Capital
Markets Authority (CMA) has issued guidance to enable various market players adhere
to compliance requirements, following market trends due to Coronavirus
outbreak.
The CMA
Acting Chief Executive, Mr. Wyckliffe Shamiah, said that the deadline for all
the licensed intermediaries, issuers of securities to the public, Collective
Investment Schemes and other approved persons with timelines for submission and
publication of audited financial statements in March and April 2020, is extended
by one month respectively.
However,
firms that can complete and file their statements within the regulatory
timelines, are encouraged to do so to ensure investors obtain information in a
timely manner.
Mr. Shamiah
added that the authority is sensitive to the unfolding financial situation
affecting market players and has relaxed disclosure obligations in relation to
publication of financial statements until 30 June 2020.
To ensure
timely flow of the required information to the investing public, CMA directed
that all required disclosures be published on their own websites and social
media platforms, Nairobi Securities Exchange website for all issuers and
trading participants and the CMA website by all entities affected by this
guidance.
However,
firms that have no challenges publishing the same in the newspapers are
encouraged to do so.
Firms
subject to other regulatory obligations beyond those of the CMA are advised to
engage the relevant regulators in case an obligation may have been altered by
the Authority’s guidance, but is applicable under a different regime outside
the Authority’s mandate.
Mr. Shamiah
explained that assessment of secondary market performance indicates a decline
in equity market prices, reflected in the stock indices, with the NSE-20 Share
Index declining by 4.9 percent last week, compared to the significant decline
of 11.5 percent in the previous week.
The
performance of the Kenyan market seems to be better off than many securities exchanges
globally. Varied performance is expected among listed companies as some of the
sectors of the economy may be more affected than others.
The exit by
some foreign investors from the market has created an opportunity for local
retail and institutional investors to take advantage of the undervalued shares
of listed companies.
Local
investors such as pension schemes, collective investment schemes and insurance
companies with a long-term investment plan are encouraged to invest in blue-chip
companies listed during this period, subject to existing limits on asset class
investments set out by their respective regulators.
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