Although the Bourse Regionale des Valeurs Mobilieres may only boast a limited number of quoted companies at present, it is fully up to date with the latest technology and legislation, which is likely to attract growing interest going forward. Writer Nick Kochan

"We are a unique institution. There is no model for us. We have had to create the model." That was the proud claim of Jean-Paul Gillet, the chief executive of the Bourse Regionale des Valeurs Mobilieres (BRVM), Côte d'Ivoire's stock exchange. He was referring to the way the exchange operates region-wide, through its Abidjan hub. Companies are able to list and trade in Abidjan, wherever they are based in the West African Economic and Monetary Union region. Indeed, each of the region's eight countries has an ownership stake in the BVRM of some 13.4%.

The recent birth of the exchange (in 1998), means that it has been able to acquire both new technology and the latest rules of trading. For example, trading on the BVRM is computerised with satellite links, which allow brokers to transmit orders from any of the member countries to the central site in Abidjan, to check and interact with the order book and to see information about the market and the central depository.

Mr Gillet says: "Our rules are more modern than many other stock exchanges. Why? Because we began with very new rules, and with new technology." The exchange operates on a T+3 trading basis. Mr Gillet is also chief executive of the exchange's clearing and settlement company, which is based in the same building.

The majority of the shares listed on the exchange, despite its regional coverage, are in fact from Côte d'Ivoire and they come from a diverse range of industries, including agriculture, banking and telecommunications. A total of 38 companies are listed on the exchange and the daily turnover is about CFA Fr1bn ($2m). The exchange has a capitalisation of CFA Fr3000. The larger brokers on the exchange are investment banking firm Hudson, and local subsidiaries of French banks BNP Paribas and Société Générale.

Obstacles to growth

Mr Gillet says the lack of quoted companies, rather than the lack of available capital, impedes expansion: "Our problem is that we need more listed companies. Investors are not an issue. We have investors, but we don't have stocks to offer and that's a political problem. We need to change the mentality of our entrepreneurs and managers and persuade them to open their firm to the market. It is not easy."

This view is shared by Jean-Luc Bedie, the managing director of Hudson, a broker on the exchange. "Our problem is liquidity," he says, adding that companies need to be encouraged to list by the passing of a corporate governance law, that would give an incentive to their listing. "We need to give companies some incentive. Let's create a corporate governance law that would say, for example, that most of the main, or the blue-chip companies should be listed. That would lead to developments in the marketplace," he adds. Mr Bedie believes the arrival on the exchange of the region's larger telecommunications companies will be a key development.

Profits to reap

Companies on the exchange may be few and far between, but they pay a good yield, says Mr Bedie. "The average dividend yield a year is 8%, so it is quite attractive. So if you don't get the growth, you get the dividends." He says his clients are predominantly investors from the Middle East and Europe, who compose some 15% of the total of investors, but more active investors than locals. In addition to stocks, a number of Côte d'Ivoire government bonds are listed on the exchange and Mr Gillet says this has been a powerful engine for the exchange's development.

The absence of sizeable pension funds in the region also inhibits the expansion of the exchange, says Mr Gillet. He says local governments have not yet provided the statutory framework to create a pensions law.

PLEASE ENTER YOUR DETAILS TO WATCH THIS VIDEO

All fields are mandatory

The Banker is a service from the Financial Times. The Financial Times Ltd takes your privacy seriously.

Choose how you want us to contact you.

Invites and Offers from The Banker

Receive exclusive personalised event invitations, carefully curated offers and promotions from The Banker



For more information about how we use your data, please refer to our privacy and cookie policies.

Terms and conditions

Join our community

The Banker on Twitter