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23 mars 2017

Primary Dealer Operational Framework

AfrAsia Bank hosted a presentation evening for its investors and clients, on Wednesday 22 March 2017, to announce its accreditation by the Bank of Mauritius as a Primary Dealer as well as present the new opportunities to investors.

The Bank stands now among the 4 banks holding such license under the Primary Dealer Operational Framework which aims to explore and develop a competitive, liquid and sophisticated local financial market in the trading of Government Securities in Mauritius.

An opportunity pool which was yet untapped into, the prevalent excess liquidity on the local market encourages the development of this secondary market whilst increasing the competitiveness of market rates. A properly established structure will also encourage investors to use Government Securities as an alternative investment solution and simultaneously promoting the culture of “Held for Trading” amongst investors.

Parikshat Tulsidas, Senior Executive of Treasury & Markets at AfrAsia Bank stated: “This is an exciting new chapter that we entering in the Mauritian Financial Sector. As a Primary Dealer, it is our duty to develop the trading of Government T-bills and Bonds which reflects well on the level of sophistication that we desire in our local financial markets, which, in turn, will encourage foreign investors to tap into. We will also ensure that we spend a lot of time brainstorming ideas with market players because our role does not stop at merely buying and selling Government securities; our aim is to act as a responsible primary dealer to ensure that investors at large get the best buck for their money in terms of competitive yields and appropriate investment duration.”

According to Jen Ramanah, Head of Treasury at AfrAsia Bank, a concerted effort from all industry players will be key to develop this market and render Government Securities more accessible to all: “The Primary Dealing system in Mauritius has been in an incubation period for quite a long time. I am convinced that this new framework is going to be a good thing for the financial markets and we hope to see the bond markets in this country reaching the next level of sophistication very soon. AfrAsia Bank is strongly committed to that and we are sure that all the other stakeholders (Primary Dealers, Bank of Mauritius, Ministry of Finance & Economic Development) will stay committed to their respective roles also to ensure success.”

The development of the secondary market will lead to the advent of new structured and innovative treasury products. Jean-Francois Ulcoq, Head of Fixed Income and Liquidity Management at AfrAsia Bank highlights: "The Bank of Mauritius has given the local market the possibility of reaching an new era, and it is our responsibility to support all participants during this transition phase. To secure the best deals for our investors, AfrAsia Bank will participate actively at Government securities’ auctions whilst actively contributing to the creation of a dynamic secondary market which will allow the client to take profit on their current portfolio and re-enter into new positions."