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Nigerian Exchange Working With SEC So Firms Can Pay Dollar Dividends

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The Nigerian Exchange Group (NGX) is working with the domestic Securities and Exchange Commission (SEC) to amend regulations so selected listed companies can pay dividends in dollars, according to Chief Executive Officer Temi Popoola.

The exchange, which has 151 listed stocks, is pursuing the changes amid economic reforms by President Tinubu’s government to revive the economy.

Both retail and institutional investors have “substantial” amounts of dollars that domestic capital markets can tap to encourage more local listings.

As of June 2022, Nigerian banks held $24.82 billion in foreign-currency customer deposits, according to data from Moody’s Investors Service.

“If the target companies cannot access dollars within our market, many of them may opt to list abroad,” Popoola said.

Other than easing foreign-exchange controls, Nigeria has also ended fuel subsidies that cost $10 billion last year.

The NGX reported a 46 percent slide in profit for the June 2023 period, when compared to the earlier (June 2022) period as revenues fell on slumping transaction fees.

Transaction fees the largest share of core revenues for the NGX in the half year (H1) period, were down by 21% to N1.82 billion, from N2.33 billion in H1, 2022.

Revenues for the group fell by 16% to N3.2 billion in the period. Personnel expense rose marginally to N1.4 billion, representing a huge outlay equivalent to 43.75% of revenues.

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