The Securities and Exchange Commission (SEC) is set to increase the minimum capital for Fund Management Companies (FMCs) from the current GH¢100,000 to GH¢2 million.

The Director-General (DG) of SEC, Reverend Daniel Ogbarmey Tetteh, told a Daily Graphic/ Graphic Business specialised programme on banking and finance, Banking & More, that the increment would be announced in a new guideline for licensing that the SEC had developed for the capital market.

He said the new guideline would be rolled out this month or early next month and would, among other things, require all other capital market operators to recapitalise.

Time frame

With regard to the increase in capital for the FMCs, Rev. Tetteh said once the announcement was made, existing companies would be given up to December 31 next year to be fully compliant.

He said the directive would take immediate effect for new entrants.

The director-general added that the Ministry of Finance had already endorsed the new capital requirement in line with the Securities Industry Act, 2016 (Act 929).


In the pre-recorded discussion that started serialising yesterday (September 16), and others scheduled for 9 a.m. on Thursday and Friday, Rev. Tetteh said the capital increase was part of a number of reforms being implemented to make the securities industry more robust and more aligned with international best practices.

He said the capital increase, which was under the new licensing regime, was aimed at “raising the bar” to ensure that only fit and proper persons were allowed to operate in the capital market.


Although astronomical, the increase from GH¢100,000 to GH¢2 million would be the first upward revision since the Securities and Exchange Commission Regulations, 2003 (LI 1728) was passed.

Parliament has already amended sections of LI 1728 to raise the capital from GH¢100,000.

The SEC director-general said the upcoming capital increment was needed to strengthen the financial muscle of the companies to meet the requirements of operating in the industry.

That, he said, would make them effective to be able to properly discharge their obligations to their clients.

He said the commission had consulted adequately with players in the fund management industry to ensure that the amount and the time frame were not arbitrary.

“Actually, when we started engaging the industry on the minimum capital, we pegged it at GH¢5 million, but the feedback was for us to bring it down, and so after the back and forth, we settled on the GH¢2 million,” he said.

He added that the commission had also engaged other stakeholders in the securities market on the capital requirement.

“So it will not come as a surprise. In fact, the market has been waiting,” he said in reference to the forthcoming announcement.

Other reforms

Beyond the new capital, Rev. Tetteh said the reforms would also touch on corporate governance, mode of supervision, enforcement and digitisation of the commission.

He said the plan was to create a compliant, solid, responsive and dynamic securities industry that would become a strong enabler of national development.

On its governance, the DG said the licensing guideline would be issued to, among other things, empower the commission to require prospective directors of capital market operators to meet specific experience, academic and character requirements before they were allowed to take up their appointments.

“We have raised the bar so that the conditions that you need to meet before you get the licence are tightened.

“We want to make sure that only fit and proper persons are allowed to operate in the industry and not every Tom, Dick and Harry comes to get a licence,” he said.

Banking & More is a thought-leadership programme meant to shape policy and bridge the information gap in the banking and financial sectors by getting key stakeholders to throw more light on issues of concern.

Credit: Graphic Online

(BY: Maxwell Akalaare Adombila)