5.2: Develop clearing house infrastructure

Measurement

Legal and regulatory framework supportive of derivatives clearing in place.

Working Group
WG3
Implementation Progress

The Capital Markets (Derivatives Markets ) Regulations 2015 is in place to address derivatives clearing.

Timelines
2014-2016
 
Status
Completed
Measurement
Size of OTC derivatives market established
Working Group
WG2
Implementation Progress

Preliminary studies conducted by CMA and NSE in 2016.
The TORs developed were harmonized with the Derivatives consultancy TORs to capture the survey.
Phase 1 and 2 of the survey to establish the size of the OTC derivatives market was undertaken by the Authority's Derivatives Unit and completed in June 2018.  
Based on survey results assets subject to the use of risk products is Ksh. 12.5bn and Ksh. 48Bn (Minimum) for capital markets intermediaries and commercial banks respectively. A post-hoc analysis is ongoing to interrogate the quantum data further.

Timelines
2014-2016
 
Status
Completed
Measurement
Approval requirements and guidelines for CCP published
Working Group
WG2
Implementation Progress

A concept paper on CCP was developed by the Authority in 2018 and is developing a policy paper to guide requirements for the establishment of CCPs by June 2019.

Timelines
2016-2020
 
Status
In Progress (Within Schedule)
Measurement
New derivatives market structure
Working Group
IC
Implementation Progress

The current derivatives framework prescribes the structure.

Timelines
2020-2023
 
Status
Completed
Measurement
Approval requirements and guidelines for CCP published
Working Group
WG2
Implementation Progress

NSE Clear approved as a CCP for Financial Derivatives.

Timelines
Continuous
 
Status
Continuous
Measurement
Degree of compliance with principles
Working Group
WG2
Implementation Progress

Licensed derivatives exchanges’ settlement infrastructure is expected to follow a CCP model. Assessment for compliance will be carried out once the market is launched.

Timelines
2016-2020
 
Status
In Progress (Within Schedule)