The Securities and Exchange Commission(SEC) has announced its plans to strengthen the regulatory framework for sustainable borrowing by governments and corporations.
The Director-General of the Commission, Dr Emomotimi Agama, disclosed this during an interview on Thursday, emphasising on the critical role borrowing plays in fostering development across various sectors of the economy.
Dr. Agama explained that improving the framework for sustainable borrowing was a very important part of the financial system of the country.
“We want to be sure of sustainability in both government borrowing, municipal and state governments, particularly with the new Supreme Court order regarding the 774 local government areas receiving direct subvention from the Federal Government,” he stated.
Addressing corporate borrowing, he announced the introduction of new rules for Central Counter Parties, which will take effect in 2025. According to him, these rules aim to simplify borrowing processes for companies and bolster the capital market’s growth.
He also revealed plans to diversify Nigeria’s capital market through the introduction of new financial products, including derivatives.
“It is very important that as we drive the growth of the Nigerian capital market, we also drive new products and new opportunities for every Nigerian,” he stated.
Dr. Agama further explained that the new framework would exempt derivatives transactions from general insolvency laws, creating a more predictable and secure environment for market participants.
