Lagos – Capital market operators have expressed optimism that the listing of the UBA Plc N30.50 billion bond on the FMDQ OTC and the Nigerian Stock Exchange (NSE) would boost market liquidity.
FMDQ OTC is Financial Market Dealers Quotations Over the Counter, another trading platform on the nation’s capital market.
They told the News Agency of Nigeria (NAN) on Thursday in Lagos that the listing would increase foreign and local investors participation in the market.
Mr Emeka Madubuike, the Managing Director, Compass Investments and Securities Ltd., said that the listing would enhance liquidity at the nation’s bourse.
He said that the development would make the nation’s capital market a better investment destination due to transparent price discovery.
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“We are expecting more trading platforms in this market where all kinds of products can be traded,’’
Madubuike said. Mr Ariyo Olushekun, the immediate past President, Chartered Institute of Stockbrokers (CIS), said that the bank listed on both markets to boost liquidity.
Olushekun said that listing on both market would allow a buyer or seller to buy or sell from either FMDQ or the NSE.
“We are optimistic that listing will encourage more corporate bonds to be issued and listed on FMDQ and NSE,’’ he said.
NAN reports that FMDQ OTC on April 8 commenced corporate bond listings on its platform with the listing of the bank’s N30.50 billion bond.
The listed Bond is Series-1 of UBA PLC 7-year 16.45 per cent Fixed Rate Subordinated Unsecured Notes due in 2021.
Mr Bola Onadele, the Managing Director, FMDQ, at the board listing exercise said that the listing would deepen the nation’s capital market.
Onadele, who commended the bank for the feat said that the bond was the first corporate bond to be listed on its platform.
He said the admission of the bank’s bond followed the recent approval of FMDQ bond listing and quotation rules by the Securities and Exchange Commission (SEC).
According to him, bonds listed and admitted on FMDQ will be traded by Fixed Income Specialists who would act as market makers to these bonds thus providing trading liquidity to the bond.
“FMDQ provides a platform for the registration, listing, quotation and trading of bonds and other fixed income securities,’’ said Onadele.
He said the company had empowered the Nigerian bond market with price discovery, transparency and market integrity through market development initiatives.
Onadele said that listing and quotation on FMDQ provided a host of benefits across the debt market value chain, positively impacting stakeholders in the Debt Capital Market (DCM).
He said that FMDQ had made the nation’s capital market globally competitive with continuous disclosure of relevant information on fixed income issues listed on its platform.
Also speaking, Mr Phillips Oduoza, UBA Group Managing Director, said the company was the first indigenous firm to undertake dual listing of corporate bond.
Oduoza said that listing on the platform would avail foreign investors the opportunity to invest in the bond due to appropriate pricing.
He said the bond had increased the bank’s level capitalisation level and would give the bank the capacity to increase more businesses and sustainability.
“It is the largest fixed income issuance we had in 2014 and we are the first Nigerian company to undertake dual listing of corporate bond,’’ he said.
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Oduoza said the bank would continue to explore new frontiers to meet growth needs, adding that the bond would be utilised in creating long-term loans to the bank’s customers across Africa.
“We are set to tap funds readily available in the market. There will be a large move from corporates loan to fixed income because it will help them to plan their loan appropriately,’’ he said. (NAN)