By Ambassador
Abdoulie M Touray
The Central Bank of The Gambia has introduced a strategic policy requiring banks to float 20–25% of their share capital locally, aiming to transition Gambian citizens from passive stakeholders into active shareholders. This reform seeks to foster economic inclusion, retain financial wealth within the country, and provide the necessary anchor listings to operationalise The Gambia Stock Exchange. The move is praised for democratising capital ownership and strengthening national economic sovereignty. For more details, read the full policy advisory from Ambassador Abdoulie M Touray of the SaHel Knowledge Campus Think Tank.
Shareholders
Shareholders are owners of a company. They hold equity (shares) in the institution and therefore possess specific rights and financial interests.
Key characteristics:
• Own a portion of the company’s share capital;
• Receive dividends when the company makes profits;
• Have voting rights at Annual General Meetings (AGMs);
• Can influence corporate governance through board representation;
• Benefit from capital appreciation when share value rises.
In essence, shareholders are risk-bearing investors whose returns depend on the performance of the company.
Stakeholders
Stakeholders are individuals or groups affected by the operations of a company but who do not necessarily own it.
Examples of stakeholders include:
• Customers;
• Employees;
• Government regulators;
• Suppliers;
• Local communities;
• Depositors in banks;
• The broader national economy.
Stakeholders benefit from the activities of a company but do not share in ownership, profit distribution, or governance rights.
Application to the Gambian banking sector
The Gambian banking system has historically been dominated by foreign-owned financial institutions. Examples include subsidiaries or affiliates of regional or international banking groups.
In such a system:
• Gambians may deposit money, work for the banks, or use their services;
• However, most Gambians do not own shares in these institutions.
Therefore, the majority of citizens remain stakeholders rather than shareholders.
They are affected by:
• Lending policies;
• Interest rates;
• Employment opportunities;
• Financial inclusion.
But they do not participate in profit distribution or ownership control.
Policy intervention by the Central Bank
The policy direction taken by the Central Bank of The Gambia to require banks to float approximately 20–25% of their share capital to Gambians is a strategic financial sector reform.
This policy serves several important purposes:
Economic Inclusion; it enables Gambians to own part of the banking sector, transforming citizens; from passive stakeholders into active shareholders; local Wealth Creation; dividends from profitable banks can now circulate within the domestic economy benefiting Gambian investors.
Domestic capital formation
Local investors gain opportunities to participate in high-value financial assets previously dominated by foreign investors.
Corporate governance participation
Gambian shareholders can influence:
• Board representation
• Governance standards
• Long-term strategic direction.
Financial market development
Public share offerings create the necessary liquidity and instruments for capital markets.
Strategic importance for the Gambia Stock Market
This policy also provides a strong foundation for the development of the Gambia Stock Exchange.
Stock exchanges require listed companies with tradable shares. Banks are typically among the most stable and attractive companies for listing.
By requiring banks to float shares:
• High-quality financial stocks become available;
• Investors gain confidence in the market;
• Pension funds and institutions have investment instruments;
• Liquidity begins to develop in the capital market.
Historically, in many countries:
• Banks were among the first companies listed on stock exchanges.
Examples include markets in Nigeria, Kenya, Ghana, and South Africa.
Thus, the Central Bank policy effectively creates anchor listings for the stock exchange.
Strategic impact for The Gambia
The long-term national benefits include:
Democratisation of Capital Ownership; citizens become participants in wealth creation; deepening of financial markets; the stock exchange gains credible listed institutions; reduction of capital flight; profits partly remain within the Gambian economy; strengthening of national economic sovereignty; local investors gain influence in strategic financial institutions.
Concluding perspective
The distinction between stakeholders and shareholders is therefore not merely academic, it is central to economic empowerment.
When citizens move from stakeholders to shareholders, they transition from being users of the financial system to owners of the financial system.
The policy initiative by the governor, board, and management of the Central Bank of The Gambia therefore represents a forward-looking reform that simultaneously promotes inclusive ownership; strengthens financial sector governance; and accelerates the operationalisation of the Gambia Stock Exchange.
It is indeed a commendable step toward building a broad-based ownership economy in The Gambia by the governor, board and management of The Central Bank of The Gambia and endorsed by government.
Ambassador Abdoulie M Touray is the president of SaHel Knowledge Campus Think Tank (SKCTT).
