Barclays Bank has launched the first exchange traded fund (ETF) in east Africa, with the listing of its NewGold ETF on the Nairobi Securities Exchange (NSE). Kenya’s Capital Markets Authority (CMA) approved the listing last month. The fund, which has had a primary listing on the Johannesburg Stock Exchange (JSE) since 2004, also has secondary listings in Botswana, Nigeria, Mauritius, Namibia and Ghana. Its initial size in Kenya will be 500m Kenyan shillings (US$4.8m), but this could be increased if demand proves strong.
The NSE has been preparing to introduce new products including derivatives, ETFs and asset-backed securities in recent years as it seeks to boost trading volumes. “NewGold ETF fits the objective of what Kenyan markets seeks to achieve, which is to boost liquidity and deepen the market,” said Michael Mgwaba, head of exchange-traded products at Barclays Africa’s Absa Capital unit.