Equity bank as a CDA is currently controlling one-third (33%) of all share transactions in the NSE. The orders are placed by their customers then Equity forwards them to either of 8 stock brokers for implementation. Once transacted,equity pockets 70% of commission while brocker pockets 30%. The effect is that Equity is squeezing the brokers at their own field,getting the lions share of commissions without having to invest in a brokerage licence(why buy a licence for Ksh 251 M when you can be a broker without being a stock broker ie rent one). The dominance of Equity in stocks is fast growing and the big boys must be scared. What would prevent them from offering the broker say 20% only (and retain 80% or more of commission) once they control 50-60% of the NSE transactions.
To avoid the intimidation by the NSE big boys,they may have to buy a broker but this would surely kill all the small brokerage outfits. If I had a brokerage firm,I would be the first to sell or else be forced to close shop once Equity enters the field.
Happy hunting
Stocksmaster-For well researched market analysis
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