Objective Capital's West Africa Investment Conference 2012 Moevenpick Ambassador Hotel in Accra, Ghana 7-9 May 2012 Speaker: Adu Anane Antwi, Securities & Exchange Commision, Ghana

1. WEST AFRICA
INVESTMENT CONFERENCE
Initiatives to Develop the Capital Markets in Ghana
Adu Anane Antwi – Director-General, Securities & Exchange
Commission, Ghana
MOEVENPICK AMBASSADOR HOTEL IN ACCRA, GHANA MONDAY-WEDNESDAY, 7-9 MAY 2012
www.ObjectiveCapitalConferences.com

2. FAIRNESS | INTEGRITY | PROTECTION
“Promoting the orderly growth and development of an efficient, fair and transparent
securities market in which investors and the integrity of the market are protected through the
proactive implementation of the Securities Laws”

3. INITIATIVES TO DEVELOP THE CAPITAL
MARKETS IN GHANA
PRESENTED BY
ADU ANANE ANTWI
DIRECTOR-GENERAL
SECURITIES AND EXCHANGE COMMISSION, GHANA
AT
WEST AFRICA INVESTMENT CONFERENCE
ACCRA, GHANA
9TH MAY, 2012

4. SEC’s MANDATE
The SEC , the apex regulatory body of the securities
market is given both regulatory and market
development mandates under the Securities Industry
Law, 1993 (PNDCL 333) as amended.
Section 9 (i) of the SIL requires the SEC to create the
necessary atmosphere for the orderly growth and
development of the capital market.
The SEC is currently pursuing various initiatives aimed
at developing the capital market.

5. Government Policies
These include:
 The use of the GSE for privatisation (not fully)
 Removal of Investment Restrictions on Foreign Investors
 Pension Reforms
 Capital Gains Tax Exemption on Listed Securities
 VAT Exemption for Mutual Funds & Unit Trusts
 Tax Rebate for Listed Companies for the first 3 years
 Tax Exemption for the GSE
 Institution of Financial Literacy Week
 Establishment of National Bond Market Working
Committee.

6. Review of the Securities Industry Law
The SIL is being amended to make it be of international
standards to enable SEC Ghana become an IOSCO ‘’Signatory A’’
country to be able to sign IOSCO’s MMoU.
Ghana has been given up to the end of this year to bring its
securities laws to international standards determined by IOSCO.
The amendment will bring new operators like commodity
exchanges, credit rating agencies, nominee accounts
operators, hedge funds, private equity funds, and venture capital
funds under regulations.
The amendment will also bring to the market new activities
like market making, securities lending & borrowing, margin
trading & financing and trading of derivative instruments.

7. Installation of an Electronic Market
Surveillance System
The SEC has installed an electronic market
surveillance system to ensure efficient and
effective market surveillance.
The Commission is to upgrade the system to
link up back room operations of market
operators.

8. Establishment of a Market Development
Committee
 The Committee with representatives from the SEC, GSE and the
Ghana Securities Industry Association is to facilitate market
development. It is mandated among other things to:
•Facilitate more listings on the Ghana Stock Exchange
•Explore the introduction of new products
•Promote the development of the Bond Market (working with the
NBMWC)
•Develop strategies to improve liquidity on the stock exchange
Contacts made with Agricultural Development Bank, Ghana
Re, GT Bank, Ghana Water Company, State Housing
Company, Electricity Company of Ghana, Ghana Airports
Authority, Volta River Authority, Ghana Grid Company and
Cocobod.
Plans to meet with all the un-listed banks in the country as well
as the un-listed companies under the Club 100 list to encourage
them to use the GSE to raise funds for their operations through
the issue of either equity or bonds.

9. Establishment of Ghana Alternative Investment
Market
The Commission is working together with the GSE to
establish the Ghana Alternative Investment Market. We
are currently working on the rules of the GAIM.
The Government has given its full support for this.

10. Establishment of Commodity Exchange
The Commission in 2010 commissioned a feasibility
studies into the establishment of a commodity
exchange in Ghana. SEC is currently working together
with the Ministry of Trade to establish the Ghana
Commodity Exchange.

11. Promotion of Exchange Traded Funds
The SEC is working with the Ghana Stock Exchange
for the introduction of Exchange Traded Funds (ETFs)
on the exchange.
The Rules for ETFs have been approved by the SEC.
We are currently working on the listing of the first
EFT on the GSE.

12. Promotion of Real Estate Investment Trusts
The SEC is currently developing rules for the
operation of REITs. The development of REIT will create
a strong link between the capital market and the real
estate sector to help solve the housing deficit in the
Country.

13. Promotion of Investment Clubs
The SEC is working to promote Investment
Clubs in the country and educate their
members on investment and securities.
The SEC will develop and publish guidelines
for Investment Clubs

14. Adoption of Risk Based Supervision
The SEC will be commissioning a consultant to
conduct a risk assessment of the Securities Industry
and assist the SEC to adopt a risk based methodology
for supervision.

15. Issue of Anti-Money Laundry, Combating
Financing of Terrorism (AML/CFT) Manual
The SEC has issued an Anti Money Laundering and
Combating the Financing of Terrorism (AML/CFT)
Compliance Manual for Capital Market Operators.
The manual covers policies and procedures on
conducting customer due diligence, record
keeping, internal control, compliance and audit.
Capital Market Operators are obligated to establish
an anti-money laundering program and report
suspicious activities.

16. Promotion of Market Association
 The SEC is working to ensure that the Ghana
Securities Industry Association becomes a vibrant
market association to help champion the concerns of
the market and contribute to policy making to boost
market development.
 Effective July 2012 the SEC will require a licence
renewal application to be accompanied by a letter
from the GSIA that the operator is a member in good
standing.

17. Advocating for Additional Incentives for Issuers
and Investors
The SEC is preparing analysis for the proposal
of further tax incentives for issuers and
investors, eg:
• Tax Exemption on Interest paid to Individuals on
Listed Bonds
• Tax Exemption on Dividends earned by Individuals
from Listed Equities

18. Introduction of an enhanced Corporate
Governance standards for the market
The current corporate governance manual is
to be reviewed and improved.
The SEC will adopt measures to ensure
compliance with the enhanced corporate
governance standards by the industry.

19. Establishment of Securities Institute and Resource
Centre
The SEC is working with the market to establish the Ghana
Investment and Securities Institute (GISI). A committee is
currently working a plan to convert the current securities courses
run by the GSE into courses of the Institute.
The courses are to be developed further into what is
recommended in a feasibility report on the institute when
funding it available and physical structures for the Institute
developed. GISI will be the training and certification institution
for all capital market operators.
 The SEC is also to set up an Information Resource Centre
(IRC), which provides a comprehensive range of services
including those utilising the latest downstream applications in IT

20. Capital Market and Compliance Officers’ Fora
The SEC has introduced semi-annual meetings with
capital market operators, called Capital Market Forum
and with Compliance Officers of regulated entities
called Compliance Officers’ Forum to help bridge the
gap between the regulator and the regulated entities
and discuss issues of concern to the SEC and CMO’s for
the development of the market.

21. Institution of Capital Market Week and Other
Investor Education Programmes
Annual Capital Market Week (formally Securities Week)
Designing and Printing of Investor Education Materials
Development of Computer Based Investor Education Programs
The publication of a quarterly newsletter for the Commission
to increase the knowledge and awareness of the capital market
in Ghana by providing information to readers.
Partnership with a private sector institution to organise a Youth
Investment Programme. The first was held in Accra in November
2011. Subsequent ones are to held in Kumasi, Takoradi and Cape
Coast this year.
Establishment of tips, complaints and referrals ("TCRs") system
with a toll free telephone line to improve the SEC’s ability to
obtain information from the public and educate the public.

22. Institution of Annual Capital Market Conference
The SEC will organise the first Annual Capital
Market Conference in Ghana in October this year. This
conference is to bring together all capital market
operators, policy makers, and law maker to
brainstorm about issues concerning the capital
market.
Some regulators, policy makers, and operators from
other African markets will be invited to share their
experiences with us during the conference.

23. Establishment of an Investor Education Fund
The SEC is planning for the establishment of an
Investor Education Fund to ensure a sustained investor
education in the country.
The SEC has the duty to help investors to invest
wisely and avoid fraud.
We believe a well informed investor is usually a well
protected investor. Investor education can be an
effective deterrent against investment scams and help
the SEC achieve its investor protection goal.

24. Advocating for a Capital Market Local Content
Policy
The SEC believes that there is the need for
Government to get companies like
telecoms, banks, mining and other oil and gas
companies to list on the GSE.
We are advocating for a Government policy that will
compel foreign companies in selected industries to
float part of their shares on the GSE after operating for
5 years. This should be part of licensing conditions for
such companies.

25. Establishment of Investor Protection Fund
The SEC is to commission a study into the setting up
of an investor protection fund for investors not covered
by the fidelity fund of the stock exchange and work
towards its establishment.
The fund will ensure investor protection and market
stability.

26. Regional Integration
 The SEC is to work with securities regulators, exchanges
and other stakeholders in the ECOWAS region towards
the harmonisation of rules and regulatory frameworks to
ensure the integration of our markets.
 The SEC has already signed an MOU with Nigeria SEC and
plans to sign an MOU with Conseil Regional De L’epargne
Publique Et Des Marches Financiers (CREPMF) before the
end of June this year.
 The SEC has also held discussions with WAMI on ways to
facilitate the integration of ECOWAS capital markets.

27. INITIATIVES TO DEVELOP THE CAPITAL
MARKETS IN GHANA
END
THANK YOU