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1st ICIFA Investment Research Report Launch

13 December 2022  


Council of the Institute of Certified Investment and Financial Analysts,

Distinguished Guests,

Ladies and Gentlemen,

Good morning,

It is an honor to be here today and to have the opportunity to speak to you at the launch of the ICIFA Investment Research Report, which allows us to assess the challenges that retail investors face in Kenya's financial markets.

May I take this opportunity to appreciate ICIFA's collaborative efforts in putting together this informative document, which will be discussed at today’s session. I would also like to congratulate the Council and the Secretariat for their enormous contribution to the development of this report, including the very thorough consultations and research that went into it.

The report before us today aims to address the challenges that retail investors face in Kenya's financial markets. Despite numerous challenges, the Kenyan Retail Investor has been critical to the development and growth of the financial sector. I take note that some of the key challenges highlighted in the report are; high transaction costs, insufficient information to aid in making sound investment decisions, market inactivity regarding IPOs and poor communication from investment institutions and regulatory bodies.

I take note of the report's assertion that certain sector policies, procedures, regulations, and institutions have harmed development and growth of retail investors. KYC policies, for example, have been criticized for being overly burdensome and repetitive, which discourages investor participation. Similarly, there is a feel that regulations governing the sector have limited product innovation, resulting in the development of products that are not aligned with the needs of customers or restrictions on retail investor participation in products.

The Kenyan government, through the Ministry of Investments, Trade and Industry, is dedicated to the Bottom-Up model, which advocates for the implementation of policies that promote SMEs, investments, entrepreneurship, and innovation. If the objectives in this policy are fully realized, retail investors will become more active in the financial markets. This, I am confident, will boost the country's GDP, which will have a direct impact on variables such as individual income, inflation, and investment appetite. Furthermore, a strong economy will result in more Initial Public Offerings (IPOs) by new firms, and the IPOs will result in more new retail investors participating in the capital markets.

It is reported that knowledge of investment service or product providers and trading companies is low. Therefore, there is need for education on players in the market, products, services, and listed companies. I am pleased that ICIFA continues to advocate for active consumer education on financial market products, services, and procedures through the ICIFA Investment show, which is hosted on the ICIFA YouTube Channel. This, among other efforts, will better position retail investors to make sound investments in anticipation of the bottom-up-economic model's realization.

Ladies and gentlemen, with the release of this report, the government will be looking for your input on how to keep the investment climate favorable. I continue to believe that there will be more opportunities for retail investors in Kenya's financial system, and I hope that your discussions today will yield positive results. It gives me great pleasure to officially launch the Investment Research Report of the Institute of Certified Investment and Financial Analysts (ICIFA). I wish you well and eagerly await the outcome of your discussions.

Thank you and God bless you all.