Becomes Fellow of the CIS

By Peter Egwuatu

SEC
STOCK

THE founder, Investment Banking and Trust Company (IBTC), Mr. Atedo Peterside, has identified macroeconomic stability, especially low inflation rate regime as a major panacea to attracting all types of investors into the Nigeria’s capital market.

Besides, Peterside, who absolved stockbrokers of the blame for persistent selling pressure with depreciation of shares on the Nigerian Stock Exchange, NSE, described as punitive, the increase in the minimum Loan to Deposit Ratio, LDR, from 60 percent to 65 percent by the Central Bank of Nigeria, CBN.

Commenting soon after he was conferred with Honorary Fellow by the Chartered Institute of Stockbrokers, CIS, during the induction of 62 newly qualified stockbrokers into associate members in Lagos at the weekend, Peterside explained that the fear of devaluation of the Naira in the wake of 12 percent inflation rate with the potential for further increase had elicited flight for safety, as local and foreign investors are taking short term bet on foreign currency as a hedging strategy.

He urged the CBN to target a single digit inflation rate of about five percent for enhanced conducive investment environment, re-build investor confidence and help stockbrokers to overcome market burn out.

“The problem of the capital market is not the fault of stockbrokers but that of macroeconomic stability framework. In Nigeria, the inflation rate is currently 12 percent, compared to two percent in the United States of America. The inflation rate in Nigeria provides incentives for devaluation of the Naira and many investors fear devaluation.
“The fear of devaluation in itself is pushing many investors towards buying foreign currency as a short term bet to speculate exchange rate. The Central Bank of Nigeria (CBN) has increased the Loan to Deposit Ratio (LDR) which requires banks to make loan or stop collecting deposit. With the current low interest rate, the policy is punitive. The CBN should bring inflation down to five percent or less to stabilize the economy” said Peterside

In his address, the President, CIS, Mr Adedapo Adekoje explained that the Institute’s Board of Fellows approved Honourary Fellowship for Peterside in recognition of his intellectual and professional contributions to the growth and development of the capital market and economy as a whole.

Adekoje noted that Peterside had served Nigeria in various capacities, including Chairman, Technical Committee of the National Council on Privatisation which culminated in the landmark privatization of all electricity distribution companies in Nigeria and Chairman, the Committee on Corporate Governance of Public Companies in Nigeria among others while he is currently the Alternate Private Sector Vice Chairman of the Nigerian Industrial Policy and Competitiveness Advisory Council.

“ We urge the 62 newly qualified stockbrokers who were inducted as associates at this colorful ceremony to uphold the highest standard of professionalism in their activities”, Adekoje said.

Vanguard





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