Barbados stock Exchange

BARBADOS STOCK EXCHANGE

GOING GLOBAL

SUSTAINABLE BUSINESS MAGAZINE

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INTERVIEW: BARBADOS STOCK EXCHANGE

GOING GLOBAL

Sustainable Business Magazine speaks to Marlon Yarde, Managing Director at the Barbados Stock Exchange (BSE) about a global vision, advances in technology, and building a resilient investment platform.

The Barbados Stock Exchange (BSE) is the central marketplace for securities trading in Barbados, allowing Barbadians and international investors alike to participate in the trading of both local and international securities. Formerly known as the Securities Exchange of Barbados, the BSE was re-incorporated on 2 August 2001, remaining a privately owned non-profit organization until its demutualization on 22 December 2015. Sustainable Business Magazine last spoke to the BSE in 2019, when, at that time, the Exchange was seeking specific recognition from Her Majesty’s Revenue and Customs in the United Kingdom in an effort to facilitate cross-listings.

The BSE was also preparing to relaunch its 2 | SUSTAINABLE BUSINESS MAGAZINE

Junior Market for small- and medium-sized enterprises (SMEs), while investigating the burgeoning potential of innovative, new technologies like blockchain. (See Sustainable Business Magazine issue 03/19 for the full story.)

INTERNATIONAL VISION “Since we last spoke, we’ve done a lot to enhance the attractiveness of Barbados as a jurisdiction”, explains Marlon Yarde, Managing Director at the BSE. “One of the things that we’re looking to develop is our International Securities Market (ISM), taking advantage of the opportunities for international companies to raise capital and list on our exchange. We’ve sought recognition by the

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INTERVIEW: BARBADOS STOCK EXCHANGE

“WE ARE AN EXCHANGE THAT SUPPORTS GROWTH, AND WE’RE SEEKING PARTNERSHIPS AROUND THE WORLD. WE ALREADY HAVE PARTNERSHIPS WITH THE NAIROBI SECURITIES EXCHANGE AND THE GUYANA STOCK EXCHANGE, AND NOW OF COURSE WITH THE LONDON STOCK EXCHANGE”

U.K. government to become a ‘Recognized Stock Exchange’, a goal we achieved on April 2nd 2019. This designation is a boon for the BSE and means that we’ve effectively become an extension of the U.K.’s capital market. In other words, securities listed on our exchange now meet the legal definition, in the U.K., of being ‘listed’ – a distinction that would only normally apply to securities directly listed on exchanges in the U.K. It’s a status therefore that presents the BSE as an attractive international market, not only to British investors that reside in Barbados, but also to the wider public in the U.K.” These moves are part of the BSE’s broader ‘Go Global’ strategy. “We want to become a global financial center,” says Mr. Yarde. “We

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are an Exchange that supports growth, and we’re seeking partnerships around the world.

We already have partnerships with the Nairobi Securities Exchange and the Guyana Stock Exchange, and now of course with the London Stock Exchange. These developments are an integral part of the BSE’s growth into a great and lasting international institution.”

COMPETITIVE ADVANTAGE The unique nature of the Barbadian economy means the BSE is well-positioned to realize its global ambitions. “Barbados by its very nature is an attractive designation as it relates to value propositions,” explains Mr. Yarde. “Many of our services are legal and accounting firms, with the Big Four all resident here. Consequently, the costs for companies wishing to list in Barbados, to do business, and to utilize the services of our professionals, are far more competitive than other international financial jurisdictions. Compared to other stock exchanges we are cost-effective, with fees set below benchmark exchanges by around 40-50%.

It’s a critical factor in this increasingly competitive environment.”

The BSE is working hard to make the most of these advantages. “To be a marketplace that creates liquidity and offer the best price discoveries, we need to guarantee that the microstructures within the BSE are efficient and effective,” says Mr. Yarde.

“We’re fortunate to have a team of people who understand the business well and the experience that allows us to become more efficient. We’re working with a company in Estonia to update our trading platform for the trading of traditional securities. This initiative will allow people to trade directly, giving them greater access to the market and giving the exchange greater access to potential customers. Previously, you had to email your broker who would then facilitate your access to the exchange. But we want to see people able to access the market via their laptop or their mobile device.

The regulations of the Barbados market stipulate that customers will still have to go via a brokerage, but they’ll be able to do that through the portal of our design.

That product is currently in the testing phase and is due to be finished for the first quarter of 2021.”

FINANCIAL SECURITY

ListAssist Services (Barbados) Ltd., a Listing Sponsor for the International Securities Market of the Barbados Stock Exchange With experience in listing an issuer on the ISM, ListAssist provides: Advice to a potential issuer on the application process, listing requirements and obligations under the ISM rules; Wayne Fields, President DGM Financial Group Tel: 1 (246) 434 4850 dgmfinancialgroup.com Trust & Corporate Services Management services for Captive Insurance, Insurance and International Companies Family Office Management License applications for International Banks and Insurance Companies Immigration Applications Listing Sponsor, International Securities Market in Barbados

SECURITY . TRUST. DEPENDABILTY

Acting as the primary point of contact with the BSE on behalf of the potential issuer/listed entity; and Advice and assistance in connection with ongoing regulatory filings and compliance on behalf of the listed entity.

PLEASE CONTACT US FOR MORE INFORMATION AT: ListAssist Services (Barbados) Ltd: PARKER HOUSE, WILDEY BUSINESS PARK WILDEY ROAD, ST. MICHAEL, BARBADOS Email: gillian.clarke@clarkes.com.bb, debbie.fraser@clarkes.com.bb or nicola.berry@clarkes.com.bb

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INTERVIEW: BARBADOS STOCK EXCHANGE

“ULTIMATELY, WE WANT TO BECOME MARKET LEADERS, AND IN ORDER TO DO THAT WE NEED TO OPTIMIZE OUR INTERNAL PROCESSES AND ADAPT OUR CULTURE.”

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EMBRACING THE FUTURE The BSE adopts a proactive approach towards new technologies that drive growth and deliver innovation. “Blockchain is a burgeoning phenomenon worldwide, and it’s gaining traction in Barbados,” explains Mr. Yarde. “We’re partnering with Blockstation, a solution provider based in Canada, to begin issuing what we call ‘digital assets’: security tokens that utilize blockchain technology for raising capital. These tokens are much like any other security, except they’re issued, listed, settled, and traded via blockchain, and the same goes for the due diligence checks we carry out on participants in the marketplace. We’ve also developed a body of rules to facilitate the listing and trading of digital assets. By implementing this technology, it will make the BSE more dynamic and the market more robust. We’ll be able to offer even better price discoveries, because with more people accessing the market, it enhances the potential for positive returns.”

In so doing, the BSE is also responding to the needs of its clients. “Millennials and younger people are driving change,” says Mr. Yarde. “They are accustomed to technology and they are asking why we don’t provide these services already. They want to cut out the middleman and to get things done. It’s important to stress that we’re not quite at the point of venturing into cryptocurrencies, but we are monitoring that segment as a future consideration. Simply put: these technologies are becoming more widespread, so we need to position ourselves at the forefront of those changes.”

LOCAL GROWTH The BSE is also working hard to ensure that its benefits are felt locally. “We want to enhance the platform for issuers requiring capital by connecting them with savers or

investors who have the capital to invest,” explains Mr. Yarde. “We’ve rebranded and relaunched our junior market, which is now known as the Innovation & Growth Market and set up for SMEs that require proportionate and affordable access to the capital markets. We’ve partnered with the Ministry of Small Business, Entrepreneurship and Commerce to develop SMEs in Barbados.

It’s an incubator program, consisting of three stages geared towards bringing these small companies to market: education, diagnostic, and raising capital. We plan to work with lawyers and accountants in sourcing these businesses, and we plan to host educational workshops with these and all stakeholders who are interested in being publicly listed.”

“We at the BSE have a simple mantra: ‘rethink, redo, revitalize’,” says Mr. Yarde.

“That means, we look at what we’re doing, how we’re doing, and then we decide upon the way forward, doing what we have to do to make ourselves more efficient. Ultimately, we want to become market leaders, and in order to do that we need to optimize our internal processes and adapt our culture. We’re now in the process of creating a three-year strategic plan taking us into 2023, designed to help us better-engage and utilize talent and to ensure that our team understands and buys into what we’re trying to achieve. We’ll look at our people, I’ll look at myself, and we’ll make the necessary changes to help us progress to the next stage.” c

Leading Stock Exchange Listing Sponsor Committed to Service Excellence

Limegrove Lifestyle Centre, Holetown, St. James, Barbados, West Indies www.centurion-ism.com klr@centurionassurance.com +1 (246) 537 0102

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