Nairobi Securities Exchange will withstand political shock and emerge stronger, NSE chief executive Geoffrey Odundo has said.
He noted that the ongoing political standoff had impacted negatively on the performance of Kenya’s stock market but reiterated Kenya’s stock market resilience and its ability to recover much faster from such shocks.
“We’re hopeful that our own political issues will be put to bed soon. We are looking at a couple of IPOs next year and the government is also looking at ways to restart the privatisation programme. We believe that if we get two companies from the infrastructure and energy sectors, interest from the corporate side will spark and this will help in market recovery,” he said.
Mr Odundo was speaking at the 7th Annual EFG Hermes London Conference, where opportunities in the Nairobi Securities Exchange were discussed on-stage with a large gathering of global investors, fund managers and financial institutions.
Noting the recent development of domestic capital pools in the form of buoyant pension and mutual fund industries will help in boosting market liquidity.
“We are very committed to having pension funds enhance liquidity in the market. We are looking at how direct property ownership can be reduced from 20% to 2% to support the Real Estate Investment Trust (REIT) market,” Mr Odundo said.
Increasing access
Mr Odundo said the regulator will work closely with other stakeholders to increase access and education for retail investors through the use of technology.
“Kenya has a very advanced mobile money platform that we have successfully leveraged. We are encouraging the rollout of products on that platform. This year, we launched a retail mobile bond for the government of Kenya. That’s just a start in educating the public on capital market securities,” he said.
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“The second level is to use the broking network to aggregate these clients. A lot of brokers have now developed online trading platforms to encourage real-time access and transparency. We have a very young population; we encourage simulation trading before even going into live trading as part of an educational, entertaining initiative. Those are the key steps in our efforts to increase retail investors – education and access for the investors.”
The 7th annual EFG Hermes London Conference, the largest MENA and frontier investor conference recorded the attendance of global investors with more than $9tn in aggregate assets under management and a large line-up of senior executives from leading listed companies based in MENA, sub-Saharan Africa, and Asia.
“Investors are increasingly seeking opportunities in Frontier Emerging Markets that will drive the lion’s share of global growth over the coming decade. EFG Hermes’ objective is to bridge the gap between global capital and opportunities in high growth markets like Kenya in a holistic manner,” said EFG Hermes Frontier Chef Executive Officer Ali Khalpey.
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