Over-the-Counter market potentially worth billions of cedis launched by GSE
Ghana’s premier local bourse, the Ghana Stock Exchange (GSE), has launched its Over-the-Counter (OTC) market.
The Exchange, with the launch of the OTC market is seeking to provide a trading platform for over 100 non-listed public companies to trade their securities in the non-formalized market.
With the OTC market, companies will have less stringent reporting requirements as compared to those listed on the main market.
The OTC market potentially to grow into billions of cedis, will serve as an additional investment avenue for investors.
The market will facilitate the trading of ordinary shares, preference shares and derivatives.
The global OTC market at end-June 2023 was valued at $715 trillion dollars.
Daily trading values in the OTC market are also substantial with the daily trading volume in the global foreign exchange (forex) OTC market for instance, pegged at $6 trillion.
Speaking at the launch of the market, Managing Director of the GSE, Abena Amoah, averred the OTC market is in line with the goal of the 10-year Capital Market Master Plan (CMMP) to create a deep, efficient, diversified and well-regulated market with a full range of products attractive to domestic and international investors.
Adding that, it also aligns with the Exchange’s goal to transition from a frontier market to an emerging market.
“The launch of the OTC market is a significant step forward for Ghana’s capital market, the market is to provide a structured platform for companies to trade their securities.
“The market will provide transparency, efficiency, liquidity and ease in trading of securities for unlisted companies and their investors,” she quipped.
Speaking further, Ms Amoah noted the OTC market will drive economic growth, adding that the GSE is committed to providing a pipeline of innovative investment products that will support the economic development of Ghana.
Also speaking at the OTC market launch was the Managing Director of ARB Apex Bank, Alex Kwasi Ewuah, who encouraged Rural and Community Banks (RCBs) to fully participate in the market and raise capital for growth.
He noted that the market will not only provide liquidity for RCBs, but also promote corporate governance in RCBs further strengthening the country’s financial sector.
“RCBs have limited sources of raising capital which is often from shareholders and community participation, with this market, RCBs have an additional avenue to raise capital.
“We look forward to seeing the positive impact that the OTC market will have on our member banks and their financial performance,” he posited.
The launch of the OTC market represents a significant step in the GSE’s efforts to broaden the scope of trading and investment opportunities in Ghana.
It underscores the GSE’s commitment to fostering a more inclusive and transparent trading environment, accommodating public companies that opt not to list on the main exchange yet still require a structured platform for their securities.
The introduction of the OTC market is expected to enhance the liquidity and visibility of public companies, contributing to the overall growth and stability of Ghana’s financial markets.
The OTC market is testament to the GSE’s proactive approach in adapting to the evolving needs of the market and investors.
