Stock Exchange of Mauritius automated trading system

Mauritius exchange new trading system goes live in Q1 2022

The Stock Exchange of Mauritius (SEM) aims to go live with a new Automated Trading System (ATS) by March 2022 after selecting South Africa’s Securities and Trading Technology (STT) as its preferred solution provider. The technology upgrade will see the Mauritius bourse advance further as Africa’s multi-currency, multi-asset financial hub.

The new ATS is part-funded by a grant from the African Development Bank. It will bring greater connectivity between the SEM and South Africa’s JSE and aims to advance trading links for exchanges in the Committee of SADC Securities Exchanges (COSSE – covering the Southern African Development Community – check the excellent COSSE website here).

The bidder selection follows the closing of bids on 30 April 2021. The contract award to STT is for $962,500 and covers “STT will implement, configure and install an automated trading system at the SEM.STT will also license and maintain the system at SEM for a period of 7 years”.

Global Mauritius

The Stock Exchange of Mauritius started in 1989 and since 2010 started to internationalize its operating and regulatory framework. It now offers a streamlined listing regime for the specialist requirements of different asset classes including equities (ordinary/ preference shares), debt (fixed income/floating rate debt/specialist debt products and Eurobonds), exchange traded funds and notes (ETFs and ETNs), depository receipts (DRs) and structured products. The above products are issued and listed by domestic Issuers, International Issuers, Investment entities, Specialist companies (including GBCs) and Public sector issuers. It lists some 200 securities across the different asset-classes and issued by a domestic, other African, and international issuers.

The top-quality regulatory framework of Mauritius includes remote broking members and allowing an issuer to list and trade a variety of products in ESD, Euro, GBP and ZAR as well as Mauritian rupees (MUR).

Sunil Benimadhu, Chief Executive of SEM, says in a press release: “We are pleased to work with STT on the implementation of a new trading platform at the SEM. STT is a leading financial market software solutions provider in the exchange space. This new venture relates to a number of ground-breaking initiatives implemented by the SEM in recent years to avail its key stakeholders, including investors and issuers, of improved state-of-the-art services and enhanced trading experience. This initiative also aims at further democratizing the share ownership culture in Mauritius and placing the stock market within the palm reach of the retail investor.”

STT making waves across Africa

Michelle de Beer, STT Managing Director, says: “We are excited to partner with a vibrant exchange such as the Stock Exchange of Mauritius. our flexible solution and ability to handle multi asset classes will allow SEM to continue innovating and creating new markets and instruments for investors, and we are certain that our state-of-the-art Automated Trading System, Surveillance and Trading Front-Ends will provide new and improved functionality to its members and investors to continue expanding their market.”

STT was founded in 1985 and offers exchange solutions, trading systems, custodian solutions, central depository solutions, risk management and back office management systems. In recent years it has won tenders to supply new systems to many African securities exchanges as well as to clearing members, brokers, banks, custodians and fund managers.

The new ATS is funded with a grant of UA430,000 (approximately $600,000) in a capacity-building for the AfDB Stock Exchange of Mauritius project. This is under the AfDB’s Middle Income Country Technical Assistance Fund (MICTAF) Grant . The SEM is contributing 60% of the project cost or $900,000. The overall project includes capacity-building and training, licensing of the ATS software, hardware and audit. The Mauritius exchange will cover the annual licensing cost and hardware.

Interconnection strategy

According to the AfDB: “The Bank’s intervention aims at supporting the interconnectivity between SEM and JSE that will result in the creation of a deeper and more integrated regional capital markets. The project‘s goal is to support: (i) the increase of the financial investment on SEM, and (ii) the acceleration of the financial integration with SADC’s stock exchanges.

“It will help in promoting access to long-term local currency funding, and improving access to SMEs, real sector, and investors in Mauritius and Africa through capital markets.” The Stock Exchange of Mauritius has long been a strategy leader among the African exchanges, an the bank says this will boost “Mauritius’ readiness and capacity to act as an international/regional financial hub for SMEs and large corporates; and enhancing SEM’s visibility to regional and international investors”.

Project documentation says: “The inter-connection between SEM and JSE will enable access to SEM by international institutional investors, thereby unlocking SEM’s connectivity problem and open the way to deeper engagement with other African stock exchanges. The project will enable SEM to be eventually connected to all members of the Committee of SADC Securities Exchanges (CoSSE).” The JSE is already linked to the Namibian and Botswana stock exchanges, according to the AfDB.

Photo from Business Magazine website, Mauritius

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