Scepticism trails investment at NSE INVESTORS, according to findings, are still finding it difficult to come to terms with the huge losses recorded when the trio of Afribank, Bank PHB and Spring Bank were taken over by the Nigerian Deposit Insurance Corporation (NDIC) penultimate week.They are waiting patiently to see whether or not the development that took the stock market by surprise will have any meaningful effect on the market growth and development.The structural change in the top management of the soon-to-be delisted banks in the market is expected to inject a new lease of life into the banks' activities.Notwithstanding regulators' assurance on the fate of depositors in the nationalised banks, investors' confidence is still presently at its lowest ebb.Operators' expectation in the nationalisation processThe reform in the market which has been planned for many years by the Central Bank of Nigeria (CBN), according to some operators, came at a time when the market was still grappling to find its feet after the loss of over N9 trillion investors' fund in the market during the 2008 stock meltdown.Operators believed that change in the market will bring the much desired growth that will leverage on the sound corporate governance that is presently being put in place, but the timing ought to have been varied.They, however, agreed that there is no better time for the apex bank to exercise its powers under the monetary policy instrument as the nationalised banks were actually at the verge of acute insolvency.They reasoned that successive managers at the market apex body had relaxed regarding weak corporate governance, high net worth share price manipulation, thereby causing investors, especially those who can count the numbers of their shares at their finger tips, the loss of their investment.While the reform in the financial/stock market is ongoing, operators are now pressed than ever before to see those culprits who have contributed in one way or the other to the failure of equities market/banks, brought to book.The operators queried that while the enabling law to prosecute offenders was available, it was only being experimented only on offenders who cannot pay the price of their complicity in any fraudulent activities as it relate to the major players in the financial market.NSE's effort to stabilise the stock marketRecently, in its determined effort to deepen the value of the stock market, the Nigerian Stock Exchange said that the Exchange had identified integrity, durable wealth creation and business development as a veritable tool to grow the market.To this end, the Exchange has concluded arrangements to come up with new products: Options and Derivatives, that will be traded on the market beginning from 2012.According to the Chief Executive Officer, Mr Oscar Onyema, the management of the Exchange has sinceco-opted 10 new members to bolster its oversight functions, adding that each inducted council member had subscribed to the code of conduct for council members.He listed the five asset class options to include exchange traded bonds, equity options, index options and derivatives and financial features.He noted that a lot of things needed to be considered for the industry to be ready for the introduction of the new products which, according to him, included the need to hire options specialists to drive the products to fruition.'Such specialists will gather necessary mechanism to drive the products and until I have such persons on board I can't give you specific options. But my goal is that within two years we will be trading on the new products. Each of these options specialists has a market structure that will deepen each product,' Onyema said.'Although not a listed company, we have adopted a new corporate governance posture which is compliant with our listing rules. The Securities and Exchange Commission's recently released Code of Corporate Governance for Public companies, and international best practice in this important area,' he said.Further on the drive to reposition the market for growth, the NSE CEO said the council approved another seven committees to oversee the various affairs of the Exchange which he listed to include Audit, Demutualsation, Finance and General Purpose, Rules and Adjudication, Technology, Risk Management and Diciplanary.In this vein, the CEO said the Managing Director, Shell Nigeria Closed Pension Fund Administrator Limited, Mrs Yemisi Ayeni, has been appointed chairman, Demutualisation Committee, to drive the processes of demutualisation in conjunction with the management of the NSE.He said the council also decided that the Exchange's 1990 MEMART would henceforth be the applicable governing document for regulating the Exchange's affair.'The Council approved for the Exchange to be re-organised into four major divisions: Market Operations and Technology, Business Development, Legal and Regulation, and Corporate. With the each of the divisions will be headed by an Executive Director.exception of Corporate, each of the divisions will be headed by an Executive Director.In addition to the existing Equities and Bond asset class offerings, council approved to the Exchange to actively develop Index/ Exchange Traded Funds, Options and Financial Futures product lines. This will bring the total number of tradable asset classes to five within five years'' he said.Transactions last weekHeavy losses in the shares of Ashaka Cement, Northern Nigerian Flourmill along with other 20 stocks on Nigerian Stock Exchange, caused the market to reopen on a downturn on Monday, even as the market capitalisation dropped by N69billion.22 companies depreciated in price, led by Ashaka cement, Northern Nigeria Flourmills, Dangote Flourmill, CAP and Chevron with five per cent to close at N20.90, N22.61, N14.44, N26.60 and N63.86 per share respectively, followed by Mobil with 4.98 per cent to close at N148.70 pershare.Forte Oil lost 4.97 per cent to close at N17.41 per share while Eco bank also shed 4.93 per cent to close at N2.76 per share.On the other hand, 26 stocks appreciated in price, as IHS, Honeywell and Fidelity Bank topped the gainers chart with five per cent to close at N2.94,N4.41 and N1.89 per share respectively.Nigerian Aviation Handling Company trailed with 4.99 per cent to close at N7.16 per share. Julius Berger, First Bank, Berger Paints garnered 4.98, 4.97 and 493 per share to close at N54.56, N11.40 and N9.80 per share.Cement Company of Northern Nigeria added 4.88 per cent to close at N7.95 per share while Capital Hotel gained 4.83 per cent to close at N7.16 per share. UAC-Properties also added 4.40 per cent to close at N19.00 per share.Consequently, the All-share index of the Exchange dropped by 216.48 basis points or 0.9 per cent from 22, 77.55 recorded on Friday to 22,559.07 while market capitalisation slide by N69billion from N7, 285 trillion to N7, 216 trillion.In all, investors exchanged 379million shares valued at N3.1billion in 5,577 deals.
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