NSX Concerned About Second Bourse

THE Namibia Stock Exchange (NSX) says it is concerned about an application for a second stock exchange to be established in the country.

In terms of the Stock Exchanges Control Act, Namfisa aertised a year ago, that it had received the application from a local firm.

“Caveat emptor is the doctrine that a market place is best regulated by cautious buyers now in principle obsolete. What effect this will have on the NSX is uncertain, fortunately the NSX reserves exceed N$42 million,” chairman Lionel Matthews said in the 2013 Annual Report.

The second exchange is being set up by a local firm called, Namibia Financial Exchange (NamFin-X), headed by Helmut Angula, the former minister of finance.

Another concern raised by Matthews in the report is the dominance of the Government Institutions Pension Fund (GIPF) on the financial sector. The risk attributed to the GIPF is due to its sheer size in the domestic market. In 2012 nearly N$370 million of trade in primary listed shares were excluded from the turnover as the trades were reported to the NSX under concessionary transaction levy terms, he said.

The total of government debt securities at the end of 2013 stood at N$ 18,83 billion. The NSX believes that the unlisted investments are inherently riskier than listed investments where corporate governance and disclosures are in keeping with best practices and subjected to transparent price discovery, Matthews said.

The local index which increased by 21,3% in 2013 on turnover of N$ 352 million after a 23,7% increase in 2012 all in an illiquid market. While the Overall index increased by 1,32% against the JSE All Share index increased by 17,85%.

In 2013 highlights of the NSX contributions to deepening the capital markets included, the listing of Bank Windhoek Holdings and the the Oryx Properties Ltd rights issue

Source : The Namibian