Representatives to investigate bank recapitalisation exercise

The Chairman of the House of Representatives committee on Capital Market and Institutions, Hon. Herman Hembe has said that his committee will investigate the on going acquisitions and merger of some banks in the country saying that from reports received so far, there are indications that >the process has largely been flawed and Laws, Rules and procedures have not been followed=.

In an interview with Vanguard shortly after he was sworn in as chairman of the committee, Hon. Hembe said regulatory bodies that are supposed to carry out activities that would instil investors= confidence in the sector have chosen to >do exactly opposite of their responsibilities=.

According to the lawmaker, Athe capital market in Nigeria is in a state none of us can be proud of. The All share index that rose to 57,990.22 points by December 31 2007 with market capitalization of N13.29 trillion with over 300 listed securities on the exchange has by 2011 witnessed a 56 percent decline to 20,202.50 points and a market capitalization value of N6.44 trillion.

AIt is further disheartening that while the investor has lost confidence and needs all the encouragement from regulators to keep investing in the Market, activities of some of these regulators tend to do the exact opposite. This Committee will work assiduously towards strengthening investor confidence and check anomalies as they arise.
ALet me particularly point to the on going mergers and acquisition of Banks, which operations fall directly within the purview of this Committee. The process has largely been flawed and Laws, Rules and procedure have not been followed. We will step in to ensure the rule of law. Following my appointment, I have received quite a number of petitions regarding these mergers particularly with respect to the fact that some very high bids were disregarded in favour of lower bids. It is my resolve and that of this Committee to intervene in the best interest of the Nigerian investor@ he said.

Hon Hembe maintained that his committee would carry out more interventions as may be required to put the country on the path to greatness.