The Securities and Exchange Commission (SEC) has said the adoption of the T+1 settlement cycle in Nigeria’s capital market is going smoothly, describing it as a development that has enhanced competitiveness and provided relief to market participants.
Speaking in an interview with journalists in Abuja at the weekend, the Director-General of the SEC, Dr Emomotimi Agama, represented by the Director of Registration, Exchanges and Market Infrastructure, Mrs Hafsat Rufai, said both local and international investors had expressed satisfaction with the new settlement cycle.
She said, “Feedback from them has been excellent. They are happy with T+1, and the local investors are also happy with T+1. The fear initially was around the availability of cash to settle, with time zones being one of the major considerations.
“Sometimes, in some countries, when we are closing our market at 4:00 p.m., it is still early in the day. Sometimes, it’s even longer than being early in the day; it’s midnight in some countries. And so everybody is concerned about how to source cash or how to source funds for settlement.
“But knowing that it is not at 8:00 a.m., it is 5:00 p.m., I think that gives enough time for the custodian banks, who are representatives of those investors, to source the funds required and settle the securities and cash as well, because it’s a DVP market. It’s delivery versus payment.”
According to a statement by the Commission, Agama said no default had so far been recorded due to the unavailability of funds for settlement at the new deadline.
“It’s just a matter of letting everybody understand that the settlement time is not 8:00 a.m.; it is 5:00 p.m. And by 5:00 p.m., everybody is good. So far, it has been good. Feedback has also been very excellent.”
He explained that the Nigerian capital market…
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