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Creating liquidity …Transparently Lagos, 23 November, 2014 1 LBS B USINESS B REAKFAST - O PPORTUNITIES ON NASD OTC.

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Presentation on theme: "Creating liquidity …Transparently Lagos, 23 November, 2014 1 LBS B USINESS B REAKFAST - O PPORTUNITIES ON NASD OTC."— Presentation transcript:

1 Creating liquidity …Transparently Lagos, 23 November, 2014 1 LBS B USINESS B REAKFAST - O PPORTUNITIES ON NASD OTC

2 Creating liquidity …Transparently 23/11/2014 C ONTENTS About NASD Entry / Trading Opportunities FAQ 2

3 Creating liquidity …Transparently 23/11/2014 ABOUT US 3

4 Creating liquidity …Transparently 23/11/2014 From an Association of securities dealers To a SEC licensed OTC market in December 2012 A PLC owned by market operators A self regulatory organisation Focussed on building transparency and liquidity ‒Start point is equities Vision ‒To be the hub of first call for capital formation in West Africa 4 H ISTORY AND F OCUS

5 Creating liquidity …Transparently 23/11/2014 Banks Clearing Platforms Participants> 77 Dealing firms > 23 Issuing Houses > 119 Authorised Traders 5 ECO - SYSTEM

6 Creating liquidity …Transparently 23/11/2014 6 StakeholderValue Added IssuersCreate public visibility InvestorsOpen market pricing MarketTransparency and liquidity Private EquityAn efficient exit window Overall EconomyGrowth S UMMARY OF VALUE ADD

7 Creating liquidity …Transparently 23/11/2014 E XAMPLES OF V ALUE A DD 7 Investor confidence: ‒Provides transparency in trading of unlisted securities ‒Protects investors from unregistered brokers ‒Provides information on liquidity around unlisted securities ‒Improved investor / Shareholder relations For brokers ‒Reduced counter party risk ‒A centralized platform for price discovery and specialized market data ‒Access to broad range of asset classes For issuers ‒Ability to raise hybrid funds ‒Increased corporate visibility which brings economies and savings.

8 Creating liquidity …Transparently 23/11/2014 ENTRY AND TRADING 8

9 Creating liquidity …Transparently 23/11/2014 A DMISSION OF I NSTRUMENTS Admitting a Company ‒Issuer will comply with all rules and regulations of the NASD ‒Price quotes are made on a daily basis ‒Company will be placed in one of two bands (Blue & Pink) ‒Full register is dematerialised and lodged in CSCS Admitting to trade ‒Initiated by the Investor ‒Broker fills an application ‒Issuer consent is not required ‒Partial dematerialisation of register 9

10 Creating liquidity …Transparently 23/11/2014 A DMITTING A C OMPANY Submit Board resolution to list shares on NASD Dematerialise securities and create register in CSCS Admitting new securities requirements Undertake to be bound by the rules of NASD Publicly announce listing on NASD 10

11 Creating liquidity …Transparently 23/11/2014 Procedure ‒Appoint Issuing House to assist with the listing process (see the List of the accredited Issuing houses on ‒Submit completed NASD application form with required documentation ‒After due diligence, NASD gives approval in principle to list ‒Company signs undertaking to abide by rules of market ‒Share register is dematerialised and sent to CSCS Timing is approximately one month 11 ADMITTING A COMPANY

12 Creating liquidity …Transparently 23/11/2014 If security meets requirements, ‒NASD will request security code and ISIN number from CSCS ‒CSCS will open account with codes within 3 working days. ‒NASD informs all stakeholders (Registrars, PIs, Issuer, Public) of admission. ‒NASD notifies the participating institution of the Security code and ISIN number for their necessary action. Timing is approximately one week 12 A DMITTING A SECURITY

13 Creating liquidity …Transparently 23/11/2014 NASD NSE DIFFERENCE 13 NASDNSE Physical trading floor None. Trade is online13 across Nigeria Participant codes Starts with 4 …. Starts with a letter CHN Starts with D….. Starts with C…. Regulator of Issuers SEC not NASDSEC and NSE Stocks introduced by Individual shareholdersAGM approves Price limits NoneDaily cap Symbol Code Starts with “SD”No unique identifier Settlement banks Six (6)Many Trading hours - 9:30 a.m. to 3:30 p.m.9:30 a.m. to 2:30 p.m.

14 Creating liquidity …Transparently 23/11/2014 OTC MARKET OPPORTUNITIES 14

15 Creating liquidity …Transparently 23/11/2014 C URRENTLY TRADING ON NASD OTC 23/11/201415 SECURITYShare Capital in VolumeMarket Cap ARM LIFE PLC 5,785,673,000 15,910,600,750.00 AFRILAND PROPERTIES PLC 250,000,000 137,500,000.00 BGL PLC 12,000,000,000 46,800,000,000.00 CONSOLIDATED BREWERIES PLC 496,071,617 45,142,517,147.00 CENTRAL SECURITIES CLEARING SYSTEM PLC 5,000,000,000 18,000,000,000.00 FRIESLAND CAMPINA WAMCO NIGERIA PLC 976,335,936 419,824,452,480.00 FOOD CONCEPTS PLC 5,650,000,000 11,243,500,000.00 GEO-FLUIDS PLC 4,257,668,000 6,429,078,680.00 GOLDEN CAPITAL PLC 1,170,324,536 1,170,324,536.00 INDUSTRIAL & GENERAL INSURANCE PLC 14,231,238,000 7,115,619,000.00 JAIZ INTERNATIONAL PLC 4,014,429,720 4,616,594,178.00 NIGER DELTA EXPLORATION & PRODUCTION 145,780,311 45,191,896,410.00 PARTNERSHIP INVESTMENT COMPANY PLC 2,875,595,000 5,751,190,000.00 RESOURCERY PLC 2,576,686,039 4,380,366,266.30 RIGGS VENTURES WEST AFRICA PLC 880,394,000 836,374,300.00 SWAP TECHNOLOGIES AND TELECOMMS PLC 2,705,378,000 8,116,134,000.00 TRUSTBOND MORTGAGE BANK PLC 10,945,334,000 13,134,400,800.00 TOTAL 73,960,908,159 653,800,548,547.30

16 Creating liquidity …Transparently 23/11/2014 FUTURE OTC OPPORTUNITIES 16 Equity-linked securities Cross border investments GDRs, NDRs, Multilayered corporate debt instruments Full range of Derivatives Venture capital and Private Equity sell downs

17 Creating liquidity …Transparently 23/11/2014 SPECIFIC INDUSTRY TARGETS Agriculture: Rice milling, Dairy products, PE activity ‒Sector to be launched by December 2014 Power: GenCos, DisCos pre-listing Technology: Estimated requirement of ₦1.3trn … 17

18 Creating liquidity …Transparently 23/11/2014 18

19 Creating liquidity …Transparently 23/11/2014 SUMMARY OF FAQS 19

20 Creating liquidity …Transparently 23/11/2014 NASD/PI FAQ Q: W HAT IS NASD? A: NASD is an acronym for National Association of Securities Dealers. It is focused on providing a technologically driven trading platform where securities not listed on the Nigerian Stock Exchange ["NSE"] are traded. Q: W HO REGULATES NASD? A: NASD is primarily regulated by the Securities & Exchange Commission ["SEC"] and it is also a self-regulatory organization just like the NSE. Q: W HAT IS THE DIFFERENCE BETWEEN NASD AND THE NSE? A: The NSE provides the platform for trading on quoted securities while NASD only deals with un-quoted securities

21 Creating liquidity …Transparently 23/11/2014 NASD/PI FAQ….C ONTD Q: W HAT IS THE DIFFERENCE BETWEEN QUOTED AND UN - QUOTED SECURITIES ? A: Quoted securities are securities that are listed/traded on an organized exchange like the NSE while un-quoted securities are those traded in an OTC market. Q: C AN ALL UN - QUOTED SECURITIES THAT CAN BE TRADED ON THE NASD OTC PLATFORM ? A: No. Before any un-quoted security can be traded, the Company must have met the following eligibility criteria: ‒The security must be registered with SEC ‒The security must be freely transferable - no legal or regulatory restriction preventing open trades. ‒The Company must have been in operation for a year. ‒It must be a public company or be held by more than 50 beneficial owners.

22 Creating liquidity …Transparently 23/11/2014 NASD/PI FAQ…C ONTD Q: H OW LONG WILL IT TAKE TO VERIFY THE CERTIFICATES OF COMPANIES WHOSE SECURITIES ARE UN - QUOTED ? A: Certificate verification will generally take about 48 hours from the day the Broker forwards it to the Registrars. However, in some cases where there are issues on the sellers signature mandate, it may take a little longer Q: H OW DO I KNOW IF A SECURITY IS TRADABLE A: Please visit our website for the list of Admitted securities Q: W HAT IS MOST EFFICIENT WAY TO GET SUPPORT FROM NASD PLC A: For quick help you can logon to our website and have a live chat with us for instant response. You can also reach us on 01-4605008

23 Creating liquidity …Transparently 23/11/2014 C ONTACT US 23 Office : 9th Floor, UBA House, 57, Marina, Lagos E-mail: Website: Live Chat enabled Tel.: +234 1 460 5008

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