Nigerian stockbrokers have been advised by the Nigerian Stock Exchange (NSE) to take up dormant licenses or merge with other operators, instead of applying for fresh licenses.
This is coming as the NSE’s plans to demutualise and become a quoted company is expected to take effect soon.
Come early March of 2020, representatives of the NSE’s 252 dealing members will vote on whether or not to finally transform the Nigerian bourse from a member-owned exchange to a public company.
The vote is expected to be unanimous and the NSE will finally change its name to Nigerian Exchange Group Plc.
In a statement, the Nigerian bourse stated that it stopped issuing new licenses to stockbroking firms as part of the demutualisation process. It also provided further explanation as to why it is committed to the demutualisation effort.
It said interested parties have been advised to purchase existing licenses. The exchange stopped issuing licenses as it progresses with its intention to demutualize.
“Going into 2020, the NSE is committed to completing the proposed demutualisation. This will further provide avenues to diversify our operations and evolve into a more competitive, robust and liberalized stock market.
The All-Share Index ended the year with a 14.6% decline. Luckily for the NSE, it was able to compensate for this decline thanks a 20% surge in its fixed income segment. What this shows, therefore, is that the NSE’s efforts to demutualise and further diversify its operations is a move in the right direction.
Recall that the NSE initially planned that the demutualisation process will be finalised in 2019. Nairametrics quoted the CEO, Oscar Onyema, in March last year as saying that “We are shooting for this year for the demutualisation to be completed.” This followed an earlier signing of a bill by President Muhammadu Buhari, which amended the law establishing the NSE, thereby making it possible for the bourse to become a public limited liability company