Nigerian Stock Exchange (NSE) has fined about 36 quoted companies N434.1 million for failure to file their audited financial statements after the regulatory due date.
Checks by New Telegraph showed that some of the companies were sanctioned for their inability to meet the regulatory requirements such as full year ended December 31, 2017 and third quarter of 2018.
The companies include Abbey Mortgage Bank Plc., Academy Press Plc., International Breweries Plc., Mutual Benefit Assurance Plc. and NPF Microfinance Bank Plc. Others are AG Leventis Plc., PZ Cussons Nigeria Plc., Meyer Plc., Presco Plc. and Royal Exchange Plc., among others.
The Exchange, in its X-Compliance report, explained that the initiative was designed to maintain market integrity and protect the investors by providing compliance-related information on all listed companies.
The report thus stated: “Companies that are listed on the Exchange are required to adhere to high disclosure standards, which are prescribed in Appendix 111 of the Listing Rules.
“Financial information, which is periodic disclosure and on-going material events disclosure should be released to The Exchange in a timely manner to enable it efficiently perform its function of maintaining an orderly market”.
The NSE in an effort to achieve a world class capital market, has reiterated its commitment to maintain zero tolerance posture on dealing member firms and quoted companies on violations of rules and regulations.
This on the back of the Exchange’s determination to shift gears to drive innovations centred on increasing global visibility for the Nigerian capital market in the current year.
Mr. Oscar Onyema, chief executive officer of the Nigerian Stock Exchange, said recently that the Exchange will sustain a zero-tolerance stance on dealing member firms and listed companies’ violations to help boost the confidence in the market.
Mr. Mike Eze, managing director, Crane Securities, reacting to the development, said the action of NSE will boost investors’ confidence in the market because it is sending a signal that the NSE’s management understands the need for investors to get companies’ financial reports as at when due.
Eze said sanctions of erring companies are ways, which the Exchange is using to tell the investing public that they really want to revive confidence in the market.
He added that investors need to take informed decisions before choosing, which stock to buy. And the quoted companies could only achieve this if there is adherence of good corporate governance.
Alhaji Gbadebo Olatokunbo, founding member of Nigeria Shareholders Solidarity Association (NSSA) and one of the leading shareholders’ activists,, said penalizing erring companies is a signal that it is no longer business as usual.
“The action is great and it shows that the NSE management is becoming alive to its responsibilities,” he said. “Besides, it is a signal to the companies in particular and the capital market in general that it is no longer business as usual. We must always abide by the rules.”
He noted that the sanction would make other companies sit up and post their results as at when due thereby providing investors, analyst and stockbrokers the platform to predict the real value of the companies.
