SEC Seeks More Innovative Products to Deepen Capital Market

Ndubuisi Francis in Abuja

The Director General of the Securities and Exchange Commission (SEC), Mr. Lamido Yuguda, has called for more innovative financial products to deepen the capital market and sustain the current growth in the industry, especially in the non-interest segment.

He stated that the non-interest finance segment holds great potential in furthering the development of the capital market and the growth of the nation’s economy.

Yuguda, who spoke at a one-day webinar with the theme, ‘The Imperative of Non-Interest Capital Market for Pension Industry,’ said this product has been adjudged one of the most appropriate for the funding of long-term infrastructure.

He stated that the event hosted by the SEC was the first in a series aimed at
providing a conducive platform for knowledge and sharing of experience among participants and to enlighten them on the way of investing and financing.

The pension industry, he stated, is one of the fastest growing sectors in the nation’s economy with assets under management of N13 trillion as at the end of September 2021, adding that of this amount, less than N80 billion is invested in Sukuk, representing a little less than 1 per cent of total pension assets.

He said: “This calls for more innovative financial products to deepen our market and sustain the growth in the industry especially in the non-interest segment. We strongly believe that the capital market has a leading role to play in this regard by providing a variety of long-term investable products to service the needs of the pension industry as well
as other investors with similar focus.

“It is encouraging that the national pension commission has taken concrete steps to improve the regulatory framework for the investment of pension funds in the non-interest capital market by the introduction of operational framework for the non-interest fund.

“This will no doubt provide an additional opportunity for retirement savings account holders and retirees to invest their savings in financial instruments that are aligned with their lite goals and objectives. Indeed, the operationalisation of the funds definitely accelerates the national financial inclusion agenda while increasing the quantum of investible funds by unlocking the untapped capital.”

Yuguda stated that as at September 2021, the total assets stood at N7.79 billion constituting about 0.059 per cent of total pension assets under management, expressing the hope that the fund assets will grow with robust public awareness, education programmes and capacity building of stakeholders through seminars, workshops and programmes
such as this.

In a goodwill message, the Director General of the National Pension Commission, (PenCom), Haji Aisha Dabir Umar, commended the SEC for organising the webinar on the imperative of non-interest capital market products for the pension industry.

Represented by the Commissioner Administration, PenCom, Dr. Umar Farouk Aminu, the PenCom chief executive acknowledged the collaborative efforts of his agency and SEC which over the years laid acceptable values and good governance standards in their investments of pension funds in the Nigerian capital market.

She stated that PenCom remains resolute in ensuring that all instruments meet this requirement before pension investment and commended the collaboration between PenCom and SEC towards deepening the capital market to sustainably introduce non-interest products.

In his remarks, the Secretary General of the Islamic Financial Services Board, Dr. Bello Danbatta, said Islamic finance is a complementary system, adding that no system would be able to develop without integrating it in its financial system.