The Ghana Stock Exchange (GSE) has announced that Cal brokers of Ghana and UBA of Nigeria have successfully completed the first transaction under the phase one of its regional market integration programme.
The integration of the capital markets in the West African sub-region is to enable brokers on the GSE, Nigerian Stock Exchange (NSE), Sierra Leone Stock Exchange and the Bourse Regionale des Valeurs Mobilieres, to trade with each other.
The phase one, which is the sponsored access, will allow brokers not registered in the Nigerian capital market, remote access to the trading facility of the Nigerian Stock Exchange (NSE) through a local sponsoring dealing member firm licensed by the Exchange.
The Deputy Managing Director of the GSE, Mr Ekow Afedzie, in an interview said although the sponsored access phase started last year, the first transaction was made about some weeks back.
“The move to integrate the West African capital markets started two years ago and we are doing it in phases. The first phase is what we call sponsored access and we had the first transaction between Cal brokers and UBA brokers in Nigeria,” he said.
The West African Capital Markets Integration Council (WACMIC) was established to harmonise a regulatory environment for the issuance and trading of securities across the West-African sub region.
As a result, brokers in the WACMIC member countries can now trade on behalf of their clients and settle securities in Nigeria through local sponsoring brokers.
As part of the integration, other West African stock exchanges such as Bourse Regionale des Valeurs Mobilieres SA, are expected to initiate similar deals which could be worth an additional US$2m a day in capital market liquidity to the Nigeria market.
Achieving integration will facilitate growth in the markets, which will empower the region to remain relevant in attracting investment inflows by creating a much larger market for local and international businesses.
Mr Afedzie explained that the objective of the workshop held in Accra was to educate brokers on the various phases of the integration process and how best they could take advantage of them.
“We are trying to encourage our brokers to link up with other brokers in other markets so they can have access to other markets and that is why we brought them together to educate them on the various phases,” he said.
The second phase of the integration, which he said, was expected to roll out from next year where qualified brokers who meet certain standards receive a common passport to enable them to trade directly in any of the markets across West Africa.
“The second phase is where brokers can have direct access to other markets in West Africa. A broker in Ghana, for instance, can access the NSE without going through a broker. Phase two will start rolling out from the beginning of next year, but phase one will not end. As a broker you can choose to do only phase one, but phase two gives you more direct access,” he explained.
The third phase, which is the final phase, will see the actualisation of the establishment of a virtual West African Securities Market (WASM) by December 2015.
Source: Graphic Business