CHENGETEDZAI Depository Company (CDC) is geared to implement United States dollar settlements in the short-term to improve its offerings.
Under this initiative the company’s trading platform, Chengetedzai Securities Depository (CSD) will also be offering services on United States dollar-based exchanges.
“The company’s focus will be on the ongoing improvement of its products, stakeholder relationships, systems and procedures to better serve the market and compete with other market players,” the firm’s chief executive officer Prosper Mutorogodo said in a trading update for the month of April.
“Due to the global financial markets accelerated adoption of digital technology, CDC will improve its offerings to better meet customer needs through the introduction of a mobile application.
“CDC CSD is geared to implement USD settlement in the short term as preparations are now at an advanced stage where CDC CSD will also be offering services on USD-based exchanges. Announcements to the investors, participants and issuers will be made in the short term to this effect,” he said.
The developments are coming at a time when there has been a steady increase in the dematerialisation ratios from 2014 when the CDC CSD was launched.
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Dematerialisation basically measures the rate at which physical share certificates are converted to electronic ones.
“The average dematerialisation penetration ratio (Demat Ratio) across all counters was at 57,27% as at April 30, 2023. This shows a steady increase in the dematerialisation ratios from 2014 when the CDC CSD was launched,” he said.
“This is mainly through the realisation by investors of the safety of keeping shares in dematerialised form through continuous market education programmes rolled out by the CSD and other capital market players.”
Mutorogodo said market value statistics dematerialised securities registered on the CDC CSD during the month accounted for 41,70% of the total market capitalisation on the Zimbabwe Stock Exchange (ZSE), valued at $1 452,69 billion.
During the month under review, 34 equity deposits were processed. This brought the cumulative number of deposits since going live to 103 795.
The investor types that held the most significant value on CDC CSD were corporates, pension funds and insurance firms.
Individuals accounted for just 2,62% by value on the CDC CSD although they held the largest number of accounts.
He said 212 new accounts were opened in the month under review, resulting in 997 accounts being opened this year to date.
As a result, the cumulative number of accounts opened on the CDC CSD was 44 978. Local investors accounted for 95,07%, and foreign investors accounted for 4,93% of all accounts opened on the platform.
Equities market capitalisation on ZSE increased by 2,99%, closing at $3,482.41 billion.
The total turnover for trades on the ZSE settling through CDC CSD was $14,518.74 million for the month under review.
Individuals held the largest number and proportion of accounts on the CSD with the other large portion of CSD accounts falling under the unclaimed shares.
“This has prompted the CSD to go on a market drive where efforts have been increased to identify those making up the unclaimed shares category so that they claim their shares,” Mutorogodo said.