Ghana’s Securities and Exchange Commission plans to increase the minimum capital requirement of fund managers to ‎GH₵2 million

The Securities and Exchange Commission (SEC) says it will increase the minimum capital requirement of Ghana's fund managers to $365,260 (GH¢2 million) from the current $18,281 (GH¢100,000).

Director General of the Securities and Exchange Commission, Daniel Ogbarmey Tetteh
  • The Securities and Exchange Commission says it will raise the capital requirement of Ghana's fund managers.
  • Director-General of the SEC says the managers that fail to meet the requirement will “fall out”.
  • The requirement will be raised to $365,260 (GH¢2 million) from the current $18,281 (GH¢100,000).

The Director-General of the SEC, Daniel Ogbarmey Tetteh who spoke to Bloomberg noted that fund managers who will not be able to meet the new capital will have to "fall out".

According to him, the directive, which will require law changes, will be fully communicated by the end of the year for compliance by December 2020.

Low Capital Requirement

Mr Tetteh further explained that existing capital requirements were too low, allowing too many people to start fund-management companies which hindered supervision.

He said, “Some who will not be able to meet that capital will have to fall out.”

Adding that “If you are a fund manager you must keep to the obligations in the contract with your clients. You signed an investment contract to do ABC -- just stick to it.”

The reason for the increment

The markets' regulator aims at strengthening the industry and restoring confidence.

It said at least 70,000 investors struggle to access savings that were trapped in the aftermath of a separate clean-up of banks, savings and loans companies, and micro-lenders.

SEC investigations

The SEC is investigating 21 fund managers for sinking as much as GH¢5 billion in risky investments such as unlisted bonds, direct private equity stakes and related-party deals that are difficult to liquidate.

It is as well investigating another GH¢4 billion is tied up in fixed-term investments, which are now starting to trickle in after the government stepped in and bailed out failed banks with GH¢11.2 billion and microlenders with another GH¢925 million.

JOIN OUR PULSE COMMUNITY!

Unblock notifications in browser settings.

Eyewitness? Submit your stories now via social or:

Email: news@pulselive.co.ke

Recommended articles

9 most expensive African countries to rent a one bedroom apartment, based on property price to income ratio

9 most expensive African countries to rent a one bedroom apartment, based on property price to income ratio

Top 10 happiest countries in Africa in 2022

Top 10 happiest countries in Africa in 2022

Here are the top 10 cities in Africa where the most rich people live

Here are the top 10 cities in Africa where the most rich people live

Africa’s richest man Aliko Dangote poised to overtake another Russian billionaire Vladimir Lisin on Bloomberg billionaires list

Africa’s richest man Aliko Dangote poised to overtake another Russian billionaire Vladimir Lisin on Bloomberg billionaires list

These 6 countries have the highest unemployment rates in Africa

These 6 countries have the highest unemployment rates in Africa

Mzee Kibor's will made public, revealing how vast wealth and millions will be distributed

Mzee Kibor's will made public, revealing how vast wealth and millions will be distributed

Ini Edo posts new photos amid reports of welcoming a baby through surrogacy

Ini Edo posts new photos amid reports of welcoming a baby through surrogacy

Top 10 African countries with the highest corporate tax rates

Top 10 African countries with the highest corporate tax rates

Referee behind chaos at AFCON was rushed to hospital after match

Referee behind chaos at AFCON was rushed to hospital after match