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Company News of Monday, January 28, 2019
Source: B & FT
2019-01-28
The 2019 exchange aims to help some bank agencies finalize their work
The Ghana Stock Exchange (GSE) has called for a formalized forex trading platform that will see the local currency bought and sold in a much more transparent way.
"Ghana should have a formal, centralized reporting framework for forex trading to better understand prices on the foreign exchange market," said Kofi Yamoah, chief stock officer, during his stock market review in 2018. Accra.
He explained that prior to the establishment of the Ghana Fixed Income Market (GFIM), which is a platform for trading notes and bonds (governments and businesses), banks traded with each other and with each other. There was little transparency.
"Before GFIM, the banks traded fixed income securities, but they traded bilaterally or individually. With GFIM, all transactions between banks are now known to all other market players, including the general public.
"This means that at any time, between Bank A and Bank B, this transaction took place at this price and at this volume. This gives me an indication of the price of buying and selling these two vehicles, "he explained.
"We want something similar in the forex
in order to better know the price of cedi compared to other commercial currencies. If we do not do this, prices at banks, bureaux de change and the black market will have a significant impact on the cedi – which harms the economy in general, "he added.
Mr Yamoah noted that, even if the central bank indicated the price at which the cedi trades against other currencies, it essentially indicates the price at which the banks are trading at the end of the day; but a forex trading platform will offer transparency and real-time reporting of transactions and prices.
"The central bank reports on the transactions made by the various banks at the end of the day. What we are trying to defend is something that happens in real time, so we do not wait until the end of the day to know that the price was, "he said.
More advocacy by GSE
GSE also urged the government to allow listed companies to pay less tax than unlisted companies. For Yamoah, this will encourage more businesses to become public. "Corporate tax rates should differentiate between listed issuers and unlisted companies," he said.
In addition, he added that viable state-owned enterprises should be encouraged and allowed to raise equity or debt-based debt in order to better fulfill their mandate.
Stock market performance in 2018
Given the strong interest shown by companies in issuing fixed income securities, rights and bonuses by listed banks to meet the new capital requirement of GH ¢ 400 million, the GSE composite index remained stable at -0.29%, with the financial index recording a loss of 6.79% compared to 52.73% and 49.51% respectively in 2017.
In 2018, the telecommunications sector had for the first time a stock market listing with the largest telecommunications company MTN, while three non-performing equity securities were delisted.
Outlook for 2019
The exchange, in 2019, aims to badist the Bank of Ghana, the Central Securities Depository (CSD), the Ministry of Finance and brokers in the finalization of the works and the implementation of transactions arising from the pension contract on GFIM .
In addition, the exchange will facilitate the introduction of securities lending and borrowing. Mr Yamoah added that the GSE would work on deploying a mobile application for secondary trading of listed securities.
"Improve market compliance by brokers and issuers through the use of technologies such as the reporting portal, and continue stakeholder engagement on ESM projects to demutualize in the short and medium term", he added.
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