* Ecobank Nigeria says its business will not be affected
* Bank says has no capital market operations except IPOs
(Adds Ecobank reaction)
By Tim Cocks and Chijioke Ohuocha
LAGOS, March 21 Nigeria's stock market regulator
said on Thursday it had suspended Ecobank from all
capital market activities because of irregularities surrounding
But Ecobank said the suspension would not affect its
business, because Ecobank Nigeria does not itself deal in
The Securities and Exchange Commission (SEC) said an Ecobank
client Arian Capital Management, a stock broking firm, had used
capital from another company without that company's permission
as collateral for a loan from Ecobank.
The SEC statement said Arian had taken shares belonging to
Avil Services LTD and used them as collateral for an Ecobank
margin loan facility without Avil's permission, withholding the
shares and accruals from Avil.
It had first suspended Arian as a result.
"The SEC ... requested further explanation from Ecobank
Nigeria Plc. This explanation is yet to come from Ecobank
Nigeria Plc despite repeated demands for it," the SEC said in a
"The suspension will continue to be in force until the bank
clears all the issues," it said.
Spokeswoman for Ecobank Nigeria Adenike Laoye said the bank
takes payments for retail participation in initial public
offerings (IPOs), but does not deal in the secondary market.
The Togo-based bank's Nigerian capital markets arm, ESL
Securities Limited, does deal in the Nigerian markets but is not
covered by the ban, she said.
"We actually don't carry out capital market activities any
more. In terms of the business it's not affecting us," she said.
Laoye said the dispute concerned shares valued at 11 million
naira ($69,300), and that Ecobank did not know that Arian did
not own the shares. She said they had issued a cheque to the SEC
to settle the amount on Thursday.
Pan-African banking group Ecobank has a presence in 32
African countries and around 9.4 million customers, some 6.4
million of them in Nigeria. Its operation in Nigeria, Africa's
second biggest economy, makes up the lion's share of its
business. Nigeria makes up about 44 percent of assets and
revenue and 35 percent of its loans.
($1 = 158.8000 naira)
(Editing by Keiron Henderson and James Jukwey)