FMDQ, RIMAN advocate improved risk management practice
FMDQ OTC Securities Exchange in partnership with Risk Management Association of Nigeria (RIMAN) has stressed the need for enhanced risk management practice in the Nigerian financial market.
Speaking at RIMAN’s quarterly risk round table programme themed, “Derivative Risks: The Role of FMDQ in the Development of the Derivatives Market in Nigeria, the Associate Executive Director, Corporate Development, FMDQ, Ms. Kaodi Ugoji emphasized the importance of entrenching professionalism in the practice of the profession to minimize risks associated with financial system stability.
She commended the association for its role in creating risk management advocacy and awareness in Nigeria.
Ugoji expressed delight at the progress made so far in the review of the Companies and Allied Matters Act (CAMA), noting that it was a well-crafted legal and regulatory framework for any market globally.
“What was critical for us in Nigeria is to have what we call a netting law so that our financial transactions will not be subjected to bankruptcy laws of Nigeria.
“We didn’t have a law that protect financial market transactions and so what we have done in FMDQ, along with the president and other stakeholders in the market, is to conduct a review of the CAMA which didn’t have bankruptcy remoteness law in it.
“We were able to infuse the netting law into the CAMA amendment bill which we were so excited to hear has passed through the house and the senate.
“The senate passed it mid-last year and the house passed it January this year; so we are literally 80 per cent there and we are just waiting for the president to sign it into law and that literally puts us on the international market”, she added.
She added that the trading platform is currently looking at introducing two-interest rate based product by the third quarter of 2019.
On his part, the President of RIMAN, Magnus Nnoka noted that RIMAN is advancing in the effort to extend risk management education to all sectors of the economy and African countries, with the recent establishment of RIMAN Risk Management Institute.
He assured that both institutions will continue to collaborate in ensuring that the knowledge and practice of risk management in Nigeria is continuously promoted, adding that with the existence of the Securities Exchanges, derivatives will function better as a product and as a risk transfer mechanism.