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Tuesday, 02 December, 2008 01:40 am
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| Nigerian Banks Condemn Lawmakers’ Ban on Public Offers |
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| Written by News Hound | ||||||
| Tuesday, 18 September 2007 | ||||||
     Speaking with local and foreign media on the outcome of the meeting in Lagos today, the Managing Director of Sterling Bank Plc, Mr. Tunde Dabiri accused the lawmakers of going contrary to the laws guiding the capital market. This reaction is coming on the heels of directives from the house committee on capital market, led by its chairman, Honourable Ahmed Wadada to the Securities and Exchange Commission (SEC) to stop granting approval to banks to access the capital market for funds. According to him the National Assembly or any other body have no right to direct banks or any company not to raise money from the capital market. His words “The lawmakers directive to banks to halt the raising of funds is contrary to the laws of the market. If a bank sees the need to raise funds and know that there is a ready market for its shares, it is not proper for any body to stop them from doing it. Usually, before an offer, there is an agreement that the issuing house underwrite 80 per cent of the offer, so there is usually no problem on how the shares are to be sold,” he said. He disclosed that the banks are already in consultation with the relevant authorities on the issue and in due time, its full position will be made known. Corroborating, the position of the bankers’ committee, SEC yesterday disclosed that it is not within its powers to stop banks or other companies from raising funds from the capital market provided the criteria and requirements for raising such funds are met by the company. Also speaking on the issue the Head, Media of SEC, Mr. Lanre Oloyi, stated that the primary responsibility of the SEC is to ensure the protection of investors against material falsehood and to boost confidence in the market, not to stop banks or companies from undertaking publicoffers or rights issues. His words, “The banks can not come to the market to raise money if they do not need it. Also there are requirements that the commission has stated that must be satisfied before approvals are given. So if the banks or any other companies meet such requirements then we have no choice than to give approvals. It is left for the investing public to make useful investment decisions whether to invest in such a bank or not based on the financial projections given by the bank”, he noted.  Quote this article on your site | Print | E-mail
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