adminJOHANNESBURG. — A NEW player has entered the share trading game after the Financial Services Board (FSB) granted it a comprehensive exchange service licence. ZAR X becomes the first company in more than 100 years to clinch a licence. It will effectively compete with the JSE, which has enjoyed monopoly status for ages.The company is headed by Etienne Nel, who in the past has been involved in the development of a number of restricted empowerment share-trading platforms.
ZAR X said on Wednesday receiving the licence paved the way for the launch of the platform in September.
JSE CEO Nicky Newton-King said her organisation had not had an opportunity to study the conditions — if any — on which ZAR X’s licence was granted. However, she said she was confident of the JSE’s ability to compete.
“We are confident in our ability to compete in any segment of our market, based on the products, services, technology, and pricing that we offer our clients,” she said.
The new exchange will offer a main board to securities issuers, similar to the JSE’s main board, but with a principles-based compliance model; and an investment products market for trading-structured products such as equity or commodities derivatives and preference shares, similar to the JSE’s debt and derivatives markets.
It will also offer a restricted market to formalise trade in over-the-counter shares, which the FSB has declared noncompliant with the Financial Markets Act.
The JSE has an empowerment segment on its main board, where MTN’s BEE partner, MTN Zakhele, was compelled to list after the FSB’s clampdown on over-the-counter trading platforms.
Mr Nel helped establish Equity Express — the backbone behind the over-the-counter trading platforms used by insurer Assupol, healthcare group Lenmed, telecoms group Vodacom’s empowerment scheme Yebo Yethu, and Phuthuma Nathi, broadcaster Multichoice’s empowerment partner.
ZAR X aims to settle trades on the same day they are made, compared with the JSE’s current five-day settlement window.
“We have dissected the requirements of the Financial Markets Act and employed these, along with the best technology platforms from well-known service providers, giving us best of breed solutions,” said Mr Nel. – BDLive.
Online Reporter