Twenty-Third Session of the Board of the Union of Arab Stock Exchanges and Securities Commissions
Mr. Jalil Tarif, the Executive Manger of the ASE and Dr. Hani Al-Halawani, an ASE Board member represented the ASE at the twenty third session of the Board of the Union of Arab Stock Exchanges and Securities Commissions, held in Cairo on November 4-6. The meeting discussed various issues and gave special attention to the developments that took place on international capital markets in the aftermath of September 11th events and their implications to said markets. The Board requested the Secretariat to prepare a comprehensive study on the possible repercussions of said events on Arab capital markets. The conferees were informed of the latest developments in the projected setting up of the Arab Clearance Institution with a five million dollar capitalization. With the present subscribed capital standing at around $3.3 million, the Board decided to extend the subscription period a further three months to complete subscription. The Union's Balance Sheet and Closing Accounts for the year 2000 were approved along with the Estimated Budget for the year 2002. Palestine Stock Exchange was exempted from its subscriptions fees for the years 2001 and 2002. Following extensive discussions, the Board was restructured into three bodies, the Stock Exchanges Board, the Supervisory Commissions Board and the Clearance and Deposit Board. The Board also approved the Union's change of name to Union of Arab Stock Exchanges.
Meeting on Restructuring of the Capital Market
The JSC held an extended meeting with economists and journalists under the title of “Restructuring the Capital Market. Experience and Challenges.” Dr. Bassam Al-Saket, Chairman of the JSC, stated that since it assumed its duties, the JSC has endeavored to restructure the national capital market to create a new securities market that would boast fairness, efficiency and transparency according to the latest international standards and practices. He outlaid capital market developments in terms of promulgating legislation and adopting procedures and instructions to safeguard citizen and investor rights and bolster Jordanian capital market credibility. He mentioned the latest steps taken, including the amendment of the Securities Law and its submission to the Council of Ministers for approval and adoption, and the adoption of the Instructions on the Buy Back of Public Share Holding Companies' Shares. He informed the attendees of the intention to establish a unified supervisory commission that would provide company financial statements, registration procedures and would keep track of its infringements. He said the said body would be the sole reference to give unified figures and information and from which accurate data can be obtained. Mr. Jalil Tareef, the ASE's E.M., in his turn gave a presentation on the latest developments on the ASE, with a special focus on the Management Information System (MIS), the data base system and dissemination of information through the various available media, and reviewed the ASE's excellent performance for this year. The latest developments on the SDC were presented by its CEO, Mr. Samir Jaradat.
Seminar The Use of Public Offers for Privatization
In implementation of the Privatization Program of the Jordanian Government, the JSC and the Executive Privatization Commission, in cooperation with the British Capital Market Partners, held a seminar on “The Use of Public Offers for Privatization” under the patronage of Dr. Mohammed Halaika, Deputy Prime Minister and Minister of State for Economic Affairs. The concept and advantages of Public Offers on international capital markets were discussed and international experience in this field was reviewed. The seminar found that it was necessary to set up a committee with the aim of implementing and developing Public Offering strategy within the Privatization Program. Indeed, right after the seminar a committee known as the Public Offers Strategy Committee was set up under the chairmanship of the chair of the Executive Privatization Commission and the membership of the Ministry of Finance, Ministry of Planning, the concerned ministry, the Jordanian Investment Corporation, the JSC, the ASE, and the company to be privatized. Mr. Sami Hattab, head of the Research and External Relations Department, was nominated to represent the ASE.
News of Arab and International Stock Exchanges
- Established a full one year ago, Abu Dhabi Financial Market continues to transfer all shareholder registers from listed companies to its Clearance Department, which is one of the market departments. Hence, electronic documents represent legal title of securities, and investor account opening involves assigning a reference single number per account and updating personal data on investors, so that accurate information on investors is provided in a timely manner. The main reason for adopting this system is the virtual impossibility of awaiting a full verification of shareholder registers and an obstructed transfer of shareholder registers to clearance.
- The New Zealand Stock Exchange intends to demutualize next year, but prior to that move a bill must be passed before the Parliament. The primary objective of the bill to enable the New Zealand Stock Exchange to demutualize, with appropriate regulation, and become a public company operating under the Companies Act, with more flexibility to meet the demands of the market for services. Once the demutualization approved, the Exchange intends to be publicly listed on its own market. Which gives the Exchange greater flexibility to meet the needs of a dynamic market. In addition, it could widen its capital base, and provide the investors with greater opportunity to have an ownership involvement in the Exchange, improving accountability and efficiency of service pricing, and use of investment capital.
- Tokyo Stock Exchange organizes special member firms meeting on demutualization, during this meeting a proposed to demutualize the Exchange, and modify its legal structure to better cope with the changes affecting the securities industry will be presented. To be mentioned that Presently, the Tokyo Stock Exchange is registered as a self-regulated, non-profit association, which established under the Exchange Law, the Exchange is managed by its members, which are securities firms and brokers.
- Mumbai Stock Exchange plans to demutualize as soon as possible, the Indian government has announced in Parliament plans for the demutualization of stock exchanges in India.
23rd Meeting of the Union of Arab Stock Exchanges and Securities Commissions
The ASE represented by it's Executive Manager Mr. Jalil Tarif, and Mr. Hani Halawani, member of the ASE Board of Directors, participates the Twenty Third Meeting of the Union of Arab Stock Exchanges and Securities Commissions, hold in Cairo in November 4th. The Union meeting will review the Secretary-General's Report on the Union's activities, the Arab Clearance Institution and the Unified Arab Stock Exchange, as well as the recent developments concerning the Arab Financial Markets Network. Also The financial situation for the Union will be discussed during the meeting.
News of International Stock Exchanges
- According to a survey made by the FIBV about the number of listings on some emerging markets at the end of last year, it appears that three main countries come into sight, and surpass by far the rest of the developing world: India, China, and Egypt.The market which has the most important number of listings was India, with Mumbai totaling 5,853 companies, and the National Stock Exchange (NSE) 1,106 companies at the end of December 2000. Market capitalization of the Mumbai Stock Exchange reached USD 148,1 bn at the same date, and India is one of the countries in the world, which counts the largest number of individual shareowners.Although Egypt was the second emerging market with the highest number of listed companies with 1,076 listings, only around 60 of them are regularly traded. In fact, because there are tax advantages in gaining a listing.Chinese markets were the third place in emerging markets by listings number but the second by trading importance with Shanghai counting 559 A shares and 55 B shares, and Shenzhen 499 A shares and 58 B shares.
- FTSE, the global index group, will launch early September in association with Mondo Visione, publisher of the Handbook of World Stock, Derivative and Commodity Exchanges, the world's first index which tracks listed exchanges, and other trading venues. The index will be named the FTSE/MV Exchanges Index. The new index will measure the progress of the new and rapidly developing exchanges sector. It will include the leading listed exchanges worldwide, among which the Australian Stock Exchange, the Deutsche Bِrse, Euronext, the Hong Kong Exchanges, the London Stock Exchange, and Singapore Exchanges. As more and more exchanges are choosing the way of privatization to expand their business and respond to competitive challenges, the sector of newly listed exchanges is expected to develop rapidly. This new index could become the benchmark by which exchange performances will be judged. It will help the management of newly listed exchanges to compare their respective performance compared to other exchanges.
- The FIBV General Assembly & Annual Meeting took place on 15-16 October 2001 in Madrid. During the meeting, many decisions have been taken. Among key decisions, a great effort will be put into demonstrating the crucial financial role exchanges play in the world economy. Also the name of Federation will be World Federation of Exchanges, and the web site will become www.world-exchanges.org. The Budapest Stock Exchange is accepted to be a new member in the FIBV, after an in depth review of the Exchange's application, including its functioning, rules and regulations.
Arab Network of Financial Markets Starts Its Services
The Union of Arab Stock Exchanges set up the Arab Network of Financial Markets, which has started to offer its services from Beirut to investors and businessmen. It covers securities of some 1400 listed companies in 12 financial markets over 10 countries, whose total value of transactions was estimated at $21 billion at end of 2000. The Network draws its importance from its being a significant initiative and a practical means of Arab Exchange interconnection. It enables investors and actors on financial markets to monitor Arab financial markets directly through the Internet, and allows subscribed brokers to execute buy and sell orders on Arab stocks through the Internet and directly. The Arab Network of Financial Markets' address on the web is www.alshabaCa.com
Capital Market News
- A Royal Decree was passed endorsing the Council of Minister's resolution to appoint H.E. Dr. Tayseer Abdel-Jaber as Deputy Chairman of the Jordan Securities Commission (JSC) Board of Commissioners, and Messrs. Safwan Batayneh and Mohamed Tash Board commissioners following the recent end of term of membership of H.E. Hisham Al-Tal and Messrs. Abdel-Hamid Hyari and Ra'ef Al-Alami.
- The Board of Commissioners of the JSC approved the draft Instructions Related to the Buy Back of Public Share Holding Companies' Shares On the Market as of January 1st 2002. The Instructions stipulate that the number of buy-back shares shall not exceed 10% of subscribed shares, that the amount set aside by the company to buy back its shares shall not exceed its total retained earnings and reserves, that the buy-back shall not be financed through lending, and that the ratio of current liabilities to net shareholder equity shall not exceed 20% as on the date of its General Assembly meeting
- The Second Conference for Middle East Stock Exchanges organized by NASDAQ, which was scheduled for 3rd of this October under the title “Global Linkage of Financial Markets” was postponed till next year.
- Mr. Nidal Hamdan and Mr. Amjad Al-Qudah represented the ASE at the Third Professional Scientific Convention for Auditors' Associations in Arab Countries, organized by the Chartered Auditors' Association under the title “Auditors and professional, legal and social responsibility”.
- A training course for financial brokers started at the headquarters of the Arab Institute for Banking Studies, in cooperation with the JSC and AMIR program, with the objective of raising the international and professional standard of operators in brokerage and capital markets. At the end of the program, participants will be awarded licenses from the JSC to work as financial brokers upon passing the set examination.
Executed Transactions Skyrocket
The number of daily-executed transactions on the ASE skyrocketed this month shooting past 2300 on certain days and setting a record since the initiation of the electronic trading system (ETS) in March 2000. The daily-executed transactions was (38,365) in August, against (12,365) contracts in August 2000, an increase of (210.3%).
The Financial Investment House Co. turned over to the Prosecutor General
In light of the procedures stipulated in the Securities Law No 23 of 1997, the JSC Board of commissioners decided in its August 9,2001 session to turn the file of the Financial Investment House Co. to the Prosecutor General to instigate legal action against it, its management and staff, as a result of breaches committed by the company. The JSC has addressed the Controller of Companies and requested him to order the compulsory liquidation of the said company by reason of loss of its entire capital and serious breaches of the Law.
Non-reporting Companies Served with Notices
The JSC sent notices of infraction to those companies that failed to abide by the Disclosure Instructions and issue their semi-annual reports. The said Instructions passed by the JSC oblige public shareholding companies to disclose their semi-annual financial statements within a month of the end of the first half of its fiscal year.
Second Conference for Middle East Markets
Mr. Jalil Tarif, the Executive Manager, will represent ASE at the Second Conference for Middle East Markets organized by NAZDAQ on the 3rd of October in Malta, under the title of Global Linkage of Financial Markets. The conference aims at joining efforts of participating countries in seeking necessary procedures to globalize their markets. It shall discuss global listing standards that will lay the foundation for said linkage.
Launch of the Arab Financial Markets Network
The ASE will take part in the official launching of the Arab Network of Financial Markets, organized by the Union of Arab Stock Exchanges on September 5th in Beirut. Mr. Nader Azar, Assistant CEO and Mr. Mohammed Al-Khatib, Head of the Computer Department will be representing the ASE at the event and the inauguration will include a live show of prices and trading on Arab Exchanges. This project will constitute the backbone of Arab Exchange interconnection
Second Meeting of Jordanian Businessmen and Investors
The ASE took part in the Second Meeting of Jordanian Businessmen and Investors, organized by the Jordanian Business Association and the Jordan Investment Board during August. Mr. Jalil Tarif, who represented the ASE at the meeting, presented a paper on “Capital Market Development In Jordan”, and reviewed the most important legislative, institutional and technical developments of the financial market in Jordan and their impact on investor protection. He went over the ETS, remote trading (RT) and ASE information dissemination over the Internet. He said the capital market took a vital place within the package of economic reforms adopted by Jordan for the purposes of improving its investment climate and merging its economy in the global economy. He made it clear that the reforms aimed at promoting income and increasing investments to be in line with international standards in this respect.
News of Companies
Al-Dawliyah for Industrial, Trade and Tourist INV. Bonds were changed to Arab International Hotels Bonds. The new name was used for trading as of Monday 13th of August 2001. Due to the merger of Al-Dawliyah for Industrial, Trade and Tourist Co. with Arab International Hotels.
News of International Bourses
- The Board of Directors of Nasdaq Stock Market decided that the US electronic market will become a publicly traded company. Thus Nasdaq can raise funds through IPO,S to improve its service.
- Oslo exchanges went public, and offered its shares for public. Approximately 20% of the shares were allotted to foreign investors and 80% to local investors & employees.
- The Philippine Stock Exchange (PSE) completed its conversion into a stock corporation from a mutual company a move aimed at promoting transparency, and reviving investor confidence in the market. (PSE) will offer its stocks to public. Those shares will then to be listed on the bourse.
- Nasdaq Europe, the European exchange created by the acquisition of the Brussels-based Easdaq by Nasdaq started its operations on 8 June 2001. Its main aim are to expand and consolidate order flow in US equities, to develop Nasdaq Europe as a roubust IPO market for European innovative companies, and to expand and capture a significant proportion of European cross-order trading. Nasdaq European represent a further step towards the fulfilment of Nasdaq's ambition of creating a truly global securities market
Arab Financial Markets Network Starts its Services
The Arab Financial Markets Network starts its services this coming September. An Arab Stock Exchanges Union's report explained that the Network would be a visual Arab market that would enable Arab investors to have access to information on 1400 or so listed companies on 10 Arab Exchanges with the possibility to trade their securities. Trading in 2000 was equal to 8.3 billion securities of a total value of $21 billion. The Network aims at raising the standard of transparency and disclosure in the financial markets, promote active interchange of trading among all Arab financial markets, along with a spread out of Arab exchanges into regional and international financial communities.
JSC Stops The Financial Investment House Co. from Operating on the ASE
The Board of Commissioners of the JSC decided to stop Financial Investment House Co. from operating on the ASE following its breach of the Securities Law and the regulations and instructions issued there under.
News of Companies
The First Telecommunications Group has changed its name to Bahraini Telecommunications Company/Jordan and its abbreviated form of “BATELCO JORDAN” was adopted by the ASE for the purposes of trading as of July 23, 2001.
Workshop on the Bonds Market and How to Develop It
The JSC in cooperation with AMIR program organized a workshop on the Bonds Market and How to Develop It. Ms. Adela Al-Baghdadi and Ms. Mona Hadadin represented the ASE to this workshop, which falls within a series of activities that the JSC conducts with the objective of developing and deepening the Jordanian capital market. Many topics were tackled, such as the importance of the government bonds and corporate bonds market in Jordan, their advantages to the Jordanian capital market, and case studies of other countries in this field.
FTSE Indicators Fully Free Float Adjusted
The May 2001 FOCUS issue of the FIBV indicated that the entire range of FTSE indexes will be fully free float adjusted to reflect availability of stock in the market accessible to public investment as of June 15, 2001.
EURONEXT Goes Public
EURONEXT NV, the European exchange formed by the merger of the Amsterdam, Brussels, and Paris exchanges, will initiate its IPO on 21 June. Euronext NV will list on the main list of Euronext Paris. The indicative price range has been set between EUR 24.0 and EUR 27.5. Euronext shares will be offered from 21 June, and closed on 4 July. The first day of trading is expected to be on 6 July.
Conference on Available Economic Resources in Jordan
The ASE is participating in the Conference on Available Economic Resources in Jordan, organized by the Middle East Studies Center, in the form of a paper on the Investment Infrastructure and Culture and their Role in Economic Development presented by the Executive Manager Mr. Jalil Tarif. He speaks about the most important aspects of investment culture at the level of both the national economy and the capital market, underlining the significant recent developments on the capital market, particularly the improvement and regulating of the market in line with international standards, increased market confidence and security, hence more depth and efficiency, and enhanced confidence in Jordanian investments and Jordanian economy.
Arab Unified Stock Exchange Technical Committee Meeting
he ASE's Assistant CEO Mr. Nader Azar represented the ASE to the Meeting of the Technical Committee to set up the Unified Arab Stock Exchange, held in Beirut on June 11-12. Rules and measures for selection of shares to be listed on the Arab Stock Exchange were adopted. Several criteria were agreed related to company capital, profits, book value, number of shareholders and information to be disclosed. The participants also discussed the criteria for selection of brokerage firms to be approved by the Stock Exchange, such as those related to their solvency, nature of business and information to be disclosed. The Arab Clearance Institution was approved to perform all security clearance and settlement operations on the Stock Exchange, the Arab Market Financial Network to secure trading and the Arab Stock Exchange Information System. Trading mechanisms were discussed, the US dollar was chosen as the trading and clearance currency, the pricing margin was set at 10%, and the trading days and hours of the Arab Stock Exchange were decided along with all matters related to trading mechanisms on the Stock Exchange with the possibility of amending them by the Unified Arab Stock Exchange in the future. These mechanisms and proposals shall be submitted to the coming meeting of the Union of Arab Stock Exchanges and Securities Commissions for approval.
Portfolio Management Seminar
Mr. Sami Hattab and Mr. Bassam abu Abbas took part in the training program organized by the Arab Center for Consultancy and Training in Amman to train participants on management of portfolios in securities markets. The concept of exposure to investment in securities risks, how to measure those risks, how to constitute portfolios with the highest return and lowest risks by diversity of investments with a view to achieving the optimum portfolio, along with mutual funds of all types were the themes tackled in the seminar.
Investor Protection Workshop
The JSC in cooperation with AMIR program organized a workshop on some important aspects relevant to investor protection. Mr. Abdel-Razzak Al-Farah, Mr. Amjad Qudah and Ms. Abla Najdawi took part on behalf of the ASE. This workshop falls within the range of activities that the JSC conducts with the objective of developing the Jordanian capital market and building the capacity of those who work in it. Several topics were covered; some of the most important were legislations regulating the emerging market operations, particularly those that are most suitable to the Jordanian environment as well as the most significant measures to be adopted by the JSC to improve and develop the legislation environment. Barriers to cooperation among the JSC, the ASE and the SDC and means of overcoming were also on the list of topics of discussion.
International Stock Exchanges News
- In April 2001 Nasdaq Stock Market converted all its listed equity securities to decimals. The first pilot program of Nasdaq stocks carried out according to plan on March, the Decimals Implementation Plan for the equities and options markets that was submitted to the Securities and Exchange Commission SEC governs The conversion by Nasdaq to decimals.
- Norway Ministry of Finance approved the new Stock Exchange regulations required to allow the new Stock Exchange Act to come into force, and allow the Oslo Stock Exchange to proceed with its privatisation project. Oslo Exchange can initiate the process leading to the share offer. It will meet both domestic and international investors to present its market, and give details on the new exchange operator organization and structure.
- Since April 2001, Madrid Stock Exchange offers to its members the opportunity to place, and receive orders in a secure and cost-effective environment in the world's top six stock exchanges; London, Frankfurt, Paris, Milan, Nasdaq, and NYSE. This comes after the signing of the agreement between the Bolsa de Madrid and GL Trade, an information Technology company that is a world leader in providing IT solutions for financial markets.
- Helsinki Exchanges launched a new index based on technology stocks listed on the exchanges. The ten most liquid technology stocks compose the new technology index, and the weight of stocks of any single company is limited to 20%. The new index will respond to the market participants' need for derivative instruments intended at managing the risks and returns of technology stock portfolios.
Union of Arab Stock Exchanges and Securities Commission Meeting
Mr. Jalil Tarif, the CEO, and Dr. Hani Halawani a board member, will participate in the meeting of the Union of Arab Stock Exchanges and Securities Commissions to be held in Sharm El-Shake. The meeting will discuss the proposal of setting up a unified Arab Stock Exchange, study the feasibility of the Arab Clearance Institution project and go over issues related to the Arab Network for Financial Markets.
JSC organizes a public awareness campaign
The JSC has launched a public awareness campaign as part of its intensive efforts to spread investment culture about matters significant to the national capital market and principles of investment therein, as well as the role of the JSC in drafting legislative and supervisory rules with a view to enhancing investor confidence and protection on the market. Everything will work according to a set program for the spread of capital-market culture, and all the capital market institutions, particularly the JSC, have opened their doors to any inquiries whether through direct contact, by telephone, or on the Internet. Jordan Securities Commission can be visited on the following site www.jsc.gov.jo and the Securities Deposit Center on www.sdc.gov.jo
The Permanent Building
Jordan Securities Commission (JSC) has moved to its new and permanent building, which was established to gather all capital market institutions in one location.ASE will move to the new building before the second half of this year.
The Insurance Regulatory Commission suspended the Jordan-Gulf Insurance Company's license due to the difficult circumstance the firm is facing. The suspension will apply to all forms of insurance the company deals with and the company will be pro from issuing any insurance policies.The suspension does not mean the dissolution of the firm, but a chance to the company to correct its situation on the one hand, and to protect the rights of the insured, shareholders and beneficiaries on the other.All rights and obligations arising from the contracts concluded prior to the suspension of the license will be considered valid and in operation.
Arab & International Stock Exchanges News
- Saudi Arabia intends to establish a formal stock exchange which will replace the electronic transactions in one of the largest stock exchanges in Arab world, aiming at having a formal stock market and an independent body that supervises transactions and providing transparency.
- The American Stock Exchange, the regional exchanges, and the options exchanges resonated with the sounds of decimals, after more than 200 years of using fractions, the conversion to decimal pricing, which began on August 2000, was completed for all the issues listed on the above-mentioned exchanges. This step-by-step procedure insured that all the specialists and brokers at the exchanges had experience trading in decimals prior to the final switch. The Nasdaq Stock Market will join the other US exchanges later this year.
- The Chicago Board of Trade's (CBOT) directors has recently approved the planned demutualization of the Exchange. The move will convert the US futures and options exchange into two new companies :
1) the first company will retain the open outcry platform of trading and will be a closely held, for-profit company. The for-profit status will allow for improved and quicker decision-making, taking advantage of increased trading volumes in an open outcry environment ;
2) The second company will establish an electronic trading capability. This company is expected to trade all current CBOT contracts, plus additional products, in an open access environment.
- On 5 February 2001, shares of Deutsche Bourse AG were listed for the first time on the Frankfurt stock market. Shares in Deutsche Bourse Jumped more than 10% on their first day of trading.The issue was 23 times subscribed with strong demand from institutional investors. Around from the UK, Switzerland, Spain, and the US.
Securities Depository Center Introduces Bilateral Netting
In its efforts to facilitate procedures for transferring ownership of securities and their settlement between financial brokers, as well as to minimize the risks associated with settlement and a preliminary step towards introducing multilateral netting the Securities Depository Center, early of February, has started implementing bilateral netting directly between financial brokers, the financial broker pays or receives payment that represents the difference between its purchases and sales with its counter party.
The General Assembly of the Jordan Dead Sea Industries has approved to transfer the company from a public shareholding company into a limited liability company.
Non-Jordanian Investment Regulation
The Cabinet has issued “ Regulating Non-Jordanian Investments Regulation” no. 54 for the year 2000, which cancelled the ex-regulation for the year 1997 which imposed restrictions on non-Jordanian ownership in some sectors including mining.
FIBV sheds light on the latest developments on ASE
In its December 2000 issue, the monthly FOCUS bulletin of the FIBV published a detailed report on the latest technical steps made by the ASE, particularly in relation to the applications of the Intranet that links ASE to its members and the abandonment of the trading hall.
Study On Ownership Structure
The FIBV conducted a survey on 1999 Share Ownership in stock exchanges members; only 26 exchanges (50% of the members) have provided a detailed share ownership structure for 1999. However, the total market capitalization of the exchanges that were able to respond amounted to approximately USD 27500 billion at the end of 1999, or 78.5% of the total market capitalization of FIBV members. The aim of this survey is to have a better knowledge of the equity market ownership structure. It become more important to know the market share ownership as most exchanges have turned to private companies and become commercial entities. The results of the survey show that at the FIBV overall level, in 1999, the most important investor category was represented by domestic institutions with an average of 30.2% of total share ownership, followed by domestic private investors with 25.5%. Combined together, these two categories of domestic shareholders owned on average more than 55% of the listed companies' market capitalization in 1999. The third most important shareholders category was represented by foreign investors (both institutions and individuals) with an average of 22.6%, followed by domestic companies representing 15.0% of the total, and finally the public sector with 6.7%. When compared with the data of the 1997 survey, it appears that domestic institutions, local individuals, and foreign investors have seen their share in equity ownership rise. The most important surge concerns the domestic institution category, and corresponds to the increasing role played by the collective funds management, banks, pension funds and insurance companies in equity holdings of listed businesses. The second noticeable trend outlined by these figures is the growth of domestic private share ownership, which represented at the FIBV overall level more than 25.0% in 1999. This growth can in part be attributed to the explosion these recent years of on-line intermediation with the development of Internet, a better investors' education about financial markets, and the stock rally experienced in most countries since 1998 encouraging small investors to enter buoyant markets. In this respect, the surge of the “new economy” companies, or the telecommunications, media and technology (TMT) stocks, has played a significant role. The increasing foreign participation across markets underlines the on-going trend toward globalization, the impressive surge in mergers and acquisitions across continents these last two years, and the upsurge in cross-border trading activities resulting from these developments. On the contrary, the part of domestic companies and the public sector in total share ownership has slowly but regularly diminished since the beginning of the 90s, following the huge privatization programs implemented during this decade in most countries around the world, and still in place in some countries of continental Europe and other continents.
- Through its privatization program, and in a JD (0.9) million transaction, the government represented by Jordan Investment Corporation sold its (1.5) million shares in the Jordan Paper & Cardboard Factories Company.
- The Cabinet has approved swapping debt-to-equity in Jordan Phosphate Mines Company to the Ministry of Finance into 21 million shares for the Government in the company's capital.
- Jordan Electric Power Company will meet up the rest of its authorized capital of JD5 million through the capitalization of retained earnings and their distribution to the shareholders. It will then increase its authorized capital from JD30 to JD40 million through the capitalization of JD3.0 million of retained earnings before the end of 2001 and cover JD7.5 million in whatever manner deemed appropriate by the Company's General Assembly.
International Stock Exchange News
- The Singapore Exchange is the third Asian-Pacific bourse to demutualize after Hong Kong and Australia. The Exchange's ownership will be composed of the investing public and the Exchange's employees which will own approximately 32%, the Exchange's members and brokers will own 30%, the government of Singapore will own 25%, and the rest will be held by the financial institutions.
- Islamic banking officials said that an inter-bank international Islamic capital market is going to open up towards the end of 2001 to lure Moslem Investors away from traditional banking practices. The international Islamic capital market would start trading in short term instruments, and that Labuan in Malaysia and Bahrain shall be the two major centers for that market.
- Hong Kong Exchanges has introduced an initial public offering (IPO) service on the Internet that allows individual investors to apply for shares which are applied through a designated website. There are no transaction costs or handling fees, and the service is available to all individual investors.