The last two weeks have witnessed a lot of media buzz over who gets appointed or re-appointed as the director-general of Nigeria’s Securities and Exchange Commission (SEC), the regulatory body for the capital market. The tenure of Ms Arunma Oteh, who held sway as DG, expired on January 6 after she exhausted her statutory five years. All manner of stakeholders have since thrown their hat in the ring, pitting themselves over whether Oteh should be re-appointed or not.
But this controversy need not have arisen since Oteh has since been engaged in subtle publicity stunts, sponsorship and collection of frivolous awards from one place and another to sway opinion to her favour and force the hands of the president to retain her. It is the failure of our president and the minister of finance to act decisively in the interest of the country and the capital market that has led to this controversy in which the ordinary person is being unnecessarily confused with vague statistics and woolly logic.
From what I have gathered, this Oteh saga has become one of the test cases for the patriotism and commitment of President Goodluck Jonathan who is presently on the campaign trail and promising to redeem this country and the national economy from mismanagement and make-believe. The president’s weakest point has been lack of courage in reining in men and women of impunity who surround him and give his government all kinds of negative image. So, for the SEC’s Oteh, is it to be or not to be?
Since Oteh took over at SEC in 2010, it has been one controversy after the other. She entertained us on live TV three years ago when she revealed that Hon. Iorwase Herman Hembe, chairman of the House committee set up to investigate SEC’s activities, was against her because she did not approve his request for N44million for the smooth conduct of the investigations. Hembe had accused her of spending N850, 000 on food in one day and N30million on hotel accommodation. Another twist emerged, however, when the executive commissioners of SEC, who had been invited by the House panel to testify, were unanimous in condemning Oteh’s activities.
Though many of us heard how Oteh ran SEC for the first time from those executive commissioners, tales about her alleged arrogance thereafter have filled my own ears: She did not let those commissioners or those that succeeded them have access to her except by phone. She sacked staff on phone from the various countries of the world that she frequently junketed to. I was also told that she did not take directives from her supervising minister. Needless to add, few staff members of SEC had a good working relationship with Oteh.
It is little wonder that the Amalgamated Union of Public Corporations Civil Service Technical and Recreational Services Employees (AUPCTRE), FCT chapter, warned, in a letter dated Jan. 7 and addressed to minister of finance Ngozi Okonjo-Iweala, that Oteh should never be considered for re-appointment unless the federal government wanted to enthrone a regime of industrial disharmony at SEC. In fact, both chambers of the National Assembly have since suspended any dealings with the SEC due to their disagreement with Oteh.
It is true that the stock market meltdown of 2008 was reversed before the current bear run plaguing the stock market started again. But it is not true, as Oteh claimed, that she made this possible because government created the Asset Management Corporation of Nigeria (AMCON) to clean up the financial markets by buying up the debt overhang consisting of eligible bank assets and non-performing loans worth N2.8trillion ($18billion) which beclouded the market. Margin loans in the capital market make up 22 per cent of these debts.
While other capital market bodies like The Nigerian Stock Exchange and the Investments and Securities Tribunal worked, Oteh did not cooperate with them. She would trample on institutional processes and abandon the primary functions of the SEC such as attending to investors’ complaints. She allegedly side-lined key staff with experience from doing their jobs in preference to contract staff and personal aides. She talks about institutionalizing corporate governance in public companies but, at SEC, she would have none of it. SEC staff claim that the head of their internal control or audit is a contract staff.
As I write this, the equities market is losing millions. Within four days of the market’s opening last week, investors lost N1.4trillion. The bears have continued their rampage mainly on banks’ shares. Nobody is investing because many equities are not expected to yield profits, just as the political situation of the country does not give optimism.
Who should take the blame for the continued stock market crash? Whenever I ask that question, the “experts” tell me there is a global meltdown. But if the situation in the market had been rosy, who would take the credit?
In fairness to Oteh, the stock market crash of 2008/9 happened before she assumed office in January 2010. In five years of her stewardship, however, I have not seen any initiative or proactive programme she created to create awareness about the capital markets in the 774 local government areas of the country. A new minimum capital requirement has been imposed on stockbroking firms, but I don’t see that succeeding because, rather than merge, stockbroking firms ought to be doubled so they could be found in every nook and cranny to widen local participation and deepen investment base.
Experts say that rather than work to correct the dominance of foreign portfolio investors who own more than 50 per cent of the market, the out-going DG was globe-trotting and parading herself as the president of the Africa Middle East Regional Committee of the International Organization of Securities Commissions (IOSCO), a position considered honorary and rotatory. Awards have been coming from different directions. Articles parading her credentials or praising her efforts at SEC have filled the newspapers.
Even though she is my sister, I have cause to take a different direction. No matter the achievements ascribed to her, I consider her first tenure a disaster. And there is no better evidence to prove this than the state of the stock market today. Yes, the bad situation preceded her, but that was why she was hired – to stabilise the market through good regulatory policies. It is the same argument I have against President Jonathan’s government. The best indicator of a government’s performance is the wellbeing of the people; anything else is dogon turenchi.
Names being bandied as likely successor to Oteh include the wife of the attorney-general of the federation who was recently appointed executive commissioner at SEC. Nigeria being Nigeria, Oteh may get five more years. After all, appointment to government offices hardly depends on competence or performance. Donating to presidential campaigners like TAN or hobnobbing with friends in high places could fetch a job faster. My advice to the powers that be is this: Please, give my sister a job but not in SEC again.