The Nigerian Exchange Limited (NGX) has imposed fines totaling N76.8 million on nine listed firms, including two banks, for failing to submit their audited financial statements on time. This action underscores NGX’s commitment to maintaining transparency and regulatory compliance among listed companies.
The penalized companies include African Alliance Insurance Plc, VFD Group Plc, FBN Holdings Plc, Sterling Financial Holdings Company Plc, UPDC Plc, ABC Transport Plc, Presco Plc, eTranzact International Plc, and NCR Plc. The fines range from N200,000 to N48 million, with African Alliance Insurance Plc receiving the heaviest penalty of N48 million for not filing its 2022 annual financials punctually.
NGX’s Rationale for the Fines
The fines were disclosed through the X-Compliance Report, an initiative by NGX Regulation Limited (NGX RegCo) designed to ensure market integrity and protect investors by providing up-to-date compliance information on listed firms. The NGX emphasizes that listed companies must adhere to the high disclosure standards prescribed in its Rulebook of 2015 and periodically updated rules. Companies that fail to meet these requirements are subject to regular sanctions.
Detailed List of Fined Companies
1. **African Alliance Insurance Plc**: N48 million
2. **VFD Group Plc**: N5.6 million
3. **FBN Holdings Plc**: N5.4 million
4. **Sterling Financial Holdings Company Plc**: N6 million
5. **UPDC Plc**: N3.9 million
6. **ABC Transport Plc**: N3.2 million
7. **Presco Plc**: N3.2 million
8. **eTranzact International Plc**: N700,000
9. **NCR Plc**: N200,000
Stock Market Performance
This development coincides with a decline in the Nigerian stock market. On Monday, June 24, 2024, the market saw a loss as the equities sector began the week negatively. Investors experienced a loss of N51.70 billion at the close of the trading session. The downturn was driven by declines in stocks such as INTERBREW, DEACAPCAP, and DAARCOM. Consequently, the All-Share Index fell from 99,743.05 on Friday, June 21, to 99,651.67.
Efforts to Maintain Market Stability
Despite these setbacks, the NGX continues to take steps to stabilize the market. In November of the previous year, Union Bank, one of Nigeria’s oldest financial institutions, announced its delisting from the NGX. The decision, approved by relevant authorities, highlighted the bank’s strategic shifts and the NGX’s evolving regulatory landscape.
In other financial news, reports indicate that Guaranty Trust Bank Holding Company Plc (GTCo) and United Bank for Africa (UBA) have emerged as Nigeria’s most profitable banks by Return on Equity (RoE) in 2023. GTCo, in particular, achieved a remarkable RoE of 44.82%, a significant increase from 18.65% in 2022.
The NGX’s enforcement actions and continuous monitoring of listed companies are vital for ensuring compliance and fostering investor confidence in Nigeria’s financial markets.
