The uncomplimentary revelation of leadership failings at the agencies responsible for the management of the Nigerian capital market has created an air of uncertainty that may harm Nigeria in the long run.
Investors in the capital market who spoke to The Post suggested that the ongoing probe was worrisome and that the problems thrown up must be resolved in a way that will benefit all stakeholders.
A House of Representative Committee has been conducting a public hearing on the collapse of the capital market but the ongoing exercise appears to have revealed the leadership failings of the former Director General of the Nigerian Stock Exchange (NSE), Prof. Ndidi Okereke-Onyiuke and the Director General of the Securities and Exchange Commission (SEC), Ms. Arunma Oteh.
Both women have traded accusations at the House probe and the clear picture that has emerged is of agencies run with little or no regard for due diligence and mostly characterized by wasteful expenditures and nepotism.
The SEC boss was, among other allegations, accused of expending N30m on hotel bills in eight months following her appointment in January 2010. And in another instance, accused of spending N850, 000 on food, while on another day, she incurred additional N85, 000 expenses in the same hotel for which SEC’s account was debited.
An investor, Manny Umanna, who is already considering moving out his investment from the market said he was looking at the option of taking credit facilities commercial banks to enhance his business venture.
On his part, the National Coordinator of Independent Shareholders Association of Nigeria (ISAN), Sir Sunny Nwosu, expressed worry over the uncertainty created by the ongoing probe but stressed that it was unlikely investment in the market in the long run.t
Nwosu noted that investment remained a personal decision for of the investor and that any prospective foreign or local investor must decide by his own assessment whether to put his money into the Nigerian capital market or not.
“SEC is not the only entity that is involved in the on-going probe or whatever related issue. It is left for the governing councils to apply its initiative in taking any leadership decision about the commission. But the most important thing is that every decision taken should be to the benefit of both SEC and all involved stakeholders. All I know is that, on the outcome of the commission, we expect the best,” Nwosu said.
Speaking in the same vein, the President, Association for the Advancement of the Rights of Nigerian stake shareholders, Dr. Umar Farouk, also noted the uncertainty created by the House probe, saying it was difficult to determine the final outcome.
Farouk declined further comments on the issue due to the appropriate law enforcement agency’s involvement in it but identified two major issues confronting the stock market, which according to him are fear and greed.
But he noted that whatever may be the outcome of the probe the interest of shareholders must be protected, adding that there was need to rebuild the confidence of the investors so that they don’t lose hope completely in the stock market.
While some investors wind up plans to disengage themselves from the capital market, others already doubt its prospect, due to loss of hope, which is as a result of the already existing trend of fall in return on investment on shares in the capital market, coupled with the on-going SEC crisis.