SecZim approves Debt Market Listings requirements
THE Securities and Exchange Commission of Zimbabwe (SECZ) has approved the Debt Market Listings Requirements paving the way for the Zimbabwe Stock Exchange to relaunch the country’s fixed income market.
SECZ Chief executive officer Tafadzwa Chinamo said the commission had approved the requirements and had forwarded them to the Ministry of Finance for gazetting.
Work on the debt market started two years ago with the first draft being released for stakeholder input in 2014.
The approval comes at a time the environment is ripe for the re-launch of the debt market as appetite from issuers and investors is high. Several successful fixed income issues have been done in the multicurrency regime. Some of the bonds issued include: CBZ’s $20 million bond issue in 2012 to finance infrastructure development; IDBZ’s $30 million issue in 2012, to finance procurement of prepaid metres and ZSE’s $1.5 million issue in 2013 to fund the Automated Trading System.
Pensions Funds were allowed to invest 15 percent of their funds into offshore investments in 2011 and the Zimbabwe Stock Exchange believes that resuscitating the debt market could allow investors mobilise some of the resources whilst offering investors with alternative investment products.
The ZSE proposed that all Government and parastatal bonds be listed on the ZSE, which the Minister of Finance and Economic Development Patrick Chinamasa granted in his 2015 Mid-Term Fiscal Policy review.
The bourse consulted widely on the listings and the pricing frameworks– input was received from Insurance Pension Commission, Zimbabwe Association of Pension Funds, Public Accountants and Auditors Board, stockbrokers, asset managers, potential issuers and financial advisors.
Recently, the ZSE said regional stock exchanges had expressed interest in participating in the country’s bond market when it is resuscitated.
Bond issuance by Government and local authorities was significant in the 1990s but eventually ceased around 2001. Although all local municipal long-term bonds were listed on the ZSE, there was virtually no trading. FinX
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