The Securities and Exchange Commission (SEC) has said that the release of rules on Sukuk bonds has enhanced the issuance process and fostered participation in the instrument. This was stated by Acting Director General of SEC, Ms. Mary Uduk during a two-day international capital market conference held in Lagos by the SEC in collaboration with the University of Lagos.
Uduk said that following the development, Osun state issued a Sukuk bond to finance building of schools while the Federal Government used two series of Sukuk isuances to finance roads and other infrastructure. “As we move into the future, we expect to see the issuances of such new products in our market,” she said.
Uduk noted that to further support infrastructure financing, especially projects with positive environmental impact, SEC released the rules on Green Bonds in December, 2018. “The rule defines Green Bond as any type of debt instrument, the proceeds of which would be exclusively applied to finance or refinance in part or in full new and/or existing projects that have positive environmental impact. You may agree with me that green bonds are essential elements of our journey towards economic development and sustainability.
“So far, the Federal Government has issued two green bonds to finance afforestation, renewable energy, provision of clean energy and other climate change initiatives. Also, two companies (NSP-SPV Powercorp Limited and Access Bank Plc) have issued this instrument to finance eligible green assets and projects,” Uduk said.
“As we move into the future, we need to continuously embrace innovation in the way we carry out our market operations and regulation. Financial innovation is germane for the conception and delivery of a dynamic industrial society. Market participants and regulators have to continually familiarize themselves with the rapid ever-changing economic, regulatory and business environment” she added