The Nigerian Capital Market has continued to record phenomenal growth in the last one decade, effectively playing its role as a facilitator of capital flows within the economy.

 

The Nigerian Stock Exchange (NSE) was incorporated in 1960 as Lagos Stock Exchange and it   commenced business operations on June 5, 1961.

 

The NSE adopted the automated trading system with the establishment of the Central Securities   Clearing System (CSCS) in 1997 and currently comprises of 290 listed securities. These include 202 equities, 36 federal government development stocks, 52 industrial loans/bonds and preference stocks, and there are 18 memorandum listings of Unit Trusts/Equity Funds.

 

The pivotal role played by the capital market in the recently concluded financial services industry reforms has further established it as a formidable institution of change for the transformation of the Nigerian economy. This has impacted positively on the performance of the Nigerian Stock Exchange (NSE) indices, which recorded quantum growth in relevant indicators in the last three years. The Market   capitalization     grew from N1.1 trillion in 2003 to N5.12 trillion, as at 2006 while the NSE All-Share Index appreciated by over 99% during the period.

 

The NSE has recorded a much improved level of investor confidence both locally and internationally since the turn of the century having featured consistently on the list of the world’s ten most profitable exchanges.

 

The Nigerian Stock Exchange All Share Index (ASI) is an aggregate of the market capitalization of all listed equities, with 1984 as the base year.

 

YEAR	ALL SHARE INDEX As at year end	MARKET CAPITALISATION
2000	8,111.01	N478.6b
2001	10,963.11	N662.6b
2002	12,317.72	N763.9b
2003	20,128.94	N1.356t
2004	23,844.45	N2.122t
2005	24,085.76	N2.90t
2006	33,189.30	N5.12t

 

 

n      The Securities & Exchange Commission (SEC) is the apex regulatory institution for all operators in the Nigerian capital market.

 

•         Brokers:                      Licensed by SEC to buy and sell shares and bonds for third parties.

•         Dealers:                      Allowed to deal in securities only for itself.

•         Broker/Dealer:           Allowed to combine the roles of a broker and dealer.

•         Issuing House:            Undertake Primary Market Issues for companies.

•         Underwriters: Take up unsubscribed portion of primary market issues.

•         Registrars:      Keeps records of shareholders on behalf of quoted companies.