The Development Bank of Nigeria (DBN) has announced that it is partnering with the Nigerian Stock Exchange to explore ways in building capacity and bringing Micro Small and Medium Enterprises (MSMEs) to the floor of the Exchange.
Speaking during the closing gong ceremony at the Exchange on Friday, Chief Executive Officer, DBN, Tony Okpanachi, explained that the proposed collaboration with the NSE will involve sourcing or prospecting for SME companies.
Okpanachi added that the collaboration is line with the NSE’s objective of trying to bring SMEs to the stock market while adding that the bank is working with them on that area as well as other areas it can colloborate with them to see how we can make an impact in that segment.
“We had a meeting to explore ways in which we can work with the Nigerian Stock Exchange (NSE) on how we can make impact in the Micro Small and Medium Enterprises in terms of capital raising especially in areas of equity and as you are aware DBN does more of debt but a lot of SMEs require equity. So this partnership is in line with the NSE’s objective of trying to bring SMEs to the stock market and we are working with them on that area as well as other areas we can colloborate with them to see how we can make an impact in that segment”., He said.
We see that there is a lot of interest as regards the SMEs but a lot of them see cost, disclosures as factors that could inhibit them but the NSE has come out with a lot of initiatives to ammeorate those challenges they are facing. For example, we were told by the Exchange we have to reduce the number of shareholders that we have before we can come on the Exchange platform and they have also streamline the cost of listing so as to make it affordable for some of these SMEs who might want to list. So the idea is for them to raise capital in a structured way
Okpanachi further revealed that DBN has plans of listing its shares on the Exchange in the long term so as to raise capital beyond its current funding.
He said, “Ultimately, we are a limited public company with shareholders and owned by the Federal Government and our long term plan is to be able to list on the NSE. There is no immediate horizon but in the long term, there will an opportunity for us to raise capital beyond the current funding we have in the future and so we have that plan in the pipeline”.