GSE hopeful of attracting blue-chip companies
The Ghana Stock Exchange (GSE) is hopeful that the successful listing of the shares of the Agricultural Development Bank (ADB) Limited and Access Bank Ghana Limited will help to lure blue-chip companies onto the local bourse.
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The listing of companies from profitable sectors of the economy is needed to help deepen capital market operations, instill an investment culture among Ghanaians and help stir up excitement on the bourse.
But after years of gaining limited success from whipping up interest among businesses in the financial, telecommunications and extractive sectors to share a part of their stakes on the exchange, the Managing Director (MD) of the GSE, Mr Kofi S. Yamoah, said the coming on board of ADB and Access Bank showed that the bourse was truly helpful to big and small businesses alike.
"Getting companies to list is a way of diversifying their ownership to include the Ghanaian investing public. It is also a way that will grow the investment culture in the country and that is why we have always been advocating more listings," Mr Yamoah said in an interview.
“Our hope is that their listing will give others a positive look towards the market,” he added.
His comments come on the back of the official listing of ADB's shares on the bourse on December 19.
The official listing of the bank's shares came after it successfully raised GH¢325.7 million through an initial public offer (IPO) that ended in November.
Through the listing, ADB became the fourth indigenous bank and ninth commercial bank to have floated a part of its shares on the GSE. Already, the shares of 37 companies are being traded on the exchange, which has been in existence since 1989.
In October this year, Access Bank Ghana, which is the local subsidiary of Nigeria-based Access Bank Plc, also launched its IPO to raise GH¢104 million for expansion.
At the close of the offer date of November 25, the bank had succeeded in raising GH¢29.62 million, slightly above the minimum amount of GH¢21 million.
Following from that, Access Bank's shares were officially listed on the exchange on December 21, making it the first Nigerian bank to trade on the GSE.
While commending these developments as positive trends in the push for more companies to list on the GSE, Mr Yamoah said it could be the beginning of better days for the local bourse.
"If ADB and Access Bank are coming, then it adds to that positive trend.”
“Hopefully, the fact that Access Bank is a subsidiary of a non-resident Ghanaian company should send a signal to other like companies that they should take such steps," he said.
Majority of the companies operating in luxurious sectors such as insurance, telecommunications, extractive and banking are foreign-owned.
Compelled listing
For decades, the GSE and other capital market stakeholders had pushed without much success to get more companies in viable sectors of the economy to list on the exchange.
While some companies have responded positively, majority of them have shied away from the bourse, prompting some stakeholders such as the GSE and the SEC to suggest that regulations should be used to force some businesses onto the GSE.
Mr Yamoah, who is one of those people, insisted that such an action was needed to develop the market while giving businesses a cheaper alternative to access capital for growth and expansion.
"We have always advocated that there are certain sectors of the economy that companies operating in there should not have the luxury of staying outside the market (GSE)," he said, referring to those in the banking, telecommunications, extractive and insurance, among others.
"In each of these sectors, companies operating there require licences and so our advocacy has always been that why don't we, if possible, use the regulators of these sectors to kind of encourage these companies to actually be publicly listed companies?
"Although we have actually met a lot of resistance from some quarters that companies should not be compelled to list, left to us alone, if you depend on a licence to operate, then we will want to encourage the regulator of that particular sector to impose on you the need to list," he said.
That notwithstanding, the MD said it did not intend tabling the matter formally before the incoming administration, which would be taking up the reins of government after January 7.
Instead, he said the exchange would continue to discuss the idea with the various regulatory institutions, with the hope that they would buy into it and implement it.
