About Capital Markets - Investor Relations Services Portal

About Capital Markets

Understanding Kenya's Capital Markets Ecosystem

Stock Issuers Shareholders Participants IR & Registry

Security Issuers in Kenya

Entities authorized by the Capital Markets Authority (CMA) to issue securities

What is a Security Issuer?

According to the Capital Markets Authority of Kenya, a security issuer is any entity that is authorized to issue securities to the public for the purpose of raising capital.

These securities may include shares, bonds, debentures, or other financial instruments that are traded in the capital markets.

Public Companies

Listed companies that have issued shares to the public through the Nairobi Securities Exchange (NSE).

Government

The Kenyan government issues treasury bonds and bills to finance development projects.

Regulatory Requirements

  • Must be licensed by the CMA
  • Required to disclose financial information regularly
  • Must comply with corporate governance standards
  • Required to protect investor interests
  • Must adhere to securities issuance guidelines
  • Subject to ongoing supervision by CMA

Types of Shareholders

Understanding ownership in public listed companies

Shareholder Categories

Institutional Investors

Professional organizations that invest on behalf of others:

  • Pension funds
  • Insurance companies
  • Mutual funds
  • Investment banks
  • Asset management firms

Typically hold large blocks of shares and have significant influence

Retail Investors

Individual investors who buy and sell securities:

  • Individual traders
  • Small-scale investors
  • First-time investors
  • Employees through ESOPs

Typically hold smaller positions but important for market liquidity

Foreign Investors

International individuals and institutions:

  • Foreign institutional investors
  • International mutual funds
  • Foreign individuals
  • Diaspora investors

Important for capital inflows but sensitive to exchange rate risks

Strategic Investors

Investors with long-term business interests:

  • Founders and promoters
  • Corporate partners
  • Government entities
  • Private equity firms

Often seek board representation and strategic influence

Market Infrastructure

Key institutions supporting Kenya's capital markets

Market Participants

1

Central Depository & Settlement Corporation (CDSC)

The CDSC plays several critical roles in Kenya's capital markets:

  • Provides electronic custody of securities
  • Facilitates settlement of trades
  • Maintains ownership records
  • Enables corporate actions processing

The CDSC reduces settlement risk and provides investor protection through its secure systems.

2

Market Participants

Various entities participate in Kenya's capital markets with specific roles:

Stockbrokers

Licensed intermediaries who execute buy/sell orders on behalf of investors.

Investment Banks

Facilitate capital raising through IPOs and other securities offerings.

Fund Managers

Manage collective investment schemes and portfolio investments.

Regulators

CMA and NSE ensure market integrity and investor protection.

Investor Relations & Retail Participation

Enhancing fair access and participation in capital markets

Promoting Fair Access

Effective investor relations plays a crucial role in ensuring retail shareholders have fair access to information and participation opportunities in the stock market.

Information Equality

Investor relations ensures:

  • Timely disclosure of material information
  • Clear communication in simple language
  • Equal access to company updates
  • Transparent financial reporting

Investor Protection

IR activities help protect retail investors by:

  • Educating about investment risks
  • Preventing information asymmetry
  • Ensuring fair treatment of all shareholders
  • Providing channels for investor feedback

Role of the Investor Relations Platform

This platform enhances retail participation by:

  • Centralizing investor information
  • Simplifying complex financial data
  • Providing educational resources
  • Enabling direct communication with issuers
  • Offering tools for investment analysis
  • Facilitating participation in corporate actions
Key Benefit

By democratizing access to information and tools traditionally available only to institutional investors, this platform helps level the playing field for retail investors in Kenya's capital markets.

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