Investor Protection Fund in the offing as SEC, Finance Ministry unveil plans to protect investors
The Securities and Exchange Commission (SEC) in collaboration with the Finance Ministry, are working to set-up an Investor Protection Fund for investors.
The objective of the Investor Protection Fund, according to the Head of Bank and Non-Bank Unit at the Finance Ministry, Andrew Ameckson, is to compensate retail investors whose investments are impaired in the event that asset management firms default in meeting admitted claims of investors.
He made the assertion speaking to norvanreports on the sidelines of the Ghana Stock Exchange’s (GSE) annual ‘Ring the Bell’ programme to mark the local bourse’s 33rd Anniversary Celebration themed, “Resilience and Adaptability: Thriving in Challenging Times”.
According to Mr Ameckson, the establishment of the Fund has become imperative given the recent financial sector clean-up which revealed numerous challenges that require liquidity enhancement for the Asset Management Industry (AMI) to boost investor confidence, as most investors are finding it difficult to redeem their investments.
“The fund will be positioned to mitigate the fiscal impact of such future occurrences and in market dislocation events,” he noted adding that, the Ministry of Finance and SEC are currently working to develop a legal framework and strategic plan to operationalize the Fund.
The Investor Protection Fund being developed by the SEC and Finance Ministry can be likened to the Depositors’ Protection Scheme. The major difference between the two, is that the former is mainly targeted at investors whereas the latter is targeted at depositors.
Speaking at the event was the Managing Director of the GSE, Abena Amoah, who noted that the GSE in its 33-year existence, has recorded a total trade volume of GHS 750bn across its trading platforms.
She noted that the GSE is currently working towards enlisting 100 companies on the bourse to boost its market capitalization and share of the country’s GDP from a single digit to double-digit.
With the current market capitalisation of GHS 74.5bn, the GSE’s market capitalization equals 8.6% of Ghana’s current GDP.
