JSE introduces USD listings
Published:Wednesday | July 6, 2011 | 12:00 AM
The Jamaica Stock Exchange (JSE) expects its new United States dollar platform launched on Tuesday to attract local and foreign listing and consequently reduce flight of foreign capital.
The US dollar-denominated market platform will create a secure market for equities quoted in US dollars and reduce the attractiveness of overseas investments in bonds and equities, said management. Proven Investments Limited will in mid-July become the first listing, injecting some US$34 million into circulation (see related story on Page C3).
Existing firms listed on the JSE can opt to list new preference share issues in US dollars on this platform, JSE said in response to a query.
"It provides another avenue to invest," said JSE general manager Marlene Street-Forrest at the launch of the platform on Tuesday at the JSE.
"Those that invest in US dollar repos can instead buy stocks on this platform."
It is the first US denominated securities market in the Commonwealth Caribbean, said Street-Forrest, who added that the JSE would assist companies through the listing process.
"We are hoping that it will have a positive impact on the economy," said Robin Levy, deputy general manager at the JSE. "We are expecting that it would result in local circulation of US dollars in the island and could have an [influx] of foreign direct investment, but it's hard to say."
The JSE expects to attract investors from the diaspora who were hesitant to hold Jamaican dollar portfolios.
Levy said that the US dollar-denominated market would be "less expensive and quicker" than investing in US securities and bonds at existing rates.
The JSE expects other overseas companies to list in the medium term. Proven is incorporated in St Lucia but is founded by Jamaicans and operates out of New Kingston.
The JSE, in operation for 42 years, currently represents about $595 billion of stock market wealth.