The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Bahamas International Securities Exchange (BISX) is seeking to attract more than 100 new listings, its chief executive telling Tribune Business: “We’ve turned the corner.”

Keith Davies said that after overcoming an initial history “when we didn’t know if the doors were going to be open tomorrow”, the stock exchange was targeting “another vigorous year” for new listings in 2016.

He confirmed that a major target were the more than 100 legacy Bahamas Government Registered Stock (BGRS) issues that are still outstanding, representing more than $3 billion in public sector debt.

Getting those issues listed on BISX would come close to doubling its existing $3.8 billion market capitalisation, and Mr Davies said he planned to work with the Government and Central Bank of the Bahamas to make this happen.

The Government is already listing its BGRS replacement, the Bahamas Government Stock (BGS), on the exchange in a move that Mr Davies described as ‘a tremendous boost of confidence”.

“It shows the biggest issuer in the country has confidence in the exchange as a place to list its securities,” he told Tribune Business. “It’s been a confidence boost for the market and a confidence boost for BISX.

“We’re not resting on our laurels. We want to improve on that process, make it more transparent and more readily available, and accessible, to the average investor.”

Mr Davies added: ‘We want to, and the point I can make, is to work with the Central Bank. One of the initiatives is to move the BGRS that are issued and outstanding on to the exchange.

“There are over 100 issues, and we’d really like to do that. That’s a huge amount of debt there. We’re trying to increase the transparency by which the Government goes about raising funds in the country.

“One of the ways to do that is place issues on the exchange. People can go to one location, find information and trade the security. It’s very cumbersome to trade BGRSs. You don’t know what’s out there, the expressions of interest. Let the exchange do what it was designed to do.”

A BISX listing is regarded as providing greater transparency and price discovery for debt issue investors, enabling them to more readily trade the security and creating a ‘yield curve’ that can be used to price future offerings.

Mr Davies said BISX was also “anticipating one or two initial public offerings (IPOs)” that might list on its ‘Main Board’ in 2016 - the first since Arawak Port Development Company (APD) in 2011.

“We expect to have another vigorous year from our perspective on the funds listings side,” the BISX chief told Tribune Business.

“We’ve got multiple applications to list, which we’re working on. We anticipate potentially one or two IPOs listing this year. That’s positive.

“We would love to have a situation where we have multiple IPOs and multiple companies coming to market and being successful. But it should never happen before it’s ready and before it’s time,” Mr Davies added.

“We also expect some activity on the secondary market, preference shares and corporate debt, and the Government will probably be raising debt for its funding activities. We expect another year of positive listings.”

Mr Davies said BISX was now profitable, after enduring significant losses during its formative year that, at one point, threatened the very survival of the Bahamas’ first and only stock exchange.

“We are now in the black and in positive territory,” he told Tribune Business. “Since I have been in the chair, we have managed our expenses closely, improved productivity, increased income and expanded product availability and options.

“We have come out of debt to the point where we are moving in the right direction and, as the directors would say, we have turned the corner.

“To have confidence in the exchange, you have to have confidence we will be here tomorrow. To say that we’re in positive operating territory shows we’re doing the right thing, and the changes we’ve made for the market are having a positive effect for us.”