I once sat with Dr Agama, the DG of SEC, in his office to discuss the markets
This was after one of my many rants on market stability, cohesion and effectiveness
He came across as a man who could make and take hard decisions, even though he didn’t look it with his State University Lecturer look.
A few weeks later, he announced the tenor limit policy, which took out some sit-tight demagogues in some very critical capital market institutions – NASD and FMDQ, to mention
Last week, he went further to announce the increase in capital for all operators end-to-end
The increment, according to a SEC report that I have seen, is aimed at strengthening the market, boosting efficiency and, most importantly, safeguarding investments
This policy met the expected resistance, which fell to 10% of Asset under Management (AUM) as expected from Fund Managers.
Critics claimed that if allowed, the policy could suck out the oxygen from their operations and instigate an artificial upper limit boundary to ensure they don’t have to quarantine so much as their AUM grows
Brilliantly, the SEC is said to come out this week with a reduction from 10% to 1%, and this should bring some relief to the community
A major Player in the Capital Market who sits on the Board of the Premier Exchange and who has tremendous holdings within the capital market reached out yesterday to ask me my thoughts on the policy, and I, in turn, asked him his thoughts
He was in strong support cos of the potential for productive growth in the market
Now let me tell you how I see it.
You know how bodybuilders go to the Gym and build their upper bodies and forget to build their legs
They come out looking funny, and the legs can’t carry their bodies.
In a fight, a punch and the legs wobble, and they come crashing down
With the All Share Index cruising past the N100 trillion mark, the operators who are the legs in this case cannot remain skinny; otherwise, we would have a Humpty Dumpty scenario
Returning the best returns of 51%, possible listing of the Dangote Refinery, and possible Deepening of the Liquidity through the work of the Liquidity committee headed by my brother, Temi Popoola, market operators must, in turn, prepare for the battle ahead
They cannot hope to continue with the same puny capital when the market is growing in Malthusian proportions
They must also increase their capacity both in Capital and in Corporate Governance, which should impact their operations and decision-making
This is especially so for the Fund Manager and Asset Managers whose valuations on their portfolios are increasing as their ties to the ASI
We can no longer have Mom-and-Pop Asset Managers with all the key-man risks in the market.
This policy will immediately lead to a series of M&A’s in the market and also the ‘driving away’ of unserious players, especially within the CIS Community, which, in my estimation, will be the best for the market
My only grouse with the SEC is that it used to look a little bit tardy in its policy formulation
When they first announced the tenor limit, there was confusion about who it was referring to.
It later came to clarify that it was only the SROs
Now this one, they have put out a 10% capital retention for Asset Managers only for them to retract and say its 1%
They should be calming down and dotting the I’s and T’s before releasing the policy
But that said, I believe this twin policy of tenor limits and capital increase is the very best tool to sustain irrevocable market growth, and with this, I lend my full support.
Welldone SEC
Thanks
Duke of Shomolu
Last modified: January 19, 2026
