Capital Markets
From The Report: Trinidad & Tobago 2017
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Following the 6% fall of Trinbagonian stocks in 2016, fund managers agreed that 2017 would bring further but more modest losses. Manufacturers and exporters in Trinidad and Tobago that incorporate local materials and have a strong brand could benefit from a weaker T&T dollar in 2017. With the national buy-and-hold mentality enduring, the expected listing of further tranches of First Citizens Bank and National Gas Company subsidiary NGL would bring some welcome trading activity in 2017. Nevertheless, the likelihood of continued high T&T dollar liquidity remains the central challenge to developing deeper and more liquid capital markets.

This chapter contains an interview with Subhas Ramkhelawan, Managing Director, Bourse Securities.

Articles from this Chapter

Overview

Slow and steady: Liquidity remains a challenge to developing a deeper market
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Established in October 1981, the Trinidad and Tobago Stock Exchange (TTSE) played a key role in socialising the benefits of economic growth that followed the discovery of hydrocarbons reserves in the 1960s. During the 1980s and 1990s the government encouraged local equity ownership of banks, conglomerates and manufacturing firms that profited from the oil boom, allowing Trinbagonians to share in the rewards in the form of investments, pensions and mutual funds. In the following 35 years…

Interview

Complex process: Subhas Ramkhelawan, Managing Director, Bourse Securities, on the feasibility of regional capital markets integration
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Interview: Subhas Ramkhelawan To what extent has Trinidad and Tobago achieved capital markets integration with Barbados and Jamaica after adopting the same trading platform? SUBHAS RAMKHELAWAN: The main challenge is the lack of a unified currency. For a Trinbagonian to buy securities in Jamaica they would have to change T&T dollars into US dollars and then Jamaican dollars. This has proven to be a big issue. The easiest thing to do would be to cross-list all stocks on the T&T, Jamaica and…

Analysis

Crystal clear: New legislation expected to provide a clearer picture of trends in the market
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With a small and thinly traded capital markets segment, Trinidad and Tobago has traditionally faced challenges regarding the transparency and risk analysis of its over-the-counter (OTC) fixed-income products. However, in recent years the T&T Securities and Exchange Commission (TTSEC) has introduced a number of measures designed to boost investor confidence in these products and provide clarity in the trading process. Global Standard Much of the impetus for reform stems from the TTSEC’s…

Analysis

To-do list: Cross-listed stocks are helping support the market
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The year 2016 was expected to be a challenging one for the stock market in Trinidad and Tobago, with several economic headwinds testing the confidence of investors. Against all odds, the local market demonstrated considerable resilience, with the main driver of market momentum coming from the cross-listed index. The T&T Composite Index (TTCI) advanced by 4.06%, with the All T&T Index, a sub-index of companies domiciled in T&T, declining by 5.86%. The cross-listed index, which accounts for 23% of the TTCI, posted an impressive gain of 57.89%. While 2017 has started in similar fashion, it is evident that more tests of confidence…

Analysis

On the market: Fiscal needs are spurring government bond issues
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Government bond issuance in Trinidad and Tobago was relatively quiet in 2016, with just two new issues of government debt coming to market, totalling TT$2.16bn ($322.7m). This would have come as a surprise to most market participants, particularly given the budgetary requirements to meet target spending. However, 2017 is likely to see increased issuance as maturities of central government and government guaranteed domestic debt of over TT$7bn ($1bn). All else held constant, issuance activity should increase as the fiscal gap between recurrent expenditures and revenues widens. MarketRebounds Activity on the secondary T&T dollar…

Analysis

Keeping up: Larger economic and market drivers are coming together
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Ongoing fiscal imbalances within Trinidad & Tobago’s budget have necessitated further initiatives to address a widening deficit. New fiscal measures appear to present hurdles to corporate earnings growth. In addition, economic developments are set to test consumer and investor confidence. On a positive note, however, liquidity and other demand supply factors remain promising. Slow Economic Activity By the numbers, economic activity is on a downward trend. Central Bank of T&T data highlights a decline in real T&T GDP growth of 10.8% in FY 2016, following a 1.6% drop in FY 2015. Much of this decline stemmed from the fallout…