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The Online News Bureau of the Diaspora
Caribbean Exchange Network Coming April 1 - A HBN Special
HBN Staff Writer
Hardbeatnews , NEW YORK , NY, Fri. Feb. 2, 2007 : Get ready for the Caribbean (Stock) Exchange Network, coming to Trinidad , Barbados and Jamaica from April 1.
That's the word from Marlon Yarde, general manager of the Barbados Stock Exchange, in a phone interview from Bridgetown with HBN yesterday. Yarde, who runs the 20-year-old exchange, disclosed that the BSE is joining forces with the Jamaica Stock Exchange and the Trinidad & Tobago Stock Exchange to launch essentially a 'one Caribbean ' trading bloc.
Pending regulatory approval in the three countries, nationals in the region and around the world could see the rollout of what Yarde calls "Phase One" of the plan this April. "Right now, we at the Barbados, Jamaica and Trinidad stock exchanges can connect with each others' trading engine so the infrastructure is in place and the trading platform is the same," explained the BSE GM. "So that's why we've taken the initiative to integrate the three exchanges first in a phase one approach."
Once the CEN gets up and running, work will commence on the phase two portion of the plan, which Yarde said will include the addition of other stock exchanges in the region to the network as well as the launch of an international trading desk, where investors outside the region can easily be able to trade in the markets.
Ahead of the pending rollout, officials at the three exchanges are busy working out the last minute details, including finalizing choice of the settlement bank for the region. "We are going to choose a settling bank with footprints across the region so this bank will be the one chosen to be the settlement bank for the network," said Yarde.
Asked about the cost of the venture to date, the stock exchange chief disclosed the basic legal, consultancy, and technical fees have been split by the exchanges with Barbados picking up about US$35,000. However, he acknowledged phase two will be more costly since most of the other regional stock exchanges trade on varied platforms so the technological integration would push up the tab.
Meanwhile, pressed for a clarification of how the CEN would run once its up, Yarde explained that brokers, once they register with the other two exchanges, will be able to trade through their local exchanges onto the Caribbean exchange. This he said will open up the market to all investors across the three countries and ensure they are listed on each other's board and available for trade region wide.
While Yarde acknowledged that there is cross trading now, he said the difference with CEN would be that an investor wanting to buy in Trinidad , but who has a broker in Jamaica , would not have to go through two brokers as they do now.
"What we're trying to create is a more efficient system whereby persons would just go through their local broker to trade securities on any of the markets," said the BSE GM.
But Yarde is also excited about phase two of the process, which he revealed will get underway by the end of this year. "This would make it easier for anyone who wants to buy stocks back home," he said. "The whole idea is to make investment in equity more commonplace in the region . the size individually may not be attractive but combined it may be more attractive to people outside the region. We are doing this to make it more attractive and to take advantages of equity trading in this CSME era."
Leading up to and following the launch of phase one, Yarde said Caribbean nationals can look for announcements in the regional media and through road shows. "We have to do a lot of educating to let people know about it and what is available, and we are really looking forward to it and hope it brings more vibrancy to our markets here in the region," he added.
Amir Mireskandari, a principal at The Lugano Group investment house in New Orleans , sees the Caribbean market harmonization as a highly positive development. "By establishing a common platform for trading and settlement, Barbados , Jamaica , and Trinidad will facilitate important investment from international institutions that seek critical mass," said Mireskandari. "The Caribbean stock exchanges' harmonization is part of an on-going global trend that includes the New York Stock Exchange acquiring Paris-based Euronext, investing in India 's National Stock Exchange, and reaching an alliance this week with its Tokyo counterpart. Also, Nasdaq is waging a hostile takeover of the London Stock Exchange."
Currently, the Barbados Stock Exchange is valued at BB $20,867.34 million while Jamaica is put at J$101,393.30. Trinidad and Tobago is valued at TT $21,426,890.94.
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