Stock crisis: DG NSE blames banks

Friday Ekeoba Lagos - 15.04.2009

The Director General of the Nigerian Stock Exchange (NSE), Professor Ndi Okereke-Onyuike, has blamed the banking industry for the capital market crisis saying they should accept responsibility as the funds divested from the market were channelled through them.

The stock market crisis has seen investors wealth depreciating by two/third from the pre-meltdown total capitalisation of over N12 trillion to N4.5 trillion currently.

Blaming the banks for the market crisis, she said “the banks must accept responsibilities and must work hand in hand with the exchange to handle the situation, because most of the funds that left the market went through the banks.”

She explained that what had happened in the market “is a feature of every stock market all over the world” stating that, people have not lost any money in the market. It is only the value of stocks that have depreciated.”

The DG said that 40 per cent of the funds that was said to be stalked in the market were wrongly invested by investors in various private placement that are not within the regulation of the apex regulatory authority of the market, the Securities and Exchange Commission (SEC) and the NSE.