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Supervision

The Registrar conducts ongoing supervision of capital market entities to protect investors, ensure that markets are fair, efficient and transparent, and reduce systemic risks. The Registrar monitors operational and compliance aspects of licensed and registered institutions to identify areas of elevated risk and non-compliance. Appropriate enforcement action is taken in the event of non-compliance and other adverse developments.

The supervisory approach for capital markets is compliance based and is conducted through off-site surveillance and on-site examinations.

Malawi is a full member of the International Organisation of Securities Commissions (IOSCO) and the regulatory and supervisory standards are benchmarked against IOSCO standards.

Off-site surveillance of capital and securities markets involves:

  1. daily monitoring of exchange trading activities to ensure compliance with trading rules; and
  2. Smonthly review and analysis of statutory returns to evaluate financial condition and performance of capital market players. The regulatory returns are submitted through Bank Supervision Application (BSA) .

On-site examination of capital and securities markets players involves:

  1. Routine examination: carried out for every licensee as per annual examination planning cycle. Routine examination may be full scope - covering all risk areas of supervisory importance, or targeted on specific areas;
  2. assessing the level of risks inherent to institution’s operations;
  3. evaluating effectiveness of risk management system and internal controls in identification, measurement, monitoring, and controlling of risks inherent to the institution’s operations;
  4. determination of residual risks faced by the institution; and
  5. assessing the institutions compliance with financial service laws

Types of on-site examinations include: