Prime News Ghana

SEC increases capital requirement for capital market operators

By Justice Kofi Bimpeh
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The Securities and Exchange Commission (SEC) has indicated that it will increase the minimum capital requirement for companies operating within the Capital Market by end of year.

Director General of the Securities and Exchange Commission, Reverend Daniel Ogbarmey Tetteh said legal processes are already underway to strike out provisions in the existing LI, (1728) which specifies the current minimum requirements.

“I am very hopeful that we will come out as soon as possible. Because we started having this conversation way back in 2018. We did the market engagements, concluded with all the relevant stakeholders,” he said in an interview with Citi FM.

The companies in the Capital Market include Fund managers, mutual funds, unit trusts, broker-dealers and custodians.

Fund Managers, for instance, will have their present minimum capital of Ghc100,000 increased to Ghc2 million. The move is to help sanitize and strengthen the capital market.

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As at December 2018, there were 140 fund managers, 35 mutual funds, 19 Unit Trust, 22 broker dealers, two securities exchanges, 16 custodians, 15 primary dealers, five trustees, four registrars, five issuing houses, nine investment advisors and one venture capital fund operating in the country.

Total funds being managed by these organizations amounts to Ghc35 billion. Out if the figure, pension funds amount to 30.5%.

Collective investments schemes is 8.5% while managed accounts is 61%. Thirty-four per cent of the funds managed by the companies are held in government bills and bonds while 12% is being invested in listed companies. The remaining funds are spread across banks.

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