the valuation of our stock market was over N12 trillion. But  in March, 2009, there was an unprecedented crash in our stock market which made the market reached a bottom of N5.5 trillion.
“A lot of average Nigerians were severely affected by this crash because over the last few years, a number of ordinary citizens of our country have invested in our market, but today, more than seven million investors who invested in the market directly were affected by the crash. Therefore, we have seen since this unprecedented crash the fragility in investors’ confidence.”
Oteh enumerated the measures which SEC had taken to resolve the issues that caused the crash saying: “As a result, since the crash, the SEC has spoken on how to enhance its own capacity to regulate the market; has tried to focus on addressing the issues that led to the crash, some of which relate to the global financial crisis, some which relate to market integrity issues in our market.”
Still trying to convince the committee on the need to prosecute those found to have acted against the smooth operations of the NSE, Oteh decalared: “There have been allegations of insider dealings, of share price manipulations, of weakness in enforcement of excessive risk taking and notably, the fact that there have been a lot of marginal loans that were taken both by institution investors and by retail investors with no adequate guidelines.
“As regulators, we have also looked at the things that we haven’t done over the last few years that impacted on the market and led to, or accelerated the crash. We feel that there haven’t been sufficient coordination amongst regulators, and I believe last year, both the Ministry of Finance and the Central Bank have put in place, measures to try and enhance this coordination, and we at the SEC have been actively participating in this respect.”
According to her, guidelines had been developed to improve on the situation in the NSE.
Her words: “The SEC and the CBN are working very closely together to develop guidelines that would ensure that the kind of excessive risk taking and the margin lending that we saw in our market don’t happen again, and we hope that very soon, we can publish those guidelines because we have had the opportunity of having the capital market operators review these guidelines, made comments on them; we had experts from outside and from other jurisdictions looked at the guidelines. We had those guidelines approved by the Minister of Finance as is statutorily required”.
On the remote causes of the crash in the NSE, Oteh said: “We had a market that was not as deep, or as broad as it should be. Because breadth and depth help to immunize the market against crises. What is important is to have a market that is deep and broad such that it doesn’t have that kind of impact that it have had on our economy.
“So, some of the things we are doing are to try and help the market not just to be dependent on equities, but to build a very strong system. In that respect, the Federal Government has taken the lead in developing a world class sovereign bond market under the auspices of the Debt Management Office with the guidance of the Ministry of Finance, because the sovereign bond market provides the benchmark which is the basis for state governments’ bonds or for corporate bonds to be priced.
“What we have seen also was that because of the commitment of the President to developing this market, recently, he approved some waivers which have allowed us to take away the discrimination that we have seen in the past where corporate bonds and state bonds were not as attractive as sovereign bond. This has allowed corporate bonds and state bonds to become at least 300 points cheaper than they would have been in the past. We believe this will help build a truly sustainable bond market, which will enable us to address some of the challenges that our country faces in terms of infrastructure, in terms of companies being able to raise money to be able to address some of the immediate needs, rather than waiting to raise equity in order to address those needs.”

Viewed 66931 times by 15566 viewers

By admin • HEADLINES • 0

Aug 11 2010

PDP caucus: Zoning stays

By: Habeeb Pindiga & Muideen Olaniyi

The National Caucus of the PDP rose from a meeting early morning yesterday rejecting moves to initiate a process for the removal of provisions on zoning and rotation from the party’s constitution.

But the caucus agreed that President Goodluck Jonathan was free to stand for elections in 2011.At a meeting held at the State House in Abuja, members of the caucus refused to accept plans to include among the proposed constitution changes a proposal for the deletion of section 7.2 (c) which provides that the party should zone and rotate political offices in the interest of peace and unity of the country.

Although no official statement was issued at the end of the meeting, senior party officials who attended the meeting told Daily Trust that there were heated debates over whether the president should be allowed to stand for election in the light of the party’s rules that zone the presidency to the North.

Supporters of the president said since the major inhibition for Jonathan’s ambition is the party rules, the constitutional provision should be deleted during the forthcoming convention.

But pro-zoning party leaders rejected this, saying it would create crisis that the party would not be able to manage.

Some party leaders suggested that given that the Federal constitution gives the president the right to stand for election, there was no point changing provisions of the PDP constitution. They also argued that in 2002 and 2006, politicians from sections of the country other than where the presidency was zoned to did contest the primaries regardless of the zoning arrangement.

The meeting rose at about 2am affirming the president’s right to stand but also rejecting moves to delete the zoning and power rotation clause from the constitution of the People’s Democratic Party.

The caucus also agreed that the party should spearhead wider consultations with the board of trustees and the national executive committee of the party over the contentious power rotation issue. It also mandated the party’s leadership to initiate dialogue with the top party leaders from both sides of the zoning debate.

The meeting was chaired by national chairman Okwesilieze Nwodo. Those who attended include President Jonathan, Senate President David Mark and other principal officers of the National Assembly, as well as members of the National Working Committee of the party. Former president Olusegun Obasanjo did not attend even though he is a member of the caucus.

Obasanjo was billed to chair the BOT meeting last night, to continue with deliberations over the power rotation issue.

Also at the caucus meeting, supporters of the president raised issues with the new state-by-state presidential primaries style contained in the Electoral Act as passed by the National Assembly. They urged that this should be removed from the bill before the presidential assent. But Mark told the agitators that it was too late to make such changes to the bill, but added that even after presidential assent, amendments could be proposed.

The caucus is an advisory body for the party and its decisions would only be enforceable after ratification by the national executive committee.

Viewed 67148 times by 15488 viewers

By admin • HEADLINES • 0

Aug 11 2010

North must produce next president –Arewa insists

By: Hassan Ibrahim, Uchechukwu Olisah, Jackson Udom and Leon Usigbe

•  South-South stakeholders woo North over Jonathan
•  Abrogating aspirants’ rights can cause problem – Marwa

THE Arewa Consultative Forum (ACF), on Tuesday, resolved that all political parties should endeavour to field northern candidates for the 2011 presidential election.

ACF said this in a communiqué issued  after its emergency joint meeting chaired by its Board of Trustees chairman, General Jeremiah Useni, adding that fielding northern presidential candidates in the 2011 election by all political parties was very important and necessary in order to ensure the principle of federal character, which, it claimed, had become part and parcel of the Nigerian political culture.

The forum urged all political parties and public organisations to continue to uphold the practice of zoning in the interest of social justice, equity, fairness and stability of a united Nigeria.

“The meeting also commended the government for appointing credible persons, including Professor Attahiru Jega, at the helm of affairs of the Independent National Electoral Commission (INEC) and urged the government to provide the INEC with all the necessary support for the 2011 elections,” they said.

Meanwhile, hundreds of youths carrying various placards converged on the ACF secretariat in Kaduna, where they told the Arewa chieftains that zoning must be retained by the PDP, while President Jonathan should not contest in 2011.

The youth, said to be mobilised by supporters of  former head of state, General Ibrahim Babangida and former Vice-President, Alhaji Atiku Abubakar, under the aegis of Arewa Citizens Action for Change, said their position on the political future of the North was that zoning must be retained.

The leader of the youth, Alhaji Nastura Shariff, said “much as we know that the ACF will not sacrifice the wishes of millions of people in the region, we hope that today will mark an important day in the political history of the North, where ACF shall tell the truth as it is.

“We must state that we will not accept any deliberate move to shut the door of the presidency, just when it is our turn. The North had not even had one term yet.”

However, leaders of the PDP and stakeholders in the South-South geopolitical zone of the country have expressed their readiness to woo their northern counterparts for the emergence of Jonathan as president in 2011.

The leaders and stakeholders said their move was emanated from the belief of the pro-North elements that the interest of the area would better be served with a president from the South-South geopolitical zone.

Coordinator of the Edo State chapter of the Rebuild Nigeria Initiative and a member of the Goodluck Support Group, Chief Ewie Aimienwauu, made this known while addressing journalists in Benin City, on Tuesday.

According to him, now was the time for the South-South to leverage on its familiarity and friendship with the North, so as to secure the ticket for President Jonathan in 2011.

Aimienwauu said the issues of the minority and political hegemony at Nigeria’s independence had not been well articulated by the leaders, particularly as they affected the interest of the South-South in the country’s quest for the position of the presidency.

“The second point is the issue of North/South dichotomy. As a South-South leader, it behoves on us to go to the North and woo them to support us. There is no automatic ticket for anybody. All of these talks about zoning or no zoning presumes that PDP will win the presidency.

“I am a PDP leader and I believe that the PDP will win the presidency but be that as it may, whoever wants to emerge as the presidential candidate of the party must go through the hurdle of the primaries. So it behoves all of us now, as South-South leaders, as those people who are championing Jonathan, to go to our brothers and sisters in the North and say to them that they should support us,” he said.

In a related development, secretary of the former Deputy Governors’ Forum of Nigeria (DGFN), Mr Christopher Ekpenyong, has called on the North and its leaders to see the Jonathan presidency as “an avenue to reciprocate the age-long support the zone had been giving the North since independent and rally round the candidature of the president.”

Ekpenyong, a former deputy governor of Akwa Ibom State, said this while addressing journalists on the state of the nation.

According to him, “while one should not rejoice over the untimely death of former President Umaru Yar’Adua, it is, however, imperative at this point to remind the North of the age-long political support it had enjoyed from the South-South zone and rise in support of the calls from within and outside the country that the son of the zone be allowed to govern the country, even beyond 2015.”

He noted that “it is even unfair to the South-South zone which produces the wealth of the country, for some people, particularly in the North, to say that even if they will support the South-South, it has to be for a term of four years, after which power will return to the North. It is unfair and unacceptable.”

Speaking further, the former deputy governor, who is aspiring for the Senate in 2011, reminded those holding the views that the president should spend only four years that “ let us not forget that the South-West, with Chief Olusegun Obasanjo, spent eight years, and, if by providence, the office has been zoned to the South-South, it would be morally right to allow the zone to rule for eight years before power goes to the North, and that is why I keep saying that Jonathan’s eight years is non-negotiable in the spirit of equality, fairness and justice.”

He lauded the president on his policy on power, which, he said, was the fulcrum of the nation’s development.

“Let me say that I am very pleased with the declaration of the president on power deregulation. I think with this policy, power will be made available to the people within the shortest possible time.

“The president should also ensure that people who are qualified are made members of the National Economic Council, so that our dream of being one of the world’s most developed economies in 2020 is achieved soonest,” he said.

Viewed 66006 times by 14966 viewers

By admin • HEADLINES • 3