Standard Bank promotes a workshop on capital market

It is an initiative that will help maximizing the efforts that have been made by Mozambique Stock Exchange of promoting the capital market in the country, which is still in its early stages.

This workshop was organized after noting that the Mozambican capital market is still far from desirable because investors have nowhere to invest due to lack of securities in the stock market.

In this sense, and as a partner of its clients and with experience in structuring this kind of operations, Standard Bank decided to advise them to look for alternative sources of financing and to offer security, namely the capital market.

“There are countless advantages in using the capital market as a source of financing. Being listed on the Mozambique Stock Exchange helps create visibility in the market, potential appreciation of equities, better interest rates on bond loans and evaluation of the company as a result of the confidence of the market and investors, which will now be seen as a transparent company and that it respects the principles of corporate governance”, explained Fernando de Oliveira, Standard Bank Investment Banking Manager.

According to the Chairman of the Board of Directors of BVM, Salim Valá, Standard Bank's initiative will help to boost the capital market, making it more dynamic and a preferential source of financing for national companies.

As Salim Valá explained, the level of stock market capitalization is still very low (about nine percent of GDP - Gross Domestic Product), and therefore there is a need to change this scenario.

“We want to significantly increase the level of market capitalization, and our perspective is that by 2022 we will reach 21%. We currently have eight listed companies and we expect to increase to 10 by the end of this year. In short, we want to increase turnover, liquidity in the market, as well as the number of listed bonds. There is a need for Mozambique to have a stronger capital market”, said the chairman of the BVM Board of Directors.

Additionally, he said that over the next 15 years the capital market may be the main source of financing for companies, as the requirements for admission are not something difficult as is often thought.

“We are doing everything so that in the future, BVM is the effective thermometer that measures the business environment and economic trends in Mozambique”, said Salim Valá.

During the event, Bayport Mozambique, a public servant credit institution that has been active in the domestic market since 2012, shared its experience in financing through the Mozambique Stock Exchange, whose operation was structured by Standard Bank.

“It is a very important tool, which increases financing opportunities of companies that want to become more competitive in the market, helping to transform our economy. We have used BVM to ensure our growth and to continue to expand our presence in the country, with Standard Bank playing an important role in the operation, including in legal aspects”, said Bayport Mozambique Chief Executive Officer Michael Mocke, so that companies take advantage of financing through capital market.

Bayport Mozambique entered the capital market in 2016 and has already issued five bonds, totalling more than 1.5 million Meticais and received the “Best Local Currency Bond of the Year” award for 2018, awarded by the GFC Media Group.