Omega Ukama 
THE Victoria Falls Stock Exchange (VFEX) has outlined guidelines for debt listings as it intensifies efforts to encourage participation.
It also comes as the Treasury has said it plans to borrow as much as US$100 million this year through bonds on the VFEX to supplement the national budget.
“The VFEX believes it is important for the exchange to be in a position to facilitate offerings and listings by continually enhancing its requirements to ensure a high level of investor protection and confidence,” the budding exchange said recently in a statement accompanying the guidelines, adding that the rules are aimed at providing investor confidence via an “orderly, secure, efficient and transparent financial market.”Among other things, the requirements provide for the minimum disclosures that investors and their professional advisers would reasonably require for the purpose of making an informed assessment of the nature and state of an applicant issuer’s business.
“The type of protection afforded to the investor often distinguishes the different types of debt securities from one another. The greater the protection, the lower the risk and yield,” VFEX said.
“Documentation is central to any issuance of debt securities. The placing document consists of sections setting out all, or certain, of the terms and conditions of the debt securities and sections dealing with the issue of, subscription for and sale of the debt securities.
“The terms and conditions of the debt securities provide for the rights of the investor, the obligations of the applicant issuer, the terms of any underwriting or guarantee, the mechanics of payment and settlement and any credit enhancements or trust deeds, credit ratings amongst other matters.”
It also comes as the budding exchange recently launched an online trading platform to increase retail investor participation.
Retail investors are non-professional market participants who generally invest smaller amounts than more prominent institutional investors, who have historically dominated the local capital market.
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