GSE revising its rules, OTC guidelines imminent


The Ghana Stock Exchange (GSE), as part of measures to keep in touch with global trends and industry best practices, is in the process of revising its rules, with key outcome of the process being the introduction of guidelines on Over-The-Counter (OTC) trading of unlisted shares.

This was disclosed at the GSE’s Annual General Meeting (AGM) by the Chairman of its governing council, Anselm Ransford Adzetey Sowah, who further stated that the proposed changes are before the Securities and Exchange Commission (SEC) for approval, with the changes expected to take effect in the short-term.

An OTC market refers to a decentralised arrangement in which market participants trade securities – stocks, commodities, currencies, or other instruments directly between two parties and without a central exchange or broker, often by companies who fail to meet listing requirements or those who want to stay outside the purview of the stock exchange.

Currently, there are a number of public companies traded on the OTC market and regulated by the SEC, but the lack of access to vital and reliable information about the traded companies and limited liquidity remains a significant drawback.

Nonetheless, speaking on the occasion of the 2021 edition of the Accra Bourse’s AGM, Mr. Sowah said the development would address the aforementioned issues as it will enable the shares of unlisted companies to be traded on platforms provided by the GSE.

“The GSE is in the process of revising its rules to keep in touch with global market trends and industry practices. Of particular is the introduction of over-the-counter rules which is currently under review by the Securities and Exchange Commission. When approved, the OTC rules will enable the shares of unlisted companies to be traded on platforms provided by the Exchange, encouraging transparency and price-discovery on the market,” he explained.

Market analysts share the view that the GSE’s involvement in the OTC market is definitely a move in the right direction, which serves as a boost to investor interest and confidence; in view of the hunger for assets. With this, what the market can be certain of is the fact that more options will be made available to foster diversification of investments, which, to some degree, can improve the liquidity of the market.

The Council’s chairman stated that the Exchange is pursuing other measures to deepen the scope of the market, which include the introduction of the Global Reporting Initiative (GRI) to develop sustainability reporting standards for the Exchange and listed companies, as the GSE actively pursues a sustainable Exchange status.

Also, mentioned was the provision of consultants to the GSE by the African Development of the Bank (AfDB) in a bid to develop market rules for asset-backed securities, exchange-traded funds, derivatives, among others and a policy framework for securities lending and borrowing.

In accordance with the Companies Act, 2019, members of the Exchange voted unanimously for a change in the suffix attached to the company’s name, with the Exchange now being referred to as the Ghana Stock Exchange Public Company Limited by Guarantee (PLBG).


In a separate interview with the B&FT, the Managing Director of the Exchange, Ekow Afedzie expressed sentiments on a similar tangent as Mr. Sowah. He maintained that his outfit is on course to attain demutualisation in the short term.

“The GSE will be demutualising; that will happen, within a year, we would have made some serious progress in demutualising, by forming a holding group with subsidiaries, which is a common practice globally,” Mr. Afedzie revealed.

Counting on the benefits of demutualising, the MD mentioned that one of the key benefits is the access to capital, in order to raise funds to improve the technology and infrastructure of the Exchange.

Demutualisation refers to the process of converting a mutually-owned organisation into a profit-making, investor-owned company. The practice, which engenders transparency and efficiency, has gained traction amongst Stock Exchanges globally, since the first demutualisation by the Stockholm Stock Exchange in 1993.

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