No less than 40 companies have been fine by the NSE for failure to comply with minimum listing standards of the bourse.
The Nigerian Stock Exchange (NSE) has fined Conoil Plc; Deap Capital Management & Trust, a Mortgage banker; R.T. Briscoe Plc; FTN Cocoa Processors Plc; eTransact International; Royal Exchange Plc and 35 others over N1 billion for their failure to file their financial statements with the bourse.
This was found in the NSE’s X-Compliance report that was released on April 1 2021. In the report, the NSE fined Deap Capital the sum of N5.5 million for default in the filing of its 2019 audited account, R.T.Briscoe was also fined about N53.4 million over its failure to turn in its audited report since 2018 to the Exchange.
Conoil Plc was fined N800,000, FTN Cocoa Processors was fined N50.3 million, Juli Plc, Omatek Ventures, Royal Insurance, Union Dicon, and Niger Insurance were slapped with N151.2 million, N537.2 million, N22.3 million, N27.5 million, and N84.2 million fines respectively among others for similar defaults.
What it means
The companies have failed to comply with minimum listing standards of the bourse as some of them have consistently failed to file their audited financial statements since 2017.
For instance, NGC, DN Tyre, Union Homes Savings & Loans, and Aso Savings & Loans have not sent their 2014 – 2019 audited results to the exchange. While Omatek, Evans, Unic Diversified, Juli, Anino, Multi-Trex failed to file their results since 2015. Roads, Staco Insurance, Goldlink, FTN Cocoa, Capital Oil, Guinea Insurance, Resort Savings, Standard Alliance Insurance, International Energy Insurance fall in the category of firms that have not submitted their 2017 and 2018 reports, respectively.
A regulatory report obtained at the weekend flagged the deficient companies with warning codes that indicated various degrees of corporate governance weaknesses, susceptibility to illiquidity, and price manipulation due to inadequate price discovery.
Some of the companies’ stocks were also on the delisting watchlist of the NSE.
What you should know
- The X-Compliance Report is a transparency initiative of the Nigerian Stock Exchange (The Exchange), which is designed to maintain market integrity and protect investors by providing compliance-related information on all listed companies.
- Companies that are listed on The Exchange are required to adhere to high disclosure standards which are prescribed in the Rulebook of The Exchange, 2015 (Issuers’ Rules), and other Rules of The Exchange, from time to time.
- Financial information which is periodic disclosure, as well as ongoing material information disclosure should be released to The Exchange in a timely manner to enable it efficiently perform its function of maintaining an orderly market.
- The X-Compliance Report is updated every Friday at the close of the market.
Source: Naira Metrics