SEC introduces electronic filing system to reduce listing time in capital market

Emomotimi Agama, director-general of the Securities and Exchange Commission (SEC), says various initiatives have been implemented to reduce time to market and improve efficiency in the capital market.

Time to market refers to the length of time it takes for a company to complete the capital-raising process and list its shares on a stock exchange.

Agama, who spoke in an interview over the weekend, said the initiatives include streamlined registration processes, the introduction of an electronic filing system and enhanced regulatory frameworks, among others. 

The SEC DG said the aim is to promote economic growth and development.

According to Agama, a shorter time to market can benefit capital market development in several ways, including increased liquidity, which will lead to faster listing.

This, the SEC boss said, would allow companies to access capital more quickly, increase liquidity in the market and enable firms to allocate resources more efficiently, thereby driving economic growth.

“Shorter time to market will also improve investor confidence because when the listing processes are efficient, it can enhance investor trust and confidence in the market,” he said.

“A shorter time to market can make a jurisdiction more attractive to companies and investors, promoting competition and growth.”

Agama said the commission, in 2019, issued a new rule on the electronic public offering (e-PO) system, which streamlines the process of issuing new securities.

He said the system facilitates faster processing of applications by automating various steps, reducing manual paperwork, and facilitating broader participation.

The director-general said the implementation of the e-PO is part of a broader effort to make the market more efficient and reduce time to market.

“The Commission has been actively digitising its operations, including the submission and processing of applications for securities registration, to reduce delays caused by manual processes,” Agama added.

“This involved the use of electronic platforms for document submissions and approvals, which not only speeds up the process but also improves transparency.

“We have undertaken regulatory reforms aimed at simplifying and streamlining the approval processes.

“These reforms include updating rules and regulations to reflect current market realities and adopting international best practices that enhance efficiency.

“For instance, the commission introduced a checklist review for registration of fixed-income securities, thereby shortening the review and approval timelines.

“The Commission launched and conducted a targeted bi-annual training for Issuing Houses to enhance time to market and fast-track review of applications.”

TIME TO MARKET PROMOTES TRANSPARENCY IN RECAPITALISATION PROGRAMME

Speaking further, Agama said in June, the commission issued a framework for the banking sector recapitalisation programme, which outlines the guidelines and procedures banks are required to follow to raise capital during the period to ensure a smooth, transparent, and efficient process.

On August 15, the commission said it had approved all the offers it received from commercial banks amid the ongoing recapitalisation exercise.

“The major highlight of the framework is the requirement for an e-offering platform to be provided by a Securities Exchange for the capital raising exercise, which allows for end-to-end offering, subscription and payment process,” he said.

“This is based on our resolution to enhance time-to-market, efficiency, transparency and integrity of the recapitalisation programme.

“The use of e-offering platforms eliminates multiple identities and reduces the potential for unclaimed dividends, among other benefits.

“Also, a joint team comprising the Commission, CBN and NDIC was set up to facilitate the recapitalisation programme, especially in areas of capital verification, which is a prerequisite for allotment clearance.

Agama expressed satisfaction with the efforts so far and assured that the current management would continue to do its best to unlock the full potential of the capital market.

The SEC boss assured that approvals for issuances will be done swiftly so that when companies desire to come to the market, they know exactly what time approvals would be given.

He also promised that the commission would guide in the process of submitting applications, which is now done electronically, thereby facilitating the process of review and feedback.