The Nigerian Exchange Limited (NGX) has imposed a N76.8 million fine on nine quoted companies for failure to file their audited financial statements after the regulatory due date.
A report by Nairametrics indicated that the companies were sanctioned for their inability to meet the regulatory requirements for the year-end 2022 and 2023 financials.
This is a requirement of the X-Compliance Report, a transparency initiative of NGX Regulation Limited (NGX RegCo) designed to maintain market integrity and protect investors by providing compliance related information on all listed companies.
Companies that are listed on Nigerian Exchange Limited (NGX) are required to adhere to high disclosure standards which are prescribed in the Rulebook of NGX, 2015 (Issuers’ Rules), and other Rules of NGX, from time to time.
Daily Trust reports that the NGX has regularly sanctioned companies that fail to comply with this requirement.
The companies axed by NGX 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 (Nigeria) Plc.
Further checks showed African Alliance Insurance Plc with N48.6 million fine for inability to file the 2022 annual financial statement when required.
Others that failed to submit their 2023 annual financials include VFD Group Plc, N5.6 million, FBN Holdings Plc N5.4 million, Sterling Financial Holdings Company Plc, N6 million, UPDC Plc, 3.9 million, ABC Transport Plc, N3.2 million, Presco Plc, N3.2 million, eTranzact International Plc, N700,000.00, and NCR (Nigeria) Plc with N200,000.00 fine accounting for a cumulative fine of N76.8 million.
Pastor Adegoke Samson, a shareholder in a chat with Daily Trust said while sanction may be good, it is necessary for the NGX to also warn them before imposing the fine.
According to him, the fine would affect the shareholders who might bear the brunt of the fine on the companies.
He said the NGX is also looking for a way to generate revenue by its regulatory sanctions which come with heavy fines.
“They don’t know that if there is no company, the NGX can’t exist. That is why some companies delist because of the regulatory sanctions. I want the NGX to always give warnings instead of fine, fine and fine so that companies would not run away from the market,” he said.