As stock-broking firms and other market operators jostle to meet the December 2008 deadline on recapitalisation, the Securities and Exchange Commission (SEC) yesterday reiterated its commitment to maintain the date and the new amount required by operators to practice in the market.

In a telephone chat with The Guardian yesterday, the Director General of SEC, Musa Al-Faki said: "We don't want to overflog the issue. We have made our statement and that remains our position."
Corroborating him, the Head, Media of the Commission, Lanre Oloyi also said: "We are not shifting the goal post. Operators should go and increase their capital base. That is the position of the commission.
Currently, some market operators especially stock-broking firms and issuing houses are raising funds to meet up with the new capital base requirements for them as stipulated by SEC.
For instance, stock-broking firms now require a capital base of N1 billion while registrars require N500 million minimum capital base.

To meet the deadline, some companies are now doing private placements, while others are seeking core investors, just as others are quietly involved in merger talks and other options available.
Meanwhile, the commission has released the guidelines on the new capital requirements.
The mode of capital injection would either be in form of cash and treasury bills, transfer of quoted securities at market value or Federal Government bonds.

Other modes are transfer of landed property at net book value, and transfer of other fixed assets at net book value.

Specifically, injection of cash would involve presentation of copy of cheque and draft; entry in the cash book, bank teller showing lodgement of the funds into the company's account; bank credit advice for transfer, bank statement of account showing credit of the funds, and company receipt issued (evidencing payment), which must contain the name and address of the subscriber, amount, date and purpose of payment.

By the second quarter of the year, all operators are expected to submit their progress reports on implementation of the new capital base and their action plans to SEC. Also, by September 30, 2008, the receipt of complete documentations of full compliance with the stipulated minimum capital base from market operators will close.

The management of SEC added that "any documentation short of the provisions as contained in these guidelines shall be unacceptable, and the commission shall not extend the deadline of December 31, 2008 for recapitalisation.