Alternative Securities Market and Long-Term Capital Market Financing in Nigeria (Published)
This study examined the effects of the Alternative Securities Market (ASeM) on long term capital market financing in Nigeria during the period 2013 – 2020. The objectives of the study were to: find out the effects of ASeM equity issues on market capitalization in the Nigerian stock market; to assess the effect of ASeM index on market capitalization; to investigate the effect of interest rate on Market Capilisation; to assess effect of inflation rate on market capitalization; and to ascertain the effect of exchange rate on market capitalization in Nigeria during the period of study. The study adopted ex-post facto research design and made use of secondary data. Time series data for the period 2013 – 2020 from the Central Bank of Nigeria statistical bulletin and well as data from Nigeria stock exchange publications were used. The study employed multiple regression analysis using Econometric-views (E-views) 10.0, to analyse the data. In the analysis, long term capital market financing was proxied by Mcap (market capitalization) and this was the dependent variable. The independent variables of the study included ASeM equity issues, ASeM index, interest rate, inflation rate, and exchange rate. The results showed that ASEM equity issues had a negative but insignificant effect on long term capital market financing (Mcap); ASeM index had a significant positive effect on long term capital market financing (Mcap); interest rate had a negative but insignificant effect on long term capital market financing; inflation rate had negative but significant effect on long term capital market financing; exchange rate had a positive but insignificant effect on long term capital market financing in Nigeria during the period of the study. The study recommended that regulatory authorities (SEC and Nigeria Exchange Group) should encourage greater participation of SMEs in the activities of the alternative securities market through equity share issues to boost or enhance long term capital market financing; regulatory agencies should sustain measures that caused ASeM index to have a significant positive effect on long term capital market financing; monetary authorities (especially, the CBN) should employ policy measures to address the negative effect of interest rate and inflation rate on long term capital market financing in Nigeria among others.
Keywords: Exchange Rate, Index, Inflation, Interest Rate, Market Capitalization, equity issues