By Mercy C.Wanjiku – Journalist (below)

Many people don’t seem to be investing in shares due to what people say or have seen with collapsed stock brokerage company like Nyaga. But one great advantage of investing in shares is that you can see your money grow and later enjoy the benefits that come with it. Lately, we have seen companies listed at NSE winning government tenders to construct infrastructural projects such as wind energy. This is a great opportunity to shareholders of the company participating in the projects and a benefit to Kenya’s economy.

Give us a brief bio of yourself and the role you play at Old Mutual Securities

My name is Julius C. Nduati Kariuki, I was born more than sixty years ago. I attended
Gatanga Primary School-Murang’a and Kenyatta Secondary School Division -Nairobi in
the late1960’s.
In the early Seventies I obtained a Diploma in Agricultural Education at Egerton
University. I worked in the Seed Industry for eleven years. In early nineteen
nineties, I went back to Egerton for a degree course. Later I sat for KASNEB –
Certified Public Secretaries Examinations and attained the title of Certified
Secretary.
Since 1976, I have shown a lot interest in securities investment. I do advise clients
to trade in securities. I have attended a number of Seminars organized by the
Institute of Certified Secretaries of Kenya facilitated by Capital Markets Authority
(CMA), Nairobi Securities Exchange (NSE) and Central Depository and Settlement
Corporation (CDSC) on pertinent issues pertaining to securities. I have hands on
experience having worked for Nyaga Stock brokers Ltd (under statutory management) and
Standard Bank Group Securities (SBG Securities LTD). Recently, I was appointed an
Agent for Old Mutual Securities Ltd as a financial advisor for the firm.

Who is Old Mutual and what are its objectives are?

Old Mutual Securities is a securities trading company licensed by the Capital Markets
Authority for the purpose of facilitating trade on the Nairobi Securities Exchange
(NSE). At Old Mutual Securities, we believe fact-based research is a crucial part of
any investment decision. Research expertise is at the core of our value proposition
to our individual and institutional clients.

What motivated you to become a financial adviser?

Having worked as an extension officer, a teacher in public schools and residing in
town, I found it appropriate to engage in a business related enterprise. The trading
in Securities combined well with Company secretarial services.

Are there any terms that one needs to understand before investing?

One must open a Central Depository and Settlement Corporation (CDSC) account in order
to trade in shares. This will facilitate direct crediting/debiting of securities to
the client’s account since these days physical /hard copy certificates are not issued
or used as proof of ownership.

Dividend: sum of money paid by a company to its shareholders out of its profits.
Immobilization: All share holders who hold physical certificates are expected to
convert them into electronic form. This process is known as immobilization. The
shareholder should approach a stockbroker or a custodian and surrender the share
certificates. Different company registrars have different requirements for the immobilization process.
Transmission: This is the process of transferring securities from deceased to
beneficiary. There are specific requirements for the transfer of such shares,
depending on the companies in question.
There are also other services provided such as transfer of shares from one broker to
another,private transfer and forms to be filled when pledging shares to obtain loans.

If one is interested in investing in shares, (specifically with Old Mutual), what are
the requirements or documents does one has to come with? How long does it take for one to have a CDSC account?

For one to be able to start trading and investing in shares he/she requires the
following documents to fill a Know Your Client (KYC) form;

 Two passport size photos,
 Copy of national ID or passport,
 Copy of KRA PIN
 Current bank statement; at least 6 months old,
 Utility bill; either water or electricity bill,
 For corporate, certificate of registration will be necessary,
It takes about four to five working days for one to be able to have an operational
CDSC account.

Can one open a CDSC account as a group and what are the requirements for that?

CDSC accounts can be individually or jointly opened. The requirements for opening the
CDSC accounts are more or less the same except that both the individuals of the joint
account have to present their personal documents. The bank statements should also be
for the joint account.
Currently, informal groups cannot open a CDSC account; only individuals, minors,
Companies,Trustees, and legal entities may open accounts and trade in securities.

After getting the CDSC account, what awaits the individual or group?

Once the documents are received by KYC (Know Your Client) team and scrutinized, CDSC
number is issued and an internal account is opened. From there, the client can start
buying shares. The client will deposit the money in Old Mutual Securities Ltd bank
account to facilitate buying of shares. That money will be used to buy investor’s
selected securities from the stock exchange. It may be important to monitor the
economy in relation to the listed companies so as to decide shares to trade in and
why. The investor can consult, Old Mutual Securities staff, for advice on the shares
or stocks to trade. Similarly, the client can issue an order to assist in sale of
shares. For payment, the client must fill a payment requisition form.

Who is your target audience when it comes to investing?

Mostly employed persons, self employed, business people, college students and farmers
will be recommended to start investing in shares.

READ Part 2