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Dar Exchange debt market turnover jumps to hefty 2tri/-

THE Dar es Salaam Stock Exchange (DSE) debt market registered the historical total turnover that crossed one trillion shillings last year.

The total bond turnover increased by almost 94.49 per cent to 2.12tri/- last year compared to 1.09tri/- in 2019. The debt analysts believed that the surge was the combination of both limited investment avenues and raising awareness.

“I believe,” Orbit Securities Head of Research and Analytics, Imani Muhingo said, “it’s a combination of both, tightened investment avenues and increased awareness”.

He added: “While, the former [limited avenues] has some influence on the latter”.

The last year total turnover was almost two-third of the total turnovers in the last five years.

The amount for the past five years 2015 to 2019 was 3.5tri/-, and was on the increasing-mode where in 2015 was 306bn/-, 2016 was 429bn/-, then 2017 was 684bn/- before it climbed to 992bn/- in 2018 and reached 1.091tri/- in 2019.

Mr Muhingo said another reason for the turnover to climb on the secondary market was also attributed to heavy regulations on forex trading which turned treasurers of financial institutions to fixed income securities.

“Yes, there are some retailers who were stranded with cash because they could not import goods mostly from China around January last year, and many opted to pack cash in treasuries,” Mr Muhingo said.

Tanzania Securities Analyst, Ombeni Uhuru said the last year was full of market uncertainty due to the coronavirus pandemic which saw most investors shifting their attention to risk free instrument—bonds.

There has been a shift of investors to risk-free assets as the stocks and other instruments perceived to be more risk...,” Mr Uhuru told ‘Daily News’.

DSE quarter four 2020 Chief Executive Officer Note said the total outstanding listed Treasury bonds increased by 3.5 per cent from 12.243tri/- at the end of last September to 12.666tri/- at the end of last December.

This was, according to DSE, a net increase, new listings less redemptions, of 423bn/-.

On the other hand, outstanding corporate bonds listed at the exchange decreased from 143.4bn/- for the three outstanding corporate bonds issued by EXIM Bank, NMB Bank and TMRC to 120.1bn/- at the end of last December.

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