Number of Investors Serviced via Omnibus Accounts Has Increased by 53% for the Month

According to the Central Securities Depository (KCSD), the number of investors serviced via omnibus accounts by KCSD’s depositors was almost 40,000 as of August 1, 2022. This is 53% more than in the previous month.

Brokers and banks have had the opportunity to open so-called omnibus accounts or nominee accounts since July 1, 2021 thanks to changes in the laws of the Republic of Kazakhstan. Such accounts make it possible to keep an aggregate record of client assets, i.e., to record client pool assets on one account with KCSD.

It is generally cheaper for brokers and banks to keep omnibus accounts than to open an individual sub-account for each client. All transactions within an omnibus account are displayed under the broker’s name, and the details of the investors that conduct operations via such account are not disclosed. Put it otherwise, the system displays the total number of securities on the account rather than the holders and number of the securities. Client assets are also segregated in the recording system of the broker or bank itself. All of these simplifies considerably the procedure for transaction registration and securities record.

"Omnibus accounts are a reasonable alternative to a segregated record of client securities. Introducing omnibus accounts is in full compliance with global practices and makes securities record cheaper, easier and faster. It not only facilitates the work of KCSD’s depositors but stimulates the exchange trade of retail investors, while increasing their number, " Adil Mukhamejanov, Chairman of KCSD’s Management Board, says.

Over 425,000 accounts were opened as of August 1, 2022 in KCSD’s nominee holding system, including 385,000 holder sub-accounts.

According to KCSD’s data on holder sub-accounts, individual brokerage account owners are still mostly young. Almost half (49.6%) of all retail investors are Kazakh people under the age of 35. The share of investors aged 18–24 is 19.3%, and of those aged 25–34 — 30.3%. As before, the largest share of retail investors is the group aged 35–54 (35.3%). The share of investors aged above 55 continues to decrease (15%). The share of sub-accounts opened in the name of minors is not more than 0.1% of the total number of brokerage accounts.

The gender ratio has not changed: male investors account for 58%, while female investors — for 42%. At the same time, the number of women among brokerage account owners has almost doubled year to date. The number of women increased by 8,748 in absolute terms in the past month alone. Men keep up with women — plus 9,322 since July 1, 2022.

In terms of geography, Almaty (22.1%) and Nur-Sultan (10.2%) keep the lead. The third leader is Turkestan region (8.8%). The number of sub-account holders in Almaty and Nur-Sultan has increased 1.5 times and in Turkestan region — 2.2 times year to date. The least number of brokerage accounts has been opened in the country’s north: Kostanai region (3.3%), Akmola region (2.3%) and North-Kazakhstan region (1.5%).