Myanmar will launch its first stock exchange by October 2015 which will be operated by the Myanmar Economic Bank in partnership with Japan’s Tokyo Stock Exchange and Daiwa Securities Group, a minister said.
Two local public companies, Asia Green Development Bank (AGD) and Myanmar Agribusiness Public Corporation (MAPCO) have been approved for listing and another three will be chosen before the launch of bourse, Deputy Finance Minister U Maung Maung Thein said at a seminar.
“To ensure the quality and compactness of the stock exchange we have decided to go with only five companies initially although there have been many applications,” he said.
Daiwa Securities Group and the Tokyo Stock Exchange signed an agreement in May 2012 to help set up the exchange as Myanmar started to open up following decades of brutal dictatorship.
“Now Daiwa Institute of Research from Japan is helping them prepare systematically for listing after signing agreements with these companies, while a few more public companies including Myanmar Thilawa SEZ Holdings Public Ltd are expected to follow suit soon,” he added.
The Thilawa economic zone outside Yangon is still being developed. An industrial estate is expected to open in mid-2015 and the zone should eventually have a port, a power plant and waste water treatment plants.
AGD Bank opened its first branch in August 2010 in the capital Nay Pyi Taw and it now has 48 around the country, according to its website.
Ye Min Aung, managing director of MAPCO, confirmed his company’s interest in listing. “Daiwa is now helping us to be in line with the standards and practices of international public companies,” he said.
The new stock exchange will be located in a former central bank building on the corner of Merchant Street and Sule Pagoda Road in the centre of Yangon.
Myanmar already has an over-the-counter bourse, the Myanmar Securities Exchange Center (MSEC), but it has only two listed firms.
The three components for the emergence of a capital market – formation of a securities and exchange commission, launch of Myanmar’s first stock exchange and preparation by companies to be listed – are taking place simultaneously, the minister said.
Myanmar enacted the Securities and Exchange Law in July 2013 to pave the way for the launch of the exchange.
The Directorate of Investment and Companies Administration (DICA) has also been trying to encourage the public to invest in the public companies.
Public company applicants were told to have at least seven initial holders, to sell unlimited shares to the public, to be an economically sustainable business, to employ skilled labour and to submit the name list to the institutions concerned.
Applicants are also notified to advertise in dailies and other media their start-up capital, business priorities, share portfolio, membership in the first board of directors and qualifications, share transfer and dealing, profit sharing, audit and electing board of directors.