HARARE – The Victoria Falls Stock Exchange Limited, a subsidiary of the Zimbabwe Stock Exchange, has signed a Memorandum of Understanding with the Reserve Bank of Zimbabwe, which provides terms for settlement services for trades once the exchange is operational.
Initially, there were plans to have an external back office for ease of settlement and confidence but challenges in securing international partners will see RBZ become the settlement bank.
The completion of the modalities on the clearing and settlement of transactions with RBZ is one of the final steps towards the launch of VFEX. The launch is targeted for the end of the month. Offices have been secured and are currently being equipped.
“Details of the Administration of FCA accounts eligible to participate on VFEX will soon be published by e RBZ, ahead of the official launch,” said chief executive Justin Bgoni.
Unlike the ZSE, the new exchange will run its own depository system in line with trends elsewhere in the world.
Finance Minister Mthuli Ncube said that VFEX will be an ideal platform for mining companies to raise funds adding that he had met with a foreign resource company, which was keen to list on the exchange. Several mining companies including Prospect, Caledonia Mining and Invictus have expressed interest in investing on the exchange, which will commence operations with the listing of the three suspended ZSE counters: Old Mutual, PPC and Seed Co International.
Ncube said that the exchange would have to market its incentives, which included exceptions from capital gains and withholding tax. Ncube also added that local pension funds would be allowed to invest 15% of their funds on the exchange in line with the statutory instrument that allows them to invest that percentage offshore.-Financial Express.