Photograph — AFRICA ON THE RISE.

The entity formally known as the Nigerian Stock Exchange has been demutualized into the Nigerian Exchange Group. NGX group is a public company with three wholly-owned subsidiaries: NGX Limited – replacing the NSE, NGX REGCO Limited – which will undertake the regulatory functions and NGX Real Estate.

Demutualization is essentially the process of turning a company limited by guarantee into a company limited by shareholders. In the case of the NSE morphing into the NGX group, it was a case of a company limited by guarantee becoming a PLC, this marked the first time this was being done in Nigeria and involved setting a template and legal precedent for how this process can be actualized.

The NSE had to seek approval from the SEC and ensure the creation of a separate entity to perform its regulatory functions, the NGX REGCO Limited. The creation of this regulatory subsidiary helps it sidestep the ethical dilemma of self-regulation and bias. In addition to seeking approval from the SEC, it also pushed a bill for its demutualization in 2017, which was then signed into law in 2018. The exchange further had to register with the CAC while transferring its assets to the new company.

The trend surrounding demutualization

The drive for modern exchanges to demutualize began in the mid-1990s with the Stockholm exchange being the first to demutualize in 1993, followed by Helsinki in 1995, Copenhagen in 1996, Amsterdam in 1997, and Australia in 1998. The Toronto, Hong Kong and London Stock exchange(LSE) all demutualized in 2000.

The new entities brought about by demutualization were more agile, could adapt to economic trends faster, were better capitalized and could use technology to expand their operations much faster than before. This is also set the stage for increased collaboration and partnership among exchanges as they were able to exercise quicker decision making, allowing their customers to take advantage of their broadened operations.

Promoting sustainability

The move to demutualize the NSE also called for a review of the CAMA (Corporate and Allied Matters Act) in 2018. This allows the NSE to fully transfer its assets and subsidiaries to the newly created NGX. The NGX in its constitution abides by the principles of the Nigerian Code of Corporate governance which allows it to run its affairs in line with practices geared towards sustainability, fairness and ethical standards.

The realities of this regulation are evident in the composition of its board members and the respective technical competence and proficiency they bring to the discharge of their duties while ensuring that there is no conflict of interest.

Management and Appointments

Mr Oscar N. Onyema, former CEO of the NSE becomes the MD/CEO of the NGX Group. While Otunba Abimbola Ogunbanjo becomes the Chairperson of the NGX group.

Mrs Erelu Angela Adebayo has been appointed as the Chairperson OF NGX Real Estate. While Mr Temi Popoola CFA has been appointed the CEO of NGX and Ms Tinuade Awe has been appointed the CEO, NGX REGCO.

Mr Abubakar Mahmoud, SAN, OON has been appointed the chairperson of NGX.


Equipped with dynamic leadership, experienced hands and armed with its new operating structure and the ability to raise capital while being a publicly-traded company, it is expected that the new entity will adapt to a profit-making stance. Despite the pandemic, 2020 was a landmark year where the market returned 50%.

It is expected that with the ability to raise funding and adhering to greater ethical standards, the NGX will position itself and by extension the Nigerian capital market as a viable destination for investment inflows.

The ability to raise finance will see the NGX, maximize technology in its operations while ensuring regulatory compliance and a more robust market. There is also the potential for the listing of other equities on the exchange, allowing for more activity from individual, foreign and institutional investors.

The process culminating in the establishment of the NGX has taken approximately a decade and tremendous input on the part of all stakeholders involved. From the SEC (Securities and Exchange Commission) and CAC(Corporate Affairs Commission) who provided oversight. To the President, HE Muhammadu Buhari GCFR, who signed the demutualization bill into law, and the amendment of the CAMA (Corporate and Allied Matters Act) to allow the process of demutualization. Mr President also headlined the event culminating in the ringing of the gong symbolizing the end of trading activities.

It is expected that the NGX Group actualizes its objective of establishing itself as a regional hub that stands to benefit the nation, our economy and the sub-region as a whole.

The live launch event included speeches from the Chairman of the NGX group, Otunba Abimbola Ogunbanjo, the DG of the SEC, Mr Lamido Yuguda The minister for Trade and Investment, Otunba Richard Adeniyi Adebayo. Mr David Swchimmer, CEO, London Stock Exchange; Ms Julie Becker, CEO, Luxembourg Stock Exchange; Mr Eric Hespenheide, Board Chairman, Global Reporting Initiative; and Mr. Ben Llewellyn-Jones, Deputy British High Commission Lagos all sent in goodwill messages.

Other Prominent businessmen who spoke at the event include Alhaji Aliko Dangote, GCON, Chairman, Dangote Group; Mr. Jim Ovia, CON, Chairman, Zenith Bank Plc; Mr. Masai Ujiri, President, Toronto Raptors; Mr. Tony Elumelu, CON, Group Chairman, United Bank for Africa (UBA) & Founder, The Tony Elumelu Foundation (TEF).

By Ogodilieze Osaji-Ugo

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