Mr Sam Onukwue, Chairman, Association of Securities Dealing Houses of Nigeria (ASHON), has frowned at the recent directive by Central Bank of Nigeria’s (CBN), suspending dividend payments by banks.

According to statement released by ASHON, the Association noted that the timing of the directive is inopportune, given the ongoing efforts by banks to meet the increased minimum capital requirement which is regulatory-induced .

It reads: “The announcement of this price-sensitive information has caused shock and dismay due to its potential impact on shareholders and the stock market.

“The indefinite suspension may erode investor confidence in the banking sector, potentially triggering a sell-off of bank shares on the Nigeria Exchange Limited (NGX), where the sector dominates daily transactions.

“ASHON suggests that the CBN could have managed this situation more discreetly to avoid speculation and market volatility.

“Unless an alternative solution is found, this directive may hinder banks’ capital-raising efforts, particularly those yet to commence their capital raise before the deadline.”

The apex bank issued the directive on June 13, this it said was to ensure compliance with regulatory forbearance and Single Obligor Limit (SOL) requirements.