What is GSD?
GSE Securities Depository Company Ltd. (GSD), a wholly-owned subsidiary of the Ghana Stock Exchange. It was licensed by the Securities and Exchange Commission to operate a Securities Depository on November 5, 2008 and started operations on November 14, 2008. It has been set up to establish and manage a Securities Depository System (SDS). The system records, maintains and registers the transfer of securities by book-entry without any physical movement or endorsement of certificates.
What does it mean to register on the GSD?
To register on the GSD means transferring your shares from a paper certificate to an electronic platform powered by Ghana Stock Exchange. If you are registered on the GSD, it means you can receive statement of all your shareholding of listed stocks on the GSE. You can view the statement and check the status to see if it is pending or available. If you should see a pending status on your GSD statement, it means that particular stock has not been approved by the registrars as a result of a mistake from the broker such as uncertified client Identification, name difference, wrong number of shares quoted on the GSD form and signature difference of the shareholder. It could also be due to the fact that the broker has not posted you shares to the GSD. Therefore, anytime you see a pending status on your GSD statement, do not hesitate to contact your broker to ensure the status is changed to available. When it is available, it means it is yours and you can buy more to add up or sell it if you wish.
What do I need to register on the GSD?
You need your share certificate or a complete indemnity for lost or destroyed certificate
A passport size photo
Valid ID
Who should register on the GSD?
All shareholders of listed stocks on the Ghana Stock Exchange
Where can you register?
Any Licensed Dealing Member of the Ghana Stock Exchange can do that for you through its brokers. Licensed Dealing Members on the GSE are companies that have been licensed by the Securities and Exchange Commission to deal in listed securities of the GSE.
What are the benefits on registering your shares on the GSD?
You have no problems with misplaced, destroyed, stolen or mutilated certificate. Hence in events like flooding, fire outbreak and loses as a result of relocation would not adversely affect your shares. This is because the shares are recorded in an electronic platform. All you need to do is to walk to any License Dealing Member of the Ghana Stock Exchange, talk to a broker and your statement would be printed for you.
The automation has helped improved efficiency on the market and increase trade volumes hence high liquidity for investors.
Transfer of shares on the depository is much easier than what used to happen in the manual trading platform.
The depository allows investors to hold more than one account, just like in the case of a bank account.
With the automated market, stock brokers now have the option to transact business from the comfort of their offices by using online trade facility provided by the GSE.
Settlement and clearing in the new trading platform has been made easy with the GSD. Past challenges with the trading settlement time of T+3 are all gone.
Trading results are also available online for investors.
As part of laid down procedures, electronic account holders receive statements showing movements in their holdings every quarter from securities depository and annually from their brokerage firms.
An alert system on mobile phones and emails to give investors real time updates of sales and purchases of shares on their account has been implemented.
Why should you register on the GSD?
Without it, you can neither buy nor sell you shares.
Governance of the GSD
The Board of Directors of the GSD comprises of two members of the Council of the Ghana Stock Exchange (GSE), two members of the Executive Management of the GSE and the Executive Director of the GSD. The Executive Director together with the Depository Officers oversee the day-to-day interface with the Depository Participants (DPs) such as Registrars and Custodians. Securities and Exchange Commission is the main regulator. Hence, you don’t have to worry about fraud with the new securities depository system. Do not hesitate to move your shares to the GSD. Together, we can make the Ghana Stock Exchange attractive to foreign investors and increase market liquidity in the long run.
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©, Sophia Kafui Teye
