Apparently miffed by the lacklustre state of Nigeria’s financial market, stockbrokers under the aegis of the Chartered Institute of Stockbrokers (CIS) have urged the Federal Government to review the entire financial system for enhanced growth and development.
This was even as they called for the need to overhaul the financial market to attract more investors into the capital market.
In a statement titled “The Nigeria Economic Review: Outlook and Recommendations for 2020”, the Institute urged the Federal Government to review the entire financial system for enhanced growth and development , adding that the federal government should set up a council, comprising different professional bodies to drive savings as a strategy to encourage investors towards medium and long term investment in Nigeria.
“There is a need to set up an independent council comprising banks, stockbrokers, mortgage institutions, insurance companies, and pension fund administrators, among others to effectively coordinate the mobilization of savings in the country. The Federal Government should also institutionalize the funding framework for Capital Market Literacy (CML) in Nigeria by financially empowering CML oriented bodies, as is done in France through the IEFP. The Tertiary Education Trust Fund (Tetfund) should allocate a portion of its fund to the CML drive, and to the CIS in particular.
As banks control almost of the entire liquidity in the Nigerian financial system, they should support capital market investments, including re-introduction of margin lending with improved regulations.CBN, being the dominant institution that currently provides liquidity support for critical economic sectors, should extend its liquidity support to the capital market, including the equity segment.’’
According to the institute, the Federal Government should direct pension funds administrators in Nigeria to look beyond fixed income investments and also invest substantially in the equities market for liquidity and stability purposes. “Greater tax incentives should be granted to companies and individuals in accordance with their level of savings and investments in formal and recognized outlets such as stock markets”, the institute said.