The Effect of Central Securities Clearing System CSCS on the Nigeria Capital Market

The Effect of Central Securities Clearing System (CSCS) on the Nigeria Capital Market

Project / Seminar Material
Reference ID: PS-7918-TM

DEDICATION

This research material titled “The Effect of Central Securities Clearing System (CSCS) on the Nigeria Capital Market” is dedicated to God for his enabling grace, and to all computer enthusiasts who contributed to make life a pleasant experience during my research documentation.

ACKNOWLEDGEMENT

I extend my sincere gratitude to all those who contributed to the completion of this project. Special thanks to my Supervisor (Name of your Supervisor), the Head of Department (Name of your HOD), the Lecturers in the department of Economics, Book Authors and Profound Scholars of existing or related project material on “The Effect of Central Securities Clearing System (CSCS) on the Nigeria Capital Market” for their invaluable guidance, support, and expertise throughout the journey.

I am also grateful to your study area (mention any funding organizations, if applicable) for their financial assistance. This research would not have been possible without the encouragement and assistance of some stakeholders (mention any mentors, teachers, or colleagues). Additionally, I would like to acknowledge the understanding and patience of my family and friends during this endeavor. Your unwavering support has been a constant source of motivation. Thank you all for being part of this meaningful endeavor.

The Effect of Central Securities Clearing System (CSCS) on the Nigeria Capital Market

CHAPTER ONE

1.1 Background Of Study

This part of this project work is only available in the paid version

1.2 Statement Of Problem

One of the functions of the Central Securities Clearing System is certificate dematerialization but most investors are not aware of the operations of the CSCS nor of the facility as they prefer to keep the paper certificate. From January 1, 2009, investors shares were being lodged directly online with the CSCS. Prior to this new directive, the following problems were observed before the introduction of CSCS:-

  1. Cancellation and frequent issuance and re-issuance of share certificate when shares changed hands.
  2. Constant signature verification
  3. Capital gains not exploited
  4. Delay in the receipt of share certificate
  5. Loss of investors’ confidence in the trading activities on the capital market
  6. Materialization of share certificate.

With the introduction of the CSCS automation of the operations of activities on the Nigerian Capital Market also took place with IT innovation. Before now, there was a problem of:-

  1. Stockholders trading on investors stock without the consent of the investors
  2. Lack of public awareness of the operations of CSCS
  3. Non-automated system.

1.3 Objectives Of The Study

The research study is undertaken with a view of achieving the following objective. Which are:-

  1. To ascertain the effect of Central Securities Clearing System on the Nigerian capital market
  2. To assess the effect of Central Securities Clearing System on investors’ confidence in the trading activities on the Nigerian capital market
  3. To identify the effect that the share certificate dematerialization will have on the performance of trading activities on the Nigerian capital market.

1.4 Research Questions

For a better formulation of hypotheses, he following research questions was drawn:

  1. Does Central Securities Clearing System have effect on the Nigerian capital market?
  2. Can Central Securities Clearing System have effect on investors’ confidence in the trading activities on the Nigerian capital market?
  3. What are the effects of share certificate dematerialization have on the performance of trading activities on the Nigerian Capital Market?

1.5 Research Hypothesis

In pursuance of this study, three null hypotheses and their alternative will be set out

Hypothesis one

  • H0: CSCS have negative effect on the Nigerian Capital Market
  • H1: CSCS have positive effect on the Nigerian Capital Market

Hypothesis two

  • H0: CSCS have negative effect on investors’ confidence in the trading activities on the Nigerian Capital Market
  • H1: CSCS have positive effect on investors’ confidence in the trading activities on the Nigerian Capital Market

Hypothesis three

  • H0: CSCS share certificate dematerializations have negative effect on the performance of trading activities on the Nigeria capital market
  • H1: CSCS share certificate dematerializations have positive effect on the performance of trading activities on the Nigeria capital market

1.6 Scope Of The Study

The scope of the study shall cover the clearing and settlement system in the Nigerian stock exchange Onitsha, the activities of the Central Securities Clearing System, its establishment, benefits and problems from inception. It shall also cover how the Central Securities Clearing System can improve the transactions in the Nigerian Capital Market.

The place of the study is Asaba Metropolis and it involves seventeen years (21) of assessment. Secondary data will be used; facts figures and other relevant statistic shall be obtained from the Nigerian Stock Exchange Onitsha, Newspapers Journals, electronic media, fact book and related books.

1.7 Significance Of The Study

The significance of the study is towards creating a positive awareness amongst investors, stockbrokers and capital market operators about the operations of the Central Securities Clearing System and its effect on the performance of trading activities on the performance of trading activities on the Nigerian Capital Market.

It will result to more prompt and accurate clearing settlement, delivery and custodian system in the Nigerian Stock Exchange brings about the efficient service delivery of stockbrokers and investors confidence in the Central Securities Clearing System operations. Also it will bring about increase in knowledge to the academic society, it will enable further researcher to acquire more knowledge and research of its.

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CHAPTER TWO

2.0 Literature Review

2.1 Introduction

This chapter focuses on the review of related literature. A literature review includes the current knowledge as well as theoretical and methodological contributions to a particular topic. It documents the state of the art with respect to the topic you are writing. It surveys the literature in the topic selected. In this research work the literature review includes the …

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