Stockbrokers in E Africa to take compulsory training

Stockbrokers, asset managers, investment bankers and some staff of capital market licensees will be required to sit a certification course to practise in East Africa.

Both the East African Securities Regulatory Authorities (EASRA) and the East African Stock Exchanges Association (EASEA) have agreed that employees in regular contact with clients will be required to take the course, whose curriculum the two bodies have agreed on.

The certification aims to standardise qualification requirements for key market activities such as trading, asset management, and investment banking.

READ: EAC capital market regulators to issue common certificates

Formal certification procedures will also help the market players to have a clear understanding of market regulations and the requisite qualifications to perform their responsibilities.

“It is envisaged that all the officials of market players who deal with clients directly will need to undertake the training,” said the Capital Markets Authority told the Business Daily.

Courses under the programme include fundamental securities, market participants training, officers and directors course.

The certification course was agreed on during an EASRA consultative meeting that was held in Bujumbura, Burundi, in March.

A lack of properly qualified staff and fraudulent trading of customers’ shares was blamed for the collapse of Kenyan stockbrokerage firms between 2007 and 2010.

Rules on frequency of training, examinations and those to be exempted based on other courses taken are yet to be finalised.

Faida Investment Bank chief executive Bob Karina said the course should emphasise on new staff rather than those in practice since traders, for example, have to undergo induction run by the Nairobi Securities Exchange before they are allowed to operate.

Mr Karina said that since certification is being implemented at a regional level, it should be standardised and recognised globally.

“It is like having an accountancy certification, which allows you to work anywhere,” he said.

There are, however, other programmes in the regional that have been running on a voluntary basis and without certification such as those run by the Securities Industry Training Institute, which is based in Kampala.