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.