Capital Market Authority Kenya is a government agency.
This agency is part of the financial market, and it regulates the licensing and regulation of capital markets.
In short terms, it brings together investors and borrowers of capital and governs their interactions.
At the moment, the capital market authority Kenya has won the title the most innovative capital market regulator in Africa.
In this article, we will look at:
- When was the capital market authority formed?
- What does it exist to achieve?
- Why it is the most innovative capital market regulator in Africa
When was the Capital Market Authority formed?
This regulatory AuthorityAuthority has been in existence since 1989 through an act of parliament.
However, it was not until March 1990, when this body became inaugurated, therefore adopting a common seal and perpetual succession.
Over the years, the capital market authority mission has evolved as its leadership changed.
It’s vision today is always to be an innovative regulator of a globally competitive market.
What does the capital market authority exist to achieve?
The capital market authority has many objectives. However, chief among those many include:
- To make sure that Kenya has sound institutions, market infrastructure, and operation- through regulating the shares and stocks to trade at the Nairobi Stock Exchange.
- Ensuring efficiency in capital markets through the use of technology.
- Promoting diversification and development of capital markets.
- They are making sure that the capital markets authority operates at the best level of operational excellence.
- They are making sure that capital market policies are facilitative of development and efficient growth of the markets.
- Act as a great strategic advisor to the direction that the capital markets are headed to.
Why it is considered as the most innovative capital market regulator in Africa
Moreover, the capital markets Authority Kenya is the most innovative and creative one over all the rest.
This is due to several factors, such as:
- The AuthorityAuthority is very keen to create the right environment that supports the adoption of financial technology. Recently it launched one of its kind tool known as a regulatory sandbox.
- The regulatory sandbox presents a platform for innovators to engage with the AuthorityAuthority on a more open platform for discussion. As a result, offering the AuthorityAuthority more creative solutions to approach product dissemination.
- Moreover, the AuthorityAuthority has recently introduced the first real estate investment trust.
- In addition to all this, the capital market authority introduced the Green bond in Kenya. This shows that the AuthorityAuthority is continuously evolving as the global financial markets keep changing.
- Moreover, the capital market authority has also been able to launch financial derivatives as well as the futures markets.
How does the Capital Market Authority Develop & Regulate the Capital Markets?
To regulate the capital markets, the AuthorityAuthority through its board of directors and chief executive has a regulatory framework.
Acts, rules, and regulations make up this regulating framework for the Authority.
Some of the main Acts by this AuthorityAuthority include:
- The Central Depository Act, 2000
- The Capital Markets Acts
When it comes to the rules and regulations, there are plenty of them to ensure that all players act in a just and fairway. They include:
- The capital markets regulation, 2001 (Collective investment schemes)
- Tribunal rules, 2002
- The capital markets regulation, 2002 (Foreign markets regulations)
- Registered venture capital companies regulation, 2002
- Asset-Backed Securities Regulation, 2007
- Among many others
Conclusion on Capital Markets Authority
If you have not yet invested in the Kenyan capital market, be assured that the AuthorityAuthority is doing everything it can to make sure that you trade safely.
Therefore there is no need to keep doubting, start trading today!