Shareholders flay imposition of excessive sanctions on listed firms

Say action deters investment in stock market

Shareholders’ under the aegies of Independence Shareholders Association of Nigeria has bemoaned excessive sanctions imposed on listed firms by the regulatory authorities.

The outgoing President of the association, Sunny Nwosu, at a forum organised to announce his retirement in Lagos, urged regulators to be cautious and reduce the penalties to attract the much-needed multinationals to list on the exchange.

He pointed out that the spate of sanctions slammed on quoted companies are eroding investors’ confidence.

He also added that the regulators, preference of foreign investors to retail ones contributed to the low participation of latter in the capital market.

He, however, advised Securities and Exchange Commission (SEC) and Nigerian Stock Exchange (NSE) to strengthen their enlightenment programmes on ways to bring retail investors back to the market.

“The regulators missed it when they stopped having respect for retail shareholders. Each time the foreign shareholders drop their share, it depresses the man and retail investors will follow. We have advised them to increase their enlightenment for the retail shareholders so that they will be their ambassador, by telling people that the market is still very stable and the best form of investment.

“They will stand to back the capital market. There should be a pre-agreement before any multinational comes into this country and that agreement should relate to listing such stock after a number of years.

“There should be an agreement like when you operate in Nigeria for five years, we want you to be listed so that Nigerians will also take advantage of the profit you are making in dividend and also providing you capital if that is not there, it will be a very bad management for Nigeria government to force any multinationals to be quoted.

“Two, have they been able to access their own company operations and other things to get quoted. There was a time they unbundled NEPA they said they have unbundled sis companies that they will come to the Exchange till today no sign that they are working towards them.

“They said they unbundled FD and incorporated companies which will be quoted but till today, nothing. Charity should begin at home. It is only through persuasion that you can get them to b e listed.

“ So if MTN is to be listed, other firms in that sector must also make to be listed.  What Iam saying is that it is a free entry free exit. And more so when there was no agreement at the beginning, you cannot create an agreement now other than to persuade.

“The capital market itself is a platform of patience. We are aware that with the recession and the economy, people will need cash .if you are able to have a stock that is very liquid and you sell, but make sure that whatever money you are deriving from it is used into something that will make you happy.

“This is because  that you have achieved something because whenever you are coming back, you will pay more. Is either you pay more or you pay less depending on the stock. It is a unique area that we need to have very clear understanding and believe in it. Total easing is not advisable.”