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BSE Seeks To Increase Liquidity and Reverse Trend of Delistings

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Botswana’s stock exchange plans to introduce global depositary receipts (GDRs) and trading in short-term debt instruments to attract issuers and increase the market’s liquidity, CEO Thapelo Tsheole tells The Africa Report.

International companies want to be able to sell shares in Botswana, Tsheole says from Gaborone. GDRs, which are designed to let investors buy shares of foreign companies on their own domestic exchanges, will be available by mid-2022, he says, and it will be possible to trade short-term debt instruments by the end of this year.

The exchange has come under pressure from Botswana’s finance ministry, its majority owner, to accelerate new listings and halt the trend of companies leaving the bourse. Finance ministry permanent secretary Wilfred Mandlebe said in February that it was up to the exchange to ensure there was a “balance between the costs and benefits of listing”.

  • The market must reduce the time needed to settle share transactions, he adds.
  • Mandlebe points to the need for integrated depository to facilitate corporate and government bond trading. Government bonds are currently traded over the counter.

The Botswana market lags behind Namibia as well as South Africa in terms of capitalisation. Liquidity has become concentrated in a handful of companies.

  • In 2020, the shares of microfinance lender LetshegoFirst National Bank Botswana and brewery holding company Sechaba accounted for 47% of total equity turnover.
  • The concentration is getting worse. In January and February of this year, trading in those three companies made up 70% of turnover. Furnmart and Wilderness Safaris both delisted in 2019, and Afinitas shares will cease trading this month.

Paperless trades

Tsheole expects the new securities to increase the liquidity of the market, as happened in 2012 when Botswana introduced exchange-traded funds. Botswana, he argues, can benefit from its strong currency and the absence of foreign-exchange controls.

  • The exchange has a “strong pipeline” of new domestic equity listings including multinationals as well as local companies, Tsheole says.
  • The bourse is planning to make it easier to borrow and lend shares to facilitate short selling, he says.
  • The innovations will be made possible by a new central security depository system, designed to end reliance on paper certificates and scheduled to be in place by May.
  • Tsheole is also trying to persuade institutions to come and serve as market makers.
  • The exchange, which completed its demutualisation in 2018, plans its own stock market listing in Botswana within the next two years, Tsheole says.

Contact the BSE via email at info@bse.co.bw or call +267 3674400

CoSSE Holds 58th Bi-Annual Meeting, Virtually

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12 April 2021: The CoSSE Secretariat hosted the 58th Bi-Annual meeting for CoSSE members and observers, on the 8th of April 2021, chaired by the Chairman of CoSSE, and CEO of the BSE, Mr Thapelo Tsheole. This is the Committee’s second meeting to be held virtually since the COVID-19 outbreak.

On the agenda for this meeting were several discussion points germane to the progressive development of the capital markets of the SADC region, chief among them being funding commitments for projects focused on enhancing financial integration and developing the regional green bond market. Presentations were made by FSD Africa principals on the roadmap of the SADC Green Bond Programme partnership between CoSSE and FSD Africa, previously announced on the 11th of March 2021. Deliberations also concentrated on the implementation of the Support to Improving the Investment and Business Environment (SIBE) Programme spearheaded by the SADC Secretariat in conjunction with the European Union (EU). Progress updates of other associated SADC Sub-Structures pertaining to capital market issues were discussed, including Financial Inclusion, Cross-Border Trade between SADC Stock Exchanges and the IOSCO Objectives and Principles of Securities Regulation.


Mr. Tsheole noted the full attendance of CoSSE members at the virtual 58th CoSSE meeting as a clear demonstration of their commitment towards the development of the regional capital market. In his closing remarks, the Vice-Chairperson Mr. John Kamanga reiterated the importance of multilateral cooperation for the betterment of the SADC region and the African Continent as a whole, and urged all attendees to continue to adhere to their respective COVID-19 health protocols.

Green Bonds Toolkit For Africa

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Africa-Green-bonds-toolkit_EN

Climate change is one of the greatest challenges of our time, requiring far more capital than governments alone can provide. Private sources of finance are needed. Tapping into the international capital markets, as well as domestic capital, will be critical.

Green Bonds are one tool that can offer the African capital markets an opportunity to leverage private capital at scale towards building a more climate-resilient, greener economy. Green Bonds have been an effective financial instrument to moving institutional capital to priority economic sectors in the global economy, promoting the development of climate-resilient, low carbon infrastructure that allows for equitable and sustainable development. Globally the green bond market has grown tremendously in recent years, with issuances totalling USD257.7bn in 2019 (CBI, 2020).

This Green Bond Toolkit has been developed to provide the African capital markets with guidance on how to issue green bonds that are in line with international best practices and standards. The Toolkit provides a backdrop to the development of the market and features successful examples of green bond issuances that have emerged out of Africa – such as Acorn Holdings in Kenya and Access Bank in Nigeria.

CoSSE-FSD PARTNERSHIP TO DEVELOP SADC GREEN BOND MARKET

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FSD Africa and CoSSE on the 11th of March 2021 signed a Co-operation Agreement to support the development of a SADC green bond market. The agreement will support the SADC’s 16 member countries to leverage domestic and international capital markets for investment in green projects.

The FSD Africa-CoSSE partnership programme will support member countries and both private and public sectors to issue green bonds, creating a favourable ecosystem and improving knowledge and capacity for sustainable investments.

The programme will also help SADC countries to develop listing guidelines and regulations for green bonds, build a pipeline of potential green bonds issuers, tap the countries’ institutional investment community for investment into green bonds, train stakeholders on climate finance and support the adoption of climate-related financial reporting and disclosure

James Duddridge, UK Minister for Africa, said:

“Climate change is the most important challenge facing future generations and ahead of COP26, our partnerships with African nations are building resilience and driving clean growth. This landmark agreement will increase access to green finance, create jobs and help support a sustainable recovery from COVID-19 to deliver for those on the forefront of the climate crisis and our planet”.

Mark Napier, CEO, FSD Africa, said:

“In recent years SADC countries have experienced extreme climate-related challenges including drought and cyclones. Green bonds can be an excellent way to channel SADC significant capital resources into job-creating projects that can help pivot the region towards a low-carbon economy and protect it from environmental shocks”

Thapelo Tsheole, CoSSE Chairperson said:
“CoSSE is pleased to consistently deliver on its objective to encourage the transfer of securities
markets’ intellectual capital and technical expertise of member countries of CoSSE. This
milestone Co-operation Agreement with FSD Africa to support the development of a green bond
market in the SADC region represents the hard work and commitment to the development of
African capital markets by both parties.

As CoSSE, we usher in this new chapter with pride and
we are committed to promoting the uptake of this programme by the SADC region. We extend
gratitude to FSD Africa for this partnership and we remain committed to the development of the
region”.

Download the full press release below:

FSD-Africa-reinforces-commitment-to-the-climate-agenda-through-partnership-to-develop-a-green-bond-market-in-th

NEW WEBSITE & MOBILE APP LAUNCH BY BSE

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On 26th June 2020, the Botswana Stock Exchange (BSE) officially launched their newly designed website and mobile application. The aim of upgrading the website was to create a more user-friendly browsing experience for current and prospective clients when accessing market information. Some of the notable features of this new site include a stock market ticker displaying real-time price & indices movements; a watchlist function to monitor selected securities; an optimized search engine for easy navigation and integrated social media buttons, amongst others.
The BSE also introduced a mobile application, suitable for clients-on-the-go in accessing market information and interacting with the Exchange. The mobile app features are aligned to those of the website, thereby presenting an easier channel for users to buy customized data to meet their diverse requirements.

The mobile app is available for download on the App Store & Google Play Store.
The interactive and modernized functionalities of the new website and the mobile app will increase the visibility of the BSE; listed companies; products and services; the reach of market data and the vibrancy in the stock market.

New BSE Mobile Application

http://www.bse.co.bw

NEW LEADERSHIP AT THE ESWATINI STOCK EXCHANGE

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PROFILE-OF-JOYCE-MHLOBISO-DLAMINI-ESWATINI-STOCK-EXCHANGE

Ms Joyce Mhlobiso Dlamini joined the Exchange in July 2015 and currently occupies the position of  Head of Eswatini Stock Exchange after a promotion last year July, where she is responsible for all its operations among which include driving the sweeping changes at the ESE, such as the automation of its trading platform, amending legislation to comply with the automated trading environment, introducing more products such as ETFs, driving the Exchange demutualisation process, among others. She is passionate about her job and her vision for the ESE is to make it a destination exchange in Africa regardless of its size by increasing both its depth (attracting more listings) and breadth (adding more diversified products).