Capital base: Operators fault House Committee's position

THE recommendation of the House of Representative Committee on the capital market that the minimum capital base of stockbroking firms be increased to N500 million from current N70 million, has been condemned by the operators on the capital market.According to the Managing Director, Lamberth Securities Limited, Mr David Adonri, said the recom-mendation demon-strated the Committees inability to differentiate between banking, insu-rance and stockbroking. Adonri explained that the minimum capital base for stockbroking in USA, the world's largest capita market was equivalence of N37.5 million while in India it was N2.5 million.He noted that the report of the Committee that probed the near collapse of the capital market was based on populist sentiments.'It was centred on personalities rather than technically iden-tifying the macro-economic, institutional and legal dislocations that caused the market failure long before Arunma Oteh became SEC DG.It will be recalled that the House had recently urged President Goodluck Jonathan to implement the resolu-tion of its committee, which investigated the near-collapse of the Market.The House also requested Jonathan to terminate the appoint-ment of Ms Arunma Oteh, the Director-General of SEC, for incompetence.It added that its committees would henceforth cease to accord any recognition or deal with Oteh as the Director-General of the commission.The Registrar, Chief Executive, Capital Market Registrars, Mr Walter Ogogo, had argued that the planned directive to sack Oteh was not necessary.The Chief Executive Officer, Cowry Asset Managing Limited, Mr Johnson Chukwu said the move was not the most appropriate way to resolve issues.Also speaking, an independent investor, Mr Ameechi Egbo, argued that since the law setting up the Commission made provisions for hiring and firing, if there is any need for removal, there is need to follow the law that instituted the Commission.
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