Stock Exchange Pushes Dollar Asset Listings for Nigeria’s Fx Challenges

Amidst the lingering crises in Nigeria’s foreign exchange market, the Chief Executive Officer, Nigerian Exchange Limited, Temi Popoola, has stated that dollar asset listings can address the challenges.

Commending the federal government’s forex reforms in an interview with Bloomberg yesterday, Popoola noted that the Exchange features a number of companies with diverse business models, some of which not only generate revenue in dollars but also report profits in dollars.

He noted that this presents an investment opportunity especially if these firms could distribute their dividends to local investors in dollars

He explained that disbursing dividends in dollars could potentially address the challenges posed by fluctuations in forex currently bedeviling the economy, adding that NGX is working with the Securities and Exchange Commission, SEC, and other market stakeholders to create a revised listing regulation for companies within the free trade zones who had their topline revenue to bottom-line in dollars.

Explaining further on companies within the free trade zone, the NGX boss stated that some of these companies’ financial structures may not align with an Initial Public Offering in local currency, which could push them abroad.

Popoola further noted that the Exchange’s primary objective is to enable these companies issue bonds denominated in dollars and eventually offer dollar equity as this can help attract listings and achieve the objectives of the administration under President Bola Ahmed Tinubu.