Zim set to amend Securities Act: Biti
Written by Taurai Mangudhla, Business Writer
Thursday, 12 July 2012 17:13
HARARE – Finance minister Tendai Biti yesterday said government will this
week gazette major amendments to the Securities Act aimed at improving the
country’s capital markets regulatory and supervisory functions.
Speaking at TN Bank’s listing ceremony on the Zimbabwe Stock Exchange (ZSE),
Biti said the move would also end current irregularities at the bourse, that
have seen chief executive Emanuel Munyukwi being suspended.
“We have had a major challenge with the ZSE, its management and the
committee that has been running it. We feel for lack of a better word it’s a
mafia corporation,” he said, adding
“Cabinet has approved major amendments to the Securities Act which I think
will be gazetted tomorrow.”
The amendment, Biti said, will force the demutualisation of any capital
market in Zimbabwe to ensure accountability.
He said the changes will allow existing markets to be accountable to a
board and some known shareholders.
“We feel that we have tried to protect these institutions without
democratising and modernising them,” Biti added.
The minister said currently, the status quo of the ZSE was that nobody
really knows who owns it and as a result the stock brokers, who are the
players, assume a self-regulatory role with disclosure being put to
question.
He said the new regulations will also set up the Central Securties
Depository (CSD) — an electronic securities settlement system in order to
make sure the ZSE complies with international best practices.
“The second thing is a CSD, a lot of things are happening, you buy a share
the next thing is a stock broker tells you don’t remember.
“Part of the reason why foreign investment has shrunk to this market
compared to say 2000 when we were the second- biggest bourse on the African
continent are issues associated with CSD and the absence of modernisation of
this market.”
Commending Lifestyle Holdings Limited (formerly TN Holdings Limited) founder
and group chief executive Tawanda Nyambirai’s success in business, Biti said
the de-merger was an ideal indigenisation model where local blacks build
assets from their capital and creativity.
“The role of the state is not to facilitate the grabbing of some people’s
assets because they are white.”
He said the ideal role of indigenisation is to create an enabling
environment such that talent and entrepreneurship irrespective of race can
flourish.
Biti welcomed Nyambirai’s initiative at a time other badly run local banks
have failed.
“In recent times we have seen in our banking system a small click of
predatory bankers. A small clique of mafia bankers. I saw an article that
said it’s almost like common practice that if you want to rob the public,
start a bank and that is totally unacceptable,” the minister said.
“To the extent that TN Bank has remained professional, professionally well
done and that Nyambirai has refused to be seduced away from the path of
virtue into the path of wilderness where people hit their chests and say I
own a bank, but you don’t own a bank you are just stealing people’s money.”