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OTC Securities Exchange Kenya

Overview

Abstract

The Project is a technical assistance project in partnership with KBA to establish an Over-The-Counter (OTC) Bond Exchange in Kenya with a future aspiration of serving the wider East African region. The OTC Exchange will essentially serve dual roles – as a trading platform provider and as a frontline market conduct and integrity regulator. This intervention seeks to help develop the bond markets and other supporting markets such as money markets, foreign exchange, and derivative markets.

The Project has three workstreams; i) Exchange structure and model, ii) Exchange registration and licensing, and iii) Exchange operationalisation.

Results

  • Establish and operationalise the EABX OTC Exchange with scale-up and replication plans in the East African Region.
  • Better-informed market actors on public debt and capital markets, leading to increased investor confidence in the public debt market.
  • Improved liquidity and transparency in bond markets
  • Improve efficiency and safety in the bond market
  • Ultimately reduce funding cost for debt capital market issuances by supporting a more credible benchmark yield curve.
  • More responsive, comprehensive, and effective policy and regulations to enable public market development.
  • Development of efficient and effective innovative products.

Project Details

Project Title

OTC Securities Exchange Kenya

Implementing Partner

The Kenya Bankers Association (KBA), FMDQ

Donor(s)

FSD Africa

Value (in £)

TBC

Implementation Period

2018 - 2022

Countries Covered

Kenya

Project Description

The Project is a technical assistance project in partnership with KBA to establish an Over-The-Counter (OTC) Bond Exchange in Kenya with a future aspiration of serving the wider East African region. The OTC Exchange will essentially serve dual roles – as a trading platform provider and as a frontline market conduct and integrity regulator. This intervention seeks to help develop the bond markets and other supporting markets such as money markets, foreign exchange, and derivative markets.

The Project has three workstreams; i) Exchange structure and model, ii) Exchange registration and licensing, and iii) Exchange operationalisation.

Target results

  • Establish and operationalise the EABX OTC Exchange with scale-up and replication plans in the East African Region.
  • Better-informed market actors on public debt and capital markets, leading to increased investor confidence in the public debt market.
  • Improved liquidity and transparency in bond markets
  • Improve efficiency and safety in the bond market
  • Ultimately reduce funding cost for debt capital market issuances by supporting a more credible benchmark yield curve.
  • More responsive, comprehensive, and effective policy and regulations to enable public market development.
  • Development of efficient and effective innovative products.

Progress

  • EABX CEO onboarded from March 2022.
  • The onboarding process for the other key personnel, such as the Chief Operating Officer (COO), Chief Legal & Regulatory Affairs Officer and Chief of Staff, is ongoing.
  • Plans to deploy the development fund are underway.

Contact

Updated: November, 2022