Management of the Nigerian Exchange Limited (NGX), on Monday, reiterated its commitment to supporting the enforcement of regulations that enhances transparency in the capital market by promoting compliance with disclosure rules on substantial holdings in listed companies.
It recalled a recent circular to the market reminding stakeholders that lack of appropriate disclosures by investors was a breach of its rules and other extant market regulations.
This act, it added, also impacts market transparency and fairness as it creates information asymmetry, which according to experts could hamper price discovery, regulatory oversight and the accuracy of public disclosures.
The statement quoted the NGX’s Divisional Head, Capital Markets, Jude Chiemeka as stressing the exchange’s full commitment to maintaining the integrity and transparency of the Nigerian capital market.
He urged “all investors to comply with our rules and regulations regarding the disclosure of substantial interests in listed companies. He added that refusing to comply with these guidelines creates information asymmetry, distorts public information and market data, and undermines the confidence of investors in our market. The Exchange will continue to take necessary actions to ensure compliance and promote a level playing field for all market participants.”
The circular also reminded investors of Rule 17.13 of the Rulebook of the Exchange, Issuers’ Rules, 2015, titled “Disclosure of Changes in Beneficial Ownership of Shares” which requires every Issuer to notify NGX immediately; about any transaction that takes the beneficial ownership of its shares to five per cent (5%) or more not later than ten (10) business days after such transaction.
It also quoted the Rulebook’s section on free float requirements, Rule 2.2 which says that “each Issuer shall incorporate in its half-year financial statement filed with NGX its shareholding pattern, and also indicate whether or not its free float is in compliance with NGX’s free float requirements for the Board on which it is listed.”
The exchange, therefore, reminded all investors and other stakeholders to be guided by the provisions of the above NGX rules and circular.