The Securities and Exchange Commission (SEC) has announced plans to open discussions with the 774 local governments in the country to encourage them to issue municipal bonds for development purposes.
The SEC Director-General, Dr. Emomotimi Agama, made this announcement during his first post-Capital Market Committee (CMC) press briefing on Thursday in Lagos.
“We want to encourage the issuance of municipal bonds so that local governments can understand the benefits of using the capital market for development,”
Agama said. “This is an initiative we are committed to pursuing. We are creating a dedicated unit at the SEC to focus specifically on this effort, and it’s important to communicate this to everyone.”
He added, “If we can reach out to all 774 local governments and help them understand the value of the capital market, especially now that they will be receiving direct funding, the most effective way to advance their development projects is through capital market issuances of securities.”
Agama emphasized that engaging with the capital market imposes discipline and governance over the funds received from the government.
“This approach will lead to developments that can drive economic empowerment for Nigerians at the grassroots level,” he stated.
He noted that the current SEC is a forward-looking institution. “As we identify problems, we are proactive in driving solutions.”
Agama expressed the determination of the commission to continue to encourage companies to list and urged the exchanges to take steps to attract new listings to align with the government’s $1trn economy target.
He said more companies should be encouraged to list on the exchange to improve market making and liquidity.
Agama expressed optimism about unlocking the full potential of the capital market, in alignment with the Renewed Hope Agenda of the President Bola Ahmed Tinubu-led administration.
He also informed members of initiatives aimed at ensuring that the rulemaking process of the Commission becomes faster and more efficient.
“These include defragmenting the rules with a view of codifying the rules into a comprehensive rule book.
Also, the Commission is presently updating rules on digital assets, has put in place guidelines for the banking recapitalisation exercise, as well as come up with guidelines for onboarding Virtual Assets Service Providers,” he said.
This, he said, was aimed at bringing the millennials, who contribute 70 per cent of the population, to participate actively in the nation’s capital market.
The director-general urged Capital Market Operators to invest in modern technology to improve trading platforms and data dissemination.
He advised that introducing new products such as derivatives, REITs, and ETFs would attract investors.
Agama noted that the fight against cybersecurity remains a priority, with the Nigerian government implementing policies and establishing a cybersecurity committee within the capital market to manage and disseminate critical information, with the Commission at the vanguard of the initiatives.