The NASD Plc said the number of trades executed on NASD over-the-counter market rose by 121 per cent in 2016.
Despite numerous challenges that characterised the country’s economic landscape, the Exchange said investors continued to respond to the opportunity to trade their shares in unlisted securities on the platform, as observed in the continued expansion of trades executed.
The Chairman, Board of Directors, NASD, Olutola Mobolurin, said this at the company’s Annual General Meeting held in Lagos.
He said the activity was partly driven by a 33 per cent increase in the number of admitted securities, 25 per cent increase in authorised traders, and 12 per cent increase in participating institutions.
The NASD admitted eight new securities; thus crossing the thirties mark in the number of securities admitted to close with 32 securities and commenced bond trading in the second half of the year, with bonds worth N9.6bn traded.
Mobolurin added, “However, in reaction to slow economic activity and weak investor appetite, the volume and value of shares traded declined by 58 per cent and 91 per cent, respectively, over the previous year.
“As at December 31, 2016, the cumulative value of transactions was about N5bn, a 91 per cent decline from the preceding year.”
The company, thus, earned N32.2m as trading commission in the year under review, compared with the sum of N242.8m achieved in the preceding year, representing 654 per cent reduction over the previous year’s performance.
The desirable growth in the OTC for the future, however, requires a much more enhanced approach in regulating the securities market, according to him.
The NASD chairman noted that, “Far too many public companies continue to operate in defiance of the law and regulation. We urge the Securities and Exchange Commission to spread its dragnet to bring the erring companies into compliance with the law. In this effort, SEC will find us a very useful partner.”
The Chief Executive Officer, NASD Plc, Bola Ajomale, said as of June 2016, shareholders resolved to recapitalise the company; of which in December of the same year, the documents to support a rights issuance were filed with SEC.
He added, “We express our appreciation to shareholders who took up their rights and even additional to ensure full subscription. We also express our profound gratitude to the management and staff of Capital Bancorp Plc and Capital Assets Limited, who jointly managed the rights issuance pro bono as part of their market development effort.”
Ajomale said the Exchange would continue to consolidate on the initiatives started in 2016