Would the UMOA-Titres agency overshadow the bond compartment of the BRVM?

Observers note a rise in strength of the agency UMOA-Securities at the expense of the bond compartment of the Regional Stock Exchange (BRVM) that has not experienced the boom expected corporate. Emissions from the Sifca agribusiness, the CRRH mortgage refinancing fund, Cofina mesofinance and, recently, the Senegalese electricity supplier Sénelec are slow to emulate.

As for the States, they prefer to fall back on the market by auctioning at low rates with short maturities. A market that has the merit of being more competitive in terms of costs and procedures. The objective of the director general of UMOA-Titles, Adrien Diouf, to go on the long maturities would not he siphon completely the bond market?

Initially, we had all felt that the money market would never rub the bond because it is not the same scope. If the corporate compartment of the BRVM is not lively, the reasons are to be found elsewhere, says the trader, estimating that issuance of public securities on the stock market have never been so high. “The activism of the agency UMOA-Securities does not explain the low attendance in the bond compartment of the Exchange”.

The structural costs of issues, transactions and securities holdings are pushing the players to turn away from a market that should urgently change, explains the other senior executive of the Ivorian Treasury. For sure, the SGI supposedly animate the market today make their butter much more on investment than on intermediation. Consequence, which was an absurdity (because in an organized market, there is no competition between the market of Treasury bills and the bond) is needed as a market of the UEMOA.

According to the 2019 issuance schedule of the states (see table below), out of the 3,233 billion CFA francs to be set in 2019, only 59 billion, ie 18%, will pass through the BRVM bond market. Most of the amount, or 2643 billion CFA francs (82%), is programmed through the UMOA-Titres agency channel.

Things are going to increase because recently the BCEAO, under the impetus of the UMOA-Titres agency, has made a great flower to the SGI by allowing them to directly access the market of public securities issued by auction and their conservation. That is, brokers can now go to auctions without going through banks. Another thorn in the foot of the WAEMU Council of Ministers: should not we entrust the exclusivity of issuing public securities to UMOA-Securities and dedicate the development of the corporate market to the BRVM?

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WAEMU: forecast state borrowing in 2019. (CFA Francs)