Press Release

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15 September 2015

Settlement of Securities Moves to Central Bank of Kenya

Nairobi January 16, 2015: …In a move that will improve the efficiency of settlement of equities and corporate bonds and align the process to international best practice, Central Depository and Settlement Corporation (CDSC) has worked together with the Capital Markets Authority (CMA) and the Central Bank of Kenya (CBK) to develop a more robust cash settlement model for equities and corporate bonds.

The cash side of the settlement process for transactions concluded on the Nairobi Securities Exchange (NSE) is now being done through the Central Bank of Kenya’s (CBK) Real Time Gross Settlement (RTGS) system, with effect from January 15, 2015. Previously, the cash settlement for securities transactions was effected through four commercial banks appointed as settlement banks by the CDSC. The securities leg of the settlement process, which entails the transfer of securities between the buyers and sellers, will continue to be carried out at CDSC.

While making the announcement, the CDSC Chief Executive, Mrs. Rose Mambo, said that this milestone moves the capital market a step closer towards providing full delivery versus payment (DVP) while deepening the capital markets. Mrs. Mambo emphasized that settlement of cash for securities transactions through CBK enhances efficiency and makes substantial strides towards full implementation of the CPMI – IOSCO Standards for Financial Markets Infrastructures. Mrs. Mambo added “CDSC is a key institution in the capital market that provides a secure central record of ownership and provides the means for the secure transfer of ownership of securities and settlement of cash following transactions at NSE”.

The CBK Governor, Prof. Njuguna Ndung’u, said “the settlement of equities and corporate bonds at CBK is part of the Bank’s legal mandate in formulating and implementing policies that best promote the establishment, regulation and supervision of efficient, effective payment, clearing and settlement systems”.

Prof Ndung’u explained that settlement using the RTGS system is aligned to the broader East African Community (EAC) objective of enhancing the efficiency of the settlement system as the region prepares for integration of the financial system.

The Capital Markets Authority (CMA) Acting Chief Executive, Mr. Paul Muthaura, noted the use of the RTGS system for securities settlement is a substantial step in strengthening the measures to address settlement risk, in line with the overall mitigation arrangements to combat systemic risk.

This constitutes the first phase of the Kenyan markets full transition to settlement of securities transactions in Central Bank money in line with global best practice standards. This arrangement is expected to boost foreign and domestic investor confidence in the Kenyan market and promote greater liquidity at the Nairobi Securities Exchange (NSE). Mr. Muthaura observed: ‘’This moves Kenya a step closer to attaining the status of a Regional and International Financial Center as envisaged in the Vision 2030 Economic Blueprint and the Capital Markets Master Plan.”

15 September 2015

CMA cautions investors about the Unlawful Public Offer by Cembe Millers

brenda Press Release

Nairobi February 19, 2015… In line with its mandate of protecting investors, the Capital Markets Authority (CMA) would like to caution members of the public against participating in the unlawful public offer by Cembe Millers, since it has not been approved by the Authority. The public offer was made today (February 19, 2015) through a public advertisement in the print media.

While issuing the cautionary statement, the CMA confirmed that the Cembe Millers public offer had not been approved as required for all public offers. The Authority noted that the purported offer was in breach of Section 30A Subsection (4) of the Capital Markets Act Cap 485A, which states; ‘’Subject to the provisions of this Act, an issuer or an offeror shall not make a public offer of securities unless that issuer or offeror has submitted a prospectus in respect of that offer to the Authority for approval’’.

The CMA has written to the promoters of the Cembe Millers offer requiring them to immediately withdraw it. The Authority will further proceed to launch investigations in collaboration with other arms of Government to establish the identity of the persons behind the offer and take appropriate action against them.

The Authority finally advised Kenyans to confirm if any public offers have been approved by the Authority before participating to avoid loss and exposure.

15 September 2015

CMA and Capital Markets Commission of Angola sign MOU

brenda Press Release

Nairobi, February 24, 2015… Capital Markets Authority Kenya (CMA) and Capital Markets Commission of Angola have today signed a Memorandum of Understanding (MOU) that promotes and facilitates information sharing and technical assistance among the two regulators. The purpose of the partnership is primarily to support supervisory and regulatory coordination between Kenya and Angola, with an ultimate goal of ensuring that markets are fair, efficient and transparent.

The MoU provides a framework that encourages technical assistance and capacity building experiences between the two regulators relating to product development and deepening of the capital markets; supervision and enforcement of licensed market intermediaries, investigation and enforcement and will also ensure that all persons doing business in the capital markets between the two countries are fully licensed and qualified.

While signing the MoU, Paul Muthaura, Acting Chief Executive at CMA noted that the MOU underscores securities regulators global commitment to share both public and non-public information with domestic and foreign counterparts. This agreement is in line with the objective of establishing information sharing mechanisms that set out when and how they will share information.

The partnership underscores the importance of international co-operation to the development and maintenance of an open, fair, orderly and sound domestic financial services industry in Kenya and Angola respectively. It will also promote the increasing international activity in the supply of financial services and the corresponding need for mutual co-operation and the sharing of information in the administration and enforcement of laws, regulations and rules concerning the financial services industry in Kenya and Angola.

‘One of the principles of securities regulations by the International Organization of Securities Commissions (IOSCO), the global standard setter for the regulation of the capital markets industry that brings together 120 securities regulators, is founded on cooperation among regulators,’ said Mr Muthaura.

Augusto Archer Mangueira, Chairman, Capital Markets Commission of Angola observed that consultations shall assist in the development of mutually agreeable approaches for strengthening the financial markets of the Authorities’ jurisdictions while avoiding conflicts that may arise from the application of differing regulatory practices.

CMA has been a full member of IOSCO since 1994 and signed the IOSCO Multilateral Memorandum of Understanding concerning Consultation, Cooperation and the Exchange of Information (MMOU) in April 2009, in recognition of compliance with cooperation and enforcement requirements. CMA has signed MOUs with the capital market regulators in Tanzania, Uganda, Rwanda, Burundi, Nigeria, South Africa, Ghana, Mauritius, Malaysia and Chinese Taipei.

15 July 2015

IOSCO Board Meeting, Seoul Korea, Feb 2015

brenda Press Release

Capital Markets acting Chief Executive Mr. Paul Muthaura (back row, 5th from left) during a board meeting of the International Organization of Securities Commissions held in Seoul, South Korea from 11 to 13 February, 2015. Mr. Muthaura also seats on the Growth and Emerging Markets Steering Committee (GEMC) which is charged with representing the interests of more than 75 percent of the membership of IOSCO covering the spectrum of the most developed emerging markets including the BRICS to frontier and nascent capital markets. Mr. Muthaura was elected to join the Board in September 201

15 September 2014

CMA grants approval to UAP Holdings Limited for issue of Ksh2 billion bond

brenda Press Release

Nairobi, June 27, 2014…The Capital Markets Authority (CMA) has in accordance with its mandate to facilitate access to financial services through effective regulation and innovation granted approval to UAP Holdings Limited to issue and list on the fixed income securities market segment of the Nairobi Securities Exchange a Kshs2 billion bond pursuant to Section 30A of the Capital Markets Act.

‘The Authority granted the approval following review of the application and is satisfaction that it meets the requirements of the Capital Markets Act, and the Second Schedule and Part C of the Third Schedule to the Capital Markets (Securities) (Public Offers, Listing and Disclosures) Regulations, 2002, by enabling investors make an informed decision,’ noted a statement released from the Authority.

UAP Holdings Limited notes that net proceeds from the issue of the Notes will be applied towards general corporate purposes, including capital management, funding long term assets and investments in subsidiaries.

ENDS

BACKROUND INFORMATION ON THE CAPITAL MARKETS AUTHORITY

The Capital Markets Authority (CMA) was set up in 1989 as a statutory agency under the Capital Markets Act Cap 485A. It is charged with the prime responsibility of both regulating and developing an orderly, fair and efficient capital markets in Kenya with the view to promoting market integrity and investor confidence.

The regulatory functions of the Authority as provided by the Act and the regulations include; Licensing and supervising all the capital market intermediaries; Ensuring compliance with the legal and regulatory framework by all market participants; Regulating public offers of securities, such as equities and bonds & the issuance of other capital market products such as collective investment schemes; Promoting market development through research on new products and services; Reviewing the legal framework to respond to market dynamics; Promoting investor education and public awareness; and Protecting investors’ interest.

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Press Release

Settlement of Securities Moves to Central Bank of Kenya

CMA cautions investors about the Unlawful Public Offer by Cembe Millers

CMA and Capital Markets Commission of Angola sign MOU

IOSCO Board Meeting, Seoul Korea, Feb 2015

CMA grants approval to UAP Holdings Limited for issue of Ksh2 billion bond

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