EC modifies stock prices

Nigerian-Stock-ExchangeSECURITIES and Exchange Commission (SEC) has approved the Par Value Rule submitted to it by the National Council of The Nigerian Stock Exchange (NSE).

According to the rule, “notwithstanding its par value, the price of every share listed on The Exchange shall be determined by the market, save that no share shall trade below a price floor of one Kobo per unit (N0.01)”. Hence, the price floor of the company shares traded on the NSE has been revised to One kobo (N0.01) from the previous price floor of fifty kobo (N0.50).

Par value is the nominal value of a share as stated in the Memorandum of Association of an Issuer while Price floor means the amount below which the price of one unit of a share shall not be permitted to trade, and the minimum amount which must be paid for a share in the event of a drop in the unit price of that share.

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