CHENGETEDZAI Depository Company (CDC) will soon be introducing securities lending and borrowing to enhance market liquidity and increase turnover for the market.
Securities lending is the practice of loaning shares of stock, commodities, derivative contracts, or other securities to other investors or firms.
This comes as the annual market turnover continues to respond to the obtaining economic environment, with figures showing an upward trend since the inception of the CDC Chengetedzai Securities Depository(CSD) in 2014.
The slight difference between 2021 and 2022 figures shows the relative stability that has been prevailing in the market as of mid-2022 according to the CDC trading update for November 2022.
“Chengetedzai Depository Company aims to uphold the best practice in central securities depository services and enhance its products. As a testimony to this, the CDC CSD retained the A — rating into 2023 after the recent review by the global CSD rating agency Thomas Murray. As the year is coming to an end, CDC will also seek to continue fruitful engagement with key market stakeholders to strengthen bilateral relationships between the entities to improve service delivery,” the company said.
During the month under review, a total of 101 equities deposits were processed bringing the cumulative number of deposits since going live to 103,131.
The company said it continued on a dematerialisation campaign to increase the dematerialisation ratio for individual and institutional investors still holding shares in physical form.
Dematerialisation is the move from physical certificates to electronic bookkeeping.
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During the period, 301 new accounts were opened, resulting in 5 795 accounts being opened to November 2022.
“As a result, the cumulative number of accounts opened on the CDC CSD as of November 30, 2022 was 43 817. Local investors accounted for 95,09%, and foreign investors accounted for 4,91% of all accounts opened on the CDC CSD as of November 30, 2022,” CDC said.
The company revealed that individuals hold the largest number and proportion of accounts on the platform CSD.
“The other large portion of CSD accounts falls under the unclaimed shares. The CDC CSD is addressing this issue through an on-going exercise based on a market drive where efforts have been increased to identify those making up the unclaimed shares category so that they claim their shares and dividends,” CDC said
Zimbabwe Stock Exchange (ZSE) equities market capitalisation decreased by 11,82% during the period closing at $1,610 trillion.
The total turnover for trades on ZSE settling through the depository was $5,368 billion for the month under review.
