NSE plans to restructure REITs, closed-end funds

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Trading on the floor of The Nigerian Stock Exchange Market

The Nigerian Stock Exchange is proposing to change the framework regarding the trading of Real Estate Investment Trusts and closed-end funds listed on the Exchange.

The bourse said the proposed changes, which would be implemented over the next three quarters of 2017, were aimed at promoting transparency, disclosure, visibility and liquidity of listed REITs and closed-end funds in the market.

It said the changes would also make it easier for existing and potential investors to access information required to make investment decisions, thereby contributing to the growth of the products in the market.

Highlighting the proposed changes, the NSE said, “Specific rules relating to REITs and closed-end funds are to be incorporated into the rulebook of the Exchange.

“REITs and closed-end funds listed on the Exchange are to submit quarterly financials and audited full year financial statements to the Exchange via the NSE X-Issuer Portal. The financials will be accessible to the pubic via the NSE’s website and other NSE platforms.”

According to the bourse, REITs and closed-end funds listed on the Exchange are to submit on a weekly basis, key performance metrics (as applicable) to the NSE, which will be accessible via the NSE’s website.

It said, “In addition, the fund managers will be required to post the information on their website. The information to be provided will include: net asset value, number of properties, property type/distribution, occupancy rates, delinquency rates on rents, average property age, and any other relevant information.”

The NSE said the prescribed submission format would be communicated to the issuers/fund managers in due course.

It said, “REITs and closed-end funds listed on the Exchange will be reclassified from the Main Board to a separate board specially created for REITs and closed-end funds under the equities market.

“Further to the proposed changes above, the Exchange is planning to host the first REITs workshop before the end of the second quarter of 2017 to further engage with the relevant stakeholders within the market, on the proposed developments.”

The bourse encouraged fund managers to the REITs and closed-end funds to embark on consistent marketing campaign on the developments, and provide detailed information to sensitise and educate investors about this asset class as a viable alternative investment vehicle.

“The Exchange looks forward to partnering its esteemed issuers, investors and other stakeholders on its course towards delivering service excellence, and a first-rate capital market experience that will cement its position as ‘Africa’s foremost securities exchange’,” the NSE said.

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