The Central Securities Depository Ghana (CSD) and the GSE Securities Depository Company Limited (GSD) have merged into a single entity. An agreement to that effect was signed between officials of the Bank of Ghana and the Ghana Stock Exchange.
Dr Kofi Wampah, Governor of the Bank of Ghana, signed on behalf of CSD while Mr Franklin Asafo-Adei, Chairman of the GSD board signed on behalf of the entity. The CSD is wholly owned by the Bank of Ghana to manage the issue, redemption and maintain the records of ownership of securities issued by Government of Ghana, Bank of Ghana and the Ghana COCOBOD.
In 2008, the Ghana Stock Exchange (GSE) also established the GSE Securities Depository Company Limited (GSD) as a subsidiary to provide custody for securities listed on the Ghana Stock Exchange and also to provide for the dematerialization of share certificates.
Under the terms of the agreement the Central Securities Depository (GH) Ltd shall be the surviving entity with effect from January 1, 2014. Bank of Ghana will own 82% of the new company and transfer 18% to the Ghana Stock Exchange.
The Ghana Stock Exchange will be allowed to increase its shareholding up to 30% within one year at a price existing at the time of the merger. Mr. Stephen Tetteh, Head of the CSD, will maintain his position as Chief Executive Officer while Mrs. Melvina Amoafo, the Executive Director of the GSE Securities Depository Company, assumes the position of Deputy Chief Executive.
All staff of the GSE Securities Depository Company will be absorbed into the new company. The merged entity will handle securities listed and unlisted on the Ghana Stock Exchange as well as Government of Ghana and Bank of Ghana Instruments, Corporate Bonds and Money Market Instruments.
It will also operate the registrar services under the licence granted by the Securities and Exchange Commission. Dr Wampah said the merger was necessary because the two depositories were a duplication of cost and efforts and pledged Bank of Ghana’s support to mitigate transitional problems.
Mr Asafo-Adei said the merger would provide a common depository platform for the two institutions and harmonisation of trading as well as clearing and settlement practices. “This will generate benefits and thus create significant additional value for all market participants,” he said.
The merger will make for a more efficient trading of fixed income and equity securities and reduce operational cost for the merged depository and lower transaction cost for market participants. Mr Asafo-Adei said 76 percent shares certificates had been dematerialised and 75,978 securities accounts had been opened, enhancing trading volumes and values.
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