1920s – 1953: Dealing in shares commenced with trading taking place on a gentleman's agreement with no physical trading floor. London Stock Exchange (LSE) officials accepted to recognize the setting up of the Nairobi Stock Exchange as an overseas stock exchange (1953).
1954 – 1962: The Nairobi Stock Exchange (NSE) was registered under the Societies Act (1954) as a voluntary association of stockbrokers and charged with the responsibility of developing the securities market and regulating trading activities. Business was transacted by telephone and prices determined through negotiation.
1963 – 1970: The Government adopted a new policy with the primary goal of transferring economic and social control to citizens. By 1968, the number of listed public sector securities was 66 of which 45% were for Government of Kenya, 23% Government of Tanzania and 11% Government of Uganda. During this period, the NSE operated as a regional market in East Africa where a number of the listed industrial shares and public sector securities included issues by the Governments of Tanzania and Uganda (the East African Community).
However, with the changing political regimes among East African Community members, various decisions taken affected the free movement of capital which ultimately led to the delisting of companies domiciled in Uganda and Tanzania from the Nairobi Stock Exchange.
1975: When the EAC finally collapsed in 1975, the Government of Uganda compulsorily nationalized companies which were either quoted or subsidiaries of listed companies.
1988: The first privatization through the NSE, through the successful sale of a 20% Government stake in Kenya Commercial Bank. The sale left the Government of Kenya and affiliated institutions retaining 80% ownership of the bank.
1990: The CMA was constituted in January 1990 through the Capital Markets Authority Act (Cap 495A) and inaugurated in March 1990. The main purpose of setting up the CMA was to have a body specifically charged with the responsibility of promoting and facilitating the development of an orderly and efficient capital market in Kenya.
1991: NSE was registered as a private company limited by shares. Share trading moved from being conducted over a cup of tea, to the floor based open outcry system, located at IPS Building, Kimathi Street, Nairobi.
1993: The CMA increased the initial paid up capital for stockbrokers from Kshs.100, 000 to Kshs.5.0 million while that for investment advisors was set at Kshs.1.0 million.
1994: With the 1994 CMA Act (Amendments), it became mandatory that a securities exchange approved by the CMA be a company limited by guarantee. The number of stockbrokers increased by a further seven.
On February 18, 1994, the NSE 20-Share Index reached a record high of 5,030 points. The NSE was rated by the International Finance Corporation (IFC) as the best performing market in the world with a return of 179% in dollar terms.
The NSE also moved to more spacious premises at the Nation Centre in July 1994, setting up a computerized delivery and settlement system - DASS.
1995: An additional eight stockbrokers were licensed in June 1995 and with the suspension of one stockbroker, the total number of stockbrokers was twenty.
The CMA established the Investor Compensation Fund whose purpose was to compensate investors for financial losses arising from the failure of a licensed broker or dealer to meet their contractual obligations.
1996: Privatization of Kenya Airways where more than 110, 000 shareholders acquired stake in the airline and the Government of Kenya reduced its stake from 74% to 26%. The Kenya Airways Privatization team was awarded the World Bank Award for Excellence for 1996, for being a model success story in the divestiture of state-owned enterprises.
1997: With the objective of developing a code of conduct, promoting professionalism, and establishing examinable courses for its members as well as facilitate liaison with the CMA and the NSE, the members of the NSE formed the Association of Kenya Stock brokers (AKS).
1998: The CMA published new guidelines on the disclosure standards by listed companies. The disclosure requirements were meant for both public offerings of securities as well as continued reporting obligations, among others.
January 1999: The CMA issued guidelines to promote good corporate governance practices by listed companies through the constitution of audit committees.
March 23, 1999: The Central Depository and Settlement Corporation Limited (CDSC) was incorporated under the Companies Act (Cap 486).
November 30, 1999: The East African Community Treaty was signed in Arusha, Tanzania between five countries, Burundi, Kenya, Rwanda, Uganda and The United Republic of Tanzania.
2000: Five core shareholders of the CDSC signed an agreement and paid up some share capital.
2001: The market at the NSE was split into the Main Investment Market Segment (MIMS), Alternate Investment Market Segment (AIMS) and the Fixed Income Securities Market Segment (FISMS).
The EAC Secretariat formally convened the first meeting of the new Capital Markets Development Committee in Dar es Salaam, Tanzania.
2003: The Central Depositories Act 2000 was operationalized in June 2003.
2004: Following the successful signing of an MOU between the Dar-es-Salaam Stock Exchange, the Uganda Securities Exchange and the Nairobi Securities Exchange, the East African Securities Exchanges Association was formed.
November 10, 2004: The central despository system was commissioned. For the first time in Kenya’s history, the process of clearing and settlement of shares traded in Kenya’s capital markets was automated.
September 11, 2006: The NSE implemented live trading on its own automated trading systems trading equities. The ATS also had the capability of trading immobilized corporate bonds and treasury bonds. The Exchange’s trading hours were increased from two hours (10:00 am – 12:00 pm) to three hours (10:00 am – 1:00 pm).
December 17, 2007: The NSE implemented its Wide Area Network (WAN) platform. With the onset of remote trading, brokers and investment banks no longer required a physical presence on the trading floor since they would be able to trade through terminals in their offices linked to the NSE trading engine.
February 1, 2008: The Nairobi Stock Exchange (NSE) announced the extension of trading hours at the bourse. Trading would commence from 9.00am and close at 3.00pm each working day.
February 25, 2008: In order to provide investors with a comprehensive measure of the performance of the stock market, the Nairobi Stock Exchange introduced the NSE All-Share Index (NASI).
April 2008: The NSE launched the first edition of the NSE Smart Youth Investment Challenge to promote stock market investments among Kenyan youth.
June 9 2008: The immobilized shares of Safaricom Ltd., commenced trading on the NSE after the trading session was opened in a colorful ceremony presided by H.E. President Mwai Kibaki. The Safaricom IPO increased the number of shares listed on the bourse to over 55.0 billion shares, from the previous 15.0 billion.
