Beyond Yuguda’s Plan for Nigerian Capital Market

The coming on board of Dr. Lamido Yuguda as director general of the Securities and Exchange Commission (SEC) did not come as a surprise to the Nigerian capital market community as the former banker is very familiar with the terrain. Before his appointment as the new SEC DG, he was a prominent personality on the board of the commission. Though Yuguda appears to know what exactly to do to move the capital market forward, there are surely some other matters that bother on the market, which capital market pundits want him to pay attention to. Bamidele Famoofo writes

Dr. Lamido Yuguda is not unfamiliar with the financial market terrain in Nigeria. A seasoned economist, banker and investment manager, with over 30-year experience in financial services, the new helmsman at SEC would be adjudged to possess the required pedigree to drive the capital market in Nigeria to the next level.

The appointment by President Muhammadu Buhari and the eventual ratification of the appointment by the Nigerian Senate, recently, was all Yuguda needed to be the commission’s substantive director general. His appointment also brought an end to the 2-year long controversy surrounding the office of the Director-General of the Securities and Exchange Commission (SEC).

Immediately he assumed office last week, Dr. Yuguda was quick to set the ball of events rolling, as he reeled out his agenda for the capital market. He hinted that his priority was to protect the interest of investors in the capital market as he warned operators in the capital market that the new management under him will not allow any form of infringement on the rights of investors. Part of his strategies to ensure the interests of investors are protected is to mete out sanctions on any capital market operator who, in any way, attempt to shortchange them. “For those that want to defraud investors, there would be no respite because we are ready to fight market manipulation to the last, anyone that flouts our rules will be made to face the consequences of their actions,” he said.

Investment enlightenment through education, robust regulation and fair dealing was another goal which the new leadership of SEC hopes to achieve. His words: “We want to assure investors that this market is for them and we are ready to do everything to ensure that we increase investor enlightenment through education, robust regulation and fair dealing.

Yuguda believes the capital market has enormous potential for growth and development of Nigeria during the COVID-19 pandemic and beyond, as he said the market was a crucial component of any economy.

Perhaps something to celebrate is the willingness of the new SEC leadership to continue to implement the master plan for growth and development already in place. Yuguda also mentioned that SEC will continue to partner other relevant stakeholders in the economy to introduce and implement various initiatives targeted at improving the regulation and development of the market.

Yuguda, according to a statement issued by the commission, observed that the capital market plan launched in 2014, has the objective of positioning the capital market for an accelerated development of the national economy. He mentioned that a good number of the initiatives in the plan have already been implemented while others are still being implemented.

He, however, assured that his team will continue to implement the plan, as it is one of the major focuses. “We also seek possible ways of strengthening it for enhanced impact. We would equally work towards improved market regulation, surveillance and general development,” he added.

In order to do this effectively, he stressed that there was the need to develop relevant capacities and foster collaboration in achieving our mandates.

Yuguda assured that the new management will work to the best of their abilities to uphold things on ground and consciously seek ways to improve them to the benefit of all stakeholders.

He noted that together, “we must set our sights on achieving those milestones that are capable of making the capital market a powerful engine of growth for the Nigerian economy,” stressing that “with God’s help and our collective resolve and dedication, we shall succeed.”

Beyond Yuguda’s Plan

The laudable plans of Dr. Yuguda to move the capital market forward notwithstanding, pundits in the sector have said, focus on deepening capital market through increased domestic participation would be their greatest expectations of the new capital market czar.

Specifically, the new SEC DG would be expected to enhance effectiveness of key initiatives like electronic dividend payment, electronic offering of shares.

A capital market analyst who would not want his names in print said, “We want him to integrate capital market as the fulcrum of policy making such that key developmental interventions, which are being done erroneously by CBN, will be done through the capital market.”

“Also, we want him to enhance investor confidence through zero tolerance for corruption especially within management and board of companies,” he said.

Yuguda’s Profile

Dr. Yuguda is a fellow of the Institute of Chartered Accountants of Nigeria (ICAN), a CFA charter holder, and also holds a Certificate in Financial Asset Management and Engineering from the Swiss Finance Institute, Geneva, Switzerland.

Yuguda is an economist, banker and investment manager, with over 30 years’ experience in financial services.

A closer look at Yuguda’s pedigree, showed that he began his career with Central Bank of Nigeria back in 1984, just shortly after he graduated from the Ahmadu Bello University, Zaria. He was employed as senior supervisor of the foreign operations department, which manages Nigeria’s external debt records.

In 1985, he moved to the Banking Supervision Department and had the task of handling bank licensing and prudential regulations. In 1988, another in-house reshuffling exercise took him to the Debt Conversion Committee Secretariat to manage the Nigerian Debt Conversion Programme together with the pioneer staff in the secretariat. He moved back to the Foreign Operations Department in 1992, and soon after became the Senior Manager of the Investment Office. Again, his responsibilities included managing Nigeria’s external debt service, as well as managing the investment of the CBN’s external reserves in a liquid portfolio of cash, fixed-term deposits, and foreign government treasury bills. Following a secondment, he joined the International Monetary Fund (IMF) in Washington DC, the USA in 1997, as an economist in the Africa Department. In this position, Yuguda assessed the economic policies and management of balance of payment support programmes in IMF member countries.

In 2001, he returned to the CBN to lead a team of staff to restructure and diversify the CBN’s growing FOREX reserve portfolio. Together with this team, a new investment policy was adopted with the introduction of new asset classes, the appointment of a reputable global custodian and asset managers. Yuguda successfully upgraded the CBN’s in-house fixed-income trading and settlement capabilities and left a state-of-the-art portfolio management system as his legacy. By 2010, he became Director of the Reserve Management Department. He is credited with the strong risk-aware investment culture in the department, and also instilled a disciplined approach to investment evaluation.

After 32 years at the apex bank, he voluntarily retired in 2016. He has been a member of the Board of the Securities and Exchange Commission, and will now resume as its DG. Yuguda has a Bachelor of Science in Accounting from Ahmadu Bello University, Zaria, having graduated in 1983. He later obtained a Master’s degree in Money, Banking, and Finance from the University of Birmingham, UK, in 1991. He has attended leadership training at notable business schools like Harvard, INSEAD, IMD, Saïd, Wharton, Haas, and London. He is a Fellow of the Institute of Chartered Accountants of Nigeria (ICAN), a CFA charter holder, and also holds a Certificate in Financial Asset Management and Engineering from the Swiss Finance Institute, Geneva, Switzerland.