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Corporate governance: The engine powering NSE’s wealth boom
When investors buy shares, they’re trusting their broker to handle the trade properly. As shareholders, they trust auditors, boards of directors, other insiders, and regulators to play their roles with integrity.
Last week, the Nairobi Securities Exchange (NSE) added Sh220 billion to investor wealth. That is the highest weekly increase on record. It’s part of a ‘bull run’ that started in 2024. Several factors have led to this growth.
Firstly, interest rates have gradually come down. The Central Bank Rate, which sets the baseline for most interest rates in the economy, has gone from a peak of 13 percent in early 2024 to 8.75 percent, set in the last Monetary Policy Committee meeting. The effect is two-fold. Credit and capital have become cheaper and valuations have gone up.
