African securities markets – shock move to integrated trading pool

Fears of the potential impact of IT disruption on African capital markets, combined with a long-running initiative to pool fragmented markets for more liquidity, led to a shock decision by the African markets association today to switch to a single African market platform at short notice.
The pioneering African Securities Markets Association market body says that all markets should be closed by 12 noon today(Thursday), while trading on the new platform is expected to start with effect from 9am on 6 April, giving traders and market institutions a very busy long weekend to set up alternative infrastructure.
“The main aim of the new system, called FITS, is to ensure that we can go on trading shares, bonds and other securities despite any possible terrorist attacks or power cuts”, said Bernani Madofo, IT spokesperson for ASMA, said in a news release: “At the same time, we are taking the chance to combine all markets in one trading pool, and at a stroke eliminating the small and fragmented markets that have been harming efficiency and capital raising in our great continent”.
The new system will revolve around a return to floor trading in a single African location. All securities, including bonds, shares and derivatives, will be listed on electronic screens, and traders will set up offices nearby before heading down to the trading floor. Traditional trading systems including verbal and physical transactions, backed up by prompt data entry, have frequently been shown in leading research studies to be more effective for trading, turnover and market pricing efficiency than expensive computer systems. Broker Japie Enroni said of his former trading screen “It’s like watching paint dry, I’d love some action”.
After hurried debate, in a shock electronic ballot the ASMA membership voted to set up the new exchange in the International Conference Centre, Seychelles are now busy setting up offices in IT enabled locations such as Club Meditrade and five star hotel Le Bigroller, while working around the clock to gearing backoffices for settlement and clearing using the revolutionary Fun In The Sun (FITS) integrated “umbrella” client and trade settlement system using L-ounger software.
Extra liquidity is likely to be gained after trading hours as Africa’s tens of thousands of stockbrokers gather in local hostelries to prepare their throats for the next day’s trading action.


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