Custom Search

‘Cut in transaction costs’ll boost market activities’

Operators in the Nigerian capital market have said that the move by the Securities and Exchange Commission to further reduce transaction costs in the capital market will enhance participation.

The Managing Director, Quantum Securities Limited, Mr. Oladele Odunsanya, said in an interview with our correspondent on Tuesday, that most investors had been discouraged by the high transactions costs.

He said reducing the costs might help correct the current bearish trend in the stock market.

Similarly, a stockbroker who pleaded anonymity, for fear of being sanctioned by the capital market regulator, said with an increase in the turnover of the capital market, the reduction in transaction costs would be appreciated.

He added, “For us as stockbrokers, our transaction charges should be increased. The multiple taxes we are saddled with eat deeply into our charges, which has been reduced.”

Major indicators on the NSE have been declining in recent times and this has made stakeholders apprehensive.

The capital market’s apex regulatory body had, last Thursday, disclosed plans to further reduce transactions costs.

According to the spokesman of SEC, Mr. Lanre Oloyi, a committee has been set up by the commission to initiate modalities for the exercise, following which the details will be released to the Federal Government and market operators.

Oloyi said, “The purpose is basically to attract more local and foreign investors into the market. There is a committee set up by the commission on this, and as soon as it concludes it work, the recommendations will be forwarded to the Federal Government. We seek FG’s approval for its implementation.”

He said that since the capital market had been fingered as a pivot for the nation’s vision 2020, the commission was willing to work towards achieving that goal.

SEC had in April 2007, reduced transaction costs in the capital market by 40 per cent and hinged the reason for its action on the need to encourage investors.–Punch

No comments:

Free SEO by Master Google