Press Release

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15 September 2023

Capital markets stakeholders’ host consultative meeting on framework for introduction of Exchange Traded Funds

Nairobi April 23, 2015…In a drive to diversify products available in the Kenyan market, the Capital Markets Authority (CMA), Nairobi Securities Exchange, and the Central Depository and Settlement Corporation together with other key stakeholders today unveiled the roadmap to pave way for the introduction of Exchange Traded Funds (ETFs). This follows the approval by the CMA Board of a Guidance Note to facilitate the introduction of ETFs.

The Guidance Note is a first in the Kenyan markets under a principles-based approval approach under Section 12A Capital Markets Act. This new provision came into force in December 2013 following the enactment of the Capital Markets (Amendment) Act 2013.

The adoption of a principles based approval framework by the Authority brings into operation recommendations of the Capital Market Master Plan with a view to enhancing CMA’s role to fulfill its twin objectives of market development and regulation.

The CMA Acting Chief Executive, Mr. Paul Muthaura, highlighted that the powers under section 12A are designed to empower the Authority to fast-track the roll-out of new products and services in Kenya’s capital markets to ensure there is a timely regulatory response to changing market dynamics pending the enactment of a comprehensive regulatory frameworks.
“A principle-based approach is a regulatory approach where the law does not set out specific/prescriptive rules on what a market player can or cannot do but rather sets out broad but well-defined principles that market players are expected to follow. This is more flexible and promotes innovation’’, noted Mr. Muthaura.

Mr. Muthaura indicated that it is in an effort to increase the scope of available capital market products in Kenya’s capital markets that CMA, in consultation with key stakeholders, developed the Guidance Note on ETFs.
As a first step, proposed amendments to the trading and listing rules that have taken account of the Guidance Note on ETFS, have already been submitted to the Authority for review and approval.
‘’The consultative forum presents an opportunity for stakeholders such as potential promoters of ETFs to understand and appreciate the process and the prerequisites for initial trading of ETFs trading in Kenya, pending the development of a comprehensive regulatory framework to guide the operations of this new market segment’’, he added.

15 September 2023

CMA enhances Investor Education County Outreach Program

brenda Press Release

Nairobi March 23, 2015…As part of its efforts to enhance capital markets outreach within the counties, the Capital Markets Authority CMA) has organised a series of events in Embu County. The events are organised in partnership with capital markets industry stakeholders, the Kenya National Chamber of Commerce and Industry (KNCCI) Embu Branch and the County Government of Embu, and include a Road Show, a stakeholder engagement session and a two-day Open Day.

The events are geared at enhancing financial literacy, and in particular ensuring that the investing public in Embu County and its environs appreciate the various opportunities for investment in the capital markets industry.

CMA has organised a Road Show in Embu County on March 26th, 2015, a Forum for the Business Community at the Izaak Walton Inn Hotel on March 27, 2015, and an Open Day to be held from 27th to 28nd March, 2015 at the Embu Moi Stadium, targeting the general public, including the business and professional community, within Embu County and its environs. Some of the institutions expected to exhibit at the Open Days include; the Capital Markets Authority, the Central Depository and Settlement Corporation, Fund Managers, Stockbrokers, Custodians, Investment Banks, and Investment Advisors among others.

The CMA Acting Chief Executive, Mr Paul Muthaura, noted that the county outreach underpins the Authority’s commitment to enhancing financial education, in recognition of the important role it plays in mobilizing savings and investments. He observed that: ”Financial literacy is a key priority under the ten-year Capital Markets Master Plan (2014-2023) for supporting development and economic transformation, which are key pillars of the Country’s Economic Blueprint, Vision 2030”.

Mr Muthaura highlighted that the Authority has put in place exciting opportunity for professionals across the country to conduct investor education speaking engagements targeting the Counties, University Students and Structured Groups over a period of twelve (12) months on a part time basis for a reasonable compensation. The main objective of this initiative is to increase awareness and participation in the capital markets by effectively engaging the various constituents mentioned above. This is in line with one of the Authority’s mandate to promote Investor Education and Public Awareness throughout the Country.

Notes to Editors:

Capital Markets Authority

The Capital Markets Authority 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. For further information contact; Antony Mwangi, Head of Corporate Communications, on Email: amwangi@cma.or.ke<;mailto:amwangi@cma.or.ke>;

15 September 2023

CMA enhances outreach within the counties

brenda Press Release

Kisumu November 18, 2014…As part of its efforts to enhance capital markets outreach within the counties, the Capital Markets Authority has organised a series of events in Kisumu County in partnership with capital markets industry stakeholders and the Kenya National Chamber of Commerce and Industry Kisumu branch, which include stakeholder engagement sessions and Open Days, from 18-22 November 2014.

The events are geared at enhancing financial literacy, and in particular ensuring that the investing public in Kisumu County and its environs appreciate the various opportunities for investment in the capital markets industry.

The education strategy will cover a wide spectrum of stakeholders including outreach to the youth and women who are a key segment of Kenya’s population whose involvement in mobilising savings and investments through the capital markets is key to catalysing economic development in the devolved environment.

CMA has also organised a Forum for the County Government and the Business and professional Community at Kisumu Hotel on November 19, 2014 and Open Days to be held from 20th to 22nd November, 2014 at the Kisumu Central Square, targeting the general public, including the business and professional community, within Kisumu County and its environs. Some of the institutions expected to exhibit at the Open Days include, the Capital Markets Authority, the Central Depository and Settlement Corporation, Fund Managers, Stockbrokers, Custodians, Investment Banks, Investment Advisors among others.

Mr Muthaura noted that the county outreach underpins the Authority’s commitment to enhancing financial education, in recognition of the important role it plays in mobilizing savings and investments. He observed: ‘’Financial literacy is a key priority under the ten-year Capital Markets Master Plan (2014-2023) for supporting development and economic transformation, which are key pillars of the country economic blueprint, Vision 2030’’.

Mr Muthaura added that the investing public is key to the capital markets industry and financial literacy will enable them provide capital in response to the supply of capital markets products and services offered by issuers such as listed companies, government and corporate bonds, and county and municipal bonds in the future.

The Authority has also been running a national trivia competition, the first ever hosted by a financial sector regulator. The national trivia allows participants to answer capital markets-related questions through subscription to SMS short code 20727 with the chance of walking away with the top prize of Kshs200,000 worth of securities listed at the Nairobi Securities Exchange and other monetary prizes. The national competition closed on 17 November 2014.

Notes to Editors:

Capital Markets Authority

15 September 2023

CMA Nominated for Microsoft Awards Press Release 09102014

brenda Press Release

Nairobi October 09, 2014….The Capital Markets Authority (CMA) has been nominated for the finals of the Microsoft Convergence 2014 Europe Customer Excellence Awards. The Customer Excellence Awards is a global programme designed to recognize Microsoft customers for achieving outstanding success with their Microsoft solutions. CMA sourced software and support infrastructure for its Enterprise Resource Planning systems from Microsoft in 2013 to facilitate business process re-engineering, aimed at enhancing efficiency and service delivery.

CMA has been nominated alongside major global brands including; Barclays, Bridgestone Corporation, Ericsson, Hugo Boss, Caterpillar, Chanel, Citi, Dell, Ford, Fujitsu, Konica Minolta, Nestle, Nissan, Pepsi, Shell, Siemens, Toshiba, and Volkswagen.

CMA invested Ksh127 million in Risk-Based Supervision (RBS) and Enterprise Resource Planning (ERP) systems with funding from the World Bank through the National Treasury Financial and Legal Sector Technical Assistance Project (FLSTAP). The customization and implementation of the project was done by Attain Enterprise Solutions.

Commenting on the development, CMA Acting Chief Executive Mr Paul Muthaura, said the nomination was a recognition of the Authority in its quest to enhance the customer experience for all stakeholders in Kenya’s capital markets. Mr Muthaura observed that the investment is also aligned to the Authority’s vision of being a world-class regulator of a vibrant capital market.

CMA’s Director of Market Operations, Mr Wycliffe Shamiah, explained that the RBS system complements the Risk Based approach to market supervision and augments the investment in a robust market surveillance system unveiled in June 2012. ‘’The Risk Based Supervision system allows the Authority to step up its oversight role by leveraging technology to improve the efficiency of its supervision activities including licensing, approvals, and inspections, analysis of returns, investigations, and enforcement’, added Mr Shamiah’.

The RBS system incorporates an online platform that allows companies to make applications for licenses online. Companies are now able to apply for approval of offer of securities to the public through the new system.

The system includes a back office module that allows automated processing of all applications made to the Authority. The Authority previously received applications and submissions from its licensees and issuers of securities manually.

Mr Shamiah observed, ‘’the system allows listed companies, stockbrokers, investment banks, fund managers, and other licensees to file statutory returns online. This ensures improved compliance as well as enables the Authority to rapidly analyze the information and proactively make the necessary interventions in a timely manner’’. The system also further enhances efficiency by allowing the Authority staff performing inspections and investigations to keep electronic files of all their findings for easier retrieval and enhanced security.

Mr Muthaura explained that the system also enables investors aggrieved by any of the players within the capital markets, to lodge complaints online, which affords them a convenient option, supported by a timely feedback mechanism throughout the resolution process.

Under the same project, CMA also implemented an off-site disaster recovery and business continuity solution that ensures uninterrupted operation and security of data and documents in the event of a disaster.

ENDS

BACKGROUND 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. For further information, please contact: Antony Mwangi, Head of Corporate Communications on Tel: 2264204, 0722 825227 or Email:amwangi@cma.or.ke” data-mce-href=”mailto: amwangi@cma.or.ke“> amwangi@cma.or.ke

15 September 2023

CMA hosts Islamic Finance Roundtable

brenda Press Release

Ms Rahma Hersi (Managing Partner-Awal Consulting-Left), Mr Yahya Aleem Rehman (Division Manager, Advisory services-Islamic Research and Training Institute-Centre) and Mr Paul Muthaura (Acting Chief Executive Capital Markets Authority-Right) during the Islamic Finance Strategic Roundtable organized by the Capital Markets Authority in collaboration with Awal Consulting and the Islamic Research & Training Institute, a member of the Islamic Development Bank, as well as the Malaysia International Islamic Financial Centre, 9-10 December 2014, at the Tribe Hotel in Nairobi.

Nairobi December 9, 2014…As part of the drive to unlock the potential of Shariah compliant investment to support infrastructure financing, the Capital Markets Authority (CMA) in collaboration with Awal Consulting Ltd and The Islamic Research & Training Institute (IRTI), a member of the Islamic Development Bank as well as the Malaysia International Islamic Financial Centre (MIFC), will today convene an Islamic Finance Strategic Roundtable.

Globally, the Islamic financial sector is a $2 trillion industry based on Islamic principles that discourage interest, speculation and empathize ethical investment.

The roundtable brings together stakeholders from the financial sector, Islamic financial services industry, government agencies and international experts to deliberate the development of Kenya as a centre of excellence in Islamic financial products. The Islamic finance strategic roundtable is intended to make recommendations and develop a plan of action towards developing a formal Islamic finance framework, a concerted program of regulatory reform, recognition and capacity building that will enable Shariah compliant financial services to respond to the investment diversification as well as funding needs of the economy. The development of a formal Shariah compliant financial sector will create a gateway for regional and international capital flows into the country with a particular focus on infrastructure project funding.

The Capital Markets Industry prioritized the development of Kenya as a centre of excellence in Islamic finance as a key priority under the Capital Markets Master Plan, the capital markets industry 10-year blueprint for the transformation of Kenya into the heart of capital markets investment on the continent. The roundtable, with the guidance of Shariah experts from Malaysia, which is the largest Islamic Financing Hub in the world, is expected to identify and refine policy proposals for the consideration of the National Treasury. The CMA Acting Chief Executive, Mr. Paul Muthaura, observed that the roundtable is part of the Authority’s strategy of leveraging relationships with regulators and financial market infrastructure providers to support the development of the sector.

Mr. Muthaura noted, ‘‘in the context of the recent announcement by the Government of Kenya that it will be seeking to issue its first Sovereign Sukuk in the near future, it is critical that the domestic financial markets are effectively prepared to leverage the opportunities arising from that increased visibility by providing a wider diversity of products to attract local, regional and global funds seeking ethical or Shariah compliant investments through the development of a globally competitive policy, legal and regulatory framework.”

Development of Islamic finance in Kenya over the last five years has been notable, with the licensing of two Islamic banks by Central Bank of Kenya, licensing of Islamic insurance (Takaful) company, registration of an Islamic Collective Investment Scheme, licensing of an Islamic asset manager, and the introduction of a Shariah component in the REITs regulations.

The roundtable is also expected to discuss the establishment of a national Shariah advisory board and the road map for the recognition of Islamic finance in the International Financial Reporting Standards.

15 September 2023

CMA recognized for Outstanding Business Achievements

brenda Press Release

Nairobi October 21, 2014…The Capital Markets Authority (CMA) has been recognized by Microsoft® with the 2014 Dynamics Business: Small and Medium Business Award as part of the Microsoft Dynamics Customer Excellence Awards programme. CMA will be honoured by Microsoft executives at an awards luncheon on 5 November 2014 at Convergence 2014 Europe, the premier Microsoft Dynamics user conference, to be held in Barcelona, Spain.

The 2014 Customer Excellence Awards, which are presented in 15 categories, recognize and celebrate Microsoft Dynamics customers that have achieved notable accomplishments using their Microsoft Dynamics solutions.

Established in 1997, the Customer Excellence Awards are awarded each year at the Convergence user conference. Microsoft Dynamics is a line of financial, customer relationship, and supply chain management solutions that help businesses work more effectively.

CMA sourced software and support infrastructure for its Enterprise Resource Planning systems from Microsoft in 2013 to facilitate business process re-engineering, aimed at enhancing efficiency and service delivery.

Commenting on the win, CMA Acting Chief Executive Mr Paul Muthaura, said this is a major milestone in the Authority’s ambition to facilitate a seamless experience for all stakeholders in Kenya’s capital markets in their engagement with CMA. Mr Muthaura observed that the investment is also aligned to the Authority’s vision of being a world-class regulator of a vibrant capital market.

15 September 2023

CMA Acting Chief Executive Elected to IOSCO Board

brenda Press Release

Nairobi September 30, 2014…Capital Market Authority (CMA) Kenya’s Acting Chief Executive, Mr. Paul Muthaura, has been elected to the prestigious Board of the International Organization of Securities Commissions (IOSCO). IOSCO is the premiere reference point for securities regulation and standard setting for the global capital markets regulatory community. This position has been re-emphasized through its proactive role in developing responses for the identification as well as mitigation of systemic and emerging risks across the financial sector globally through the Financial Stability Board (FSB) and G-20 process.

With his election to the Board, Mr. Muthaura will also take up a seat 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. The election was conducted during the GEMC meeting held in Rio de Janeiro, Brazil on September 29, 2014 and attracted candidates from CNV Argentina, FSC Mauritius, CMB Turkey, CMA Kenya and CDVM Morocco. CMB Turkey was also elected to the IOSCO Board.

This position strengthens the voice of the more than 85 Latin American, European, African, Middle Eastern and Asian securities and derivatives regulators in informing IOSCO policy and regulatory formulation and it’s impact on developing capital markets. It is also a significant boost to Kenya’s aspiration for Nairobi to become an International Financial Center.

His immediate priority is to add his voice to developing practical solutions at Board level to mitigate the unintended consequences of global regulatory reforms on emerging and frontier markets, to strengthen Africa’s voice in the Financial Stability Board and G-20 work-streams relating to capital markets issues and to foster new approaches to capacity building through peer to peer programs by leveraging the expertise within the membership.

Mr. Muthaura stands out among the regulators in the growth and emerging markets for his role in spearheading the implementation of key reforms in the capital markets in Kenya, notably finalizing the demutualization and self listing of the Nairobi Securities Exchange (NSE), development of Kenya’s first 10 Year Capital Markets Master Plan, as well as the roll out of a regulatory framework of the Derivatives markets. The Kenyan capital markets is further at advanced stages of introducing new products such as Exchange Traded Funds (ETFs) and Real Estate Investment Trusts ( REITs).

During the meeting, the International Monetary Fund (IMF) was welcomed as a new member of the GEMC. Mr. Ranjit Singh, Chairman of the Malaysian Securities Commissions was elected Chairman of the Growth and Emerging Markets Committee while Mr. Bert Chanetsa of FSB South Africa, was elected Vice Chairman.

15 September 2023

CMA approves NIC Bank Rights Issue

brenda Press Release

Nairobi September 23, 2014…The Capital Markets Authority (CMA) has approved a rights issue for NIC Bank Limited in accordance with the requirements of Regulation 11 of the Fourth Schedule to the Capital Markets (Securities) (Public Offers, Listing and Disclosure) Regulations, 2002.

The approval will allow the bank to raise funds from the capital markets through a rights issue for the third time in seven years. In 2007, the bank raised Kshs1.1 billion through a rights issue that was oversubscribed by 49 percent, followed by a second rights issue in 2012 through which a further Kshs2.1 billion was raised, recording a 238 percent subscription rate.

This approval will allow the commercial lender to issue and list an additional 42,663,040 ordinary shares at a rights issue price to be announced by the Company to shareholders of ordinary shares of NIC Bank Limited on the register of its members at the close business on October 2, 2014. Through the capital raising exercise, the bank expects to raise Kshs2.1 billion for the purpose of expanding its capital base. The rights issue will open on Thursday, October 23rd, 2014 and close on Monday, November 17th, 2014.

While announcing the approval the CMA noted that, it has reviewed the disclosures by NIC Bank Limited and is satisfied that all the requirements have been met in accordance with the Fourth schedule of Capital Markets (Securities) (Public Offers, Listings and Disclosures) 2002.’

A rights issue is an offer given by a company to existing shareholders to buy a proportional number of additional shares at a given price, within a fixed period. Rights are often transferable and a shareholder may sell them on the open market.

15 September 2023

CMA approves Diamond Trust Bank rights issue

brenda Press Release

We would like to clarify that the Board of the Capital Markets Authority has adequate quorum as prescribed under the Capital Markets Act Chapter 485A of the Laws of Kenya to conduct business and make decisions notwithstanding the lapse of term for some of its members.

The Board currently has seven members and this number surpasses the quorum requirement of six members in accordance with the provisions of the Act. The Board of the Authority has therefore since the end of May 2014 continued to hold meetings and made decisions in compliance with the provisions of the Act always being quorate.

Further Section 6 subsection 3 of the Act which states that in the absence of the Chairman “the members present shall elect one of their number who shall, with respect to that meeting and the business transacted thereat, have all the powers of the chairman provides for the seamless holding of the meetings of the Authority even in the event of a vacancy in the office of chairman and this has been the case since the departure of the previous office holder. “

We would like to confirm that the Board of the Authority has the quorum to make all decisions according to the power vested upon it to ensure the smooth running of the organization and the capital markets industry.

15 September 2023

CMA approves issuance by Britam of a Ksh5 billion corporate bond with a green shoe option of Ksh1 billion

brenda Press Release

Nairobi, June 6, 2014…In an effort to deepen the corporate bond market, the Capital Markets Authority (CMA) has approved the issue of a Ksh5 billion Medium Term Note Programme by British American Investment Company (Britam) to be used to fund strategic business initiatives.

Prior to giving the approval, the Authority reviewed information provided and is satisfied that it meets the eligibility requirements for Public Offering of Fixed Income Securities and Listing on the Fixed Income Securities Market Segment and is satisfied that contained in the second schedule of the Capital Markets (Securities) (Public Offers, Listing and Disclosures) Regulations, 2002.

The bond will be issued in two tranches as follows; the first tranche will amount to Ksh3 billion and with the option to take up to an additional amount of up to Ksh1 billion in a green shoe option, while the second tranche will amount to Ksh2 billion.

Britam expects to use the funds to support several strategic initiatives including; real estate opportunities; private equity opportunities; local and regional business growth; and ICT investments.

ENDS

BACKROUND INFORMATION ON THE CAPITAL MARKETS AUTHORITY

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

Capital markets stakeholders’ host consultative meeting on framework for introduction of Exchange Traded Funds

CMA enhances Investor Education County Outreach Program

CMA enhances outreach within the counties

CMA Nominated for Microsoft Awards Press Release 09102014

CMA hosts Islamic Finance Roundtable

CMA recognized for Outstanding Business Achievements

CMA Acting Chief Executive Elected to IOSCO Board

CMA approves NIC Bank Rights Issue

CMA approves Diamond Trust Bank rights issue

CMA approves issuance by Britam of a Ksh5 billion corporate bond with a green shoe option of Ksh1 billion

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