Sections
Poll: Power pledge
Is Mr. President's promise of additional 6,000 MW of electricity in 18 months achievable?
Redefining investment banking
Font size:
Abimbola Olashore, MD, Lead Capital Limited
He cuts the image of a visionary in the financial services sector. While other operators are whinging over the planned mark up of the capital base of stock broking firms from N70m to N1 billion, Abimbola Olashore, Chief Executive Officer of Lead Capital limited sees the move as the way forward.
He leads the camp that argues that the campaign against the recapitalisation exercise would amount to stockbrokers breaking the synergy that is driving the robust growth in the financial sector, an impressive pattern that is being marshalled by the banks.
Olashore’s creative disposition predates today’s preoccupation with growing the stock market to incomparable levels on the continent. It dates back to his active banking days when as the managing Director of Lead Bank he spearheaded the strengthening of the bank’s brokerage subsidiary apparently in anticipation of a today’s stout standing of the exchange.
Incidentally, it is this intuition with Lead Capital that has managed to keep Olashore in the game, especially after Lead Bank which was eventually acquired by Afribank Bank plc, failed to scale the N25 billion recapitalisation bar on its own limbs. Today, Lead Capital stands as of the leading financial services institution with a paid up capital of N1 billion.
In the areas of stock broking, trade execution, asset management and corporate finance, the company is actually showing remarkable expertise and commanding appreciable trust. Such record and standing could be comforting for some other chief executives. But Olashore is not the type to rest on his oars.
“We would like to see ourselves playing a much more diversified role in the market,” he says, adding that beside just being a brokerage firm, “we would like to define ourselves more as traditional investment banking” outfit.
It is for this wish to play even bigger in the market that Olashore is throwing his weight behind the recapitalisation programme. He has a ready argument against those posturing that stock brokers as mere intermediaries buying stocks for clients, do not need regulation on minimum capitalisation. His position is that as managers of people’s funds, the firms themselves should inspire better credibility with manifest liquidity
“Talking about market turnover, it runs into billion of units. What the N1bn capital base means is that for the brokerage companies, they have to invest more in their infrastructure. We have gone beyond the era of a one man brokerage firm. If you don’t have capital, how are you going to invest in infrastructure, how are yougoing to invest in people and technology?”
Olashore already sees beyond the prevailing exertion among operators to meet the new capital base. His position is that future competition might even be keener and probably swallow those who wait on the regulatory body before stepping up their liquidity. Easily, he compares the scenario to what is happening in the banking industry where competition has forced most banks to push far beyond the mandatory N25 billion capitalisation set by the Central bank in 2005.
But his unabashed crusade for uniform strengthening of stock broking firms through the setting of mandatory capital limit may have put him on ideological collision course with the small operators who urge segmentation in the implementation of the policy. Their point is that the industry should provide for small firms that cater to the needs of small investors.
But Olashore thinks that such argument cannot fly. “How do we go about that? Who is small and who is big?” he queries, insisting that it would be difficult to implement such thorny arrangement.
“I have never seen a stock broking firm that would see a transaction that involves huge amount of money and would reject it because it is only for small investors… How can members of the public be able to differentiate from a firm that says it is only out for small investors, and that for big investors.
However, there is growing apprehension in the camp of investors over mounting bearish run in the market especially against the backdrop of an impressive performance last year which ended with about 90 per cent gain in dollar terms. Their fear is fuelled by the pervasive downturn and threat of recession in the global economy.
Olashore acknowledges this trend, but believes that the lull in the market will be temporary. He attributes the reversal in the price of some blue chip companies to “profit taking” and the fact that investors were unsure of the results of companies, especially after a plethora of public offers.
“But we expect a rebound in the market and the bearish run that we have seen for sometime now would definitely turnaround. We must not disregard the impact of a number of pronouncements from the Securities and Exchange Commission, which said it was investigating the sharp increase in prices of some lowly priced stocks, which we know is economically irrational.
“Looking at this year, it started also on a very bullish note and that shows improved confidence in the market. If you look at the factors that have been driving the market, those factors are still very positive.”
It is his conviction that the capital market would continue to grow in line with the abiding high level of awareness and public appreciation which is sustaining today’s momentum in the market.
“All of a sudden, we have seen the investing public now have a better appreciation of
what the capital market is. About ten years ago, we were still educating people as to why they should invest in shares and what we had then were people that
were not trading. They would buy and just keep the stock for years, all because they were not well informed of what the benefits of the market.
“In the past, if you look at the investing attitude of Nigerians, a lot of them were investing abroad, but today, many of them have realised that at home, you
can make better returns on investment.”
Part of his optimism also derives from the fact that off-shore funds are coming in from international investors who are satisfied with Nigeria’s performance and the economy’s potential as an emerging market.
Olashore, 42, has no doubt had a rewarding career in the financial services industry. Upon graduation as an engineer in 1987, he started off with Deloitte Adetona Isichie & Co, an auditing firm before joining the banking industry; a career choice that peaked when he was appointed the managing director of Lead Bank at a youthful age of 31.
As the chief executive officer of defunct Lead bank Plc, he was known to have introduced innovative ideas that consolidated it as a force in the fields of financial advisory, stock broking and project finance.
He later joined Lead Capital where he took up the challenge to implement plans to transform the company from a stockbroking to an investment banking outfit.
Along that line, Olashore is preoccupied with the ambitious repositioning of his company which involves the task of raising its capital base from N1 billion to N5.5 billion; a process that has started in Lagos by way of private placement.
According to Olashore Lead Capital’s vision is to become “the preferred financial advisor in Nigeria and move to the top league by all indices by 2010.”
At a recent ceremony in Lagos that showcased the company’s new image and aspirations, Olashore received accolades for his efforts towards rejuvenating Lead Capital and repackaging it for the challenges of a new financial age. Minister of state for finance Remi Babalola, who attended the ceremony described the soar away standing of Olashore’s company as an example of how the private sector could meaningfully contribute to the efforts to jumpstart the nation’s economy.
Olashore’s creative disposition predates today’s preoccupation with growing the stock market to incomparable levels on the continent. It dates back to his active banking days when as the managing Director of Lead Bank he spearheaded the strengthening of the bank’s brokerage subsidiary apparently in anticipation of a today’s stout standing of the exchange.
Incidentally, it is this intuition with Lead Capital that has managed to keep Olashore in the game, especially after Lead Bank which was eventually acquired by Afribank Bank plc, failed to scale the N25 billion recapitalisation bar on its own limbs. Today, Lead Capital stands as of the leading financial services institution with a paid up capital of N1 billion.
In the areas of stock broking, trade execution, asset management and corporate finance, the company is actually showing remarkable expertise and commanding appreciable trust. Such record and standing could be comforting for some other chief executives. But Olashore is not the type to rest on his oars.
“We would like to see ourselves playing a much more diversified role in the market,” he says, adding that beside just being a brokerage firm, “we would like to define ourselves more as traditional investment banking” outfit.
It is for this wish to play even bigger in the market that Olashore is throwing his weight behind the recapitalisation programme. He has a ready argument against those posturing that stock brokers as mere intermediaries buying stocks for clients, do not need regulation on minimum capitalisation. His position is that as managers of people’s funds, the firms themselves should inspire better credibility with manifest liquidity
“Talking about market turnover, it runs into billion of units. What the N1bn capital base means is that for the brokerage companies, they have to invest more in their infrastructure. We have gone beyond the era of a one man brokerage firm. If you don’t have capital, how are you going to invest in infrastructure, how are yougoing to invest in people and technology?”
Olashore already sees beyond the prevailing exertion among operators to meet the new capital base. His position is that future competition might even be keener and probably swallow those who wait on the regulatory body before stepping up their liquidity. Easily, he compares the scenario to what is happening in the banking industry where competition has forced most banks to push far beyond the mandatory N25 billion capitalisation set by the Central bank in 2005.
But his unabashed crusade for uniform strengthening of stock broking firms through the setting of mandatory capital limit may have put him on ideological collision course with the small operators who urge segmentation in the implementation of the policy. Their point is that the industry should provide for small firms that cater to the needs of small investors.
But Olashore thinks that such argument cannot fly. “How do we go about that? Who is small and who is big?” he queries, insisting that it would be difficult to implement such thorny arrangement.
“I have never seen a stock broking firm that would see a transaction that involves huge amount of money and would reject it because it is only for small investors… How can members of the public be able to differentiate from a firm that says it is only out for small investors, and that for big investors.
However, there is growing apprehension in the camp of investors over mounting bearish run in the market especially against the backdrop of an impressive performance last year which ended with about 90 per cent gain in dollar terms. Their fear is fuelled by the pervasive downturn and threat of recession in the global economy.
Olashore acknowledges this trend, but believes that the lull in the market will be temporary. He attributes the reversal in the price of some blue chip companies to “profit taking” and the fact that investors were unsure of the results of companies, especially after a plethora of public offers.
“But we expect a rebound in the market and the bearish run that we have seen for sometime now would definitely turnaround. We must not disregard the impact of a number of pronouncements from the Securities and Exchange Commission, which said it was investigating the sharp increase in prices of some lowly priced stocks, which we know is economically irrational.
“Looking at this year, it started also on a very bullish note and that shows improved confidence in the market. If you look at the factors that have been driving the market, those factors are still very positive.”
It is his conviction that the capital market would continue to grow in line with the abiding high level of awareness and public appreciation which is sustaining today’s momentum in the market.
“All of a sudden, we have seen the investing public now have a better appreciation of
what the capital market is. About ten years ago, we were still educating people as to why they should invest in shares and what we had then were people that
were not trading. They would buy and just keep the stock for years, all because they were not well informed of what the benefits of the market.
“In the past, if you look at the investing attitude of Nigerians, a lot of them were investing abroad, but today, many of them have realised that at home, you
can make better returns on investment.”
Part of his optimism also derives from the fact that off-shore funds are coming in from international investors who are satisfied with Nigeria’s performance and the economy’s potential as an emerging market.
Olashore, 42, has no doubt had a rewarding career in the financial services industry. Upon graduation as an engineer in 1987, he started off with Deloitte Adetona Isichie & Co, an auditing firm before joining the banking industry; a career choice that peaked when he was appointed the managing director of Lead Bank at a youthful age of 31.
As the chief executive officer of defunct Lead bank Plc, he was known to have introduced innovative ideas that consolidated it as a force in the fields of financial advisory, stock broking and project finance.
He later joined Lead Capital where he took up the challenge to implement plans to transform the company from a stockbroking to an investment banking outfit.
Along that line, Olashore is preoccupied with the ambitious repositioning of his company which involves the task of raising its capital base from N1 billion to N5.5 billion; a process that has started in Lagos by way of private placement.
According to Olashore Lead Capital’s vision is to become “the preferred financial advisor in Nigeria and move to the top league by all indices by 2010.”
At a recent ceremony in Lagos that showcased the company’s new image and aspirations, Olashore received accolades for his efforts towards rejuvenating Lead Capital and repackaging it for the challenges of a new financial age. Minister of state for finance Remi Babalola, who attended the ceremony described the soar away standing of Olashore’s company as an example of how the private sector could meaningfully contribute to the efforts to jumpstart the nation’s economy.
Add to:
del.icio.us |
Digg
del.icio.us |
Digg
Email to a friend
Print version
Plain textRate this article
Comments ( posted):
Post your comment