Saturday, August 19, 2017

List of 10 YSX underwriters revealed

Ten securities companies, named below, intend to operate as underwriters for the new Yangon Stock Exchange which is due to open on December 9, The Myanmar Times has learned.

Myanmar Securities Exchange Centre, the over-the-counter predecessor to the Yangon Stock Exchange, has two listed companies. Photo: StaffMyanmar Securities Exchange Centre, the over-the-counter predecessor to the Yangon Stock Exchange, has two listed companies. Photo: Staff

The exchange has not yet made an official announcement, but corporate sources and all but one of the companies involved have confirmed that provisional licences, dependent on registering a subsidiary with the Directorate of Investment and Company Administration and putting up K15 billion (US$11.5 million) in initial capital, will be granted to the following:

1. AYA Bank’s wholly owned subsidiary, AYA Trust Securities Company
2. Co-operative Bank’s wholly owned subsidiary CB Bank Securities
3. Daiwa Securities and state-owned Myanma Economic Bank’s joint venture subsidiary, Myanmar Securities Exchange Centre
4. Global World Securities, an Asia World affiliated company
5. Green Circle Company, known in Myanmar for its Ve Ve drinks brand, in a joint venture with Hong Kong-based Pins Capital, called Expert Investment Securities
6. Innwa Bank linked Aung Myint Mo Min Securities
7. KBZ Group and Singaporean firm Stirling Coleman Capital’s joint venture company KBZ Stirling Coleman Securities
8. Loi Hein Company and Thai firm KT ZMICO’s joint venture subsidiary KTZ Ruby Hill Securities
9. United Amara Bank’s wholly owned subsidiary Amara Securities
10. Young Investment Group’s wholly owned subsidiary, Union Trust Securities Company

Of these companies, only three – AYA Trust, KBZ Stirling Coleman and Union Trust – have so far registered with DICA, according to the regulator’s website.

Chair of the Securities and Exchange Commission of Myanmar U Maung Maung Thein has repeatedly declined requests to confirm the names of companies, and was unavailable for comment yesterday.

All the underwriters will be in Yangon next week for the launch of the exchange, when an announcement is expected to be made about the 10 underwriters, as well as brokers, dealers and advisors who will also play an important role.

Much remains to be done for companies involved, including installing the necessary IT systems, paying the required up-front capital, hiring and training staff and opening offices.

Director U Thet Tun Oo from the Myanmar Securities Exchange Centre said earlier this week that the first initial public offerings, or IPOs, will not be launched until the underwriters have been granted their licences, adding that this process has not yet started.

The exchange is 49 percent owned by two Japanese companies – Japan Exchange Group, the operator of Tokyo Stock Exchange and Daiwa Securities Group, which signed an agreement with majority owner state-owned Myanma Economic Bank (MEB) on December 23 last year.

Due to its ownership, the exchange risks opening under US sanctions, as previously reported by The Myanmar Times.

While the Yangon Stock Exchange itself is not designated specifically by the US Treasury department’s Office of Foreign Assets Control (OFAC), US officials have said that under US law it would be automatically sanctioned, as it is 51 percent owned by MEB, a state entity under US sanctions.

U Maung Maung Thein told state media on November 30 that around five companies would be ready to list when the exchange opens.

No names have yet been announced publically, though the MSEC chair told Eleven Myanmar that First Myanmar Investment, Myanmar Citizens Bank and Myanmar Thilawa SEZ Holdings would attempt an initial public offering.

Other companies to publicly state their intention to list include Asia Green Development Bank and Myanmar Agribusiness Public Company (MAPCO).

Listing criteria for companies were published on August 23. Firms must meet these standards to attempt an IPO.