Stock market decline

The Barbados Stock Exchange appears to be another casualty of the economic problems the island is facing.

The BSE first quarter 2013 report and its 2012 annual report, both released today, point to decreased trading activity, save for some major transactions which influenced trading worth close to $200 million between last year and the end of last month.

These involved a handful of entities including those involving Trinidad companies Republic Bank and ANSA McAl. While stock market officials called 2012 “stable”, they called the first three months of this year “challenging”, similar to the same period last year.

“The increases in general trading volumes can be attributed to the large volumes associated with the takeover transactions and put-through market activity. However, the prices at which these and other trades occurred, were not sufficient to cause an increase in the value of shares traded in the first quarter of 2013,” the first quarter report stated.

The BSE said it was continuing its own efforts to ensure things turned around by enabling foreign companies, and locally registered international business companies to list their shares here.

This was at a time it said the depressed economic situation in Barbados was being reflected in the local capital market.

“At the BSE, we are well aware that activities in the wider marketplace tend to be mirrored in the local capital market. However, we maintain that while we must be prepared for any negative impacts, we must, at the same time, continue to evolve and position ourselves in such a way that we are able to take advantage of any opportunities that may become available in the future,” the January to March report said.

“Thus, we continue to press ahead with our International Securities Market initiative which would facilitate the listing and trading of foreign securities of companies domiciled abroad that are seeking to establish a physical presence in Barbados, as well as securities owned by International Business Companies that are currently operating on the island.

“We hosted a breakfast meeting to discuss the Rules of the ISM and said rules are currently before the Financial Services Commission, our regulator, pending approval. Once approved, the ISM will be marketed globally and our intention is to attract as many IBCs to list their securities while providing Barbados with yet another tool to attract more foreign investment to our shores,” the BSE added.

In its annual report the BSE said it had a number of major regulatory objectives it wanted to attain between now and next year after a difficult 2012 and its management was encouraged by improvements in the international capital markets “because of the close links between market performance and economic performance”.

“If these trends continue and there is a resurgence of positive economic activity in these economies, our closely linked economies in the region are sure to see improvements in 2013. However, we must remain cognisant of our dependency on these international economies and the potential for both positive and negative impacts as well,” the organisation said. (SC)

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