African Alliance investor accounts move to Sterling

Brokers on the NSE trading floor. FILE PHOTO | SALATON NJAU

By CHARLES MWANIKI
More by this Author

Summary

• Investors who have yet to move their shares from African Alliance Investment Bank after it ceased offering stockbroking services will now have their holdings transferred to Sterling Capital by the end of the month.
• African Alliance said in a notice published yesterday that the transfer will also include cash balances held in client accounts.

Investors who have yet to move their shares from African Alliance Investment Bank after...

it ceased offering stockbroking services will now have their holdings transferred to Sterling Capital by the end of the month.

African Alliance said in a notice published yesterday that the transfer will also include cash balances held in client accounts.

In June last year, the firm announced that it would cease offering stockbrokerage services nearly 18 years after acquiring its broker's licence through takeover of Kenya Wide Securities in October 2002 but would continue with its other businesses including investment banking and fund management, which includes collective investment vehicles.

It therefore asked its clients to move their equities trading accounts to other stockbrokers of their choice, and to collect the cash balances in these accounts, failure to which they would be transferred to another market intermediary.

“The company has since appointed Sterling Capital as the transferee broker. As required by law, the company has also obtained all required regulatory approvals on the appointment of the transferee broker,” said African Alliance in a notice to its clients, published yesterday.

“All your outstanding client assets that have not been transferred to another stockbroker of your choice by the set deadline and you have issued no outstanding instructions to the company as at the set deadline or at all, and your account is not in suspended status for trading purposes, those client accounts will be transferred to Sterling Capital through a bulk process by March 31, 2020.”

The firm added that those whose accounts will be transferred to Sterling will however be free to subsequently move them on to another intermediary.

The NSE has recorded declining activity in the past three years, with annual equities traded turnover fell from Sh175.7 billion in 2018 to Sh148.7 billion in 2020.

This has resulted in lower commission earnings for stockbrokers, who are also contending with lower advisory fees due to a fall in capital raising activity through the market.