LBS BUSINESS BREAKFAST- OPPORTUNITIES ON NASD OTC Lagos, * Creating liquidity …Transparently 1
CONTENTS FAQ Opportunities 3/15/2018 About NASD Entry / Trading Creating liquidity …Transparently 2
ABOUT US 3/15/2018 Creating liquidity …Transparently 3
HISTORY AND FOCUS • From an Association of securities dealers • To a SEC licensed OTC market in December 2012 • A PLC owned by market operators • A self regulatory organisation • Focussed on building transparency and liquidity ‒ Start point is equities • Vision ‒ 3/15/2018 To be the hub of first call for capital formation in West Africa Creating liquidity …Transparently 4
ECO-SYSTEM Banks Clearing Platforms Participants 3/15/2018 > 77 Dealing firms > 23 Issuing Houses > 119 Authorised Traders Creating liquidity …Transparently 5
SUMMARY OF VALUE ADD Stakeholder Value Added Issuers Create public visibility Investors Open market pricing Market Transparency and liquidity Private Equity An efficient exit window Overall Economy Growth 3/15/2018 Creating liquidity …Transparently 6
EXAMPLES OF VALUE ADD • Investor confidence: ‒ Provides transparency in trading of unlisted securities ‒ Protects investors from unregistered brokers ‒ Provides information on liquidity around unlisted securities ‒ Improved investor / Shareholder relations • For brokers ‒ Reduced counter party risk ‒ A centralized platform for price discovery and specialized market data ‒ Access to broad range of asset classes • For issuers ‒ Ability to raise hybrid funds ‒ Increased corporate visibility which brings economies and savings. 3/15/2018 Creating liquidity …Transparently 7
ENTRY AND TRADING 3/15/2018 Creating liquidity …Transparently 8
ADMISSION OF INSTRUMENTS • Admitting a Company ‒ Issuer will comply with all rules and regulations of the NASD ‒ Price quotes are made on a daily basis ‒ Company will be placed in one of two bands (Blue & Pink) ‒ Full register is dematerialised and lodged in CSCS • Admitting to trade ‒ Initiated by the Investor ‒ Broker fills an application ‒ Issuer consent is not required ‒ Partial dematerialisation of register 3/15/2018 Creating liquidity …Transparently 9
ADMITTING A COMPANY • Submit Board resolution to list shares on NASD • Dematerialise securities and create register in CSCS • Admitting new securities requirements • Undertake to be bound by the rules of NASD • Publicly announce listing on NASD 3/15/2018 Creating liquidity …Transparently 10
ADMITTING A COMPANY • Procedure ‒ Appoint Issuing House to assist with the listing process (see the List of the accredited Issuing houses on www. nasdng. com) ‒ Submit completed NASD application form with required documentation ‒ After due diligence, NASD gives approval in principle to list ‒ Company signs undertaking to abide by rules of market ‒ Share register is dematerialised and sent to CSCS • Timing is approximately one month 3/15/2018 Creating liquidity …Transparently 11
ADMITTING A SECURITY • If security meets requirements, ‒ NASD will request security code and ISIN number from CSCS ‒ CSCS will open account with codes within 3 working days. ‒ NASD informs all stakeholders (Registrars, PIs, Issuer, Public) of admission. ‒ NASD notifies the participating institution of the Security code and ISIN number for their necessary action. • Timing is approximately one week 3/15/2018 Creating liquidity …Transparently 12
NASD NSE DIFFERENCE NASD NSE Physical trading floor None. Trade is online 13 across Nigeria Participant codes Starts with 4…. Starts with a letter CHN Starts with D…. . Starts with C…. Regulator of Issuers SEC not NASD SEC and NSE Stocks introduced by Individual shareholders AGM approves Price limits None Daily cap Symbol Code Starts with “SD” No unique identifier Settlement banks Six (6) Many Trading hours - 9: 30 a. m. to 3: 30 p. m. 9: 30 a. m. to 2: 30 p. m. 3/15/2018 Creating liquidity …Transparently 13
OTC MARKET OPPORTUNITIES 3/15/2018 Creating liquidity …Transparently 14
CURRENTLY TRADING ON NASD OTC SECURITY Share Capital in Volume ARM LIFE PLC AFRILAND PROPERTIES PLC BGL PLC CONSOLIDATED BREWERIES PLC CENTRAL SECURITIES CLEARING SYSTEM PLC FRIESLAND CAMPINA WAMCO NIGERIA PLC FOOD CONCEPTS PLC GEO-FLUIDS PLC GOLDEN CAPITAL PLC INDUSTRIAL & GENERAL INSURANCE PLC JAIZ INTERNATIONAL PLC NIGER DELTA EXPLORATION & PRODUCTION PARTNERSHIP INVESTMENT COMPANY PLC RESOURCERY PLC RIGGS VENTURES WEST AFRICA PLC SWAP TECHNOLOGIES AND TELECOMMS PLC TRUSTBOND MORTGAGE BANK PLC TOTAL 3/15/2018 Creating liquidity …Transparently 5, 785, 673, 000 250, 000 12, 000, 000 496, 071, 617 5, 000, 000 976, 335, 936 5, 650, 000 4, 257, 668, 000 1, 170, 324, 536 14, 231, 238, 000 4, 014, 429, 720 145, 780, 311 2, 875, 595, 000 2, 576, 686, 039 880, 394, 000 2, 705, 378, 000 10, 945, 334, 000 73, 960, 908, 159 Market Cap 15, 910, 600, 750. 00 137, 500, 000. 00 46, 800, 000. 00 45, 142, 517, 147. 00 18, 000, 000. 00 419, 824, 452, 480. 00 11, 243, 500, 000. 00 6, 429, 078, 680. 00 1, 170, 324, 536. 00 7, 115, 619, 000. 00 4, 616, 594, 178. 00 45, 191, 896, 410. 00 5, 751, 190, 000. 00 4, 380, 366, 266. 30 836, 374, 300. 00 8, 116, 134, 000. 00 13, 134, 400, 800. 00 653, 800, 548, 547. 30 15
FUTURE OTC OPPORTUNITIES • Equity-linked securities • Cross border investments • GDRs, NDRs, Multilayered corporate debt instruments • Full range of Derivatives • Venture capital and Private Equity sell downs 3/15/2018 Creating liquidity …Transparently 16
SPECIFIC INDUSTRY TARGETS • Agriculture: Rice milling, Dairy products, PE activity ‒ Sector to be launched by December 2014 • Power: Gen. Cos, Dis. Cos pre-listing • Technology: Estimated requirement of ₦ 1. 3 trn • … 3/15/2018 Creating liquidity …Transparently 17
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SUMMARY OF FAQS 3/15/2018 Creating liquidity …Transparently 19
NASD/PI FAQ • Q: WHAT IS NASD? • A: NASD is an acronym for National Association of Securities Dealers. It is focused on providing a technologically driven trading platform where securities not listed on the Nigerian Stock Exchange ["NSE"] are traded. • Q: WHO REGULATES NASD? • A: NASD is primarily regulated by the Securities & Exchange Commission ["SEC"] and it is also a self-regulatory organization just like the NSE. • Q: WHAT IS THE DIFFERENCE BETWEEN NASD AND THE NSE? • A: The NSE provides the platform for trading on quoted securities while NASD only deals with un-quoted securities 3/15/2018 Creating liquidity …Transparently
NASD/PI FAQ…. CONTD • Q: WHAT IS THE DIFFERENCE BETWEEN QUOTED AND UN-QUOTED SECURITIES? • A: Quoted securities are securities that are listed/traded on an organized exchange like the NSE while un-quoted securities are those traded in an OTC market. • Q: CAN ALL UN-QUOTED SECURITIES THAT CAN BE TRADED ON THE NASD OTC PLATFORM? • A: No. Before any un-quoted security can be traded, the Company must have met the following eligibility criteria: ‒ The security must be registered with SEC ‒ The security must be freely transferable - no legal or regulatory restriction preventing open trades. ‒ The Company must have been in operation for a year. ‒ It must be a public company or be held by more than 50 beneficial owners. 3/15/2018 Creating liquidity …Transparently
NASD/PI FAQ…CONTD • Q: HOW LONG WILL IT TAKE TO VERIFY THE CERTIFICATES OF COMPANIES WHOSE SECURITIES ARE UN-QUOTED? • A: Certificate verification will generally take about 48 hours from the day the Broker forwards it to the Registrars. However, in some cases where there are issues on the sellers signature mandate, it may take a little longer • Q: HOW DO I KNOW IF A SECURITY IS TRADABLE • A: Please visit our website for the list of Admitted securities • https: //nasdng. com/market/admitted_securities. php • Q: WHAT IS MOST EFFICIENT WAY TO GET SUPPORT FROM NASD PLC • A: For quick help you can logon to our website and have a live chat with us for instant response. You can also reach us on 01 -4605008 3/15/2018 Creating liquidity …Transparently
CONTACT US Office : 9 th Floor, UBA House, 57, Marina, Lagos E-mail: Website: info@nasdng. com www. nasdng. com Live Chat enabled Tel. 3/15/2018 : +234 1 460 5008 Creating liquidity …Transparently 23
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