THE COUNCIL RESTRUCTURES THE EXCHANGE

y Yemi Kolapo and Ifeanyi Onuba
Published: Thursday, 23 Oct 2008


The post of Director-General in the Nigerian Stock Exchange, currently occupied by Ndi Okereke-Onyiuke, may have been abolished.

The scrapping of the position was the high point of a new organisational structure of the NSE approved by its council at a meeting on Friday.

A statement on Wednesday by the council’s Secretary, Mrs. Josephine Igbinosun, however, said that the Exchange would be headed by a Group Chief Executive Officer.

The GCEO, according to the statement, would be assisted by three executive directors that would be in charge of compliance and surveillance, quotations and listings and market operation/IT.

The statement which was silent on the fate of Okereke-Onyiuke came amid calls by stakeholders for government‘s intervention in the crisis currently rocking the Nigerian capital market.

The development however, spurned rumours that Okereke-Onyiuke’s job might be on the line. But the NSE debunked the insinuation, saying the restructuring was a strategic plan that had been on for over five years.

“It is not a new development. There is a terminal age for retirement. She (Okereke-Onyiuke) will leave when she is due for retirement,” the NSE spokesman, Mr. Sola Oni, said in a telephone interview with one of our correspondents.

He, however, declined to speak when asked when Okereke-Onyiuke was due for retirement. Oni added that the NSE DG was very much involved in the restructuring and that the plan had no link whatsoever with the current market crisis.

Okereke-Onyiuke, who was born in 1950, joined the NSE in 1983. She became the DG of the Exchange, a private sector organisation, in 2000.

Had she been in the public sector, she would have been due for retirement in the next two years. Efforts by our correspondents to find out if the post of DG in the NSE had a fixed tenure proved abortive.

Some stockbrokers, who spoke with one of our correspondents on the condition of anonymity, said the restructuring could be a plot to elongate the tenure of Okereke-Onyiuke who also doubles as the Exchange’s Chief Executive Officer.

“A lot of investors are losing their money. Just yesterday (Tuesday), the capital market crisis claimed its first casualty because the managing director of a stock broking firm slumped right inside his office and died. Don‘t be surprised that it might be an indirect way of elongating the tenure of the DG,” one of the stockbrokers said.
The name of the deceased and his company were kept under wraps as at 9pm on Wednesday.

Igbinosun said in her statement that the new structure, approved at the council‘s meeting on Friday, was a consequence of the reorganisation, which the council approved early in 2008.

She added that the restructuring, which was expected to end in December 2010, would involve the transformation of the NSE‘s governance, IT platform and diversification of its listings and market development product offerings into derivatives and exchange traded funds.

The statement said following a diagnostic study of the structure, management and processes of the Exchange by Accenture, the council held a retreat in June 2008 and approved the restructuring plan, which would culminate in the “demutualisation” of the NSE (listing the Exchange on the NSE and other Exchanges).

The statement reads in part, “The transformation process is broken into five distinct and parallel phases. Phase one of the plan, which commenced in June 2008, is the pre-transformation phase, which involves setting up a programme office and appointing a programme manager.

”Phase 11 of the restructuring involves the internal restructuring phase and migrating the NSE into a new operating model.”

It said the execution of the first two phases was in full swing while phase three, which was the most critical, would involve working with identified stakeholders to make the NSE become a diverse and liquid market with a significant number of large, medium and small companies and investors.

The statement added, ”Programme management is phase 1V and will involve ensuring that resources are deployed to all initiatives and managing risks and ensure completion of the project.

”The last phase is the change management phase, which will ensure that all stakeholders understand the implication of the changes on their various businesses, get buy-in and ensure that the change process gets support of investors, stockbrokers and financial regulators such as the Central Bank of Nigeria and the Securities and Exchange Commission.”

However, some capital market operators commended the restructuring, saying it would ensure transparency, stability and vibrancy of the capital market in the long-run.

”What the NSE is doing is a good development, it shows they are being proactive in dealing with future problems but this is not what the market needs right now. Let them save the market from collapse instead of restructuring,” one of them said.

Another, however, said that anything short of the injection of a stabilisation fund into the market would not achieve instant result.



TIGERKENN COMMENTS

Now, it took the death of one big wig to spur these regulators to action, do they know how many 'small' people that have died as a result of this? or do they even care? Many more blood pressures are rising as a result of this, and more deaths may happen if things are not done urgently.

My thinking is that the slow drop is more fatal than the fast drop, like the 5% drops, things will fall faster and rise back faster. There is the feeling of inevitability associated with this 1% drop, you already know your positions are bleeding, you know the bleeding will continue, you know there is nothing you can do about it, you know the banks will come for your throat.

Why wont somebody drop and die, my surprise is that it took this long for the first person to die!