A minimum turn-over level would soon be set to ensure
public participation into private enterprises, Chairman of the House of
Representatives committee on Capital Market, Alhaji Aliyu Wadada, has said.
Wadada disclosed this in an address at the opening of the
three-day workshop on the review of Investment and Securities Act (ISA) of
1999 in Abuja.
He lamented that private companies that would have become
public had refused to offer their shares to the public, thereby limiting
their profits to only few shareholders.
Their action, he said, had deprived the federal
government the revenue from their participation in the capital market while
stalling the growth of the economy.
The companies, he said, had refused to go public because
of lack of appropriate laws and assured that the National Assembly would
soon pass an act to compel them to open up to the public.
Wadada frowned at how some banks sourced their investment
instead of going through capital market to expand it, saying that the market
had become a nucleus for banks to raise their minimum re-capitalisation to
N25 billion as directed by the Central Bank of Nigeria (CBN).
The capital market, he noted, was expected to play a
vital role in facilitating the re-capitalisation of banks either through new
issues of equity for the existing quoted banks
or new ones that might wish to join the market through
merger or acquisition.
He complained about the long period spent for allotment
of shares in the issuance of Initial Public Offers (IPO�s) and charged
stakeholders to ensure immediate issuance of such offers by companies to
restore customers confidence and ensure transparency in the system.
Declaring the workshop open, Speaker of the House, Aminu
Masari said that if the nation must reap the benefits of the present
reforms, globalisation and NEPAD, the legal and institutional framework of
the capital market must be provided to enhance the operational imperatives
of the market institutions.
Masari who was represented by the ANPP
House Leader, Dr Ahamed Salik, observed that, the ISA as
the backbone of the market, must be made responsive to the realities of the
time and circumstances.
In coming up with the amendment to the ISA, he charged
participants to do comparative overview of similar legislation in the
continent and beyond.
