Per Section 209 of the Securities Industry Act 2016, (Act 929), which is in line with the commission’s mandate of regulating and promoting the growth and development of an efficient, fair, and transparent securities market, the Securities and Exchange Commission (SEC) has introduced new capital requirements for all market operators in the country.
December 31, 2021, is the designated deadline for existing players to meet SEC’s new capital requirements. However, new entrants are expected to meet the new capital requirement immediately before a license is issued. The market players include but are not limited to, clearinghouses, corporate and individual investment advisors, security depositories, issuing houses, trustees, and broker-dealers.
The “new minimum capital requirements for market operators were expected to be in force by end of next year, therefore, existing market operators would be expected to be fully compliant by 31st December 2021 while new entrants would be required to meet the new requirements immediately,”
Reverend Daniel Ogbarmey Tetteh, Director General of the Securities and Exchange Commission, made this statement speaking at the Annual General Meeting (AGM) of the Ghana Securities Industry Association (GSIA) in Accra.
The new capital requirements vary across the different market players. Fund managers for instance are required to raise a minimum of GH¢2million while broker-dealers are required to have a minimum capital of GH¢1.5million. Other capital requirement includes:
• Clearinghouses and custodians to raise GH¢50million
• Corporate investment advisors to raise GH¢1million
• Individual corporate advisors to raise GH¢200,000
• Issuing houses to raise GH¢1million
• Securities depository to raise GH¢50million
• Securities exchange to raise GH¢10million
• And primary dealers, mainly banks to raise GH¢400million.
The Director-General of the Securities and Exchange Commission, further noted that the new capital requirements should be of no surprise to market players as the new capital requirements had been discussed before the implementation.
The move is to strengthen the integrity of the capital market and boost investor confidence.
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