Would you like to receive notifications on latest updates of the following headlines?

SEC Brings N2.36tn Special Funds into Custody

POSTED ON April 22, 2024 •   Business      BY Abiodun Saheed Omodara •   VIEWS 152
Securities and Exchange Commission Logo l Credit: SEC l Source: X

The Securities and Exchange Commission has revealed that it has brought about N2.36tn in discretionary and non-discretionary funds under custody following updates to the country's Collective Investment Schemes guidelines.

In a notice on its website, the SEC revealed the new amendments to its regulations titled ‘Exposure Of New And Sundry Amendments To The Rules And Regulations Of The Commission’.

Providing an update on the proposed guidelines at the media briefing after the first quarter Capital Market Committee meeting on Friday, the Chief Economist at SEC, Dr Okey Umeano, said funds in the discretionary and non-discretionary windows had been brought under custody to enhance investor protection.

Umeano said, “On the CIS efforts, we have made. We asked that all CIS funds be put in custody. Before that update we did to the rules, only the ones we called Collective Investment Schemes were put in custody. The funds that were in discretionary and non-discretionary products were not in custody. To further protect investors in that part of the market, we asked that all the funds be put in custody.

“And we followed up with an inspection to ensure compliance. We are pleased to report that today, at the end of the first quarter, we had N2.14tn in CIS funds and N2.36tn in discretionary and non-discretionary funds and all in custody.”

Shedding more light, the immediate past Director-General of the SEC, Lamido Yuguda, at the meeting noted that it was standard practice that assets management and custody are separated but that arrangement only applied to the public CIS, not the bilateral arrangements.

With the new rules, all funds were mandated to the custodians.

The former SEC DG said, “Usually in fund management, you have two important activities, one is the application of the skills of the fund manager to obtain good investment returns for their customers and you have the actual custody of the securities that have been purchased through these investment management processes.

“So, typically, when you have one single entity doing both, you are at risk should that entity collapse. When you segregate the safe custody of the asset from the investment management function, you find that it is a much better process as you have given persons who have speciality in a function to undertake that function. The world over, these functions are separated.

According to Yuguda, what the SEC has done was to mandate all investment management activities in the public CIS space or the bilateral space to be in custody.

He added that investment management must be segregated with the custody part being handled by a duly licensed custodian.

“The object of this is to improve trust, to ensure that investors assets are protected and also to give the market a boost,” he stated.

According to smartasset.com, for a discretionary investment account, sometimes known as a managed account, the broker has the authority to make individual trades in the investor’s portfolio without seeking approval.

It added that they have the discretion to buy or sell assets on their own, while for a non-discretionary account, the investor has to approve each decision on the account.

Meanwhile, President Bola Tinubu announced a new board for the commission late Friday, removing Yuguda and replacing him with the Managing Director of the Nigerian Capital Market Institute, Emomotimi Agama.

In a statement by the Special Adviser to the President (Media & Publicity), Ajuri Ngelale, the new SEC board is chaired by Mairiga Katuka.

Other members include Frana Chukwuogor, Executive Commissioner (Legal and Enforcement); Bola Ajomale, Executive Commissioner (Operations); Mrs Samiya Hassan Usman, Executive Commissioner (Corporate Services); Mr Lekan Belo, Non-Executive Commissioner and the Managing Director of APT Securities and stockbroker, Garba Kurfia, who was appointed a Non-Executive Commissioner.

RECOMMENDED FOR YOU
IMF pledges support for Tinubu's reforms
BY Abiodun Saheed Omodara November 21, 2024 0

The President of the International Monetary Fund (IMF), Kristalina Georgieva has expressed strong ba...

RECOMMENDED FOR YOU
Amazon Shares Show Resilience Amid Market Fluctuations
BY Suleiman Kelvin Jimoh November 21, 2024 0

Amazon.com Inc (AMZN) has demonstrated a remarkable rebound in the stock market, showing a year-to-d...

RECOMMENDED FOR YOU
Gombe gov presents N320bn 2025 budget to assembly
BY Abiodun Saheed Omodara November 20, 2024 0

Gombe State Governor, Muhammadu Yahaya, presented a proposed budget of N320.11 billion for the 2025...

RECOMMENDED FOR YOU
NNPCL: Coalition group vows protest, says 1.6bn litres PMS will cripple economy
BY Benedicta Bassey November 20, 2024 0

NIGERIA—Following the decision by the Nigeria National Petroleum Company Limited (NNPCL), to i...

RECOMMENDED FOR YOU
FG reviews housing budget to N500bn for 2025
BY Benedicta Bassey November 19, 2024 0

NIGERIA —The Federal Government on Tuesday said it is reviewing it's annual housing budget to...

RECOMMENDED FOR YOU
Naira appreciates, hit N1,735/$ in parallel market
BY Benedicta Bassey November 19, 2024 0

The Naira appreciated to N1,735 per dollar in the parallel market from N1,740 per dollar last weeken...

RECOMMENDED FOR YOU
Tinubu, India PM sign pacts to foster collaboration in defence, economy
BY Benedicta Bassey November 18, 2024 0

NIGERIA — Nigeria and India have entered into partnership to foster collaboration in  def...

RECOMMENDED FOR YOU
UK regular pay growth slows, offering Bank of England hope for easing inflation pressures
BY ROCKETPARROT.com staff November 12, 2024 0

LONDON, Nov. 12 – British wage growth excluding bonuses hit a two-year low in the third quarte...

OUR CHANNELS:

OTHER ARTICLES ::

25th November, 2024
Tinubu eyes livestock sector reform, investment to curb farmer-herder clashes
BY Abiodun Saheed Omodara November 25, 2024 0

President Bola Tinubu has reaffirmed his administration’s commitment to resolving the farmer-h...


Katsina Govt. applauds  NAF  strike against bandits, vows to sustain regional stability
BY Abiodun Saheed Omodara November 25, 2024 0

KATSINA – The Katsina State Government has commended the Nigerian Air Force (NAF) for successf...


Breaking : Supreme court voids National Lottery Act
BY Abiodun Saheed Omodara November 25, 2024 0

The Supreme Court, on Friday, nullified the National Lottery Act 2005 enacted by the National Assemb...


ECB's renews integration call as trade war looms
BY Abiodun Saheed Omodara November 25, 2024 0

European Central Bank, President Christine Lagarde renewed her call for economic integration across...


China expands Visa-free entry to more countries to boost economy
BY Abiodun Saheed Omodara November 25, 2024 0

On Friday, China announced that it would expand visa-free entry to citizens of nine more countries a...


FAO aims key outcomes at COP16 Saudi Arabia
BY Abiodun Saheed Omodara November 25, 2024 0

The assistant Director-General of the Food and Agriculture Organization (FAO), Dr. Abdul Hakim Elwae...


Illegal detention: Bizman slams N50m suit on NDLEA
BY Benedicta Bassey November 25, 2024 0

NIGERIA — A businessman, Damilare Samuel, has slammed the National Drug Law Enforcement Agency...


Appeal Court invalidates verdict against Rivers LG election
BY Benedicta Bassey November 25, 2024 0

ABUJA, Nigeria —The Court of Appeal, sitting in Abuja has nullified the judgement that prevent...


Man in Police net for defiling, impregnating 15-yr-old daughter
BY Benedicta Bassey November 25, 2024 0

CALABAR, Nigeria —A 48-year-old man, Mallam Adamu Umaru, was paraded by the Zone 6 Police Comm...


Trump picks Pam Bondi as Attorney General following Gaetz withdrawal
BY Benedicta Bassey November 25, 2024 0

WASHINGTON, United States  — US President-elect Donald Trump has nominated Pam Bondi, a v...


Menu