The Ghana Stock Exchange (GSE) has launched its Over-the-Counter (OTC) market, aiming to provide a trading platform for over 100 non-listed public companies.
This new market will enable these companies to trade their securities in a less formalized environment compared to the main exchange, with less stringent reporting requirements.
The introduction of the OTC market is expected to become a significant investment avenue, potentially growing into a market worth billions of cedis. It will facilitate the trading of ordinary shares, preference shares, and derivatives.
The global OTC market was valued at $715 trillion as of June 2023, with daily trading volumes in the global forex OTC market alone reaching $6 trillion.
At the launch event, Abena Amoah, Managing Director of the GSE, emphasized that the OTC market aligns with the goals of the 10-year Capital Market Master Plan (CMMP).
The plan aims to create a deep, efficient, diversified, and well-regulated market with a full range of products that are attractive to both domestic and international investors.
She also noted that the OTC market is a crucial step in the GSE’s transition from a frontier market to an emerging market.
“The launch of the OTC market is a significant step forward for Ghana’s capital market. It provides a structured platform for companies to trade their securities, ensuring transparency, efficiency, liquidity, and ease of trading for unlisted companies and their investors,” said Ms. Amoah. She highlighted the market’s potential to drive economic growth and reiterated the GSE’s commitment to offering innovative investment products to support Ghana’s economic development.
Alex Kwasi Ewuah, Managing Director of ARB Apex Bank, also spoke at the event, encouraging Rural and Community Banks (RCBs) to participate in the OTC market to raise capital for growth. He noted that this new platform will not only provide liquidity for RCBs but also promote corporate governance, thereby strengthening Ghana’s financial sector.
“RCBs have limited sources of raising capital, often relying on shareholders and community participation. With this market, RCBs have an additional avenue to raise capital. We look forward to seeing the positive impact the OTC market will have on our member banks and their financial performance,” he stated.
The launch of the OTC market marks a significant milestone in the GSE’s efforts to expand trading and investment opportunities in Ghana. It underscores the GSE’s commitment to fostering a more inclusive and transparent trading environment, catering to public companies that choose not to list on the main exchange but still require a structured platform for their securities. This initiative is expected to enhance the liquidity and visibility of public companies, contributing to the overall growth and stability of Ghana’s financial markets.
The GSE’s proactive approach in launching the OTC market demonstrates its dedication to adapting to the evolving needs of the market and investors, ensuring the continued development and dynamism of Ghana’s capital market.
