2005 ASEA Yearbook PDF

ASEA Member Exchanges
Abidjan Stock Exchange

Bond Exchange of South Africa
Botswana Stock Exchange
Cairo & Alexandria Stock Exchanges
Casablanca Stock Exchange
Dar-Es-Salam Stock Exchange
Ghana Stock Exchange
JSE Limited
Lusaka Stock Exchange
Malawi Stock Exchange
Mozambique Stock Exchange
Nairobi Stock Exchange
Namibian Stock Exchange
Stock Exchange of Mauritius
Stock Exchange of Swaziland
The Nigerian Stock Exchange
Uganda Securities Exchange
Zimbabwe Stock Exchange
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Table of Contents
Chairmans Letter
ASEA Executive Committee
ASEA at a Glimpse
Main Economic Indicators (ASEA Member Countries)
Market Highlights (ASEA Member Stock Exchanges)
Member Exchanges Profile
Dar-Es-Salam Stock Exchange
JSE Limited
Swaziland Stock Exchange
The Stock Exchange of Mauritius
ASEA Audited Financial Statements - June 2005
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5
7
11
19
35
36
40
53
58
62
71
78
80
82
92
98
103
110
116
120
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Chairmans Letter
The African Securities Exchanges Association (ASEA) is pleased to present the first issue of its annual Yearbook, which
serves as a work of reference for African member securities markets, by providing consolidated information on ASEA
members in a single source.
Founded in 1993, as a non-profit organization limited by guarantee in Kenya, ASEA aims at establishing systematic
mutual cooperation, exchange of information as well as harmonization of market standards, to enable its members to
attain a greater role in the competitive global market environment.
Throughout 2005, ASEA Working Committee has worked on reviewing the Memorandum and Articles of Association
to enable the association to function more effectively and provide value to its members, preparing and reviewing ASEA
sustainability budgets and investment policy.
ASEA has also worked on improving information and promotional avenues by upgrading its website with more information
about the association as well as trading statistics and profiles about member countries. This first issue of ASEA Yearbook
was also developed, to further enhance the level of transparency about the African members.
Moreover, ASEA is holding annual conferences hosted by one of the members, each year. The 9th ASEA conference
was hosted by Cairo & Alexandria Stock Exchanges in September 2005, under the theme Accelerating Development
in African Securities Markets.
From another perspective, ASEA is trying to coordinate with regional bodies such as the United Nations Economic
Commission for Africa (UNECA) and the New Partnership for Africa Development (NEPAD), to promote the role of the
African securities exchanges in capital mobilization and economic development strategies.
ASEA has also grown in membership and currently comprises 18 exchanges in 17 African countries. An application
for membership from the nascent Bourse des Valeurs Mobilieres de LAfrique Centrale (BVMAC) was recently approved
by ASEA. Other potential members were also approached by ASEA members to give them assistance in setting up
Maged Shawky
President
African Securities Exchanges Association
Chairmans Letter
stock exchanges. These include the Democratic Republic of Congo, Angola, Rwanda, Madagascar and Lesotho.
To establish a structured approach towards fulfilling ASEA mission and ensure its continuity, the association is in the
process of developing a 5-year business plan, in cooperation with Kenya Institute of public Policy Research & Analysis
(KIPRA). Our focus will be on areas of creating awareness and visibility for the region, promoting stronger corporate
governance, holding joint development programs and bilateral visits, supporting African countries in the establishment
of stock exchanges and development of financial products as well as harmonizing markets regulations to pave the
way for cross-border listing and facilitate the process of financial integration within the region.
We will strive to make the association a central reference point for the regional markets, by offering member exchanges
guidance in their business strategies.
Individually, member exchanges continued to work hard to step up global challenges by developing regulations,
expanding their services, promoting corporate governance as well as enhancing their operational infrastructure.
To date, three ASEA members; JSE limited, Cairo & Alexandria Stock Exchanges and Stock Exchange of Mauritius, have
attained the membership status of the World Federation of Exchanges (WFE), reflecting their compliance with international
standards and market principles.
On the trading front, ASEA member markets witnessed an impressive performance in 2005, with positive annualised
returns on members indices ranging from 146 percent in Cairo & Alexandria Stock Exchanges to 13 percent in the
Stock exchange of Mauritius. The member markets concluded 2005 with a total of 1468 companies listed on their
boards, recording a total market capitalization of US$ 845 billion; a 28 percent growth over 2004. The gain in return
was accompanied by higher trading volume and value which leapt by a robust 27 percent and 21 percent to culminate
at 72 billion and US$ 250 billion, respectively.
Finally, I would like to seize this opportunity to express my sincere appreciation and to extend my grateful thanks to
all our members for their commitment and contributions. Special thanks are also due to the Secretariat for their efforts
in maintaining a cohesive organization. I am confident that together we will achieve our worthwhile goals.
ASEA Yearbook 2005
Maged Shawky
President
African Securities Exchanges Association
ASEA Executive Committee
Office Bearers
President
Mr. Maged Shawky Sourial
Cairo and Alexandria Stock Exchanges (CASE)
Member
Mr. Joseph Chikolwa
Lusaka Stock Exchange (LuSE)
Member
Mr. Chris Mwebesa
Nairobi Stock Exchange (NSE)
Member
Mr. Geoff Rothschild
JSE Limited
Member
Mr. Jonathan Njau
Dar-Es-Salaam Stock Exchange (DSE)
First Vice President
Mr. Ekow Afedzie
Ghana Stock Exchange (GSE)
Second Vice President
Mr. Sunil Benimadhu
Stock Exchange of Mauritius (SEM)
ASEA Yearbook 2005
ASEA Member Countries
Egypt
Ghana
Cote
Dvoire
Nigeria
Uganda
Kenya
Tanzania
Mozambique
Zambia
Malawi
Namibia
Zimbabwe
Botswana
South Africa
Morocco
Swaziland
Mauritius
ASEA
ASEA At
A Glimpse
African Securities
Exchanges Association
ASEA Background
ASEA is a non-profit company limited by guarantee that was found in Kenya on the 13th of November 1993,
according to Chapter 486 of the Laws of Kenya, with the aim of establishing systematic mutual cooperation
and exchange of information among its members.
The association started with Nairobi Stock Exchange as the first member in 1993, followed by Mauritius, Uganda
and Dar-es-Salam Stock Exchanges in the nineties. The association is currently represented by 18 regional
exchanges in 17 countries.
ASEA Mission Statement
ASEA provides a forum for mutual communication, exchange of information, cooperation and technological
assistance among its members, to facilitate the process of financial integration within the region for the effective
mobilization of capital to accelerate economic development of Africa.
ASEA supports members in the establishment of Stock Exchanges and the development of financial instruments.
The association also assists in promoting the development of standards of training and professionalism amongst
members and other market players, standards of listing, trading and settlement of securities, the products and
services of Africas capital markets as well as the establishment of a data bank and information system.
Together with enhancing member exchanges joint programs, the association aims to harmonize standards for
market principals in the region.
ASEA Membership
The membership of the association is open to any Securities Exchange or nascent Stock Exchange located in
the African region after filling the admission application and getting the Executive Committee approval.
On 1st August 2005, the ASEA Secretariat received an application for membership from the Bourse des Valuers
Mobilieres de L' Afrique Centrale (BVMAC), which introduced itself as a private organization owned by some
of the largest financial institutions and industries of the Central African region. Through the CEMAC (Central
ASEA At A Glimpse
Africa Economic and Monetary Union) Treaty, the six governments of the CEMAC (Cameroon, Congo, Gabon,
Equatorial Guinea, Chad and Central African Republic), have given BVMAC the exclusive mandate to animate
and develop a regional stock exchange.
At the 9th ASEA Executive Committee meeting, the application of the BVMAC to be a member of ASEA was
accepted, on the condition that the BVMAC kept the ASEA informed of developments and notifies the ASEA
when the BVMAC is finally incorporated as a regional securities exchange and is operational.
ASEA Working Committee Meetings
Three ASEA Working Committee meetings took place in 2005, which were hosted by Dar-es Salam Stock
Exchange, JSE Limited and Cairo & Alexandria Stock Exchanges on the 26th of January 2005, the 13th of May
2005 and the 10th of September 2005, respectively. The meetings have mainly focused on the following issues:
- The review of the Memorandum and Articles of Association to enable ASEA to function more effectively and
to provide value for its members.
- The preparation and review of ASEA sustainability budgets and investment policy.
- The preparation of a 5-year business plan for ASEA, with the cooperation of Kenya Institute of Public Policy
Research and Analysis (KIPRA).
- Improving information and promotional avenues for ASEA (upgrade website, developing annual yearbooks,
holding regional workshops).
- Approaching potential members and development of procedures for admission.
- Leveraging on regional bodies such as the United Nations Economic Commission for Africa (UNECA) and the
New Partnership for Africa Development (NEPAD) to promote the role of African stock exchanges in economic
development, by sharing resources and collaborating on mutually beneficial initiatives.
- Changing the name of the organization from African Stock Exchanges Association to African Securities
Exchanges Association.
ASEA Conferences
One of the key activities of ASEA is holding annual conferences, which are hosted by different members almost
each year since its inception in 1993, whereby issues relevant to the growth of the regional securities markets
ASEA Yearbook 2005
ASEA
ASEA Member Countries
Main Economic
Indicators
2002/2003 2003/2004 2004/2005
70.0
69.04
986
3.1
3,902
10.5
5.8
69.3
61.95
894
17.3
407
11.1
6.2
Population (million) *
Real GDP (billion)
Real per capita GDP
Inflation Rate (%)
Net FDI (million)
Unemployment Rate (%)
Exchange Rate (LE/USD)
68.0
60.86
895
NA
701
10.5
6.0
Indicators
* Excluding Egyptians living abroad
Egypt
(USD)
Botswana
2003 2004 2005
1.64
9.05
10,500
NA
NA
23.8
5.06
NA
4.10
2,265
7.00
2.53
NA
4.69
Population (million)
Real GDP (billion)
Real per capita GDP
Inflation Rate (%)
FDI (billion)
Exchange Rate (local currency versus USD)
NA
3.66
2,068
9.20
2.25
NA
4.93
Indicators
(USD)
Economic Indicators
12
Kenya
(USD)
2003 2004 2005
34.30
19.40
NA
10.50
NA
75.38
33.18
16.11
430.33
11.62
46.00
79.28
Real GDP (billion)
Real per capita GDP
Inflation Rate (average annual %)
FDI (million)
32.23
15.04
431.33
9.82
81.00
75.93
Indicators
Over 50% unemployment
2003 2004 2005
12.1
NA
NA
15.4
NA
NA
123.7806
11.9
NA
NA
11.5
NA
NA
109.4382
Real GDP
Real per capita GDP
Inflation Rate (%)
FDI
10.8
NA
NA
9.6
NA
NA
97.9188
Indicators
Malawi
(USD)
ASEA Yearbook 2005
13
2003 2004 2005
1.24
NA
5,130
5.6
1.37
9.5
30.25
1.23
NA
5,150
3.9
1.80
8.5
27.98
Real GDP
Real per capita GDP
Inflation Rate (%)
FDI (billion)
Unemployment Rate (mid-year) (%)
1.22
NA
4,550
5.1
1.97
7.7
26.23
Indicators
Mauritius
(USD)
2003 2004 2005
38.7
49
NA
1.0
NA
NA
9.249
31.1
54
NA
2.0
NA
NA
8.211
Real GDP (billion)
Real per capita GDP
Inflation Rate (%)
FDI
30.6
49
NA
1.5
NA
NA
8.762
Indicators
Morrocco
(USD)
Economic Indicators
14
2003 2004 2005
19.424
23.38
1,300
7.8
NA
21
24,300
18.071
21.00
1,117
12.8
228.7
21
22,581
Real GDP (billion)
Real per capita GDP
Inflation Rate (%)
FDI (million)
Unemployment Rate *1997 est. (%)
17.481
19.20
1,000
15.2
NA
21
24,000
Indicators
(USD)
Mozambique
2003 2004 2005
2.03
5.88
2,895
3.4
230
40
6.345
2.00
5.70
2,843
4.9
67
NA
5.670
Real GDP (billion)
Real per capita GDP
Inflation Rate (%)
FDI (million)
1.97
5.50
2,794
3.6
NA
NA
6.651
Indicators
Namibia
(USD)
ASEA Yearbook 2005
15
2003 2004 2005
46.9
242.2
5,164
3.7
NA
26.5
6.29
44.8
252.6
5,638
4.3
64.7
29.2
5.49
Real GDP (billion)
Real per capita GDP
Inflation Rate (%)
FDI (billion)
44.8
191.9
4,283
6.8
46.3
31.2
6.55
Indicators
South Africa
(USD)
2003 2004 2005
1.136
2.117
1,863
4.7
NA
40
6.32
1.105
1.615
1,462
3.4
5.22
NA
6.45
Real GDP (billion)
Real per capita GDP
Inflation Rate (%)
FDI (million)
1.081
1.607
1,487
7.4
4.78
NA
7.56
Indicators
Swaziland
(USD)
Economic Indicators
16
2003 2004 2005
35.0
NA
NA
4.8
273.2
NA
1,165.5
35.0
2,008.2
57.0
4.2
260.2
NA
1,043.0
Real GDP (million)
Real per capita GDP
Inflation Rate (%)
FDI (million)
34.2
1,844.7
53.9
3.4
247.8
NA
1,063.6
Indicators
Tanzania
(USD)
2003 2004 2005
26.8
8.3
311.9
3.5
NA
NA
1,816.0
25.1
8.1
304.4
4.9
NA
NA
1,739.1
Real GDP (billion)
Real per capita GDP
Inflation Rate (%)
FDI
Exchange Rate (Ushs per USD)
24.4
6.6
253.5
5.9
NA
NA
1,943.2
Indicators
(USD)
Uganda
ASEA Yearbook 2005
17
2003 2004 2005
11.4
901.00
78.75
15.9
259
NA
3,500
11.1
638.13
57.54
17.5
239
NA
4,700
Real GDP (million)
Real per capita GDP
Inflation Rate (%)
FDI (million)
10.7
636.09
59.20
17.2
172
NA
4,475
Indicators
Zambia
(USD)
2003 2004 2005
13.5
NA
NA
360
NA
76
84588
13
19.1
2000
350
NA
74
5729
Real GDP (million)
Real per capita GDP
Inflation Rate (%)
FDI (million)
13
19.5
2000
365
200
72
824
Indicators
Zimbabwe
(USD)
Economic Indicators
18
ASEA
Member Stock Exchanges
Market
Highlights
Value Traded
(USD million)
Average Monthly
Traded Co.
Market Cap
as % of GDP
Exchanges
Number of
Listed Co.
Volume Traded
(million)
29.3
55.2
77
0.1
235.4
28.65
14.7
10.4
31.6
NA
42.6
NA
22.3
NA
NA
53
186
8
388
NA
9
6
NA
21
35
2
NA
80
Botswana SE
Casablanca SE
CASE
Dar-Es- Salam SE
JSE Ltd
Luska SE
Malawi SE
Mozambique SE
Nairobi SE
Namibian SE
SE of Mauritius
Swaziland SE
Uganda SE
Zimbabwe SE
47.19
16,060
27,937
13.36
203,300
19.58
7.59
34
484.5
529
179.82
0.03
3.1
760
28
54
744
8
388
13
10
13
48
28
41
6
7
80
44.16
440
5,311
29.69
54,510
215.33
61.56
8.5
874.2
121
306.28
0.06
14
9600
Market Cap
(USD billion)
2.65
27.28
79.35
2.28
570
2.5
9.05
0.24
6.14
121.27
2.65
0.20
1.85
20
Turnover
Ratio
1.78%
14.87%
31.10%
0.58%
36.00%
0.62%
3.07%
0.10%
7.90%
0.44%
5.68%
1.00%
0.17%
NA
2005 Market Highlights
Comparative Market Statistics (2005 vs. 2004)
% Change
21.31%
27.43%
28.00%
-3.86%
Value Traded (USD million)
Volume Traded (million)
Market Capitalization (USD billion)
Number of Listed Companies
205,573
56,139
660
1527
2004 2005
249,375
71,535
845
1468
ASEA Members Trading Aggregates *
* Excluding Bond Exchange of South Africa (BESA)
Market Highlights
20
% Change Exchanges
194.54%
110.24%
100.00%
73.96%
63.82%
59.07%
51.52%
39.54%
21.93%
19.83%
14.22%
10.65%
8.46%
1.60%
Dar-Es- Salam SE
CASE
Zimbabwe SE
Uganda SE
Mozambique SE
Nairobi SE
Luska SE
Malawi SE
JSE Ltd
Namibian SE
Botswana SE
SE of Mauritius
Casablanca SE
Swaziland SE
0.77
37.74
10.00
1.06
0.15
3.86
1.65
6.49
467.50
101.21
2.32
2.40
25.15
0.19
Market Cap (USD billion)
2004 2005
2.28
79.35
20.00
1.85
0.24
6.14
2.5
9.05
570.00
121.27
2.65
2.65
27.28
0.20
% Change
Member
Exchange
1545.18%
146.29%
80.57%
74.66%
57.60%
55.42%
42.98%
34.88%
31.87%
22.49%
13.12%
-0.46%
Zimbabwe SE
CASE
Uganda SE
Botswana SE
Luska SE
Malawi SE
JSE Ltd
Nairobi SE
Namibian SE
Casablanca SE
SE of Mauritius
Swaziland SE
1,097,492.53
2567.99
381.87
693.63
506.67
583.48
12656.86
2945.58
425.93
4521.98
710.77
157.40
Index Closing (end of year)
2004 2005
18,055,724.01
6324.70
689.54
1211.49
798.52
906.85
18096.54
3973.04
561.68
5539.13
804.03
156.68
Index Name
Industrials
CASE 30
USE All Share Index
All Companies Index (ACI)
LuSE All Share (LASI)
MASI
FTSE/JSE All Share
NSE 20 Share Index
NSX Overall Index
MASI
SEMDEX
All Share Index
Return on Index
Market Capitalization
ASEA Yearbook 2005
21
% Change Exchanges
1880.6%
310.3%
174.6%
83.8%
72.1%
23.4%
21.6%
17.6%
8.3%
5.0%
-12.6%
-25.0%
-37.7%
-52.1%
Uganda SE
CASE
Luska SE
Casablanca SE
Nairobi SE
Malawi SE
SE of Mauritius
Namibian SE
JSE Ltd
Botswana SE
Mozambique SE
Swaziland SE
Zimbabwe SE
Dar-Es- Salam SE
0.16
6,808
7.13
8,740
281.58
6.15
147.84
450
187,800
44.94
39
0.04
1,220
27.88
2004 2005
3.1
27,937
19.58
16,060
484.5
7.59
179.82
529
203,300
47.19
34
0.03
760
13.36
Value Traded
Volume Traded
% Change Exchanges
3660.55%
144.37%
118.20%
64.40%
43.28%
39.80%
29.54%
19.97%
1.89%
-13.10%
-23.90%
-24.73%
-26.08%
-44.33%
Uganda SE
Casablanca SE
CASE
SE of Mauritius
Zimbabwe SE
Nairobi SE
Dar-Es- Salam SE
JSE Ltd
Luska SE
Swaziland SE
Namibian SE
Mozambique SE
Botswana SE
Malawi SE
0.37
179.85
2,434
186.30
6,700
625.33
22.92
45,438
211
0.07
159
11.29
59.74
110.59
2004 2005
14
440
5,311
306.28
9600
874.2
29.69
54,510
215.33
0.06
121
8.5
44.16
61.56
Market Highlights
22
2005 Gains in ASEA Stock Exchanges Indices (in local currency) *
Swaziland SE
SE of Mauritius
Casablanca SE
Namibian SE
Nairobi SE
JSE Ltd
Malawi SE
Luska SE
Botswana SE
Uganda SE
CASE
0% 25% 50% 75% 100% 125% 150% 175%
ASEA Yearbook 2005
23
* Zimbabwi SE index realized 1545.2% gains in 2005 compared to 2004.
-0.5%
13.1%
22.5%
31.9%
74.7%
80.6%
146.3%
55.4%
57.6%
43.0%
34.9%
Top 5 Stock Exchanges by Value Traded in 2005 (USD million)
203,300
27,937
16,060
760
529 Namibian SE
Zimbabwe SE
Casablanca SE
CASE
JSE Ltd
0 5,000 10,000 15,000 20,000 25,000 30,000 35,000
Market Highlights
24
Gains in Value Traded (2005 vs. 2004)
0% 50% 100% 150% 200% 250% 300% 350%
1881%
5%
8%
22%
18%
310%
175%
84%
72%
23%
-13%
-25%
-38%
-52%
Dar-Es- Salam SE
Zimbabwe SE
Swaziland SE
Mozambique SE
Botswana SE
JSE Ltd
Namibian SE
SE of Mauritius
Malawi SE
Nairobi SE
Casablanca SE
Luska SE
CASE
Uganda SE
ASEA Yearbook 2005
25
Top 5 Stock Exchanges by Volume Traded in 2005 (million)
874
5,311
9,600
440
54,510
Casablanca SE
Nairobi SE
CASE
Zimbabwe SE
JSE Ltd
0 2,500 5,000 7,500 10,000 12,500 15,000
Market Highlights
26
Gains in Volume Traded (2005 vs. 2004)
Malawi SE
Botswana SE
Mozambique SE
Namibian SE
Swaziland SE
Luska SE
JSE Ltd
Dar-Es- Salam SE
Nairobi SE
Zimbabwe SE
SE of Mauritius
CASE
Casablanca SE
Uganda SE
0% 30% 60% 90% 120% 150% 180%
20%
30%
40%
43%
64%
118%
144%
3661%
-44%
-26%
-25%
-24%
-13%
2%
ASEA Yearbook 2005
27
Top 5 Stock Exchanges by Market Cap End of December 2005 (USD billion)
27.3
79.4
121.3
570.0
20.0
0 50 100 150 200 250
Zimbabwe SE
Casablanca SE
CASE
Namibian SE
JSE Ltd
Market Highlights
28
Gains in Market Capitalization (2005 vs. 2004)
Swaziland SE
Casablanca SE
SE of Mauritius
Botswana SE
Namibian SE
JSE Ltd
Malawi SE
Luska SE
Nairobi SE
Mozambique SE
Uganda SE
Zimbabwe SE
CASE
Dar-Es- Salam SE
0% 30% 60% 90% 120% 150%
8%
11%
14%
20%
22%
40%
52%
59%
64%
74%
100%
110%
195%
2%
ASEA Yearbook 2005
29
Market Cap as % of GDP (End of December 2005)
0.1%
14.7%
22.3%
28.7%
29.3%
31.6%
42.6%
55.2%
77.0%
235.4%
10.4%
0% 20% 40% 60% 80% 100% 120%
Dar-Es- Salam SE
Mozambique SE
Malawi SE
Uganda SE
Luska SE
Botswana SE
Nairobi SE
SE of Mauritius
Casablanca SE
CASE
JSE Ltd
Market Highlights
30
Number of Listed Companies (End of December 2005)
0 100 200 300 400 500
Swaziland SE
Uganda SE
Dar-Es- Salam SE
Malawi SE
Luska SE
Mozambique SE
Botswana SE
Namibian SE
SE of Mauritius
Nairobi SE
Casablanca SE
Zimbabwe SE
JSE Ltd
CASE
6
7
8
10
13
13
28
28
41
48
54
80
388
744
ASEA Yearbook 2005
31
Average Monthly Traded Companies in 2005
2
6
8
9
21
35
53
80
186
388
0 40 80 120 160 200
Swaziland SE
Mozambique SE
Dar-Es- Salam SE
Malawi SE
Namibian SE
SE of Mauritius
Casablanca SE
Zimbabwe SE
CASE
JSE Ltd
Market Highlights
32
Turnover Ratio (%) (End of December 2005)
Mozambique SE
Uganda SE
Namibian SE
Dar-Es- Salam SE
Luska SE
Swaziland SE
Botswana SE
Malawi SE
SE of Mauritius
Nairobi SE
Casablanca SE
CASE
JSE Ltd
0.2%
0.4%
0.6%
0.6%
1.0%
1.8%
3.1%
5.7%
7.9%
14.9%
0.1%
31.1%
36.0%
0% 10% 20% 30% 40%
ASEA Yearbook 2005
33
ASEA
Member
Exchanges
Profile
Background
The Botswana Stock Exchange is Botswanas national stock exchange given the responsibility to operate and
regulate the equities and fixed interest securities market. Formally established in 1989, the BSE continues to be
pivotal to Botswanas financial system, and in particular the capital market, as an avenue on which government,
quasi- government and the private sector can raise debt and equity capital. The BSE plays host to the most
preeminent companies doing business in Botswana. These companies represent a spectrum of industries and
commerce, from Banking and Financial Services to Wholesaling and Retailing, Tourism and Information Technology.
The main law which governs all the activities between the Exchange and its members, the proceedings of the
main Committee and its composition; the relationship between the Minister and the Exchange together with
the relations between the Registrar, the exchange and members of the exchange is the Botswana Stock Exchange
Act No 11 of 1994.
The members have promulgated Rules (Members Rules) which provide for the requirements to be fulfilled for
the securities listed and trading on the Exchange. Members Rules provide as the main objective thereof, to
operate a Stock Exchange in Botswana with due regard to the public interest, and to maintain fair and efficient
dealing in securities for the protection of investors and to regulate the affairs of members.
In addition, the Exchange has a set of Listing Requirements which provide the pre-listing requirements and post
listing requirements to be observed by the issuers of listed Securities. The emphasis is to make sure issuers disclose
as much information to the public and investors so that the latter can make informed investment decisions.
36
Trading Statistics
2003 2004 2005
47.19
47.19
-
44.16
44.16
-
2.69
28
NA
NA
2.65
29.3
1.78
44.94
44.94
-
59.74
59.74
-
1.91
25
NA
NA
2.32
56.6
1.94
41.17
41.17
-
77.41
77.41
-
2.38
25
NA
NA
1.94
53.0
2.32
Trading Statistics
Indicators
Total Value Traded (USD million)
Value Traded on Listed Securities
Value Traded on Unlisted Securities
Total Volume Traded (million)
Volume of Listed Securities Traded
Volume of Unlisted Securities Traded
Total Number of Transactions (billion)
Number of Traded Companies
Average Monthly Traded Companies
Market Capitalization End of Year (USD billion)
Market Capitalization as % of GDP
Turnover Ratio (%)
Number of Companies Included in Each Sector
Sectors Traded
Sectors Traded on the Stock Exchange
4
4
2
5
2
1
1
7
0
1
1
4
4
2
6
2
1
1
4
1
1
1
Banking
Financial Services and Insurance
Tourism
Retailing, Wholesaling and Consumer Staples
Property and Property Trusts
Healthcare and Emergency Services
Energy
Mining and Materials
Transport Services
Information Technology
Security Services
4
4
2
6
2
1
1
2
1
1
1
2003 2004 2005
ASEA Yearbook 2005
37
Issue Value (USD million) Issue Date Maturity Date
9.65
10.25
1-Mar-08
31-Oct-15
BW 002
BW 003
26-Mar-03
26-Nov-03
Government Bonds
# Yield (%)
850
900
Sector
5 Most Active Sectors in 2005
Banking
Financial Services and Insurance
Mining and Materials
1
2
3
Sector
Retailing, Wholesaling and Consumer Staples
Property and Property Trusts
4
5
2003 2004 2005
288.69
260.37
28.32
23.23
-
23.23
Value traded on government bonds
Value traded on corporate bonds
0.56
-
0.56
Bonds Statistics
Bonds
Description of the Product Year
1989
1997
1999
Stocks
Bonds
Commercial Paper
Equities
Fixed Income
Fixed Income
Products
Product
38
Description of the Index Methodology of Calculation
Market cap indx
Market cap indx
Market cap indx
Covers all domestic listed companies
Covers all foreign listed companies
Covers both foreign and domestic listed companies
Domestic Company Index (DCI)
Foreign Company Index (FCI)
Indices
Index Name
Indices Trading Statistics
Index
Market Cap. (USD billion)
2.65
59.56
62.22
2.32
34.58
36.90
2004 2005
39.56
4.60
44.16
56.78
2.96
59.74
2004 2005
44.79
2.40
47.19
42.78
2.16
44.94
2004 2005
Indices Performance
Index
% Change
23.21
78.02
74.66
3559.14
1129.94
1211.49
2888.68
634.71
693.63
2004 2005
ASEA Yearbook 2005
39
Chairmans Letter
In a year of mixed fortunes for markets, CASE has continued to reinforce and improve its position in terms of
benchmark performance. Our core trading business has performed exceptionally well during a period of
increasing competition among markets.
Undoubtedly, 2005 was the most remarkable year for CASE over the past decade. CASE ranked top, compared
to developed and emerging markets, tracked by Standard & Poors and Morgan Stanley indices. The well
acclaimed magazine Newsweek pointed out that CASE was one of the top and best performing markets in
the world. All CASE main market indicators reached their all time high: market capitalization soared to $80
billion almost 110 percent higher than 2004, value traded increased sharply to $28 billion around 310 percent
more than 2004, market capitalization as a percent of GDP exceeded 75 percent etc. The domestic market
has seen significant growth in equities trading, which was mainly fuelled by the active participation of international
and retail customers.
Our vision is to be the Exchange of Choice in the Middle East and North Africa (MENA) Region and as such
we will spare no efforts to better serve our customers.
This year, we have worked on building and renewing our critical regulatory and infra structural platforms. Our
commitment to develop a quality marketplace is indisputable. In line with our annual efforts, we released a set
of new rules i.e. margin trading, intraday trading and some amendments in the listing rules. These measures were
aimed at raising the responsibilities of intermediaries and facilitating mergers and acquisitions among issuers.
These changes are important in continually improving the robustness of our marketplace. Furthermore, we have
cemented our leadership in technology and driven ahead with an agreement with one of the key technology
exchange companies worldwide, OMX Group, to establish a joint venture company in Cairo that will better
serve the Egyptian, Middle Eastern and African capital markets.
In the coming year, we plan to introduce new products such as Exchange Traded Funds. We will also be exploring
new structured products and distribution channels for greater retail penetration. Furthermore, CASE will focus
its coming efforts on encouraging new domestic and regional listings. By constructing a market of quality listed
companies, we are in a position to greatly advance the reforms of the Egyptian economy. Moreover, CASE
40
will continue its educational programs in collaboration with various universities in Egypt in order to enhance
investor education.
Year 2005 witnessed the passing of several important economic laws by the Egyptian government, which
confirmed the governments commitment to reform and impacted positively on the activity and turnover of CASE.
In its drive to be the major player in the MENA region, CASE also strives to be recognized globally. Consequently,
CASE was the first Arab Exchange to be a member of the World Federation of Exchanges in 2005, which
confirms the compliance of CASE to international standards.
Maged Shawky
Chairman - CASE
ASEA Yearbook 2005
41
Background
The history of Cairo and Alexandria stock exchanges can be traced to the19th century, when the merchants
of Alexandria used to meet in coffee houses to cut their deals, then found the urge to establish the Alexandria
Bourse in 1883, to be one of the oldest among the Middle East stock markets, followed by the Cairo Stock
Exchange in 1903 with 97 listed companies at an aggregate capital of LE 29 million, which jumped to 228
listed companies in 1907 with a combined capital of LE 91 million.
Both Cairo and Alexandria Stock exchanges merged and managed to outperform throughout the 1940s and
the early 1950s, to the extent that they ranked fifth among the world exchanges. Twenty-one brokerage firms
were on hand to take care of this swelling trading.
Following the socialist regime and the nationalization policy adopted by the government in the early 1960s,
the role of Egypts private sector has diminished and likewise the activities of the Cairo and Alexandria Stock
Exchanges (CASE). Only 9 companies were listed on the market during 3 decades, nevertheless the Exchange
was never shut down.
In consistency with Egypts new era of economic reform and restructuring undertaken in 1991, the role of Cairo
and Alexandria Stock Exchanges was re-activated in 1992, with the issuance of the Capital Market Law no.95
of 1992, issued by the Capital Market Authority (CMA), which laid the regulatory framework for the financial
intermediaries; brokers, fund management firms, venture-capital firms, underwriters, investment banks..etc. During
this year, 656 companies were listed and available on the trading floor.
One automated trading system was to link both Exchanges in 1994, which facilitated the implementation of the
privatization program that had started in the same year leading to another push in the revival of the Egyptian
Stock Market. A number of Initial Public Offerings (IPOs) of the state-owned companies were executed through
Cairo and Alexandria Stock Exchanges.
Starting 1997, as the importance of the Stock Exchange was established - as a gateway for companies to raise
capital and for investors to share in companies profits the number of issued and listed shares kept on increasing,
which attracted both retail and institutional investors to the market, leading to higher trading volumes.
42
It is worth mentioning that starting1997 and pursuant to Presidential Decree no. 51 for 1997, both stock exchanges
were managed by the same Chairman and Board of Directors. The Chairman is appointed by the Prime Minister,
whereas the Board of Directors are elected from the market participants, representatives of the Capital Market
Authority, the Central Bank of Egypt (CBE) and the banking sector.
ASEA Yearbook 2005
43
Trading Statistics
2003 2004 2005
27,937
26,248
1,689
5,311
4,199
1,112
4,210,092
744
441
186
79
77
31.1
Total Number of Transactions
Turnover Ratio (%)
4,514
3,740
775
1,423
1,202
221
1,229,377
978
540
206
28
36
11.5
Trading Statistics
Indicators
6,808
5,807
1,001
2,434
1,786
648
1,743,654
795
503
200
38
44
14.2
% of the Total Value Traded
Investors Type
Investor
27%
73%
47%
53%
Foreign Investors
Local Investors
Institutions
Individuals
20%
80%
54%
46%
2003 2004 2005
30%
70%
47%
53%
44
Sectors Traded
24
106
34
12
55
55
69
63
42
5
66
6
5
12
13
20
33
10
34
4
48
28
27
120
34
12
57
60
73
68
39
5
74
6
6
13
12
21
32
11
38
4
54
29
Agriculture and Fishing
Building Materials and Construction
Chemicals
Consumer & Household Goods
Electrical Equipment and Engineering
Entertainment
Financial Services
Food and Beverages
Health and Pharamceuticals
Holding Companies
Housing and Real Estate
Information Technology
Media
Mills and Storage
Mining & Gas
Miscellaneous Services
Paper & Packaging & Plastics
Retailers
Textile and Clothing
Telecommunication
Trade
Utilities
28
148
32
16
75
73
102
78
45
5
103
8
0
14
14
24
44
13
48
0
73
35
2003 2004 2005
ASEA Yearbook 2005
45
Sector
Textile and Clothing
Building Materials and Construction
Telecommunication
1
2
3
Methodology of Calculation
Indices
Index Name
It is a free floated market capitalization index that was released on
the 2nd of February 2003 and was retroactively computed as of
1 January 1998 with a base value of 1000 points. The most important
criterion for inclusion in the index is liquidity.
CASE 30 Index
Description of the Index
free floated
market cap
index
2003 2004 2005
1,540
1,512
28
456
448
8
531
494
37
Bonds Statistics
Bonds
Products
Product
All common stocks as well as 2 companies with preferred stocks
Government and corporate bonds with the bulk owed to Treasury bonds issued through the Primary Dealers System.
Three closed ended funds
Stocks
Bonds
Mutual Fund
Description of the Product
Sector
Financial Services
Holding Companies
4
5
46
Index
CASE 30 Index Constitiuents
43 17
2004 2005
2,559 1,313
2004 2005
15,511 4,161
2004 2005
Date of Offering
GDRs
GDR
London Stock Exchange
New York Stock Exchange
LondonStock Exchange
Luxemburg Stock Exchange
Stock Exchange
Egyptian Financial Group Hermes Holding
Orascom Construction Industries
Orascom Telecom
Ezz Steel
Misr International Bank
Commercial International Bank (CIB)
Commercial International Bank (CIB)
Paint & Chemical Industries (Pachin)
LAKAH Group
Suez Cement
Egypt Lebanon Ceramics (Lecico)
Telecom Egypt
Aug-98
Aug-02
Jul-00
Jun-99
Apr-98
Jul-96
Jul-96
Oct-97
Jul-99
Jul-96
Nov-04
Dec-05
Indices Performance
Index
CASE 30
% Change
146.29
6324.7 2567.99
2004 2005
ASEA Yearbook 2005
47
Latest Achievements
In view of the Exchange's vision to become the main gateway for investment in the MENA region, CASE
undertook an ambitious plan to develop its technology, regulations, information dissemination, public awareness
and products development.
a) Technological Development
Having recognized technology, as one of the key foundations in the capital market, CASE spared no efforts in
upgrading its technology platform and infrastructure to accommodate new features and products.
In 2005, CASE has upgraded the capacity of the trading system to meet the surge in turnover and activity
and the corresponding increase in number of transactions and volume trading. Accordingly, the capacity of
the system was enlarged to accommodate more than 100,000 transactions per day.
Year 2005 has also witnessed the linking of the trading system of CASE with the clearing system of the MCDR,
to provide a Straight through Processing environment. The new system ensures investor protection as it guarantees
the availability of the securities before effecting selling transactions (the correct or the wrongly executed ones),
which in turn ensures timely and proper settlement, on one hand and a reduction in the number of cancelled
transactions, on the other.
In order to accomodate the extensive implementation of the privatization program undertaken by the Egyptian
government, CASE has recently designed and developed a special program for the OPR market that accommodates
and compiles IPO and private placements orders before execution in the market. This program facilitates orders
registrations and cancellations, ensures accurate calculations of the allocation percentages and smoothes the
dealing with the large number of transactions related to the offerings.
From another perspective, CASE is currently working on building a Disaster Recovery Site in Alexandria Stock
Exchange to act as the back-up system in case of any unexpected failure in the main trading system located
in Cairo Stock Exchange premises.
Moreover, a new coding program is currently under prepartion to enable brokerage firms to register their new
clients from their offices.
48
Finally, the Exchange is planning to upgrade its backbone network in order to enhance its trading infrastructure,
with support from its new partner; OMX Group.
b) Regulatory Development
Year 2005 witnessed the issuance and amendments of some rules and regulations covering a number of tools
and mechanisms introduced by CASE to the market. These include amendments to the Listing rules to accommodate
new offerings, mergers and acquisitions undertaken under the privatization program, formulation of the Intra-
day Trading rules (which became operative in October 2005) and finalizing the executive regulation of the
margin trading rules. CASE has also finalized online trading (e-trading) rules, pending the Capital Market
Authority (Regulator) approval for implementation.
c) Information Dissemination
In order to increase the level of transparency and improve the quality of information in the market, CASE has
re-launched its website in September 2005, providing the most recent market statistics with only 15 minutes
delay, together with a wealth of information about CASE rules and regulations, member firms, up-to-date news,
education corner as well as information services.
Moreover, through its subsidiary (EGID), CASE ensures a proper dissemination of information to market participants
and data vendors.
Its worth mentioning that in October 2005, the Minister of Investment and Chairman of the Board of Trustees
of Egypt Institute of Directors approved the release of Egypt's Code of Corporate Governance, conforming
to OECD principles, which would be adopted by companies listed on CASE, financial institutions and large
non-traded family members and would further enhance the level of transparency in the Egyptian market.
d) Public Awareness
Within the framework of its investor education and public awareness campaign, CASE held Borsa Step X Step
Forum and Exhibition, which targeted this year students in the different universities in Egypt.
ASEA Yearbook 2005
49
The Forum offered interactive sessions in order to educate students about the basics and fundamentals of
investment and trading in the stock market.
It is worth mentioning that throughout 2005, Borsa Step x Step was held in Ain Shams University in April 2005,
Cairo University in July 2005, the Canadian University and the German University (GUC) in November 2005.
Moreover, Borsa Step X Step has moved to Egypt's Governorates, starting with Mansoura University, where
the forum was held over the period (20 - 24 November 2005).
The Forum will be continued at the American University (AUC), Mansoura University, Ain Shams University and
Cairo University in 2006. It is expected that the forum will be also held in other governorates.
CASE has also conducted road shows in the Gulf region to promote the Egyptian market and encourage
reputable blue chip companies to come and list on CASE.
A workshop defining the concept of Islamic Finance, how Islamic methods are integrating into global capital
markets, was conducted jointly between CASE, HSBC Egypt and HSBC Amanah in July 2005. This workshop
was attended by bankers, investment bankers, asset & portfolio managers in Egypt, as well as senior stock
exchange management.
Finally, CASE has concluded a joint project with Egypts Post Office to launch a new mutual fund that invests
in the stock market in order to attract the savings of small investors into the market. In this respect, CASE has
conducted educational courses about the basics of investment and financial instruments available in the capital
market, for the Post Office officials amd employees.
e) International Alliances
CASE became a member of WFE (World Federation of Exchanges) in November 2005, making it the first Arab
country to enjoy this status at the WFE, which in turn reflects the compliance of the Egyptian Stock Exchange
to international standards recognized by financial institutions and regulatory bodies in different markets.
50
The WFE currently consists of 57 member exchanges from different regions, representing almost 97percent of
the world market capitalization.
On the regional front, CASE was elected to preside over the African Stock Exchanges Association (ASEA),
which consists of 18 African Stock Exchanges members. The elections took place at the end of ASEA 9th
conference, which was held in Cairo mid September 2005.
Moreover, CASE is an active member of the Federation of Euro-Asian Stock Exchanges (FEAS) and the Union
of Arab Stock Exchanges.
On 18 January 2006, CASE and Borsa Italiana signed a Memorandum of Understanding to enhance the
activities of intermediaries and investors in both the Egyptian and Italian markets. The two Exchanges will consult
and cooperate on issues of mutual interest such as market regulation, investor education, market efficiency and
training programs. The two Exchanges also agreed to share information on the principles of corporate governance
for listed companies and on listing criteria, market surveillance, electronic platforms and statistics.
The Exchange has also signed Memoranda of Understanding (MOUs) with various stock exchanges including
Korea, Hong Kong, London, Madrid, Nigeria, Johannesburg, Kuala Lumpur, Malta, China, Thesssaloniki and
National Stock Exchange of India, in addition to joint cooperation agreements with most of the Arab Stock
Exchanges including Kuwait, Lebanon, Jordan, Bahrain, Oman and Sudan.
f) Product Development
ABN-AMRO Bank got a license from CASE to issue open end certificates on CASE 30 Index to be traded
on 4 international stock markets. On 27 October 2005, 500 thousand certificates were listed and traded on
the Swiss Exchange.
CASE has also signed on 3 January 2006, a joint branding and marketing agreement with Dow Jones Indexes,
ASEA Yearbook 2005
51
a leading global index provider, to create the Dow Jones CASE Egypt Titans Index, a blue-chip index that covers
the largest and most liquid companies in Egypt. The index is scheduled to be launched by the end of the first
quarter 2006.
CASE is looking ahead to undertake the following:
Re-locate the Exchange to the Smart Village, being a main component of the regional financial center.
Commitment to best practices (conduct standards and integrity).
Increasing diversity of offerings.
Continuous review of Listing and governance rules to ensure quality issuers on its main board.
Introduce a new segment for SMEs and growing companies.
Encouraging dual listings of blue chip companies.
Introduce new trading mechanisms such as margin trading, short selling and online trading to further enhance
market liquidity.
Introduce Exchange Traded Funds and derivatives.
52
Background
On 7 November 1929, the Casablanca Stock Exchange held its first trading session. In the course of its 77-
year history, the institution has undergone three major reforms. Under the first, in 1948, the Securities exchange
acquired legal personality. The second, in 1967, involved a legal and technical reorganization, and a change
in legal status to that of a public establishment. The third was initiated in 1993, and amended and supplemented
in 1996. This reform defined the various market players, and introduced a range of rules and technical procedures
needed for the development of the Moroccan financial market.
In March 1997, the Stock Exchange has launched the electronic-based trading system followed by the central
securities depository Maroclear in 1998. In end of the same year the Central Market and Block-Trade Market
replaced the Official Market and Direct Transfer Market. Another milestone was in May 2001 when the
settlement period for market transactions was reduced from T+5 to T+3. The new indices of the Casablanca
Stock Exchange: MASI, MADEX, as well as sector indices, return indices and currency indices were all launched
in the beginning of year 2002, while during 2004, the Exchange has adopted the float-weighted market
capitalization method for calculating indices.
ASEA Yearbook 2005
53
Trading Statistics
2003 2004 2005
Trading Statistics
Indicators
6.13
6.13
-
37.4
37.4
-
38,102
52
52
50
13.18
27.14
5.66
8.74
8.74
-
179.8
179.8
-
73,133
53
53
52
25.15
46.75
7.36
16.06
16.06
-
439.5
439.5
-
160,982
54
54
53
27.28
55.23
14.87
Total Value Traded (USD billion)
Total Number of Transactions (million)
Turnover Ratio (%)
Sectors Traded
6
3
6
5
3
2
4
2
1
1
1
1
3
5
3
6
5
3
2
4
2
1
1
-
1
3
Food Producers & Processors
Insurance
Banks
Construction & Building Materials
Beverages
Chemicals
Distributors
Wrapping
Electrical & Electronic Equipment
Real Estate
Pharmaceutical Industry
Software & Computer Services
Mining
5
3
6
5
3
2
4
2
1
1
-
1
3
2003 2004 2005
54
2003 2004 2005
477.82
-
477.82
862.25
-
862.25
939.30
-
959.30
Bonds Statistics
Bonds
Sectors Traded
2
1
7
3
1
1
1
2
-
9
3
1
1
1
Oil & Gas
Utilities
Investment Companies & Other Finance
Holding Companies
Forestry & Paper
Telecommunications
Transport
2
-
9
3
1
-
1
2003 2004 2005
Sector
Telecommunications
Banks
Food Producers and Processors
1
2
3
Sector
Holding Companies
Mining
4
5
ASEA Yearbook 2005
55
Index
MASI
MADEX
5.53
4.22
5.33
4.01
2004 2005
439.22
419.14
168.29
162.88
2004 2005
Value Traded (USD billion)
15.59
12.42
5.85
4.79
2004 2005
Indices
Index Name Description of the Index
Morroccan All Shares Index
Most Active Shares Index
Morroccan All Shares Index
Most Active Shares Index
MASI
MADEX
MASIR
MADXR
Free Float Index / Market cap index
Free Float Index / Market cap index
Return Index
Return Index
Indices Performance
Index
MASI
MADEX
MASIR
MADXR
% Change
22.49
23.75
27.71
28.45
5539.13
4358.87
8453.02
6373.44
4521.98
3522.38
6619.16
4961.66
2004 2005
56
Latest Achievements
Application of new listing requirements.
Extension of trading hours. The trading session begins at 09:00 am (pre-open) and closes at 03:30 pm instead
of 01:30 pm previously.
Increase in the price change limit for the reference price to 10 percent during each of the first five stock-
market trading sessions following listing of a company on the Casablanca Stock Exchange instead of 6 percent
previously.
De-listing of DIAC-EQUIPMENT by the Casablanca Stock Exchange for non-respect of listing requirements.
Approval by the Ministry of Finance and Privatization of guidelines concerning the supervision of brokerage
firms.
ASEA Yearbook 2005
57
Dar Es Salaam Stock Exchange
Chairmans Letter
Dar es Salaam Stock Exchange (DSE) is one of the youngest stock exchanges in Africa. The DSE was established
in 1996 through the Government of Tanzania initiatives, to facilitate among other things, the privatization exercise
being implemented by the Government. Today DSE is eight years old. The listings have increased from two
in 1998 when the DSE started operations to eight, which includes two cross-listings from Nairobi Stock Exchange
(NSE). A lot of efforts have been made to achieve what we see at the DSE today. These efforts include public
awareness programmes, market development initiatives such as identifying potential companies and their
sensitization to list at the DSE and cross border listings and linkage of the markets in the East African region
as well as in the SADC area. The above efforts have facilitated the harmonization of rules and regulations as
well as cross listings. So far, there are two companies which are cross listed in the East African Markets. The
two companies are listed at the Nairobi Stock Exchange (NSE) as their primary listing market and in Uganda
Securities Exchange (USE) as well as at the DSE. The two companies are Kenya Airways and East African
Breweries Ltd. Several other companies are in the process of obtaining cross listings in all the three markets.
The cross-listings in an indication of the commitment by East African Securities Exchanges, to integrate their
markets.
As ASEA seeks to consolidate the information on all ASEA members, the inclusion of the DSE data on the ASEA
fact book will provide the needed information on the African Stock Exchanges so that investors may have a
single source of information pertaining to all African markets in a single source.
We, at the DSE, are committed to providing an update on our activities as and when required so that the fact
book is continuously updated. It is our hope that the enclosed facts on the DSE will provide the starting point
of the preparation of ASEA fact book and the step towards the provision of necessary information on the African
Stock Exchanges to the wide investor base across the globe.
We wish ASEA all the best in this endeavor.
G.E. Maganga
Chairman DSE
Dar Es Salam Stock Exchange
58
Background
The Dar Es Salaam Stock Exchange (DSE) was incorporated in September 1996 as a private company limited
by guarantee and not having a share capital under the Companies Ordinance (Cap. 212). The DSE is therefore
a non-profit making body created to facilitate the Government implementation of the economic reforms and
in future to encourage the wider share ownership of privatized and all the companies in Tanzania and facilitate
raising of medium and log-term capital.
The formation of the DSE followed the enactment of the Capital Markets and Securities Act, 1994 and the
establishment of the Capital Markets and Securities Authority (CMSA), the industry regulatory body charged
with the mandate of promoting conditions for the development of capital markets in Tanzania and regulating
the industry. The governing organ of the DSE is the Council of the Exchange, which consists of 10 members
representing various interest groups in the society.
Trading activities at the DSE commenced on 15 April 1998 after two years of background preparatory work
under the stewardship of the Government through the Capital Markets and Securities Authority. The opening
of the Trading Floor coincided with the listing of TOL Limited as the first company on the new Exchange.
The Exchange is open for 5 days in a week. The trading days are currently four days in the week, Tuesdays,
Wednesdays, Thursdays and Fridays. Trading takes place between 10-11 am. The securities currently being
traded are ordinary shares of eight companies, six corporate bonds and ten Government of Tanzania bonds.
The DSE membership consists of Licenced Dealing Members (LDMs) and Associate Members. LDMs are allowed
access to the trading floor. Associate members are institutions and companies which support the DSE.
ASEA Yearbook 2005
59
Trading Statistics
Sectors Traded
7
1
2
6
1
2
Manufacturing
Agriculture
Transport
5
1
0
2003 2004 2005
2003 2004 2005
13.36
13.36
NA
29.69
29.69
NA
2,285
8
8
8
2,283.03
0.109
0.58
27.88
27.88
NA
22.92
22.92
NA
3,426
7
7
7
774.10
0.037
3.60
Market Capitalization End of Year (USD million)
Turnover Ratio (%)
30.95
30.95
NA
42.94
42.94
NA
5,429
5
5
5
668.57
0.034
4.63
Trading Statistics
Indicators
Dar Es Salam Stock Exchange
60
Sector
Manufacturing
Agriculture
1
2
Issue Value Issue Date Maturity Period
17.84
16.48
18.13
17.99
2 yrs
5 yrs
7 yrs
10 yrs
1
2
3
4
2002
2003
2003
2003
Government Bonds
# Yield (%)
Sector
Transport 3
1998
1999
Equities
Bonds
Corporate
Treasury and Corporate
Products
Product
NA
NA
NA
NA
ASEA Yearbook 2005
61
JSE Limited
Chairmans Letter
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63
Trading Statistics
2003 2004 2005
203.3
2
54.5
''
'2
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2'
187.8
!
45.4
'
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2
Trading Statistics
Indicators
Sectors Traded
2003 2004 2005
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2'
2
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65
Indices
Index Name
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Indices Performance
Index
|S|/S| /|| S|cc
|S|/S| cc
% Change
2-
!2
!-'
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!2'
!!'2
2004 2005
S| |..|cc
66
Index
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Market Cap.(USD billion)
2-'
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2
2-
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2!
2004 2005
Volume Traded (billion)
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2
2'
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2-2
2004 2005
Value Traded (USD billion)
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2004 2005
Year
GDRs
GDR
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67
Latest Achievements
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68
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69
The JSE now looks |c ||c .|.c cc||c cc..cccc |c cc| ||c cccs c .|s s|c'c|c|ccs cc cc|.c.|c |c gcw.g
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70
Chairmans Letter
As we look at the first 10 years of our nascent market, we note very exciting developments which the Lusaka
Stock Exchange has been experiencing, that are illustrated into details in the achievements part.
As we look to the next 10 years of the Exchange, we foresee LuSE playing a central role in the economy as
the premier long term capital raising mechanism of choice and core driver of economic activity. The quoted
tier is being restructured to allow medium sized growth companies to access cheaper long term capital and
also provide an exit and market valuation mechanism for venture capitalists.
Our intended link into the JSE will make our market more visible to the prying eyes of emerging market investors.
We are looking at unlocking the potential that lies in our bond market for both corporate and Treasury bonds.
Most of these initiatives are ably tackled under the national Financial Sector Development Plan which is a five
year plan for the development and rationalization of the overall financial sector.
Friday Ndhlovu
Chairman - LuSE
ASEA Yearbook 2005
71
Background
The Lusaka Stock Exchange (LuSE) was established in 1993 and started formal operations on 21 February, 1994.
The stock exchange was setup with initial financial and technical support from the World Bank/IFC, UNDP and
the Government of the Republic of Zambia as a capital market development project. LuSE was incorporated
as a private not-for-profit limited liability company owned by the Member Brokers.
LuSE was setup to provide access to cheaper long term capital for the private sector as Government moved
away from conducting business to facilitating its proper functioning after liberalization of the national economy
in 1991. Government also required a transparent and organized platform from which to exit from some of the
potentially successful parastatals. The stock exchange was also setup as an empowerment vehicle for Zambians
facilitating the widespread ownership of shares.
72
Trading Statistics
Investors Type
Investor
69.36%
30.64%
Foreign Investors
Local Investors
39.97%
60.03%
2003 2004 2005
44.67%
55.33%
2003 2004 2005
19.58
19.42
0.16
215.33
210.92
4.41
2,519
13
15
NA
2,456.00
28.65
0.62
Turnover Ratio (%)
11.05
11.05
0.00
311.44
311.41
0.03
2,102
11
12
NA
768.00
21.22
1.44
Trading Statistics
Indicators
7.13
7.10
0.03
211.35
165.69
45.66
1,993
12
14
NA
1,649.98
38.06
0.42
Sectors Traded
6
1
1
2
6
1
1
2
Manufacturing
Hospitality
Retail Trading
Agriculture
6
1
1
2
2003 2004 2005
ASEA Yearbook 2005
73
5
2
1
1
5
1
4
2
1
1
3
1
3
1
1
1
3
1
2003 2004 2005
Banking
Property
Energy
Oil Marketing
Mining
Investments
2003 2004 2005
5.45
5.45
NA
13.43
13.43
NA
23.57
23.57
NA
Bonds Statistics
Bonds
Sector
Manufacturing
Banking
Agriculture
1
2
3
4
5
Sector
Oil Marketing
Property
74
*Treasury bonds are issued monthly in various tenors; 2, 3 and 5 years. These are the trading bonds as of end March, 2006. However, the actual issues are too
numerous to itemise.
Issue Value
(USD million)
Issue Date Maturity Date
8.7
15.7
9.8
12.5
5.9
9.6
21.1
6/20/06
7/17/06
10/24/06
1/17/07
2/21/07
5/23/07
2/18/11
06/2005
01/2005
04/2005
01/2005
02/2005
05/2005
01/2005
6/20/05
1/17/05
4/25/05
1/17/05
2/21/05
5/23/05
2/18/06
Government Bonds *
# Yield
(%)
4.24
5.04
5.99
5.75
3.71
5.93
8.29
1994
1994
NA
NA
NA
Products
Product
Equities
Bonds
Index Futures
Bond Futures
Single Stock Futures
Kruger Rands
Bond Index Futures
An instrument that signifies an ownership position, or equity, in a corporation, and represents
a claim on its proportionate share in the corporation's assets and profits.
A contract to pay the holder a specified amount of interest (floating or fixed) on a specified
date for a specified period of time and the principle at the end of the period.
A standardized, transferable, exchange-traded contract that requires delivery of a commodity,
bond, currency, or stock index, at a specified price, on a specified future date.
A single transaction equivalent to the simultaneous sale of a put and purchase of a call
for a given stock. Single stock futures essentially allow investors to sell a stock short without
waiting for a downtick as would otherwise be required.
A standardized, transferable, exchange-traded contract that requires delivery of a bond
index, at a specified price, on a specified future date currency.
ASEA Yearbook 2005
75
Indices
Index Name Description of the Index
Weighted market capitalisation Index. Represents
100% of all shares in issue except cross-listed stocks
such as Shoprite Holdings
LuSE All Share (LASI) Two values are provided, i.e. the market cap of
none-cross listed stocks to market cap of none-
cross listed stocks on 2nd January, 1997.
Indices Performance
Index
% Change
57.60
798.52 506.67
2004 2005
Index
Market Cap.* (USD million)
856.01 387.41
2004 2005
215.33 211.28
2004 2005
19.16 7.00
2004 2005
*Mkt Cap. Excludes ZCCM-IH and Shoprite Holdings Ltd (RSA) a cross listed stock
NA
NA
NA
Product
Warrants
Exchange Traded Funds
Interest Rate Product
The right to purchase or sell shares (the underlying security) at a specified date in the future
at a specified price.
An Exchange Traded Funds (ETF) is a fund that tracks an index, but can be traded like a
stock.
The interest rate product offers a single platform for the trading of interest rate products
on a yield basis. It is a single point access and one stio yield shop.
76
Latest Achievements
As we look at the first 10 years of our nascent market, we note very exciting developments which the Lusaka Stock
Exchange has been experiencing. There has been an increase in the number of listed companies, there has also been
notable improvements in all the market indicators. This has in turn highly exposed the LuSE in this ever shrinking global
market. To elaborate on this the following are some recent developments; 2004 and 2005 saw the LuSE receiving
international recognition namely:
Standard & Poors in the 2004 World Capital Markets Fact Book ranked the LuSE amongst the top 25 best performing
stock markets out of a total of 102 world stock exchanges. This ranking was based on the performance of the LuSE
All Share Index. This ranking placed LuSE in third place after Egypt and Ghana on the continent and fourteenth
globally. This now created the exciting challenge of competing with older more well established Exchanges.
In 2005, the LuSE also received an award for Best Performing Regional Stock Exchange, awarded by the Financial
Gazette of Zimbabwe. The exciting thing about this Award was the fact that LuSE was the first recipient.
Another plus for LuSE in 2005 was the recognition by the Committee of SADC Stock Exchanges (COSSE) of LuSE
being the first stock exchange in the region to issue its own corporate governance code for listed and quoted
companies.
These exciting developments have not only occurred on the international scene. On the home front we have seen a
greater appreciation of the market and its role as recently witnessed by the over subscription in the Metal Fabricators
of Zambia (ZAMEFA) IPO in August 2004 and its subsequent doubling in price between listing in September and
end December, 2004. The release of residual shares of five listed companies held by the Zambia Privatization Trust
Fund resulted in an over subscription of 420 percent. This has given us even greater challenge to explore ways of
deepening our market.
The Exchange also managed to translate and print its basic information in five local languages. This is a way of
empowering local people through understanding of the operations of the stock exchange and its role in wealth
creation. We are grateful that the Government has made investment in shares of listed companies by individuals
exempt from the 15 percent withholding tax on dividends. This effectively makes investment in shares tax free as there
is no capital gains tax in Zambia.
ASEA Yearbook 2005
77
Trading Statistics
2003 2004 2005
Trading Statistics
Indicators
Sectors Traded
4
2
2
1
1
4
2
2
0
1
Financial
Manuafacturing
Tourism/Hotel Industry
Invetment Vehicle
Multisectoral
4
2
2
0
1
2003 2004 2005
Turnover Ratio (%)
7.59
7.59
-
61.56
61.56
-
480
10
9
9
9.05
14.72
3.07
8.71
8.71
-
181.87
181.87
-
290
9
9
9
5.39
6.23
7.87
6.15
6.15
-
110.59
110.59
-
282
9
9
9
6.49
9.01
3.65
78
Indices
Index Name
MALAWI ALL SHARE INDEX
DOMESTIC SHARE INDEX
FOREIGN SHARE INDEX
MASI
DSI
FSI
Market Cap. Index
Market Cap. Index
Market Cap. Index
Sector
Financial
Investment Vehicle
Multisectoral
1
2
3
Sector
Manufacturing
Tourism/ Hotel Industry
4
5
Indices Performance
Index
MASI
DSI
FSI
% Change
55.42
61.26
50.00
906.85
687.00
358.20
583.48
426.03
238.80
2004 2005
ASEA Yearbook 2005
79
Trading Statistics
2003 2004 2005
34.0
34.0
-
8.5
8.5
-
77
13
5
6
242.3
10.36
0.1
Turnover Ratio (%)
483.7
483.7
-
114.4
114.4
-
193
9
6
8
105.8
5.51
4.6
Trading Statistics
Indicators
38.9
38.9
-
11.3
11.3
-
42
10
4
4
146.5
6.98
0.3
Sectors Traded
1
1
1
2
1
1
1
1
1
1
Banking
Food and Beverages
Construction
Communications
Government
1
1
1
1
1
2003 2004 2005
80
2003 2004 2005
34.01
25.88
8.13
36.15
29.95
6.20
477.61
420.57
57.04
Bonds Statistics
Bonds
10.75
11.38
11.50
10.63
5.80
12.00
2011
2007
2009
2010
Perpetual
2015
1
2
3
4 Series 1
4 Series 2
4 Series 3
2001
2002
2004
2005
2005
2005
Government Bonds
# Yield (%)
9.6
4.1
10.3
20.4
61.7
68.6
Food and Beverages
Banking
4
5
Sector
Government
Construction
Communications
1
2
3
Sector
Products
Product
Private
Corporate and Government
Corporate
Stocks
Bonds
Commercial Paper
2001
1999
2005
Year
ASEA Yearbook 2005
81
Chairmans Letter
It is my pleasure to present to you my statement for the year ending 31st December 2005 which is my first as
the Chairman of the Board of Directors of the Exchange.
I would like to continue where my predecessor left off and improve the vibrancy of the Exchange by increasing
both the efficacy of its service delivery and its relevance as a stimulator of economic development and wealth
creation. Our main thrust would be to improve the Exchanges ability to execute trades by automating infrastructure,
whilst at the same time diversifying our product offering and strengthening our relationships with other like
minded institutions.
The NSE Board and management are looking forward to cementing already established contacts between
ourselves and our regulator, the Capital Markets Authority (CMA). We realize, we need their assistance and
guidance to enable us to achieve our vision - To be a leading Securities Exchange in the World as measured
in terms of efficiencies and effectiveness in our value preposition to all our stakeholders. Our simple goal is to
develop a deep and efficient regional securities market, which will serve to channel domestic and international
capital for investment in our economies in the East and Central Africa region and create wealth for our citizens.
M.H. Da Gama - Rose
Chairman - Nairobi Stock Exchange
82
Background
In 1951, an Estate Agent by the name of Francis Drummond established the first professional stock broking firm.
He also approached the then Finance Minister of Kenya and impressed upon him the idea of setting up a stock
exchange in East Africa.
Two years later, the two approached London Stock Exchange officials and the London officials accepted to
recognize the setting up of the Nairobi Stock Exchange (NSE) as an overseas stock exchange. The NSE was
constituted in 1954 as a voluntary association of stockbrokers registered under the Societies Act. Since Africans
and Asians were not permitted to trade in securities until after the attainment of independence in 1963, the
business of dealing in shares was then confined to the resident European community. At the dawn of independence,
stock market activity slumped due to uncertainty about the future of independent Kenya.
The first three years of Kenyas independence starting 1963, were marked by steady economic growth, rekindling
confidence in the market. The exchange also handled a number of highly oversubscribed public issues. In 1972,
growth was however halted when the oil crisis introduced inflationary pressures in the economy depressing
share prices. A 35 percent Capital Gains Tax was introduced in 1975 (suspended since 1985), inflicting further
losses to the exchange which at the same time lost it's regional character following nationalizations, exchange
controls and other inter-territorial restrictions introduced in neighboring Tanzania and Uganda. For instance in
1976 Uganda compulsorily acquired a number of companies, which were either quoted or subsidiaries of
companies quoted, on the NSE.
In 1984, International Finance Corporation (IFC)/Central Bank of Kenya (CBK) study, "Development of Money
and Capital Markets in Kenya" became a blueprint for structural reforms in the financial markets which culminated
in the formation of a regulatory body, 'The Capital Markets Authority (CMA), in 1989. The overall objective of
the CMA is to assist in the creation of an environment conducive for the growth and development of the
country's capital markets.
In 1991, the Exchange was registered under the Companies Act and trading shifted from the Call Over system
and to the more open and transparent floor based Open Outcry system, whereby stockbrokers shouted out
their bids and offers on an open trading floor. This was followed in July 1994, with a computerized delivery
ASEA Yearbook 2005
83
and settlement system (DASS) and a modern Information Center. In November 2004, the same year the Exchange
celebrated its golden anniversary, the automation of the capital markets clearing and settlement systems went
live. The Exchange also had the privilege of hosting the eighth African Stock Exchanges Association (ASEA)
conference in Nairobi.
84
Trading Statistics
2003 2004 2005
484.53
484.53
NA
874.20
874.20
NA
176,483
48
47
NA
6.14
31.63
7.90
Turnover Ratio (%)
200.86
200.86
NA
381.23
381.23
NA
91,889
48
47
NA
4.18
27.81
4.80
Trading Statistics
Indicators
281.58
281.58
NA
625.33
625.33
NA
124,793
48
47
NA
3.86
23.96
7.29
Investors Type
Investor
Foreign Investors
Local Investors
Institutions
Individuals
NA
NA
NA
NA
2003 2004 2005
5.45%
94.55%
61.11%
38.89%
NA
NA
NA
NA
ASEA Yearbook 2005
85
Issue No. Issue Date Maturity Date
Government Bonds
Face Value (USD million) Yield (%)
47,148.08
64,477.80
24,410.32
51,924.19
5,432.64
45,356.33
24,670.16
38,391.15
59,258.32
17,665.87
40,922.05
22,742.81
FXD1/2004/2
FXD2/2004/2
FXD3/2004/2
FXD4/2004/2
FXT1/2004/2
FXD3/2002/3
FXD2/2003/3
FXD3/2003/3
FXD4/2003/3
FXD1/2004/3
FXD2/2004/3
FXT1/2002/4
2
2
2
2
2
3
3
3
3
3
3
4
23-Feb-04
22-Mar-04
24-May-04
23-Aug-04
27-Sep-04
20-Jan-03
28-Jul-03
24-Nov-03
29-Dec-03
26-Apr-04
26-Jul-04
29-Apr-02
20-Feb-06
20-Mar-06
22-May-06
21-Aug-06
25-Sep-06
16-Jan-06
24-Jul-06
20 -Nov-06
25-Dec-06
23-Apr-07
23-Jul-07
24-Apr-06
Sector
Industrial and Allied Sector*
Finacial and Investment Sector*
Commercial and Services Sectors*
1
2
3
* Sectors belong to the Main Investment Market Segment
Sector
Agricultural Sector*
Alternative Investment Market Segment (AIMS)
4
5
7 Corporate Bonds
2 Preference securities of Kenya Power & Lighting Company Ltd.
Sectors Traded
39
9
66*
39
9
NA
Main Investment Market Segment (MIMS)
Alternative Investment Market Segment (AIMS)
Fixed Income Securities Market Segment (FISMS)
As of 31 December 2005, the following number of debt
securities were listed on the FISMS of NSE
39
9
NA
2003 2004 2005
* Government of Kenya Treasury Bonds
86
Issue No. Issue Date Maturity Date Face Value (USD million) Yield (%)
4
4
4
4
4
4
4
5
5
5
5
5
5
5
5
5
5
6
6
6
6
6
6
6
7
7
7
7
8
8
8
9
9
FXD1/2002/4
FXD2/2002/4
FXD1/2003/4
FXD2/2003/4
FXD3/2003/4
FXD1/2004/4
FXD2/2004/4
FR1/2001/5
FXT1/2002/5
FXD1/2002/5
FXD2/2002/5
FXD3/2002/5
S 1/2002/5
FXD1/2003/5
FXD2/2003/5
FXD3 /2003/5
FXD1/2004/5
FR1/2001/6
FXD1/2002/6
FXD1/2003/6
FXD2/2003/6
FXD3/2003/6
FXD1/2004/6
FXD2/2004/6
FXD1/2003/7
FXD2/2003/7
FXD1/2004/7
FXD2/2004/7
FXD1/2003/8
FXD2/2003/8
FXD1/2004/8
FXDI/2003/9
FXD2/2003/9
24-Jul-06
18-Dec-06
19-Mar-07
18-Jun-07
22-Oct-07
21-Jan-08
16-Jun-08
15-May-06
19-Mar-07
11-Jun-07
20-Aug-07
22-Oct-07
29-Oct-07
18-Feb-08
21-Apr-08
18-Aug-08
20-Apr-09
22-Oct-07
22-Sep-08
12-Jan-09
18-May-09
16-Nov-09
15-Feb-10
19-Jul-10
15-Mar-10
18-Oct-10
17-Jan-11
15-Aug-11
18-Apr-11
19-Sep-11
12-Mar-12
14-May-12
16-Jul-12
29-Jul-02
23-Dec-02
24-Mar-03
23-Jun-03
27-Oct-03
26-Jan-04
21-Jun-04
21-May-01
25-Mar-02
17-Jun-02
26-Aug-02
28-Oct-02
04-Nov-02
24-Feb-03
28-Apr-03
25-Aug-03
26-Apr-04
29-Oct-01
30-Sep-02
20-Jan-03
26-May-03
24-Nov-03
23-Feb-04
26-Jul-04
24-Mar-10
27-Oct-03
26-Jan-04
23-Aug-04
28-Apr-03
29-Sep-03
22-Mar-04
26-May-03
28-Jul-03
25,292.00
10,541.75
36,153.51
59,064.71
30,722.75
23,422.05
51,169.90
54,585.65
25,186.05
37,728.01
24,664.48
9,846.75
3,899.78
37,059.16
33,853.43
44,923.69
19,188.32
37,607.85
25,193.62
17,970.48
68,065.72
21,366.04
55,688.70
31,852.30
35,327.95
39,043.26
33,569.63
22,361.25
49,284.18
63,363.40
38,317.36
29,865.67
90,657.80
ASEA Yearbook 2005
87
Issue No. Issue Date Maturity Date Face Value (USD million) Yield (%)
10
10
1
1
1
1
2
1
2
3
1
3
4
1
5
3
2
2
4
5
6
10-Jun-13
12-Aug-13
25-Dec-06
15-Jan-06
20-Feb-06
19-Mar-06
19-Mar-07
24-Apr-06
23-Apr-07
21-Apr-08
22-May-06
19-May-08
18-May-09
19-Jun-06
14-Jun-10
23-Jul-08
27-Aug-07
24-Sep-07
28-Oct-09
26-Nov-10
19-Dec-11
23-Jun-03
25-Aug-03
27-Dec-04
17-Jan-05
21-Feb-05
21-Mar-05
21-Mar-05
25-Apr-05
25-Apr-05
25-Apr-05
23-May-05
23-May-05
23-May-05
20 -Jun-05
20 -Jun-05
25-Jul-05
29-Aug-05
26-Sep-05
31-Oct-05
28-Nov-05
26-Dec-05
2003 2004 2005
176.31
176.31
0.0
430.27
430.09
0.18
552.95
551.59
1.36
Bonds Statistics
Bonds
FXD1/2003/10
FXD2/2003/10
ZC3/2004/1
ZC1/2005/1
ZC1/2005/1
ZC3/2005/1
ZC1/2005/2
ZC5/2005/1
FXD1/2005/2
FXD1/2005/3
ZC5/2005/1
FXD2/2005/3
FXD1/2005/4
ZC6/2005/1
FXD1/2005/5
FXD3/2005/3
FXD2/2005/2
FXD3/2005/2
FXD3/2005/4
FXD2/2005/5
FXD1/2005/6
Total
34,117.05
74,785.57
51,671.92
70,585.90
70,549.95
33,265.64
72,528.38
53,893.79
45,458.50
31,766.52
30,275.61
6,663.72
45,722.75
36,097.38
23,048.69
86,914.73
27,848.13
70,466.70
70,516.52
74,940.09
93,431.51
2,733,785.97
88
Year
Products
Product
Ordinary and Preference Shares
Government and Corporate Bonds
Shares
Bonds
Since 1954
Since 1996
Indices
Index Name
Based on the share price for 20 blue chip companies NSE 20 Share Index
Price Index
Index
NSE 20 Share Index
Market Cap.(USD million)
4,959.89 2,830.55
2004 2005
293.63 217.82
2004 2005
313.21 210.58
2004 2005
Indices Performance
Index
NSE 20 Share Index
% Change
34.88
3973.04 2945.58
2004 2005
ASEA Yearbook 2005
89
Automation:
The Exchange has entered the second phase of its automation program - the automation of the execution of
trades _ the processes that occur before settlement; which will be finalized in September 2006. The Automated
Trading System (ATS) is designed to electronically match buy and sell orders in a transparent process that involves
member firms of the NSE placing bid and ask prices in a centrally accessible electronic order book. The
anticipated benefits of the new system include greater transparency in the placement of bids and offers. The
system will also improve market surveillance and transmit almost in real time, trading information relating to index
movements and price and volume movements of traded securities. More current information will become readily
available to a wider constituency of the market, facilitating the decision making process and lowering the risk
of participating in Kenyas capital markets. As such the Exchange views a situation where it will soon have an
opportunity to enhance its revenue streams through the provision of information vending services.
The implementation of the ATS and achievement of T+3, will propel the Exchange closer to achieving its vision
of being a leading securities exchange in the world; bringing it a step closer to meeting the Group of 30's
(G30) standards, adopted in 1989 to ensure that securities trading world-wide becomes simpler, safer and more
efficient. Overall the market will benefit from a more liquid market as investor confidence is enhanced, through
a heightened awareness of our markets, and issuers of capital are more comfortably able to raise larger amounts
of long term capital.
New Listings:
The first privatization through the NSE was the 1988 successful sale of a 20 percent government stake in Kenya
Commercial Bank. In 1996, the privatization of Kenya Airways, came to the market. Having sold a 26 per cent
stake to KLM, the Government of Kenya proceeded to offer 51 percent of the airlines shares to the public.
More than 110,000 shareholders acquired a stake in the airline and the Government of Kenya reduced its stake
from 74 percent to 23 percent. The Kenya Airways Privatization team was awarded the World Bank Award
for Excellence for 1996 for being a model success story in the divestiture of state-owned enterprises.
As part of its fiscal and policy incentives to encourage more listings, with effect from July 1, 2005, newly listed
companies pay corporation tax at a lower rate of 20 percent, for a period of 5 years, provided these companies
offer at least 40 percent of their shares to the Kenyan public.
Latest Achievements
90
On May 17, 2006, the shares of Kenya Electricity Generating Company (KenGen) began to trade on the
Exchange. The privatization of the generator of 80 percent of Kenyas electricity was 337 percent oversubscribed.
The Government of Kenya therefore easily met its target of raising Kshs. 7.8 billion (USD. 102.9 million) from
the market for the 30 percent of the shares of KenGen that it offered to the public.
The Government of Kenya has made known its commitment to list 34 percent of Telkom Kenya, the state owned
fixed line operator on the Stock Exchange in 2007. Besides selling more shares in Mumias Sugar Company
and National Bank of Kenya, the Government also intends to list a portion of Kenya Reinsurance Corporation
and Consolidated Bank of Kenya in 2007.
ASEA Yearbook 2005
91
Chairmans Letter
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92
Background
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c |cg|c .vcs|c| ccy |c'c|s c.s| |c |c|c cs.c ||c| cc|cgcs cc |cscc|cc cs c.c.c||y cs
ccss.c|c | ||c ccc.|c| c'c| ||c c. c. .s |c |.' ||csc cccc|c w|c |cvc scv.gs |c ||c c|cccc.s cc
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/S|/ `ccccc' 2'
93
Trading Statistics
|c| ccccc.c| '|ccc| c|y cc.c '
2003 2004 2005
529
'2-

121
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2
2
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272
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Trading Statistics
Indicators
450
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2
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94
2003 2004 2005
286
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Total Value Traded - Nominal Value (USD million)
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64
'

Bonds Statistics
Bonds

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# Yield (%)
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222

Sector
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95
Indices Performance
Index
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% Change
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2004 2005
Indices
Index Name
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Year
Products
Product
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96
Latest Achievements
- |c c.c||.s|.gs c g.c| cccc.cs s.c| cs /g|c/c.cc c|c ||c| |cvc ccc ||c |S` cc c ||c |cgcs|
. c| ||c scccc c.ggcs| s|cc' cc|cgc . /.cc . |cs c c'c| ccc.|c|..c|.c
- Cccccc|.c cgccc|s w.|| ||c S| Scc..|.cs |c|cgc c S/ cc ||c |ccc S|cc' |c|cgc |cvc
cccs|cc s'.||s cc csc.ccs . |c.c.c cc cc|.c.|cc |c ||c scc|| cc s|cccy gcw|| cc ccvc|ccc|
c |c.c.cs ccc.|c| c'c|
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cc ||c| cc| .|cc|.cc| cc..cc|s
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NSX is looking ahead to;
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gc| c|| S/|C cg.c s|cc' cc|cgcs |.'cc |c c s.g|c |cc.g c|c|c cy ||c ycc 2 c| ||c cc|.cs|
- |.c.g wcys |c .cccsc ||c cc.| c |cc.g ||c cc|c| c|c||cgc cc.g ||c |S` cs ||.s |.c..c.|y .s ||c
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97
Chairmans Letter
The local exchange did not perform well during the year 2005. The All Share Index ended the year lower
and the volume and value of securities traded also fell. However, on a brighter note, 2005 saw the listing of
a new corporate bond issue by a local commercial bank. We hope that other financial institutions will follow
suit to capitalise on the low interest rates prevailing in the economy at the moment.
Also during the previous year, two legislations, which are expected to have a positive impact on the exchange,
were passed by Parliament. The two are the Insurance and Retirements Funds Acts. These Acts require that
insurance companies and pension funds and other institutional investors, invest a certain portion of the assets
in the domestic market. This will no doubt increase the demand of instruments that are listed for transparency
on the part of the these funds. To reap maximum benefits, the exchange has started visiting potential listing
companies to utilise the facilities offered by the exchange.
It is the aim of the local exchange to continue working together with other regional exchanges as they work
together to find a solution to their common problems.
Martin Dlamini
Chairman - Swaziland Stock Exchange
98
Background
A move towards a formal structure for capital markets development in Swaziland goes back 12 years (1989)
when a working party, under the direction of the Central Bank, was commissioned to examine if there were
economic benefits to be derived from the establishment of a stock exchange. The working party concluded
that there was indeed a need and an opportunity for such a move; and proposed, as a first step, the formation
of a stockbroking company, which would be licensed under existing banking legislation pending the drafting
of a securities law.
For eight years the stock market operated as an over the counter-single broker facility. It was not until July 1999
that a fully-fledged stock exchange, the Swaziland Stock Exchange (SSX), was inaugurated.
ASEA Yearbook 2005
99
Trading Statistics
Investors Type
Investor
0%
100%
Foreign Investors
Local Investors
0%
100%
2003 2004 2005
0%
100%
Sectors Traded
2
1
1
1
1
2
1
1
1
1
Financial
Hotel/Services
Property
Industrial/Agriculture
Empowernment
2
1
1
1
0
2003 2004 2005
2003 2004 2005
30
30
-
63.2
63.2
-
29
6
6
2
197.0
NA
1
Total Value Traded (USD thousand)
Total Volume Traded (thousand)
Number of Traded Securities
Turnover Ratio (%)
46
46
-
83.3
83.3
-
34
5
5
2
152.1
8
1
Trading Statistics
Indicators
38
38
-
72.5
72.5
-
31
6
6
2
193.9
7.7
1
100
2003 2004 2005
0.002
NA
1.3
NA
Bonds Statistics
Bonds
various 2 31-Feb-03
Government Bonds
# Yield
34.392
Year
Products
Product
Public companies shares
Government, corporate, government guaranteed
Stocks
Bonds
1990
1990
NA
NA
Indices Performance
Index
All Share Index
% Change
-0.46
156.68 157.40
2004 2005
Indices
Index Name
Includes all listed stocks All Share Index
Weighted capitalisation
ASEA Yearbook 2005
101
NA
Latest Achievements
The latest achievement during 2005 include the listing of a new bond by one commercial bank. A new draft
Securities Bill has been submitted to the Ministry of Finance and it is anticipated that after years of waiting,
the Bill will be tabled in Parliament during the year 2006.
The exchange is a member of COSSE and ASEA and a corresponding member of the World Federations of
Exchanges (formerly FBIV), and it will continue to cooperate with other regional exchanges in mapping a
development strategy and way forward.
102
Chairmans Letter
The Stock Exchange of Mauritius (SEM) is very proud to be associated with the publication of the ASEA Factbook
2006, an initiative which not only aims at providing some key information about the Exchanges that are currently
operating in Africa, but also strives to highlight the attractive potential of African stock markets. In what follows,
we are pleased to present the evolutionary path of the SEM since its establishment in 1989, briefly describe
the main changes that have characterised the SEM during its short history and focus on future undertakings
that will underpin our activities in the near-term.
The Stock Exchange of Mauritius Ltd (SEM) was established in 1989 under the Stock Exchange Act 1988, as a
private limited company, responsible for the operation and promotion of an efficient and regulated securities
market in Mauritius. Trading on the SEM started on 5 July 1989, with five listed companies representing a market
capitalisation of U.S$ 92 million and a trading and settlement environment which was manual. Stock market
activities have since picked up substantially and the size of the market has grown to reach US$ 2.7 billion as
at 31 May 2006, representing about 45 percent of the GDP of Mauritius. 41 companies are currently listed
on the Main Board of the SEM and 80 companies are traded on the OTC market. On the performance front,
the Mauritius stock market has performed very well with an annualised total return of about 19.5 percent over
a sixteen year period. On the operational and regulatory fronts, the growth of the market has over the years
been accompanied by significant developments with the installation of an automated depository and settlement
system in 1997 and of a state-of-the-art automated trading system in 2001, the implementation of disclosure
based listing rules in 2000 and the setting up of audit, risk-management, and corporate governance committees
recently to ensure that the SEM effectively practices what it preaches to its listed companies. The attainment
of membership status of the World federation of Exchanges (WFE) in November 2005 constitutes an important
milestone that has enabled the SEM to join a select league of the worlds leading stock exchanges, which are
committed to the highest levels of market quality. The SEM has also been involved in several capital markets
development projects in Africa, confirming thereby its strong regional commitment.
The stock market in Mauritius was opened to foreign investors in October 1994. Foreign investors can freely
trade securities listed on the SEM. Foreign investors benefit from generous incentives such as tax-free dividends
and zero capital gains tax. Investments by foreign investors on the SEM have grown over the years and represent
about 35 percent of trading activities on the market.
ASEA Yearbook 2005
103
Our main focus in the coming years will be of a developmental nature. One of the key near-term challenges
of the SEM will be to increase the range of investment products available to investors. In this light, a key
undertaking will be the introduction of the Development & Enterprise Market (DEM) in July 2006. The DEM
aims at providing medium-sized enterprises and new business ventures possessing a strong growth potential
with a platform to raise capital to finance their funding requirements. During the years 2004 and 2005, a lot
has been undertaken to place the SEM on the radar screen of international institutional investors who are keen
on frontier emerging markets. In 2006 and 2007, we want to step up these efforts to increase foreign portfolio
flows into our market. The affiliation of the SEM to WFE membership status in November 2005 can positively
contribute to this endeavour.
The SEM will also continue its campaign to bring the Stock Exchange activities within the reach and understanding
of a wider section of the population in order to sensitise the population at large about the functional and
operational aspects of capital markets and the underlying investment opportunities. On the international and
regional fronts, the SEM will continue pursuing regional activities to expand the scope of our activities and seize
opportunities of enhancing market and professional links with ASEA, other regional and international Stock
Exchange associations.
The SEM has made some important strides in its development process since 1989 and looks well poised to
undertake a number of reforms in order to contribute towards the enhancement of the operational and regulatory
efficiency of the local market. In the coming years, the SEM aims at consolidating its position with a view to
further contributing to the development of the Mauritian economy and of capital market activities on the national
and regional fronts. We are very keen in stepping up our involvement with ASEA and we strongly believe that
ASEA can play a leadership role in enhancing and promoting the profile of African Stock Exchanges worldwide.
Jean Juppin de Fondaumire
Chairman - Stock Exchange of Mauritius
104
Background
The Stock Exchange of Mauritius Ltd (SEM), was incorporated on 30 March 1989 and started its activities on 5 July
1989, when the first trading session took place. The mission of the SEM is to strive to position itself as a service-driven
and operationally excellent organisation with world-class trading and settlement capabilities, which incorporate and
maintain the fundamental principles of market integrity, investor protection and efficient price discovery.
The SEM operates two markets: the Official Market and the Over-The-Counter (OTC) Market. The Official Market
started its operations in 1989 with five listed companies and a market capitalisation of only US$ 92 million. Currently,
there are 41 companies listed on the Official Market and market capitalisation has experienced a 28- fold expansion
to attain US$ 2,645 million as at 30 December 2005. The OTC market commenced its operations in 1990 and has
since grown quite substantially. There are to-day 76 companies with a market capitalisation of US$ 1.1 billion that
are traded on this market.
The stock market was opened to foreign investors following the lifting of exchange control in 1994. Foreign investors
can freely trade any share listed on the Official market without any restriction. The only restriction applies to listed
sugar companies where foreign investors collectively cannot hold more than 15 percent of the shareholding of a sugar
company. By investing in companies listed on the Official market, foreign investors benefit from generous incentives
such as tax-free dividends and zero capital gains tax.
The Stock Exchange of Mauritius is the first stock exchange in Sub-Saharan Africa to operate a fully automated central
depository and settlement system, which ensures strict delivery versus payment and meets the G-30 requirements.
Trades are currently cleared and settled on a T+3 basis. On the trading front, the SEM has implemented since 2001
a state-of-the-art automated trading system which is based on a very modern architecture and which can handle
trading in a variety of financial instruments including equities, corporate bonds and debentures, short-term and long-
term government securities. The ATS also incorporates internet trading facilities and features which enable investors,
from the comfort of their homes and offices around the world, to follow the market on a real-time basis and trade
on a real-time basis.
On the performance front, the SEM has generated very attractive returns for investors in general. The all-share price
index, SEMDEX, has grown by 723 percent during a 17- year period, while the total return index, SEMTRI, shows a
1900 percent return during the same period. Some of the flagship companies have grown at an even faster rate,
generating thus some very attractive returns to their shareholders.
ASEA Yearbook 2005
105
Trading Statistics
Investors Type
Investor
17.69%
82.31%
Foreign Investors
Local Investors
12.07%
87.93%
2003 2004 2005
20.26%
79.74%
Sectors Traded
6
7
7
11
4
5
1
6
7
7
11
3
5
1
Banks, Insurance & Other Finance
Commerce
Industry
Investments
Leisure & Hotels
Sugar
Transport
5
7
7
11
3
5
1
2003 2004 2005
2003 2004 2005
179.82
150.35
29.47
306.28
271.57
34.71
40,000
41
45
35
2.65
42.64
5.68
Turnover Ratio (%)
148.87
113.98
34.89
226.04
168.09
57.95
30,000
39
42
30
1.95
32.78
5.83
Trading Statistics
Indicators
147.84
100.75
47.09
186.30
146.36
39.94
36,000
40
46
30
2.40
38.59
4.21
106
2003 2004 2005
1.74
1.74
-
7.06
7.06
-
2.54
2.53
0.01
Bonds Statistics
Bonds
Sector
Banks, Insurance & Other Finance
Leisure & Hotels
Investments
1
2
3
Issue Value Issue Date Maturity Date
1.19
5.63
6.41
6.63
6.81
20-Jan-06
21-Apr-06
27-Oct-06
5-Jan-07
16-Mar-07
GOVT.A0005
GOVT.A0008
GOVT.A0009
GOVT.A0010
GOVT.A0011
23-Jan-04
23-Apr-04
29-Oct-04
7-Jan-05
18-Mar-05
Government Bonds
# Yield (%)
NA
NA
NA
NA
NA
Year
Products
Product
Ordinary and preference shares
Issued by the Bank of Mauritius on behalf of the Government of Mauritius
Issued by Corporates
Stocks
Bonds (Treasury Bills)
Debentures
1989
2003
1991
Sector
Commerce
Industry
4
5
ASEA Yearbook 2005
107
Indices Performance
Index
SEMDEX
SEM-7
SEMTRI
% Change
13.12
17.21
20.49
804.03
175.43
1951.83
710.77
149.67
1619.92
2004 2005
Indices
Index Name
The SEMDEX is an index of prices of all listed shares and each stock is
weighted according to its share in the total market capitalisation.
The SEM-7 comprises the seven largest eligible shares of the Official List,
measured in terms of market capitalisation. Only shares which meet liquidity
and investibility criteria are eligible for inclusion in the SEM-7.
The SEMTRI was launched in October 2002 to enable investors capture
both capital gains and dividends generated by listed companies.
SEMDEX
SEM-7
SEMTRI
Market Capitalisation
Market Capitalisation
Return index
108
Latest Achievements
Throughout its nearly 18 year of history, the SEM has always striven to enhance its operational, technical and
regulatory set-up and responsibilities and work in line with stringent international standards. In November 2005,
the SEM became the third stock exchange in Africa to be admitted as member of the World Federation of
Exchanges (WFE) at the 45th General Assembly and Annual Meeting of the WFE held in Mumbai, India.
The attainment of membership status of the WFE constitutes an important milestone that has enabled the SEM
to join the league of stock exchanges which are compliant with the stringent standards and market principles
established by the WFE. Membership identifies the SEM as having assumed the commitment to prescribed
business standards, recognized as such by users of exchanges, as well as by regulators and supervisory bodies.
It will also enable the SEM to attract investments from institutional investors who are restricted by law to dealing
only on WFE member exchanges when purchasing securities outside their home country.
ASEA Yearbook 2005
109
Chairmans Letter
As we approach our ninth year in operation, the USE continues to play its role as the key platform for Financial
Sector Deepening in Uganda. With the sister Exchanges in Nairobi and Dar es Salaam, we continue to harmonise
all parameters of our trading platforms towards the common objective of a single regional exchange. The USE
Board and Management team are focused on the USE mission to influence monetary and fiscal policy in the
direction of efficiently mobilizing the optimal combination of Domestic Direct Investment (DDI) as well as quality
Foreign Direct Investment (FDI).
G.A Onegi - Obel
Chairman - Uganda Securities Exchange
110
Background
The Uganda Securities Exchange (USE) was licensed to operate as an approved Stock Exchange in June 1997
by the Capital Markets Authority of Uganda. The USE began formal trading operations in January 1998 following
the listing of its first instrument, the 4-year East African Development Bank (EADB) Bond. In January 2000, USE
listed its first equity, Uganda Clays Ltd. The first ever cross border listing in the East African region occurred
with the listing of East African Breweries Ltd (EABL) on the USE on 27th March 2001. EABL is ranked among
the top 10 companies on the Nairobi Stock Exchange (NSE) in terms of capitalization. This was followed by
the listing of the Kenya Airways and later Jubilee Holdings Ltd. Currently the products listed on the Exchange
include 15 government bonds, 2 corporate bonds and 8 equities (3 of the equities are cross listings).
ASEA Yearbook 2005
111
Trading Statistics
Sectors Traded
1
3
1
1
1
1
3
1
1
1
Construction
Financial Sector
Industry
Agriculture and Processing
Aviation
1
1
1
1
1
2003 2004 2005
2003 2004 2005
3.096
3.096
-
13,868,376
13,868,376
-
762
7
7
NA
1.851
22.3
0.1673
Total Volume Traded
Turnover Ratio (%)
0.170
0.170
-
222,262
222,262
-
352
5
5
NA
0.748
11.4
0.0228
Trading Statistics
Indicators
0.157
0.157
-
372,286
372,286
-
226
7
7
NA
1.063
13.1
0.0147
Sector
Financial Sector
Construction
Agriculture and Processing
1
2
3
Sector
Aviation
Industry
4
5
112
22-Feb-07
19-Mar-09
08-May-14
29-Jun-06
04-Oct-07
25-Jan-07
17-Apr-08
14-Jun-07
24-Jul-08
18-Sep-08
29-Nov-07
10-Jan-08
FXD 2/2004/3
FXD 3/2004/5
FXD 4/2004/10
FXD 5/2004/2
FXD 6/2004/3
FXD 1/2005/2
FXD 2/2005/3
FXD 3/2005/2
FXD 4/2005/3
FXD 5/2005/3
FXD 6/2005/2
FXD 1/2006/2
25-Feb-04
24-Mar-04
19-May-04
30-Jun-04
07-Oct-04
27-Jan-05
21-Apr-05
16-Jun-05
28-Jul-05
22-Sep-05
15-Dec-05
11-Jan-06
Government Bonds
# Yield (%)
46.0
23.0
8.6
28.8
51.8
55.1
13.8
11.0
27.5
11.0
30.3
13.8
2003 2004 2005
10.544
10.544
-
7.795
7.795
-
NA
NA
-
Bonds Statistics
Bonds
14.90
14.88
16.38
13.33
14.90
13.33
14.90
13.33
14.90
14.90
13.33
14.90
Year
Products
Product
Corprate bonds
Equity
Government bonds
1998
2000
2004
ASEA Yearbook 2005
113
Indices
Index Name
Computed using the prices of all listed equity USE All Share Index
Market Value Weighted Index
Indices Performance
Index
USE All Share Index
% Change
80.57
689.54 381.87
2004 2005
114
Latest Achievements
2003:- The Launch of the USE All Share Index on 23 October 2003.
2004:- Official Listing of the 2 year, Ushs 20 billion Uganda Government 20% Coupon Rate Treasury Bond
on 15th January making it the first Government Bond to be listed on the USE. Currently there are 2, 3,
5 and 10 year government bonds listed on the stock exchange. Please refer to our Listed Securities
page for more information.
2004:- DFCU group goes public making it Uganda's second financial institution to do so.
2004:- USE ranked by the Databank as the third highest Exchange in the world in terms of 2003 Index returns.
2004:- New Vision offers 20 percent of its shareholding for sale to the public, making it the fifth local company
to conduct an IPO in the Ugandan market. NVL is officially listed on 16 Dec 2004.
2005:- Uganda receives Fitch Rating. Long Term, Short Term, Local currency and Country Ceiling Ratings stand
at B.
2005:- USE for the Second time by Databank Services as the third best performing exchange 2004.
2005:- The listing of the 8 year East African Development Bank (EADB) Bond in December 2005.
2005:- Official commissioning of the USE Securities Industry Training Centre (SITC).
2006:- Official cross-listing of Jubilee Holdings Limited (JHL) on the USE on 14th February making it the first
insurance institution to list on the USE.
2006:- USE named 3rd best performing exchange for the third time in a row.
ASEA Yearbook 2005
115
Background
Zimbabwe's first stock exchange opened in 1896 in Bulawayo for only six years, to be followed by the present
Zimbabwe Stock Exchange, that was founded in 1946 in Bulawayo. In December 1951, a second floor was
opened in Harare. In January 1974, the Zimbabwe Stock Exchange Act was promulgated as Act 27 of 1973
(chapter 198), which formalized the establishment of the present Zimbabwe Stock Exchange (ZSE) with its head
office in Harare.
The ZSE is regulated by the Zimbabwe Stock Exchange Act (Chapter 24:18 of 1996). It operates under the
supervision of a nine-member committee composed of seven representatives of the stock broking companies
and two government-nominees. The chief executive of the ZSE is the secretary of the committee.
Equities, preference shares, government bonds and municipal stocks, debentures and warrants are the instruments
traded. Also traded is a local depository receipt, the Zimbabwe Depository Receipt.
Zimbabwe Stock Exchagne
116
Trading Statistics
2003 2004 2005
0.76
0.76
-
9.6
9.6
-
NA
80
83
80
20
NA
NA
Total Volume Traded (billion)
Turnover Ratio (%)
0.79
0.79
-
9.6
9.6
-
NA
80
83
80
40
NA
NA
Trading Statistics
Indicators
1.22
1.22
-
6.7
6.7
-
NA
80
83
80
10
NA
NA
Investors Type
Investor
2.7%
97.3%
95.0%
5.0%
Foreign Investors
Local Investors
Institutions
Individuals
1.2%
98.8%
95.0%
5.0%
2003 2004 2005
1.0%
99.0%
95.0%
5.0%
ASEA Yearbook 2005
117
Sectors Traded
10
13
39
5
2
1
2
7
10
13
39
5
2
1
2
7
Financial
Agri Processing
Industrial
Mining
Tourism
Property
Technology
Insurance
10
13
39
5
2
1
2
7
2003 2004 2005
Products
Product
Equities Equities
Sector
Financial
Industrial
Mining
1
2
3
Sector
Technology
Insurance
4
5
Zimbabwe Stock Exchagne
118
Index
Industrials
Minings
Market Cap.(USD billion)
2.34
NA
1.78
NA
2004 2005
NA
NA
NA
NA
2004 2005
NA
NA
NA
NA
2004 2005
Indices
Index Name
All except minings
Mining Counters only
Industrials
Minings
Price Index
Price Index
Indices Performance
Index
Industrials
Minings
% Change
1545.18
2580.20
18,055,724.01
6,042,352.99
1,097,493
225,444.18
2004 2005
ASEA Yearbook 2005
119
Background
In the mid-1980s, two investigations into South Africas financial markets were commissioned by the South African
government. Conducted by officials of the South African Reserve Bank and containing certain recommendations,
the studies were published in 1988. The following year saw the promulgation of the Financial Markets Control
Act and the formation of the Bond Market Association (BMA). The BMA was globally unique in that its
membership comprised a wide range of interest groups: bond issuers, intermediaries, banks, brokers, inter-dealer
brokers and investors.
During the next few years, the BMA took steps to modernize bond trading by commissioning electronic trade
capture and matching, clearing and settlement, and the conversion of paper scrip into electronically recorded
bonds. Government and several parastatals, the only issuers of bonds at that time apart from a few private-
sector organizations, also began trading in their securities to improve their liquidity.
In 1996 the BMA was licensed to operate as a self-regulatory exchange. It changed its name to the Bond
Exchange of South Africa (BESA), but remained a mutual association, owned by rightsholders.
The BMA had met one of the conditions of its being licensed with the creation of a R30 million Guarantee
Fund, achieved through member contributions. The purpose of the Fund, which now stands at R100 million, is
to compensate traders or their clients for any re-transaction losses caused by trader default. There has been
no claim on the Guarantee Fund since its creation.
120
Trading Statistics
Current number of primary dealers 8
Current number of authorized users of the Exchange 56
Number of
Listings
Total Nomial (Face) Value
(USD million)
Total Market Value
(USD million)
83,390
496
9,592
3,024
23,139
119,641
67,941
429
8,040
2,570
22,314
101,294
Central Government
Municipal Government
Public Enterprises
Water Authorities
Private Sector
Total
132
3
22
13
309
479
Trading Statistics at End of December 2005
Market Turnover in 2005
At nominal value USD 1,291 billion
At consideration value USD 1,560 billion
Main Indices
All Bond Index (ALBI)
Government Bond Index (GOVI)
Other Bond Index (OTHI)
ASEA Yearbook 2005
121
In 1998 major banks were appointed as primary dealers in government bonds. Their trading, together with
rapidly rising interest rates and a major decline in share prices, produced a surge in bond market turnover. Bond
market velocity (the number of times in a year market capitalization is turned over) reached a globally impressive
22 times.
In 2000 BESA launched its Bond Automated Trading System (BATS), capable of providing screen-based trading
and straight-through processing. Most traders, however, preferred to remain with their existing trading methods
and BATS was used only for trade capture and matching.
In late-2002 rightsholders approved a new business model for BESA. The chief aim of the Resilient Exchange
Model (REM) was to establish the exchange as a separate business, operating independently of the often
conflicting interest groups which comprised its rightsholders and from whose ranks all members of the executive
committee were drawn. BESAs management team was also charged by REM to diversify BESAs revenue streams
by introducing products and services for those engaging in fixed-income derivatives contracts.
Restructuring BESAs corporate governance was achieved by late-2003. Creating stable IT platforms and systems
to serve derivatives as well as bond transactions took longer. By late-September 2005 BESA was capturing
over-the-counter derivative transactions. Its centralized price-discovery system, ZA Prices, was also offering the
Exchanges licensed users live information on a single screen about bond prices, trading volumes in individual
securities and much additional information. In May 2006, a Derivatives Trading Association was formed and
its members began trading in derivatives that had already been listed on BESA.
Latest Achievements
122
ASEA
ASEA Audited
Financial
Statements
June 2005
Notes 2005
(US$)
2004
(US$)
Indicators
Income And Expenditure Statement For The Year Ended 30 June 2005
3
8,500
-
8,500
6,050
-
1,150
214
165
-
261
-
7,840
660
-
660
9,500
580
10,080
3,025
4,810
1,200
225
405
500
174
1,773
12,112
(2 ,032)
( 217)
( 2,249)
Income
Subscriptions from members
Write back of prior year expenses
Administrative expenses
Secretarial fees
Travelling expenses
Audit fees - current year
- prior year under provision
Bank charges
Bad debts written off
Website costs
Provision for tax penalties
(Deficit)/surplus from operations
Taxation
(Deficit)/surplus for the year
The notes set out on pages 128, 129 and 130 form an integral part of these financial statements.
ASEA Audited Financials June 2005
124
The financial statements were approved by the Executive Committee on 12 September 2005 and were signed on its behalf by:
Notes 2005
(US$)
2004
(US$)
Balance Sheet At 30 June 2005
4
5
16,750
63,157
79,907
79,907
71,786
8,041
80
8,121
79,907
10,500
70,229
80,729
80,729
69,537
10,895
297
11,192
80,729
ASSETS
Current assets
Debtors
Bank balances
TOTAL ASSETS
FUND BALANCE AND LIABILITIES
Fund balance
Current liabilities
Accruals
Taxation
TOTAL FUND BALANCE AND LIABILITIES
Deputy Chairman:___________________________ Chairman:___________________________
ASEA Yearbook 2005
125
2005
(US$)
2004
(US$)
Cash Flow Statement For The Year Ended 30 June 2005
660
(5,750)
311
(4,779)
-
(4,779)
67,936
63,157
(2,249)
6,250
3,071
7,072
-
7,072
63,157
70,229
Operating (deficit)/surplus before working capital changes
Decrease/(increase) in debtors
Increase in accrued liabilities
Cash generated from/(absorbed by) operating activities
Income taxes paid
Net cash flow from/(used in) operating activities
Cash and bank balances at beginning of year
Cash and bank balances at end of year
126
(US$)
Statement of Changes in the Fund Balance for the Year Ended 30 June 2005
71,126
660
71,786
(2,249)
69,537
Balance at 1 July 2003
Surplus for the year
Balance as at 30 June 2004
Deficit for the year
Balance as at 30 June 2005
ASEA Yearbook 2005
127
1. SIGNIFICANT ACCOUNTING POLICIES
The principal accounting policies adopted in the preparation of these financial statements are set out below:
a) Basis of preparation
The financial statements are prepared in accordance with and comply with the International Financial Reporting
Standards. The financial statements are prepared under the historical cost convention.
b) Revenue
Revenue is accounted for on accrual basis.
Subscriptions represent annual subscriptions receivable from the various stock exchanges that are members of the
Association.
c) Taxation
For tax purposes the Associations gross income is deemed to be taxable income. However, where more than 75%
of the gross income is earned from members subscriptions, then the gross subscription income is not subject to tax.
Investment income is however subject to taxation unless the Association is granted exemption by the Kenyan Minister
for Finance.
d) Cash and cash equivalents
For the purposes of the cash flow statement, cash and cash equivalents comprise bank balances held with the bank.
e) Debtors
Debtors are stated at their nominal values less write downs for any amounts considered to be unrecoverable.
f) Creditors
Creditors are recognised when the Association has a present legal or constructive obligation as a result of past
events and it is probable that an outflow of resources embodying economic benefits will be required to settle the
obligation and a reliable estimate of the amount of the obligation can be made
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2005
128
2. STAFF COSTS
The Association did not incur any staff costs in the year.
Average number of people engaged in the year Nil (2004 Nil).
3. TAXATION

Taxation on investment income @ 30%
Prior years under provision

In the year subscription income from members formed more than 75% of the gross income and therefore is not
subject to taxation under the Income Tax Act.
4. DEBTORS

Subscriptions outstanding for over 1 year
Subscriptions outstanding for over 6 year
Subscriptions outstanding for over 5 years but less than 6 years
Subscriptions outstanding for over 1 year but less than 2 years

Current subscriptions due

The Executive Committee is of the opinion that the above outstanding contributions are recoverable in full and
consequently no provisions have been made in the financial statements.
2004
US$
-
-
-
2004
US$
500
-
1,000
500
1,750
5,000
8,750
8,000
16,750
2005
US$
-
217
217
2005
US$
-
500
-
-
500
1,000
2,000
8,500
10,500
ASEA Yearbook 2005
129
Subsequent to year end and up to the date of issuing the report and financial statements, a total of US$ 5,500
relating to subscriptions outstanding was received.
5. ACCRUALS

Secretarial fees
Website fees
Audit fees:
- prior years
- current year
Provision for tax penalties

6. MEMBERS LIABILITY
The members liability is limited by guarantee at KShs 10,000 per member. The number of members as at 30 June
2005 was 18 (2004 17).
7. INCORPORATION
The Association is incorporated in Kenya under the Companies Act as a company limited by guarantee.
8. CURRENCY
The financial statements are presented in US Dollars (US$).
2005
US$
3,025
87
-
1,200
4,810
1,773
10,895
2004
US$
6,050
261
580
1,150
-
-
8,041
130
All the information stated in the book has been obtained from its original sources. The role of CASE is only confined
to displaying such information. CASE bears no responsibility for the information or any errors or omission of the data
or misuse of the information by any person or institution.
Disclaimer
ASEA Yearbook 2005 - Produced by:
4A, El Sherifein St., Postal Code 11513,
P.O. Box 358 Mohamed Farid, Down Town, Egypt
African Securities Exchanges Assosiation - President
w w w . e g y p t s e . c o m
Tel.: +202 3955266 - 3955477
Fax.: +202 3955799
N a i r o b i S t o c k E x c h a n g e
Nation Centre, First Floor, Kimathi Street,
P. O. Box 43633, Nai robi 00100
African Securities Exchanges Assosiation - Secretariat
w w w . a f r i c a n s e a . o r g
Tel.: +254 20 2831000 - 20 2422065
Fax.: +254 20 224200

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Total Value Traded (USD billion)

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