Nigeria: Finance Minister Urges SEC Board to Embrace Innovation in Capital Market Regulation

The Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, has called on the newly inaugurated board of the Securities and Exchange Commission (SEC) to embrace innovation to enhance the agency’s ability to regulate a dynamic capital market.

Speaking during the board’s inauguration in Abuja on Friday, Edun expressed his enthusiasm for the board’s composition. He urged members to be bold, courageous, open to innovation, and ready to tackle the challenges of regulating emerging areas.

According to a statement issued by the SEC, Edun highlighted the rapid advancements in financial technology and communications. He emphasized that with the advent of Artificial Intelligence (AI), digital currency, and other technological innovations, it is crucial for the regulator to stay informed to provide proper guidance and necessary approvals.

“The top minds go into finance and technology because these areas are advancing rapidly, unlike basic industries such as steel making or manufacturing, which have settled technologies. Financial technology, communications, artificial intelligence, crypto, and digital transitions are evolving at a fast pace,” Edun said.

He added that transactions must be understandable to investors, issuers, and regulators to receive the necessary approvals, which provides some comfort regarding the financial market.

Edun urged the SEC board to rise to the challenge of regulating these new areas, particularly cryptocurrencies, which are complex and fast-moving. He also cautioned against regulatory arbitrage, where companies with sophisticated transactions seek the lowest level of registration just to claim they are licensed and regulated.

“You have been carefully selected for this role. Ensure top-notch corporate governance practices. Where conflicts arise, they must be quickly identified, disclosed, and dealt with according to global best practices. Do not be stumbling blocks to those awaiting processes and approvals,” he said.

In his remarks, Chairman of the SEC Board, Mr. Mairiga Katuka, assured the Minister that the new Board would leverage their collective expertise, innovation, and passion to drive growth in line with the Commission’s dual mandate of developing and regulating a fair and efficient capital market.

“The board will pursue a comprehensive agenda aimed at advancing the interests of investors, safeguarding market integrity, promoting capital formation, and enhancing regulatory oversight,” Katuka said.

He highlighted the positive economic outlook driven by the current administration’s reforms, including robust inflation management, social protection, macroeconomic stability initiatives, and improved private sector development, which are expected to foster economic growth.

Katuka expressed optimism about the future of Nigeria’s securities market, stating that with diligence, integrity, and a shared sense of purpose, there is hope for a more prosperous and resilient financial ecosystem.

President Bola Tinubu had approved the appointment of seven individuals to the SEC Board on April 19, 2024. The appointees include Katuka as Chairman, Mr. Emomotimi Agama as Director-General, Frana Chukwuogor as Executive Commissioner (Legal and Enforcement), and Mr. Bola Ajomale as Executive Commissioner (Operations). Others are Mrs. Samiya Usman as Executive Commissioner (Corporate Services), Mr. Lekan Belo, and Mr. Kasimu Kurfi as Non-Executive Commissioners.

Meanwhile, SEC has alerted the public about fake social media accounts impersonating Agama. The Commission warned that scammers are using these accounts to lure people into sharing personal information and making unauthorized payments.

“The SEC informs the public that neither the Director General nor any staff of the Commission will request personal information about investments through private phone lines, emails, or social media handles. Official information from the Commission is communicated only through its verified email addresses, website, social media handles, and phone numbers,” the statement added.

The public is urged to verify the identity of any person or entity contacting them and to immediately contact the Commission if in doubt.