The Securities and Exchange Commission has approved 32 securities as collaterals over which margin lending can be undertaken by investors.
The list, which was published on the SEC website on Thursday, is to ensure that stakeholders, who wish to be involved in margin lending are guided.
The securities approved by SEC are Ashaka Cement Plc, Cadbury Nigeria Plc, Conoil Nigeria Plc, Custodian and Allied Insurance Plc, Dangote Cement Plc, Dangote Flour Mills Plc, Dangote Sugar Refinery Plc, Fidson Healthcare Plc, Flour Mills Nigeria Plc and Glaxo Smithkline Consumer Plc.
Others are Guinness Nigeria Plc, Honeywell Flour Mills Plc, International Breweries Plc, Julius Berger Plc, Lafarge WAPCO Cement Plc, Livestock Feeds Plc, Mansard Insurance Plc, Mobil Oil Nigeria Plc, National Salt Company Nigeria Plc and Nestle Nigeria Plc.
Nigerian Aviation Handling Plc, Nigerian Breweries Plc, Oando Plc, Okomu Oil Palm Plc, PZ Cussons Nigeria Plc, PRESCO Plc, Seven-Up Bottling Company Plc, Total Nigeria Plc, Transnational Corporation Plc, UACN Property Development Plc, Unilever Nigeria Plc and United African Company Nig Plc were also listed.
Investors are therefore advised to check the Margin List before entering into a margin lending arrangement with a broker or a bank.
The statement from SEC said, “It is important to note that the guidelines exclude bank stocks from being used as collateral for margin trading transactions. The margin lending rules and guidelines provided for a margin list. This Margin List is not an investment recommendation but rather a guide to those who wish to engage in margin activities.
“The SEC cautions that only persons and entities who are knowledgeable about margin activities should engage in such transactions. Retail investors who do not have the requisite knowledge should consult a knowledgeable financial expert.
“The guidelines cover the type of securities that qualify as marginable securities as well as the profile of investors that may participate in margin trading.”