SEC urged to release securitization rules, as FG plans $25b fund for infrastructure

To further deepen the nation’s capital market and boost investors’ confidence, the Minister of Finance, Mrs Kemi Adeosun has urged the Securities and Exchange Commission (SEC) to ensure that the rules on securitization are released as soon as possible, even as market operators continue to hunt for infrastructure projects that could be packaged and financed through securitization.

Besides, Adeosun unveiled government plans to set up a $25 billion fund wholly dedicated to infrastructure investments.

The Minister stated this, during the inauguration of the Capital Market Master Plan Implementation Council (CAMMIC), National Investor Protection Fund (NIPF), and the launch of the Corporate Governance Scorecard for quoted companies by the Securities and Exchange Commission (SEC) in Lagos yesterday.

Securitization is the process of taking an illiquid asset, or group of assets, and through financial engineering, transforming them into a security.

The Minister, who was represented by the Permanent Secretary, Mahmoud Isa -Dutse at the occassion, commended the SEC as well as the entire capital market community for the laudable initiative of articulating a long-term strategic development blueprint for Nigeria’s capital market.

“A crucial assignment we have for the capital market community is to come up with other innovative ways of mobilizing the capital needed to address Nigeria’s infrastructure challenge. For example, the Master Plan highlights a need to ensure the securitization market is deepened; and we all know the revolutionary impact that could have on infrastructure and housing projects.

“An immediate task for the SEC is to therefore ensure the Rules on securitization are released as soon as possible while market operators should already be scouring across the country for infrastructure projects that could be packaged and financed through securitization.”

According to her, efficient and vibrant capital markets are an indispensable feature of any modern economy in terms of supplying affordable medium-to-long term capital needed for growth.

She pointed out that this facilitates mobilisation of savings, accelerate capital formation, provide investment avenues and enhance efficient allocation of capital to growth sectors, adding that the emergence of such market would help tackle Nigeria’s biggest challenges of huge infrastructure deficit and reduce unemployment.