Reference is made to the editorial opinion and article in the Financial Journal titled "NSE flirts with trading shutdown" carried yesterday, in The Standard newspaper, the 22nd of July 2008.
The Nairobi Stock Exchange (NSE) categorically states that the direct reference to and implication of the possibility of a trading shut down owing to the alleged arrears owed to UUNET and alleged "hasty implementation of the Automated Trading System" are erroneous and alarmist.
In response to the said article, for which no official request for substantiation is on record as having been made to the Nairobi Stock Exchange (NSE) by the writer or any member of The Standard Group, it is our wish to clarify the alleged issues raised here below.
- The Automated Trading System (ATS) has been and operates independent of the Wide Area Network (WAN), through which the member firms are able to trade remotely. The NSE exercises complete control and management over the ATS. Only the NSE can grant or deny access to the ATS.
- The Automated Trading System (ATS) can be accessed either through the NSE trading floor (based on the Local Area Network) or via remote trading from the member firm offices (based on the Wide Area Network). The disablement of the WAN remote trading option/connection does not interfere with trading from the NSE trading floor
- The Automated Trading System (ATS) is a robust and efficient trading software, obtained from Millenium Technologies (MIT), who have serviced other exchanges in Africa, Europe and North America i.e. The Boston Stock Exchange, Boursa Malaysia, the Stock Exchange of Mauritius, and the Colombo Stock Exchange. The ATS has actually enhanced transparency in the trading of shares, making it easier to identify Illegal trading'. The ATS, which has a self check mechanism, is tested daily before commencement of trading and is backed up on a separate system
- The Nairobi Stock Exchange (NSE) and UUNET enjoy a cordial working relationship, and we are satisfied with the service rendered to us to date. The NSE is not in any arrears to UUNET. UUNET has individual contracts with the respective member firms and no such firm is in arrears.
- The Wide Area Network (WAN) has 2 separate components; a primary fibre link and secondary Kenstream link provided by two providers, increasing the link redundancy.
- The implementation of the Automated Trading System*(ATS) was thoroughly tested and authenticated prior to its launch. This implementation was done according to laid down processes and procedures, with the express approval of the regulator, the Capital Markets Authority.
- The Nairobi Stock Exchange and the Capital Markets Authority continue to partner in seeking solutions with the best interest of the investor in mi$d, through our respective surveillance and compliance procedures.
NAIROBI STOCK EXCHANGE
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