THE BARBADOS STOCK EXCHANGE (BSE) needs some kind of Government help or its listing board will shrink even further.
And a senior executive of Fortress Funds, the island’s largest mutual fund manager, has suggested that the Jamaica example might be a good one to follow where that government has provided tax incentives for companies to list on the Jamaica Stock Exchange.
He said the recent listing of regional company Lasco was a positive result of the Jamaica initiative.
Chris Callender’s comments came against a backdrop of the delistings by Barbados Dairy Industries Limited and GraceKennedy earlier this year.
In addition, he cited plans by Republic Bank of Trinidad and Tobago to seek a complete buyout of Barbados National Bank (BNB) and delist the bank from the local exchange, and the expected delisting of ANSA McAL Barbados following an announced takeover bid by AMCL Holdings Company.
Over the past five years several big names have delisted, most of them due to acquisition by other companies.
Callender, a Fortress Funds senior executive and former equities trader, told BARBADOS BUSINESS AUTHORITY that even more institutional investors might shift from equities to corporate bonds as share values continue to decline.
He also said investors might be tempted to shift to other, more active markets like Jamaica or Trinidad and Tobago, though currency shifts in those markets could be a disincentive to local investors who don’t face that in Barbados.
“It really is a guessing game about who might go next. I am worried about the cross-listed companies Neal & Massy and Trinidad Cement Limited and how long they go before they decide to come off the exchange because there is very little activity and maybe take the same action as GraceKennedy, which delisted earlier this year,” Callender said.
In a recent interview, Securities Commission chairman Sir Neville Nicholls warned that continued delisting of companies from the BSE and inactive trading could spell trouble for the local stock market.
Sir Neville said too that Government might have to offer tax incentives to investors to encourage trading and to companies to list on the BSE and raise capital there.
“The individual national markets are really very small markets and, inevitably, what is emerging is the need for one regional market,” Sir Neville noted.
