Zambian firm to list $500m debt note on BSE
Mbongeni Mguni | Monday October 30, 2023 06:00
On Monday when opening the Botswana Bond Market Association's (BBMA) roundtable, BSE CEO Thapelo Tsheole said similar requests were coming in from around the region at different levels of advancement.
“One of the things that we are seeing, because of what we managed to do in terms of developing the market, is interest from neighbouring countries to come and raise capital,” he said.
“Two weeks ago, we approved $500 million from a Zambian company and there’s also a Namibian company coming very soon. “Just this morning, a South African company also said it wants to come here.”
In recent years, the local bourse has intensified its market development efforts, which include investments into technology that ease trades and settlements, as well as ongoing education campaign. The local capital market is also surfeit with funds, with nearly P12 billion of the total P132 billion in pension fund assets as at July, held as cash or near cash.
However, it is the BSE’s efforts to boost its regional and international appeal by signing up and adhering to high market standards and affiliations that appear to be attracting attention from regional debt issuers.
In recent years, the BSE has qualified as a full member of the World Federation of Exchanges, chaired the Committee of SADC Stock Exchanges, held the presidency of the African Securities Exchanges Association (ASEA) and been selected as one of just three stock exchanges in Africa recognised by His Majesty’s Revenue and Customs, the United Kingdom’s tax and customs agency.
“If you don’t develop the ecosystem in terms of market, there’s nothing that can move forward,” Tsheole said at the conference. “We have been in competition with the Johannesburg and Mauritian stock exchanges over time and this interest we are seeing from regional companies is part of the positives of running a proper market.”
The CEO said the BSE was finalising its connectivity to the African Exchanges Linkage Project, which involves linking nine stock exchanges across 16 countries.
The project, promoted by ASEA and the African Development Bank, seeks to facilitate cross-border trading of securities on the continent. At least 1,500 companies with a market capitalisation of $1.5 trillion are covered under the project.
“We are close to linking up as the eighth exchange. “Very soon, you will be able to go to your stockbroker in Botswana and be able to buy Dankote securities in Nigeria and they will be able to go to their own and buy Letshego and others here,” Tsheole said.
The BSE has approved programme memoranda from various entities worth P62.9 billion, with actual issuances of P25.8 billion. Approved programme memoranda are documents from which the debt issuer will then periodically seek capital from the market through the issuance of bonds or commercial paper.