4th May 2022
Own Correspondent
The Botswana Stock Exchange(BSE) today launched the BSE Investor Compensation Fund, to mitigate financial loss for investors due to fraud, dishonesty or liquidation by a Participant handling their securities trading.
This Fund is valued at 28 million pula and going forward Participants will contribute towards the Fund. These contributions will be accommodative and it has been agreed that each party will contribute an annual amount of BWP 5, 000.00 (Five Thousand Pula), towards the Fund.
“Naturally, if you have invested money with a regulated participant that has gone bankrupt, been involved in an unclear situation (where a judicial authority has intervened), or, for whatever reason, does not give you what you are owed, you have the right to be compensated,” said Lieutenant General Tebogo Masire, Botswana Stock Exchange(BSE), Chairman during the Bell Opening Ceremony.
He said, “Therefore, this development is set to revolutionize our market as we join an elite number of securities exchanges that have adopted this practice in promoting investor protection. And I would like to underscore the issue of investor protection as how the BSE is protecting investors is one of the most recurring questions that we receive from our stakeholders.”
The robustness and attractiveness of any stock exchange is hinged on its capabilities to innovate and adopt international best practises to remain competitive in this global, fast-paced environment.
In ensuring the growth of its market, since inception, the BSE has undergone a number of transformational phases in which it has evolved from being one of the smallest exchanges on the continent in terms of market cap, to being one of the most efficient exchanges amongst emerging markets.
This phenomenal change has been attributed to a number of factors laid through the significant support received from Government and relevant stakeholders during its thirty three years in existence.
From its diverse issuer and investor base to its state of the art technological advancements in the form of the Automated Trading System and CSD System, the BSE has made important strides to position the BSE as a key player in the global financial markets space.
As such, it was not a surprise that today, it introduced another essential component that will serve to complement its market and instil confidence for all participants, especially our investors.
“The commencement of the Investor Compensation Fund is a significant milestone in the maturity of the local capital market industry and a necessary measure to strengthen the protection availed to retail investors. Entrenching positive stakeholder perceptions and confidence in the local capital markets industry is of paramount importance,” said Oduetse Motshidisi, Chief Executive Officer(CEO) of the Non-Bank Financial Institutions Regulatory Authority(NBFIRA).
In terms of the BSE Market Capitalization, the equities market is valued at 38.8 Billion pula, representing twenty-three (23) domestic listed companies and seven (7) foreign listed companies.
It still has Botswana Building Societies Limited as the only company registered on our Serala Over-The-Counter Board. With respect to debt security, the value traded for Government Bonds from 5th January to 22nd April, 2022 stood at 444.5 million pula while corporate bonds for the same period stood at 50 million pula. This means that the total value traded of bonds stood at 494.5 million pula.
For the Market Capitalization, Government Bonds are valued at 18.5 billion pula while Corporate Bonds are valued at 5.4 billion pula. This brings the total bonds market capitalization to 23.9 billion pula.
Currently, BSE has seven (7) Government Bonds and thirty-six (36) Corporate Bonds.
