The Central Depository and Settlement Corporation (CDSC) posted a net profit of Sh16 million in the year to December 2024, marking an end to years of losses on the back of lower costs and higher revenue.
The company had made a net loss of Sh43.9 million a year earlier. It had a string of losses of Sh43.94 million, Sh107.37 million and Sh8.21 million in 2023, 2022 and 2021, respectively.
Its revenues in the review period increased by 14 percent to Sh195.02 million from Sh171.3 million in 2023, while total administrative expenses declined by 15 percent to Sh167.85 million from Sh196.52 million.
The company attributes its revenue growth to increased transactions on the Nairobi Securities Exchange (NSE) in a year when equity trading volumes grew by 32 percent to 4.93 billion shares from 3.75 billion in 2023.
“This is due to the trading activities improving compared to the previous year, leading to an increase in the transaction and depository levy incomes,” says the CDSC in its latest annual report.
“The overall business environment continues to remain challenging, and this has a resultant effect on the overall demand for the company’s services. The company’s strategic focus is to enhance revenue growth whilst maintaining profit margins, the success of which remains dependent on overall market conditions.”
The CDSC provides clearing and settlement services in the Kenyan capital markets.
It is controlled by the Capital Markets Challenge Fund, which owns 50 percent of the shares.
The remaining shares are held by the NSE, AKS Nominees, Capital Markets Investor Compensation Fund and Uganda Securities Exchange in the ratio of 22.5 percent, 18 percent, seven percent, and 2.5 percent, respectively.
Since its inception, CDSC had enjoyed a steady streak of positive financial performance, a trend that was broken in 2021 when it posted a net loss of Sh8.2 million, down from a net profit of Sh40.2 million in 2020, fuelled by a decline in the volume of shares traded on the exchange.
