GSE to Get $1b From World Bank for Automation

Tue, 29 Nov 2005 Source: Vanguard

WORLD Bank is to assist Ghana Stock Exchange (GSE) with $1billion to kick start its automation process next year.

The General Manager GSE, Mr. Ekow Afedzie disclosed this to journalists from the West African countries who paid a courtesy visit on the Exchange during a four day training programme organised by Guaranty Trust Bank (GTBANK Plc) last week in Ghana.

According to him " Trading of equities electronically is expected to start next year if the GSE gets the $1billion grant from the World Bank. The World Bank has promised to assist our Exchange with $1 billion."

He further disclosed that GSE is presently operating a T+3 settlement system and has 28 companies listed on the Exchange as at September 2005. "We are waiting for the Ghanian Government to change the existing law so that we can have the equities in the depository of the Bank of Ghana," he added.

The General Manager of GSE however said that non Ghanian residents are not allowed to buy shares of AngloGold Ashanti because it is government owned enterprise and has the highest market capitalization of 79 .092.03 billion cedi .

Afedzie further disclosed that the challenges facing the Ghana Stock Exchange were on infrastructure, liquidity problem and how to attract companies to list on the Exchange.

According to him " There are provisional listing meant for small scale enterprises. This listing is targeted at companies that cannot meet full requirements for listing. Already we have 4 of such companies listed on our Exchange. We are currently undergoing manual trading and we hope to go on automation next year. Our market capitalisation as at August 2005 was 92,013.53 billion cedi. About 855.58 million shares were traded between November 1990 and August 31st , 2005."

Speaking further he said that GSE has 29 companies listed on the Exchange and operates three category of listing. " This include: first , second and third tiers. Our bond sector is not yet developed as we have only four bonds," he added.

Meanwhile, GSE was incorporated in July 1989 as a private company limited by guarantee under Ghana's companies code, 1963 (Act 179). The Exchange was given recognition as an authorised stock exchange under the Stock Exchange Act of 1971 (Act 384) in October 1990, and trading on the floor of the Exchange commenced in November 1990. In April 1994, it was converted into a public company limited by guarantee.

The GSE is governed by a Council with representation from licensed dealing members , listed companies, the banks, insurance companies, money market and the general public. The Managing Director of the Exchange is an ex-officio member. The Council sets the policies of the Exchange and its functions include preventing fraud and malpractices, maintaining good order among members, regulating stock market business and granting listing.

Source: Vanguard