The Ghana Securities Industry Association is the umbrella body of organisations licensed by the Securities and Exchange Commission.
Fund Managers want the government to remove the cap on payments to enable them to settle customers
The Ghana Securities Industry Association has entreated the government to increase the payouts to defunct fund management companies whose money is with the receiver.
Speaking to Accra-based Citi FM, a governing Council Member of the Association, Kisseih Antonio, said even though the receivership process has been good so far, the cap on money payouts is making it difficult for them to sort out their distressed customers.
Kisseih Antonio said that increasing the cap for fund managers would help the industry since the government wants to make sure that all depositors of collapsed savings and loans companies, finance houses and MFIs are fully paid their deposits.
In 2019, the Securities and Exchange Commission (SEC) revoked the licenses of 53 fund management companies for various regulatory breaches.
At the time the companies had over eight billion cedis in assets under management. The collapse of the companies came at a time a number of the firms were unable to meet investors’ demands for the funds.
An analysis of the country’s financial sector showed that some of the collapsed fund management companies kept their funds in the savings and loans companies and other financial institutions that were shut down by the central bank.
However, Mr Antonio said that to restore full confidence in the financial sector, investors in the fund management space must be allowed to have access to their funds in cash rather than in bond payments as planned by the receiver.
“We want to plead with the government to treat SEC-regulated institutions like the banks. We see that with the banks, we had depositors being paid in full, but with fund managers, we see that there is a cap, and investors are being paid with commercial paper in any amount over GHC170,000. If the government is to treat us like the banks that will go a long way in restoring confidence in the financial sector.”
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