STL TRUSTEES CAPITAL MARKET & MONEY MARKET NEWS RECAP

While you were away!

NSE SET TO LAUNCH TRADING PLATFORM FOR MUTUAL FUNDS

The Nigerian Stock Exchange (NSE) in conjunction with the Fund Managers Association of Nigeria (FMAN), the Central Securities Clearing Systems (CSCS) and the Association of Stockholding, Nigeria (ASHON) is set to launch a new trading platform for collective investment schemes (CIS), otherwise known as mutual funds, this Friday 22^nd February 2019.

The platform is expected to facilitate electronic transactions with seamless connection among key parties in transactions, including the Exchange, Central Securities Clearing System (CSCS), stockbrokers and fund managers.

According to the NSE, the new platform aims to improve and enhance access of listed mutual funds to investors.

“The overarching goal is to enhance visibility for the listed funds and promote financial inclusion while stimulating retail investor participation in our market,” the NSE said.

The new platform is also expected to engender listing of more mutual funds at the Exchange.

The platform will not only enhance the visibility of mutual funds as hoped by the NSE, but it will also increase their liquidity.

SEC INTRODUCES CHANGES TO THE PRACTICE OF FILING OFFER DOCUMENTS IN RESPECT OF DEBT ISSUANCES

The Securities Exchange Commission (SEC) has introduced changes to the practice of:
·     filing consent letters at the commencement of a debt issuance transaction;
·      the execution of advert materials and specimen evidence of allotment by all parties; and
·      the mode of execution and Issuance of consent letters by Sub-national Issuers.

In a Circular released by the Commission on Wednesday 20^th February 2019, it was declared that the changes will take effect from Monday 18^th February 2019. Details of the circular areas provided below:

Consent Letters

With effect from the Effective Date, Consent letters of every person who consents to be named in the offer document or other document(s) in connection with a proposed offer, may now be filed either at the initial stage of a transaction or at the point of filing executed offer documents.
In giving effect to the foregoing, Issuing Houses are to note the following;
·     The flexibility does not serve as an exemption to the complete filing directive of the Commission;

• This directive does not permit the filing of consent letters in batches;
• All consent letters are expected to be filed in one complete batch at the initial point of filing the transaction or at the point of filing the executed offer documents;
• All issuers and Issuing Houses are to note that Filing of consent letters at the point of filing executed offer documents will not preclude the identification of deficiencies which may delay the approval of the transaction;
• Issuing Houses are to ensure that all consent letters appropriately describe the transaction, indicate in what capacity the person giving consent has agreed to be named in the offer document and other related documents, are signed in wet ink by the named signatory (ies) and be duly notarized by a Notary Public;
• Consent letters shall not be notarized by a person who is also a named signatory on the consent letter;
• Scans, photocopies or consent letters with electronic signatures are not acceptable.

Execution of Advertisement materials and Specimen Documents

• The Commission will no longer require executed advert materials where the offer is by book building with no retail tranche;
• For other types of offers, all advertisement materials and specimen document (certificate or re-allotment advice) are to be executed only by the Issuing House(s).

Sub-national Issuers – Consent Letters and Execution of Offer Documents:

The Commission has evaluated the practice of having all members of a State Cabinet consent to be named in the offer document and execute the prospectus and considers this practice unduly burdensome and not in line with the accountability structure of sub-national governments.

With effect from the effective date and without prejudice to the requirements for sub-national issuances as contained in the law as well as the rules and regulations of the Commission, the offer document for sub-national issuances shall only name and be executed by the Governor, the Commissioner for Finance, the Accountant-General and the Attorney-General of the State.

Consequently, consent letters shall only be required from the Governor, Commissioner for Finance, Accountant-General and the Attorney-General of the State.

FGN SAVINGS BOND AGAIN OVERSUBSCRIBED BY 156% IN FEBRUARY 2019 AUCTION

The trend of oversubscription at FGN Bond Auctions for the year continued at the February 2019 Auction conducted by the Debt Management Office (DMO) on Wednesday, February 20, 2019, at which 3 instruments, for 5, 7 and 10-year tenors, with a total value of N150 billion were offered.

Total bids received from investors for the bonds exceeded N234 billion, with a total subscription level of 156%. The focus of investors was principally on the 10-year bond which had a subscription level of 392%.

Successful bids were allotted at rates notably lower than those at the January 2019 Auction, with 14.52% for the 5-year, 14.7999% for the 7-year and 14.939% for the 10-year bond.

The DMO allotted the full N150 billion offered to successful bidders across the 3 tenor.

DOLLAR EXCHANGE RATE REPORT 11^TH   FEBRUARY TO 22^ND FEBRUARY  2019

This report is a compilation of the dollar exchange rate at the official and parallel market from 11^th February to 22^nd February 2019.  The quoted parallel market prices are to serve as a guide to readers, as they represent the average price obtained daily from different black-market dealers in the Country.