SEC, ASHON task shareholders on insider abuses
To forestall further loss of investment arising from the takeover of a bank, the Securities and Exchange Commission (SEC), and Association of Stockbroking Houses of Nigeria (ASHON), have urged shareholders to exercise their right and report any case of insider abuse or malpractice from any quoted company to protect their investment.
Specifically, the Vice President, ASHON, Akinsola Akeredolu-Ale, while speaking at the third Capital Markets Committee Meeting in Lagos, at the weekend, said the Skyebank takeover is a wakeup call for shareholders to exercise their right.
He noted that SEC has a Code of Governance that allows minority shareholders to have a voice and speak up when there are malpractices and irregularities especially in account statements.
He said: “When you see things going wrong, you speak out, even in the Companies and Allied Matters Act (CAMA), you see some roles that are given to shareholders both majority and minority. I think the shareholders are beginning to be complacent and at the end of the day, if you have insider abuses in your financials, and you keep quiet about it and it goes on continuously, at the end of the day, the CBN will protect only the depositors.”
The Head, Exchanges Division, SEC, Agama Emomotimi, urged shareholders to report any incidence of malpractice to the Commission especially when the feedback given by the firm is not satisfactory.
He said: “When you get to AGM, ask questions; look at the financials and if you observe any form of irregularity, ask questions. And if you did not get the feedback that you want, do not keep quiet, write to SEC that this is what you see on the document, and by so doing, you are able to protect your investment.”
He continued: “Regulators are not shareholders; regulators do not make decisions on behalf of shareholders. The regulators only regulate the statutory requirement, the governance structure and compliance for returns, but the real day-to-day decisions are made majorly by the shareholders, not by the regulators. But we will find ways to collaborate more with CBN so that shareholders would be protected better.”
Indeed, with the recent takeover of Skye Bank Plc by the Central Bank of Nigeria (CBN), following the inability of the owners to shore up the capital of the distressed bank, shareholders are at the risk of losing a whooping N10.69 billion shareholders’ fund.
Shareholders, who spoke to The Guardian, noted that while retail investors were still grappling with N83 billion loss of investment occasioned by the sale of the three nationalised banks: Keystone Bank Limited; Mainstreet Bank; and Enterprise Bank.
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