The high cost of running a brokerage business continues to push more players out of the market amid a tough operating environment.

Equity Stock Brokers has announced that it is exiting the stock brokerage business largely linked to low returns on investment.

Activity on the Uganda Securities Exchange (USE) remains low yet brokerage firms rely on retail business. In 2021, Bank of Baroda’s brokerage subsidiary, Baroda Capital Markets decided to cease and liquidate the business due to poor performance on year on year basis.

In 2018, African Alliance shut down its asset management arm at the USE due to low returns on investment.

In a statement, the brokerage firm said they will not renew their license with the regulator when it expires.

“We regret to notify our brokerage clients and the general public that the company will not renew its Broker license with Capital Markets Authority (CMA) and will therefore cease to offer the services effective June 30, 2022. Consequently, the Company will cease being a trading participant of the USE and agent of the Securities Central Depository (SCD) from June 30, 2022,” a statement from the firm read in part.

“We request all our brokerage clients to contact the Company to enable them to transfer their respective SCD accounts of title to any other broker of choice. This will enable the Company to refund cash balances in the existing clients' SCD accounts of title. This exercise will take place from July 4 to July 29, 2022.”