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Capital Markets Operations to Continue Normally Despite COVID-19 in Kenya – CMA

In line with the mandate of ensuring an orderly, fair and efficient market as well as protection of investors, the capital markets industry is working jointly to ensure that market activities continue normally as Kenya copes with the devastating effects COVID-19 is having on the global economy and after the confirmation of a few known cases in the country reported to date. The Capital Markets Authority (CMA), Nairobi Securities Exchange (NSE), Central Depository and Settlement Corporation (CDSC) and the other market players are working closely to ensure normal operations during this time, despite the scaled down physical interaction measures taken.

CMA Acting Chief Executive, Mr. Wyckliffe Shamiah, said the Authority has put in place necessary business  continuity plans to ensure the safe and orderly conduct of its business during this time and is working with the entire capital markets industry so that appropriate measures are taken as the usual service is made available. Mr. Shamiah observed, ‘’CMA continues to collaborate with NSE and CDSC, market intermediaries, issuers and other capital markets industry stakeholders to ensure that there is minimal disruption to market activities while supporting the Government of Kenya strategies to contain the spread of the Coronavirus’’. He added that although the overall impact on the economy, based on what has been witnessed to date is likely to be very considerable, the Authority is looking into measures to alleviate the resultant effect on the industry. In this regard, and following the recent Presidential Directive that suspended public gatherings and meetings among other measures, listed companies and licensed persons including collective investment schemes that were scheduled to hold their Annual General Meetings (AGMs) in March, April and May 2020, are advised to defer the meetings to a later date while ensuring all affected stakeholders are notified in good time. Mr Shamiah added that although the market had reacted immediately the first COVID-19 case was confirmed, it had since corrected itself and, going by the subsequent activities, there exist great investment opportunities that investors can take advantage of, especially local investors.

The NSE Chief Executive, Mr. Geoffrey Odundo, said, “We are witnessing some stabilization of market activity with signaling improvements in participation by local investors and increased inflow of foreign investor capital. This is reflected by the recovery witnessed in the NSE 20 share index in the last few days. We are happy to note that investors continue to diversify their portfolios across the various asset classes available at the Exchange. We are confident that market performance will continue to improve steadily and urge investors to take advantage of online and mobile trading platforms to participate in the market and track their investments’’.

The CDSC Chief Executive, Mr. Nkoregamba Mwebesa, affirmed that sound Business Continuity Plans are in place to ensure seamless settlement of all securities traded at the exchange. Mr. Mwebesa further noted that “in the endeavor to support the Government to contain the spread of CoviD-19, CDSC issued a circular on 16 March 2020 to all its stakeholders providing alternative channels to be used for delivery of physical documents to minimize physical contact”. CDSC continues to offer all services the stakeholders and shall closely monitor the events of the Coronavirus as they unfold and adjust its’ business decisions as may be necessary.