Union bank’s free float deadline expires in 20 days
The grace period given by the Nigerian Stock Exchange (NSE) to Union Bank Nigeria to rectify its free float deficiency will expires on 30th June 2017.
This places the bank, in a situation to either ensure that the float gap is filled within the remaining days of the month before the expiration of the deadline, or request for further extension of grace period or opt for migration to the ASeM board of the Exchange.
Union bank occupies number one position among the other nine companies listed in schedule 7 of the X-Compliance Report of the NSE, all of which were labeled below listing standard (BLS).
According to the Nigerian Stock Exchange (NSE), companies listed on the bourse are required to maintain a minimum free float for the set standards under which they are listed in order to ensure that there is an orderly and liquid market for their securities.
The free float requirement for companies on the ASEM Board is 15 per cent of market capitalization, while main Board listing is 20 per cent of market capitalization while companies on the Premium Board is 20 per cent of market capitalization or above N40 billion on the date The NSE receives the Issuer’s application to list.
Following the regulatory requirement, Union bank’s free float which currently stood at 14.94 per cent, against regulatory benchmark of 20 per cent, has barely 15 week days to made good its free float deficiency, or take alternative measures.
The bank currently has 5.06 per cent shares value of its market capitalization to provide to the market in order to sustain its status in the NSE main board, to ensure orderly and liquid marketing its securities.
The June 30 deadline, it was gathered was part of early extension granted to the bank “The Quotations Committee of Management considered and approved an extended timeframe for the companies to regain compliance with the listing requirement.
The companies are however required to also provide quarterly disclosure reports to The Exchange detailing their level of implementation of the compliance plans” the exchange stated in schedule 7 of the x-compliance report.
Other companies with free float deficiencies include, Capital Hotel, Great Nigeria Insurance AND Chellerams. Others are, A.G. Leventis, Interlinked Technology, Infinity Trust Mortgage, Caverton Offshore Support Group among others.
