- SEC Levy Shock Could Deepen Ghana’s Treasury Bill Dependence – Expert Says
Ghana’s effort to strengthen the financing of capital-market regulation could produce an unintended consequence if sharply higher regulatory charges encourage investors to abandon professionally managed funds in favour of Treasury bills, according to Adjei “AJ” Boateng, Chief Investment Officer at Blackstar Advisors.
He warned that the scale and speed of the Securities and Exchange Commission’s new levy increases risk raising the cost of formal investment at a time when Ghana’s capital market remains relatively shallow and investors are becoming increasingly sensitive to fees.
“I think 400% increase across board will be problematic for any sort of service that’s being provided for an industry without very little consultation,” Mr Boateng said during a special edition of the NorvanReports Economic Governance Platform on X Space on Sunday, August 16, 2026. The discussion, hosted by Norvan Acquah-Hayford, Managing Editor of NorvanReports, examined the theme “Regulating or Overcharging? Examining SEC’s New Levies and the Future of Ghana’s Capital Market,” with particular focus on who ultimately pays when regulatory costs rise.
The debate goes beyond whether the SEC requires more funding, because few industry participants dispute the need for a regulator with sufficient resources to supervise fund managers, brokers, investment advisers and other market institutions. The more difficult question is whether sharply higher charges imposed across a relatively small pool of regulated activity could increase the industry’s cost base faster than the market itself can grow, thereby weakening participation instead of deepening it.
Mr Boateng’s concern is rooted in the structure of Ghana’s investment market, where government securities continue to exert a powerful pull on household and institutional savings. “Ghana has ultimately become, you know, a Treasury bill sort of market in the last sort of, maybe three years,” he said, pointing to the extent to which fixed-income securities dominate investor behaviour and portfolio construction.
That makes the level of fees particularly important because the comparison facing investors is increasingly straightforward. A client can either place money with a professional fund manager, paying management, custody, administrative and regulatory charges, or purchase Treasury bills directly and avoid some of those costs, raising the question of whether professionally managed products still deliver enough additional return or diversification to justify the difference.
“If you’re a client, you have access to all the information in the world, participating in T-bills versus sending your fund manager, what are the cost benefits or what is the overall sort of net yield that I’ll receive?” Mr Boateng said. “If you ask that question, you know, you could be walking on very, very slippery slope for the industry as a whole.”
The warning becomes more consequential when yields are falling because fixed charges consume a larger proportion of the investor’s return as gross income declines. When Treasury yields are elevated, an additional regulatory or management charge may appear relatively small, but as yields compress, investors become more sensitive to every deduction between the portfolio’s gross return and what they actually receive.
That dynamic could weaken the economics of collective investment schemes, which are meant to give households access to diversified portfolios, professional management and securities that individual investors may struggle to access directly. If higher regulatory costs narrow the return advantage sufficiently, more sophisticated investors may choose to bypass fund managers altogether and move directly into Treasury securities.
Mr Boateng argued that Ghana’s collective investment industry remains too small for policymakers to disregard that behavioural risk. “I did some exercise, in fact, for the last, maybe say, two and a half to three years, every three weeks, the government raised more money than the entire size of the collective investment scheme in the auctions,” he said.
The comparison highlights a deeper structural problem within Ghana’s financial system because government borrowing already competes strongly with private investment products for domestic savings.
If regulatory policy makes managed investment products relatively more expensive, it could reinforce the concentration of savings in short-term government debt rather than encouraging capital to flow towards corporate securities, equities and other productive assets.
Mr Boateng nevertheless acknowledged that the SEC faces a legitimate revenue challenge and did not reject the principle of increasing regulatory charges. His objection is primarily to the magnitude and timing of the adjustment, arguing that a 400% increase may be too abrupt for a market that is still developing and where smaller operators have limited room to absorb higher fixed costs.
“We are still in early, or infant sort of stages in terms of developing the market. So introducing a 400% increase right now might not be optimal,” he said. “There is a deeper understanding that there needs to be an improvement in the revenue for the SEC, but 400% right now might not be, like, the best.”
His preferred alternative is a phased approach that would allow regulators to raise more revenue while observing how investors and operators respond. “Perhaps, let’s increase it, but maybe on a gradual basis, right? So maybe you could sort of double it, like, this year, and then see how the market responds,” Mr Boateng said.
A staggered increase would effectively give the SEC an opportunity to test the levy’s impact on investor withdrawals, new inflows, management fees, profitability and industry consolidation before moving to the full increase.
It could also help determine whether investors are migrating towards direct Treasury holdings or, potentially more worrying for regulators, towards unregulated schemes offering higher returns with weaker investor protections.
Mr Boateng also argued that deeper consultation with market participants should form part of that process. “I’ll go even further by engaging the market participants to get their view and insights as to what is the best approach,” he said, suggesting that regulatory reform would be more durable if operators understood not only the justification for higher charges but also the path by which they would be implemented.
The central issue is therefore not simply whether an increase of 400% appears large in percentage terms, but whether the new cost structure changes investor behaviour in ways that work against Ghana’s broader capital-market ambitions.
A well-funded regulator can strengthen confidence, reduce misconduct and improve market integrity, but regulatory financing becomes counterproductive if it materially increases the cost of formal investment and makes competing government securities more attractive.
For Ghana, the sequencing is critical. The country is seeking to broaden retail participation, mobilise domestic savings and build deeper pools of long-term capital, while Treasury bills already provide investors with a familiar and comparatively simple alternative.
Mr Boateng’s warning is therefore less an argument against stronger regulation than a caution against making regulated investment materially more expensive before the market has achieved sufficient scale.
The risk is that the SEC could emerge with higher revenues and stronger institutional capacity while presiding over a collective investment industry weakened by the very charges introduced to support it.
