Saturday, April 30, 2011
Trade Bank of Iraq arranges visits for the Iraq Securities Commission & the Iraq Stock Exchange to the Financial Services Authority and the London Stock Exchange in London
Baghdad, Iraq, May 15, 2011: The Chairman of the Iraq Securities Commission and the
CEO of the Iraq Stock Exchange meet officials from the London Stock Exchange and
Financial Services Authority in London, hosted by the Trade Bank of Iraq
In its efforts to help the Securities markets in Iraq, The Trade Bank of Iraq (wholly owned by
the Ministry of Finance) arranged for Dr. Abdlrazak Al Saadi, Chairman of the Iraq Securities
Commission (ISC), and Mr. Taha Abdulsalam, CEO of the Iraq Stock Exchange (ISX), to
meet officials from the London Stock Exchange (LSE) and the Financial Services Authority
(FSA) on the 9th to 11th May, 2011. In a series of meetings, the honored guests from the ISC
and ISX were taken to the offices of the LSE in St. Paul's and the FSA in Canary Wharf to be
introduced to senior officials from these globally recognized and highly respected institutions.
The discussions at the LSE, between Dr. Abdlrazak Al Saadi and Mr. Taha Abdulsalam were
centered on how the ISX could further enhance its regulatory and market infrastructure
practices as well as how to benefit from possible collaboration on training. The LSE senior
officials cited examples of how the LSE has historically collaborated with emerging market
stock exchanges such as those of the Egyptian Stock Exchange and more recently, the
Mongolian Stock Exchange. They also discussed the potential benefits of the LSE Academy
to the ISX, which provides training services to developing stock exchanges globally. The LSE
officials also explained the benefits to local Iraqi companies by having a double listing on the
ISX and the LSE through Global Depository Receipts (GDRs) in terms of increased global
exposure, liquidity, and trading volume. Finally, the LSE senior officials explained their
technological offering including their cutting edge market surveillance software developed by
Millenium IT, which is part of the LSE Group.
Dr. Abdlrazak Al Saadi and Mr. Taha Abdulsalam were also invited to meet officials at the
FSA in Canary Wharf. This meeting gave the delegation the opportunity to enquire about the
UK regulatory framework regarding monitoring the stock exchanges and their participants,
and how regulations were enforced.
Mr. Hussein Al-Uzri, President and Chairman of the Board of TBI, was delighted by the
success of the meetings in London and the potential positive impact they may have in the
future development of the Iraqi Capital Markets. He said, "We hope that the successful
meetings in London between the ISC and ISX and the LSE and FSA will bring a positive
impact on the development of the ISX and investment in Iraq, through the development of
long-term relationships between both parties."
The ISX was established in 2004, under the oversight of the ISC. The ISX is self-regulated,
owned by its member brokers and is independent of the government. At launch, there were
only 15 listed companies but presently there are 85 with a combined capitalisation of $3.6bn.
The ISX has 45 licensed brokers and banks represent the largest sector on the ISX, with
73% of total capitalisation, followed by the Industry and Hotels sectors at 12% and 11%,
respectively. The Year-to-Date performance of the ISX in 2011 has been impressive with a
27% increase in the ISX Index. However, average monthly trading volumes in 2011 are still
only $43m and average monthly foreigner participation is only 21% of this. The ISX has still a
long way to go in its development with the total capitalisation of the ISX presently
representing only 4% of Iraq's 2010 GDP compared to other MENA stock markets that
average 50%. Recently though, a new Iraq Securities Law amendment is due be approved
and passed, which
will hopefully improve the market rules and regulations and facilitate future
growth of the ISX.
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