CMA Master-Plan Expert Review

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The Capital Markets Authority (CMA) faced challenges in the implementation of its 10-year masterplan, this includes poor uptake of the new bourse products in addition to broker and bond issuer collapse.

As a result, the regulator introduced the FSD Africa-backed consultant that will assist audit the roadmap and mandate of the regulator.

CMA chief executive Wyckliffe Shamiah noted that historical issues such as the collapse of Discount Securities and Nyaga Stockbrokers have negatively affected the confidence of investors.

He also noted the impact of the collapse of Chase Bank and Imperial Bank which are filled with unresolved corporate bonds issues on investor confidence.

In addition to the challenges, the Covid-19 pandemic has hit the capital markets, which led to new medium-term strategies formulation.

“Low uptake of various capital markets products such as Exchange Traded Funds (ETFs), Reits, Asset-backed securities and limited listings on Nairobi Securities Exchange has also hampered vibrancy of the securities market in Kenya,” he said in a statement.

“The review of the Capital Markets Master Plan (2014-2023) is expected to inform review of the CMA Strategic Plan (2018-2023) to align both documents with the prevailing market conditions and expectations of the stakeholders.’’

However, the provision of an enabling policy, legal and fiscal environment to facilitate the introduction of new products and services such as Real Estate Investment Trusts (Reits), Asset-Backed Securities (ABS), derivatives markets, online forex trading, Commodities Markets, and Green Bonds are some of the success stories that the regulator has experienced.

In conclusion, strengthening of corporate governance and other investor protection instruments are part of the regulator’s game-plan to maintain financial market stability.

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About Author

Anthony Kiratu is the Founder of Finsolutions. He is a financial analyst with over 5 years experience in research, investment advisory, valuation and financial modelling. Anthony is a member of the Institute of Certified Investment and Financial Analysts and Institute of Certified Public Accountants of Kenya. He is passionate about development of African Capital Markets through training of investors and dissemination of information for sound financial and investment decision making process. He is also a part-time lecturer in the Certified Investment and Financial Analyst course in the subjects of International Finance, Portfolio Management, Equity Investment Analysis, and Fixed Income Securities. Email: anthony@finsolutions.co.ke Contact: +254 780216631

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