BUSINESS MONDAY: BSE ON A MISSION

THE Barbados Stock Exchange (BSE) is on a mission to include trading in digital assets.

So promised by Marlon Yarde, the CEO of the BSE, one of six stock exchanges in the Caribbean. He said that a platform will be created for such trading.

Speaking at an investment promotional function sponsored over the weekend by Invest Barbados, the CEO said that this is one of the goals the BSE will be pursuing actively in 2021.

“Digital assets are a burgeoning phenomenon. Essentially they are securities issued by a blockchain framework which allows for greater transparency for investors and listing companies, and easier oversight for regulatory authorities,” said Yarde.

He pointed out that the Exchange will be launching a pilot project next year to work on the technical aspects of facilitating digital asset trading.

One clear benefit anticipated, Yarde explained, will be the ability to trade a set of transactions and payments.

Yarde indicated that the BSE is a member of a number of international bodies including the World Federation of Exchanges. However, they will be going further by introducing international trading of stocks and going after a similar arrangement the BSE has in place with the UK, with one in Canada.

Recalling that four years ago they took a decision to expand by setting up the International Securities Market (ISM), Yarde said the ISM has seen a UK listing valued at about Bds$1 billion.

The CEO noted that when UK companies decide to list securities on the ISM of the BSE, and by being recognised in the UK, the BSE becomes an extension of the UK capital market.

This would be a boom to our market, although securities would still retain their inherent coverage on the local market, he noted.

According to Yarde, “You can therefore see why attaining this designation is highly beneficial for us in Barbados and as a result, we are now able to offer the eligibility for BSE-listed securities to be included in UK pension funds and UK individual savings accounts.”

The CEO pointed out that capital markets allow savings and investments between suppliers of capital and issuers of capital to undertake transactions. He said that persons who require capital need it normally for their businesses to develop and to grow.

“Investors, on the other hand, are persons looking to invest their cash while earning  a reasonable return on their investments,” Yarde told the function.

“So stock exchanges bring suppliers of capital and users of capital together to make a transaction,” he remarked.

The CEO said therefore that stock exchanges are very important in that among other things, they create a true value for securities. “Essentially we (at the BSE) create a bridge between market actors who are investors including institutional investors. We are a local exchange with global ties,” he stated.