• Friday, July 19, 2024
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JSE, NSE partner to promote cross-listing, strengthen African capital market


The Johannesburg Stock Exchange (JSE), South Africa, is developing a strategic partnership with Nigerian Stock Exchange (NSE) that will benefit investors and create opportunities for cross-listing on both Exchanges. The two Exchanges are confident the collaboration will complement each other and ultimately strengthen other African economies.

The JSE ranks 19th largest exchange by market capitalisation and the largest exchange in Africa; offers secure, efficient primary and secondary capital markets across a diverse range of instruments, supported by cost-effective services.

Speaking at a special business visit to Lagos recently, Donna M. Oosthuyse, the JSE director, Capital Markets, noted that, though African securities exchanges face many challenges the collaboration will help grow the Nigeria capital market, and also improve liquidity.

“We are of the view that everyone and indeed other markets would benefit from this. We have been working with the NSE for some time in this regard, and the joint goal we have is to develop products and services that would be of interests to issuers and investors in both markets.

“This would be of mutual benefits. So, we would like to have South African companies and products listed on the NSE. And we would also invite Nigerian issuers and products to be listed on the Johannesburg Stock Exchange (JSE),” she said.

The JSE Director is optimistic that the cross-listing will greatly benefit the investors and grow the continent’s capital markets. This is because opportunities abound for products and services in cross-listing – companies that are listed Nigeria to also list on the JSE.

“I had personally spoken to a lot of private wealth managers that aspire and want to be exposed to the Nigerian economy because they see higher growth than in many other markets and they believe there is opportunity for greater returns and they are willing to take the risk.

“So, we see cross-listings not just from Nigeria to South Africa but also from South Africa to Nigeria. We have got MTN already listed on the NSE while we have got Oando listed on ours. We would like to see more of this.”

The JSE also seeks collaboration in Exchange -Traded products like Exchange Traded Notes and Funds which are basically listed in one market that reference the other market. JSE Director disclosed that the Exchange is already discussing with a group of Nigerian issuers, investors and stockbrokers on how this could be developed.

“We trade not just on equities and equity derivatives; we have the third largest bond market in the world. We have bonds, interest rate and currency derivatives and commodities. So, this is another opportunity for the smaller brokers. This stirred the interest of a number of Nigerian brokers that we met with.”

Oosthuyse further stated that the collaboration will offer both Exchanges the opportunity to train at each other’s commission to deepen their operational knowledge about topical subjects relating to capital markets.

“We would welcome members from NSE coming over to spend time at JSE and hope that our members would also be welcome here so that we can learn from each other. From our interactions, I think the industry professionals in the NSE and in the ecosystem around investment are very good. Nigeria has almost the same challenge South Africa has, which is how to transfer this expertise into educating the issuers and investors in terms of what value the Exchange brings to the economy,” she added.

Formed in 1887 during the first South African gold rush, the JSE is a key part of South Africa’s economic landscape. As South Africa’s only full service securities exchange, it connects buyers and sellers in a variety of different financial markets, namely equities, equity derivatives, commodity derivatives and interest rate instruments.

The JSE has 62 equities members, 120 Equity Derivatives members, 92 Commodity Derivatives members and 102 Interest Rate and Currency Derivatives members licensed in South Africa, a mix of local and international operations.