TODAY, I am proud to feature in my column my friend Aigboje Aig-Imoukhuede, a man with a coat of many colours: a lawyer turned banker, the President of the Nigerian Stock Exchange, the Chairman of Coronation Capital Limited and the outgoing Chairman of FMDQ OTC board.
His legendary friendship with Herbert Wigwe has often been compared with that of me and my late friend Dimgba Igwe. When Dimgba and I interviewed him some time ago about the founding of Access Bank, we found his story so engaging and so inspiring that we had to keep it in our secret literary vault with the hope that very soon, we will turn it into a book—a biography. Ever since, the man has been on our radar and we keep tabs on him. On Monday, he made history with his colleagues with the launch of an innovative financial product that meets the needs of the times of our foreign exchange scarcity era. It is an “over-the-counter futures market” product that will help investors to plan and hedge against the volatility of our sick, bedridden naira against the almighty dollar. And it is backed by the Central Bank. I bring you my abridged version of the remarks of Aig-Imoukhuede at the launch of the new financial market product which is said to be revolutionary:
First of all, I am an extremely proud Nigerian today. I take great pride in FMDQ’s achievements. Today we celebrate the Nigerian OTC Futures Market but literally maybe every quarter I read the newspapers or I see on TV or in the Internet another first by FMDQ. My pride comes in the fact that perhaps God just placed me at the right place at the right time to be part of history. I am really touched when you make references to the President of the Financial Market and so on, but at the end of the day, you know as well as I do that the achievements being recorded today is as a result of the collaborative efforts of many—some actually who precede us, if you think about people like Funke Osibodu and we can go on and on—I don’t want to recall that ancient history.
I need to start my remarks by stating clearly why my involvement in financial markets. It is very important. I started my banking career in 1988 and I started getting involved in the markets in 1992. And essentially, what was clear to me was that there is a perfect correlation between the advancement of economies and the advancement of their financial markets. You cannot strip it. I don’t know whether there is a cause and effect but it is just perfect.
We have to move to a system whereby prices are set based on empirical data and financial principles. We are moving in that direction in Nigeria and I will speak more to that. Now FMDQ as an idea or a vision was not mine. It was certainly the collective vision of FMDA. It was brought to me in my capacity as the chairman of the Board of Trustees of FMDA in 2009. That was the year we had interventions. And so this must have been after the intervention had cooled down. I am talking about Lamido Sanusi’s intervention and when we had clear mind to think. Bola Onadele, the MD/CEO FMDQ OTC Securities Exchange whom we call “Koko” remembers my very first statement. And my first statement was this: “Guys, this is fantastic. If we make this work, this is a revolution.”
And I said: “We have to make it work. It is not going to be easy to move from your idea to reality but we would be strong, we would be courageous, we would face the battles and we would make it work.”
I introduced this to the Bankers’ Committee in 2010 and it was met with some resistance, not for any other reason other than the fact that in everything new, particularly where you have risk managers in a room, people are going to say: ‘Look, where are we going with this stuff?’ But then we got on board and everybody got behind it—Bankers’ Committee and most impressively, the Central Bank. Typically, you don’t find Central Bank playing the type of role that the Central Bank and the SEC is playing in the advancement of financial markets. Because regulators tend to want to step back and be in a position to regulate these developments. But when there is a vacuum, somebody has to step forward. And so the Central Bank became a very, very primary stakeholder in this process of advancement. In January 2011, I remember our SEC registration meetings. We went for interviews at SEC. The CEOs of several banks. And we were seeking registration for an exchange and I was just waiting for them to ask the question: “Which of you has run an exchange before?” Fortunately they didn’t. But then we had the stock exchange as a shareholder and I think that the stock exchange has played a great role in building the FMDQ vision as we know it.
Now, we were lodged in November 2013. That day, Koko nearly brought tears to my eyes through his flattering compliments. But the tears were less of “Aig this is what you have done” and more of “Aig could have been part of this gathering of brains, Nigerians and indeed some foreigners who have made history. And I just thank God and I thank you guys for allowing me play the role that I did.
My philosophy—and I am very strong when I make this statement and when I debate this point—is that market-based systems are vastly superior to any other form of systems of allocating resources in any economy. And history has proven me right. There is no economy in the world that has survived anything other than a market-based fundamental underpinning of how economic resources are allocated. And therefore, the power of exchanges and platforms is that they provide the basis for the efficient allocation of resources. Now, I want you to think for one minute: Let us assume that FMDQ didn’t exist. How would you actually implement this futures market? A futures market that has the conditions of liquidity transparency, price discovery and clear communication cannot be implemented without the likes of FMDQ and some other exchange platforms.
So what is my message? My message is this: Many of the things that we have been calling for—we have been calling for futures for years. We have been calling for systems by which corporates can decide to issue a bond and within a week, you have priced that bond and you’ve issued it. That is what we look for, for this country. But why have we been calling for it and it’s not been happening? Because we didn’t have the market infrastructure to do it. The market infrastructure in the form of exchanges such as FMDQ. So it is in our own selfish interest—and I am not just talking here about intermediaries like banks, treasurers and so on. I am talking about corporates. I am talking about people on the buy and sell side. Most importantly, I am talking about Nigeria. To promote platforms like this. Platforms like this represent our future.
Nigerian Stock Exchange, well done for the work you are doing. Nigerian financial markets are taking huge leaps. And I pray that this would provide the basis for the Nigerian economy, similarly to take huge leaps.
It is also interesting I see my friends in the media. I watch the TV and I see them mention NIFEX, NEITI, NIBOR and so on. And they speak so eloquently and so well. And you can see the developments. I see stockbrokers talking about NEITI and other terms. If you spoke about these things before, if you said NEITI, somebody might think it’s a reggae slang. You see the markets and the country progressing. But however, we must expect challenges in the future. Market development is not an easy thing. There would be volatility. There would be shocks. We wake up one morning and we hear that Great Britain had chosen to leave the EU. It would continue to happen. But you must be strong. And you must be courageous. And of course, you must collaborate. Koko and the team, and indeed FMDA and the entire markets and the country, I congratulate us all. Very well done. Thank you.