CSD ready to support capital market
The Central Securities Depository Ghana Limited (CSD) has indicated its preparedness to help provide the infrastructure and technical expertise needed for smooth registration, safekeeping, settlement and efficient processing of securities transactions in the financial market.
That, it said, was needed to help create a conducive environment to attract investors into the economy.
The Chief Executive Officer (CEO), Mr Stephen K. Tetteh, said the CSD was working to position itself at the core of the financial markets in order to help make the country an appealing destination for investments.
"Generally, informed investors will not go to a market where there is no CSD because they know how important a depository is to their investments. Going forward, we want to continue to ensure that we build and sustain investor confidence,” Mr Tetteh said.
The processes to settle transactions in debt and equities, also called securities, were done manually prior to the introduction of the central depository services 10 years ago.
This, according to the CEO, was highly inefficient, hence the commitment by the company to help reduce such challenges.
“Over the 10-year period, the CSD has drastically reduced human intervention and automated most of the processes to ensure smooth transfer of securities. This has also minimised the risks associated with securities settlement, increased trading of securities in the country, helped boost growth in the capital market and to grow the businesses of stock brokers and custodians,” Mr Tetteh said in an interview.
In January this year, the GSE Securities Depository and the Bank of Ghana Depository merged in line with plans to help reduce transaction costs and inconveniences associated with operating two depositories in the country’s relatively small market.
Although the merger took effect in January, the CEO said investment records on debt and equities were still on separate platforms and work was ongoing to unify them.
"We have integrated our operations and staff but the process to integrate the two systems is still ongoing and will be completed by the end of the year. We are also interfacing the CSD system with the GSE Automated Trading System and that should be completed by the close of the year," he assured.
Upon completion, registered investors would maintain their investment in both debt and equity in a single account. As a result, the transaction costs of brokers, custodians and other market players will reduce, leading to an improvement in the respective cash flows.
The Associate Director of Fixed Income Trading at Standard Chartered Bank, Mr Emmanuel Nambware, said in a separate interview that the CSD was an important institution in the country's financial market, as it served as a vehicle to attract investors into the country.
"In these times where technology has taken over most facets of banking and investment, it will be impossible not to have the CSD. The next step for the Ghana CSD is obviously to position itself and project the organisation as an integral part of the country’s quest to be a regional and international financial destination for the financial markets," he added.
The company, which operates from the Cedi House in Accra, is preparing to mark the 10th anniversary of the introduction of securities depository services into the country.
It expects to use the occasion to fraternise with industry players and chart a new course for the operations of securities depository services in the country.
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