Sampa urges raising of $100m through a Diaspora bond
By Chiwoyu Sinyangwe
Sat 07 Apr. 2012, 13:30 CAT
THE government and Securities and Exchange Commission (SEC) should consider raising US$100 million from Zambians working abroad through a Diaspora bond, says finance deputy minister Miles Sampa.
And Sampa has implored local authorities to "put their houses in order" and start raising finances from Lusaka Stock Exchange instead of endlessly looking up to central government for operations finance.
Speaking at the launch of SEC strategic plan 2012-2015, Sampa said there was need to leverage the over 2,000 Zambians working abroad to ensure their earnings contribute to national development.
Sampa, who is also Patriotic Front Matero member of parliament, said there was need for SEC and the government to work on a mechanism to structure the bond.
"It has been determined that worldwide, there are about 2,100 professional Zambians abroad doing good jobs at United Nations (agencies), Africa Union, International Monetary Fund and the World Bank, among others," he said.
"Assuming that each one of them can save up US$30, 000 to US$50, 000, there's a US$100 million in the hands of Zambians abroad. So, we need to target that money through a Diaspora bond that can be spiced with some other features that will attract them to bring that money here than invest it abroad. US$100 million raised by the government from Zambians abroad is sweeter than US$100 million that would be raised from foreigners. We need to take advantage of our Diaspora."
Sampa also urged SEC and the Bank of Zambia to harmonise the local bond structure so that a pricing could be determined and properly marketed to the capital market and become a chief source of finances for the country's economic growth and long-term investments in infrastructure projects.
"Because only if pricing for long-term debt is known, it sets a benchmark for short-term borrowing and predictability in the market," he said.
"About 70 per cent of the finances needed in our country can be generated from the capital markets to facilitate mobilisation of funds meant for long-term investments. We need to move from an era where we keep thinking of investment in a short-term, in a one month to five years. We need to have abilities to raise finances for as long as 20 to 50 years because only then will companies be able to borrow to invest in infrastructure."
And Sampa said decentralisation could be accelerated if the local authorities started raising finances from the local bourse.
"These councils…they can actually raise their own funds through municipal bonds like it is done in other countries," said Sampa.
And SEC chief executive officer Dr Wala Chabala said the local capital market was set to grow further and needed support of all key stakeholders in the economy.
Labels: BONDS, MILES SAMPA, SEC
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Securities Act doesn't allow creation of exchange market, says Liweley
By Chiwoyu Sinyangwe
Friday May 02, 2008 [04:00]
SECURITIES and Exchange Commission (SEC) director for licensing and enforcement Michael Liweleya has said the current securities Act does not allow for creation of a commodity exchange market.
Liweleya was commenting on reports that Zambia Agricultural Commodities Exchange (ZAMACE) had approached SEC with a view to forming a commodity exchange market which was expected to operate along the same line as Lusaka Stock Exchange (LuSE). He also confirmed that SEC had received an official application from the promoters of the commodity exchange market.
“We received a written application from ZAMACE over their intentions to set up a commodity exchange market but our view is that the current securities Act only empowers SEC to regulate securities and not commodities,” he said.
Liweleya also said for SEC to start providing for provision for establishment of commodity stock market, the securities Act needed to be amended.
He disclosed that the government had since endorsed the position that SEC in the current setup did not have a legal mandate to regulate commodity exchange market.
“After making our assessment and position on the matter, we wrote to the Attorney General to seek further guidance on the matter and yesterday (Monday) they wrote back to us and they also confirmed position that unless there is an amendment to the current securities Act, we cannot licence for a commodity exchange market,” said Liweleya.
The commodity exchanges are the associations with public corporation established to handle the purchase and sales of goods quoted in the commodity exchange market and to determine, register and declare prices of those goods in the market.”
It operates on the same principles like stock exchanges where the bonds are exchanged but the only fundamental difference between the two is that the commodity exchange market deals with agricultural goods.
Currently, ZAMACE is the country’s sole agriculture commodity market with a stronger commercial focus and links to regional commodity exchange.
Labels: COMMODITIES, LUSE, SEC, ZAMACE
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SEC moves to rid sector of crooks
By Kabanda Chulu
Thursday January 24, 2008 [03:01]
SECURITIES and Exchange Commission (SEC) has directed organisations dealing in securities and investment advisory services to
display their licences at their business premises in order to remove crooked people from the industry. The Securities and Exchange Commission has also warned the investing public that they should not risk their financial assets and other interests by giving instructions to unlicensed people.
According to the list of licensees for 2008 released yesterday, it is a requirement of the securities Act cap 354 that all financial intermediaries conducting securities business such as dealing in securities or providing investment advisory services must be licensed unless otherwise exempted by law.
“Therefore, before any person conducts securities business in Zambia that person must obtain an appropriate licence and in a bid to remove crooked people from the industry, licensees are further required by law to display their licensees prominently at their business premises,” it stated. “
And the investing public is warned that they should not risk their hard earned financial assets and other interests with unlicensed persons.”
Under the dealers’ licence list, the Securities and Exchange Commission has registered African Banking Corporation investment services, Barclays Bank, Citibank, Comcapital securities, Equity Capital Resources, Intermarket Securities, Investrust Bank, Laurence Paul Investment, Lloyds Financials, EMI Pangaea Securities, Stanbic Bank, Standard Chartered Bank, Stock Brokers Zambia and Zambia National Commercial Bank.
Under investment advisers’ list, the Securities and Exchange Commission has registered six institutions and these are African Life Financial Services, Agricultural Advisers International, Entrust Financial Services, Madison Investment, Roland Imperial Capital and Zambia Capital Partners Limited.
Labels: REGULATION, SEC
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New collective investment scheme coming
By Joan Chirwa
Friday January 18, 2008 [03:00]
THE Securities and Exchange Commission (SEC) has granted authorisation to Equity Capital Resources Plc for a new collective investment scheme on the local market effective December 2007. Equity Capital Resources (ECR) Plc - a financial advisory and asset management firm - will operate the fourth of collective investment schemes in Zambia besides Cavmont, Intermarket Banking Corporation and African Banking Corporation which are running the Cavmont Income and Growth Fund, ABC Unit Trust and Intermarket Unit Trust.
ECR Plc director Nathan DeAssis, in an interview, said the investment scheme - which is expected to be officially launched this April - would be run in partnership with AGM Global Trust Company and a selected bank as trustees and custodian respectively for the Equity Capital Resources Unit Trust.
"With regard to investment, the key element in all investment activities is how to manage the risk process and everything has a level of risk and it is what you do with the risk factors rather than worry about the risk itself that makes good investment sense; my own philosophy is that if it does not make money sense then I do not invest," DeAssis said. "A unit trust allows the unit holder to make investment without worrying too much about the risk because of the professional nature of the parties undertaking the management process and adherence to prudent regulatory requirements through the Securities Act of Zambia."
A collective Investment Scheme operates on a basis of a mutual fund that allows the unit holders a direct participation in the operations of the scheme through appointment of a management company, trustee and custodian of the assets.
It is also a vehicle used to pool investors' money to make multiple types of investments, known as the portfolio.
"Shares, bonds and money market funds are all examples of the types of investments that may make up a collective investment scheme. The collective investment scheme is managed by a professional investment manager who buys and sells securities for the most effective growth of the fund," DeAssis said. "As a collective investment scheme investor, one becomes a "shareholder" of the collective investment scheme vehicle.
When there are profits they will earn dividends. When there are losses, their shares will decrease in value. Collective investment schemes are, by definition, diversified, meaning they are made up of a lot of different investments. That tends to lower risk of an investment; it does not eliminate risk completely but mitigates the levels of risk associated with an investment."
Labels: EQUITY CAPITAL RESOURCES PLC, SEC
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ZCCM-IH buys off Maamba Collieries
By Kabanda Chulu
Wednesday January 09, 2008 [03:00]
ZCCM Investment Holdings (ZCCM-IH) has acquired 100 per cent the government shareholding in Maamba Collieries but government will retain a golden share with rights to appoint a director to sit on the board. And the Securities and Exchange Commission (SEC) has approved the registration of two billion ordinary shares of Prima Reinsurance plc at the Lusaka Stock Exchange (LuSE).
The acquisition of the country’s major coal mine follows the signing of the share transfer agreement between the government and ZCCM-IH and the agreement in support of the scheme of arrangement between the government, ZCCM-IH and Maamba Collieries Limited.
According to the withdrawal of the cautionary announcement released by Stock Brokers Zambia, ZCCM-IH would pay an agreed price purchase consideration in order to acquire the 100 per cent shares.
It stated that ZCCM-IH would take over all trade creditors’ liabilities which are the subject of the scheme of arrangement.
“Caution is no longer required to be exercised by shareholders when dealing in the company’s securities since the sale of the shareholding in Maamba Collieries has now been concluded upon the signing of the share transfer agreement and ZCCM-IH shall ownership, operational control of and responsibility of social assets run and operated by the company as at the effective date (30 November 2007),” it stated.
“However, government will retain a golden share that shall confer such rights and privileges as shall be stipulated by the new articles of association to be adopted by Maamba Collieries and by virtue of the golden share, government shall have the right to appoint a director to sit on the board of directors.”
According to the weekly stock news, the Securities and Exchange Commission (SEC) has approved the registration and offer document of Prima Reinsurance plc at LuSE.
“The SEC has approved the registration of two billion ordinary shares of Prima Reinsurance Plc and also approved the offer documents relating to the offer for sale of 500 million ordinary shares to the Zambian public through an initial public offer at an offer price of K8.00 per share,” it stated.
And last week the Lusaka Stock Exchange recorded a total of 1.3 million shares in 90 trades that resulted in a total turnover of K360 million.
According to the weekly stock news ending January 4, 2008, the all share index equity market closed at 3,584 points up by 1.44 per cent from 3,517 during the week ending December 28, 2007.
Labels: SEC, ZCCM-IH
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