TECHNICAL COMMITTEE ON MARKET LIQUIDITY ENHANCEMENT UPDATE AUGUST

TECHNICAL COMMITTEE ON MARKET LIQUIDITY ENHANCEMENT UPDATE AUGUST 2017

INTRODUCTION § As part of the Securities and Exchange Commission’s (“SEC” or the “Commission”) ongoing efforts to implement the over 100 initiatives recommended in the Nigerian Capital Market Master Plan (CMMP) 2015 – 2025 and in furtherance to SEC’s vision of being Africa’s most modern, efficient and internationally competitive market, the Commission recently set up a technical committee on the enhancement of market liquidity § The overall objective of the committee is to drive implementation of recommended initiatives in the Master Plan aimed at enhancing market liquidity, which is central to the consolidation of the gains from other ongoing initiatives in the Nigerian capital market § In furtherance to this objective, the technical committee's activities is expected to be guided by the broad terms of reference enumerated below: − Examine existing liquidity enhancement initiatives such as securities lending and market making to identify possible challenges and constraints; − Develop Roadmap for the enhancement of liquidity in the market; and − Undertake any other activity that may be relevant to the achievement of the mandate § Furthermore, the technical committee will consist of key stakeholders and subject matter experts (as shown in the following slides) who will collaborate and recommend actionable steps which the SEC can implement to deepen liquidity in the market 1

TECHNICAL COMMITTEE MEMBERS § The committee consists of the following members: 1. Temi Popoola – CEO, Renaissance Securities (Nigeria) Limited (Chairman) 2. Sadiq Waziri – Group Head, Research, Lead Capital Plc 3. Eguarekhide Longe – President PENOP 4. Ikechukwu Duru – MD, FSDH Securities Limited 5. Oluwafemi Onifade – Representative from NSE 6. Isiaka Atanda – Representative from NASD 7. Jumoke Olaniyan – Representative from FMDQ 8. Akinsola Akeredolu – Representative from ASHON 9. Sonnie Ayere – Representative from AIHN 10. Representative from FMAN 11. Mahmud Mukhtar – Head Secretariat (SEC) 12. Dalhatu Hussaini U. – Secretariat 13. Rotimi Teteye – Secretariat 2

4 AGREED ACTION PLAN AND TIMELINE § At the inaugural meeting of the technical committee on 4 th August, 2017, it was agreed that the task set before the committee will be best assessed from an wholistic stand point, encompassing all markets and understanding how these markets can work together to improve the financial markets liquidity § Ultimately, the committee aims to produce 5 to 7 actionable recommendations to the SEC on how to solve the problem of market illiquidity § The committee decided that the best way to carry out the set task is to assess the existing financial markets ‘architecture’ with the aim of identifying the problems, the cause of the problems and then Identify solutions as proposed by drivers of the sector and its various markets § In line with the approach above, it was agreed that: 1. The committee members best equipped to evaluate the Fixed Income Market, will come up with a draft paper outlining problems in that market as well as solutions that look evident based on their experience and expertise. They will also outline steps that have already been taken in the Fixed Income Market to try and solve this problem. This will be presented at the next meeting. 2. This document will act as a guide for an equities draft paper which will be drafted for the subsequent meeting by suitable committee members. 3. SEC representatives will clarify what is currently being reported to CAMIC (Capital Market Masterplan Implementation Committee) by the individual markets (equity and debt) and how that compares to what the committee will be reporting so as not to send duplicate reports; and 4. SEC representatives will confirm the timeline of the assignment (however 3 months is currently assumed based on timelines for other similar committees) § Next meeting will be held 2 weeks from today (Friday August 18 , 2017) at Ren. Cap’s offices 3