288 workers lose job nationwide as firms fail SEC recapitalisation deadline

At least 288 workers from 24 capital market firms across the country have lost their jobs, following their companies’ inability to meet the new minimum operational capital set by the federal government for all market operators.

Investigations by PREMIUM TIMES showed that the hope of the workers to regain their various jobs earlier suspended in third quarter of 2015 was dashed as the Securities and Exchange Commission released the final list of 955 firms that crossed the recapitalisation hurdle.

A breakdown of the list showed also that 429 companies were capital market operators, CMOs, while 526 firms are consultants/experts.

SEC said in statement that the successful 955 firms were the market stakeholders that complied with the new minimum capital requirement after capital verification exercise.

The capital market apex regulator said the list was based on the consideration of the reports on capital verification and the responses received from the affected CMOs.

According to SEC, 24 CMOs were disqualified for non-compliance and/or inability to substantiate claim of compliance based on queries raised by the audit firms.

The capital market regulator also said that 16 new CMOs were added to the list, 10 of which were newly registered companies while six filed evidence of compliance after the release of provisional list, which were verified and accepted.

PREMIUM TIMES recalls that under the new operating regime, the federal government, through SEC, increased the minimum capital requirements for all capital market functions, which became operational since November 1, 2015.

The apex capital market regulator increased minimum capital base for brokers/dealers by 329 per cent from the existing N70 million to N300 million.

A broker, who currently operates with a capital base of N40 million, will now be required to have N200 million, representing an increase of 400 per cent.

The minimum capital base for dealers increased by 233 per cent from N30 million to N100 million.

Also, Issuing Houses, which facilitate new issues in the primary market, will now be required to have a minimum capital base of N200 million, as against the current capital base of N150 million.

The capital requirement for underwriters also doubled from N100 million to N200 million.

A registrar will now have a minimum capital base of N150 million, as against the current requirement of N50 million.

The minimum capital base for corporate investment advisers remained unchanged at N5 million, individual investment advisers will have to increase their capital base by 300 per cent from N500, 000 to N2 million.

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