BBS eyes BSE listing
Lebogang Mosikare | Friday May 27, 2016 10:15
Addressing shareholders at a meeting held this week to update them on the Society’s demutualisation process, managing director, Pius Molefe said BBS would operate for two years as a commercial bank before it lists on the BSE. “The plan is for our shares to be traded over the counter (OTC) and not at the main bourse,” he said.
Over-the-counter or off-exchange trading is done directly between two parties, without the direct supervision of an exchange.
Last year, the BSE set up the Serala OTC board, where a public interest company can register its shares for trading outside the normal channels of the bourse with a view to ultimately list on the main board. According to the BSE rules, companies registered on Serala can only be allowed to remain on the board for a maximum of five years.
Currently, Molefe said BBS has over 40,000 shareholders.
Through demutualisation, BBS will convert into a shareholder-owned company allowing the organisation to apply for a commercial banking licence.
Although he could not state the exact date at which they expect to have acquired a banking licence, Molefe said: “We expect to have acquired a banking licence in a period not exceeding 18 months from now. At the most, we are optimistic to complete the process of converting into a bank between nine to 12 months”.
Molefe said BBS would be well prepared to cater for shareholders’ existing and new needs.
“By the time we open as a commercial bank, we would be more than ready to meet your expectations. It is normal for some people to be sceptical since we are undergoing a transition, but let them be rest assured that we would not disappoint them.
Some of our officers would also attend refresher courses to keep abreast with modern banking trends,” Molefe assured some shareholders who were not sure if the transition from a society to a bank would lead to the success or collapse of BBS.
Molefe said the demutualisation of BBS would be carried out in phases. The demutualisation of BBS from a society into a commercial bank is also expected to create more jobs.
Although he did not give the number of jobs that would be created by the demutualisation of BBS, Molefe said demutualisation would surely create more jobs, as BBS would now offer more products and services that it did not offer before.
BBS currently employs around 200 people.
The decision to demutualise the society was arrived at, as BBS was not competing favourably with commercial banks, which are offering more products and services.
He stated that in 2015 and 2016, the profits of BBS and commercial banks in the country took a nosedive because of liquidity constraints.
The BBS boss also stated that just like commercial banks, BBS would also go the innovation and Internet banking way to enable it to compete favourably with its competitors.
Molefe added: “Although we have 10 branches throughout the country, we would continue to expand as time goes on. We are currently modernising our Automated Teller Machines (ATM) to ready them for the transition from a society to a bank. We would also not discard our conventional ways of doing business”.