There is not much new initiatives to be undertaken on financial sector reforms in Fiji as announced in the 2009 National Budget that was delivered on Friday, 21 November 2008, by the Interim Prime Minister and Minister for Finance.
Much of the initiatives mentioned are those that the financial sector authorities have been saying that they were working on for a number of years past.
Of interest though is what is being said with regard to the deregulation of the superannuation industry. There is some mention for a detailed study to be done "on advancing the deregulation of this industry".
Will the deregulation of the industry attract new players, given that one of the primary concerns with regard to the industry is that their potential investments are mostly restricted to assets and projects in Fiji? Will the Fiji National Provident Fund still be "encouraged" to invest its the funds in government securities and to fund Government's borrowing needs, even if there are new competitors?
Also of interest is the work to be done on Micro, Small and Medium Enterprise Development. The Budget mentions that the Reserve Bank of Fiji is working with stakeholders on how Micro, Small and Medium Enterprises can be developed further in Fiji and what role the Reserve Bank of Fiji should play.
In summary, much more effort needs to be put in by the authorities to advance thinking and development of our financial sector. There needs to be critical thinking from our regulators and the players in the financial sector on how we can keep our financial sector vibrant and attractive to potential investors.
There will be a huge challenge to balance that and what happens on the political front, however, this does not stop everyone doing some critical thinking.
Is this a time to go into offshore banking? One where we can still provide services to foreign investors and offer rates and features that are not linked to how the domestic economy works. Funds obtained from foreign investors are not invested in Fiji but overseas so they are safe from domestic hiccups.
What services can our financial regulatory authorities provide in the region to regulators of other small island countries? Are we still able to maintain our competitive advantages in this area compared to our upcoming competitors, Samoa and Papua New Guinea.
How can we encourage more locally owned financial institutions to establish themselves in Fiji and then to branch out into the Pacific after having operated successfully over a number of years? This will serve as a way to hedge country risks of financial institutions incorporated in Fiji.
With regard to Micro, Small and Medium Enterprises, is the Reserve Bank considering a new facility to provide a volume of funds and/or concessionary rates for lending to Micro, Small and Medium Enterprises? Is it considering providing scholarships or paying for training on basic business operations and management for the large number of Fiji's population as an incentive to encourage people to set up their own businesses in light of potential downsizing of companies and organisations as a result of the global/local crisis in the business sector?
Again, as I had already mentioned above, more critical thinking needs to be done by the financial sector and regulatory authorities to advance Fiji's financial sector rather than give us the usual "this and that" that we have been hearing for a number of years now.
Individuals and groups that need investment advice, or advice with regard to capital markets issues, can use our company, Gilbert & Samuels Company Limited. We also do strategic planning, business continuity planning and capacity assessment consultancies. Our contacts are: telephones (679) 3342719, (679) 3544897 or e-mail: info@gilbert.com.fj.
Showing posts with label Capital Markets Development Authority. Show all posts
Showing posts with label Capital Markets Development Authority. Show all posts
Tuesday, November 25, 2008
Wednesday, November 7, 2007
New Financial Services Commission to be set up
The Interim Cabinet has approved the establishment of a new Financial Services Commission.
The Commission will regulate the level of fees and charges imposed by financial institutions in Fiji.
The idea of a Financial Services Commission arose out of the 1998 Financial System Inquiry after considering complaints by customers on the 'exorbitant' fees, charges and interest rates levied by financial institutions in Fiji.
The Interim Minister for Finance has said that there is a lack of competition in the financial sector in Fiji which has resulted in high bank profits, high user charges, excessive margins and poor services standards.
The Commission is to work together with other financial services regulators in Fiji which include the Reserve Bank of Fiji, the Financial Intelligence Unit and the Capital Markets Development Authority.
Yesterday, bankers have said that there was no need for another regulator as they felt that the Reserve Bank of Fiji is adequately supervising the area of bank fees and charges.
Perhaps a comprehensive customer survey of banking and other financial services customers would best reveal the demand for a financial services commission.
The Commission will regulate the level of fees and charges imposed by financial institutions in Fiji.
The idea of a Financial Services Commission arose out of the 1998 Financial System Inquiry after considering complaints by customers on the 'exorbitant' fees, charges and interest rates levied by financial institutions in Fiji.
The Interim Minister for Finance has said that there is a lack of competition in the financial sector in Fiji which has resulted in high bank profits, high user charges, excessive margins and poor services standards.
The Commission is to work together with other financial services regulators in Fiji which include the Reserve Bank of Fiji, the Financial Intelligence Unit and the Capital Markets Development Authority.
Yesterday, bankers have said that there was no need for another regulator as they felt that the Reserve Bank of Fiji is adequately supervising the area of bank fees and charges.
Perhaps a comprehensive customer survey of banking and other financial services customers would best reveal the demand for a financial services commission.
Wednesday, October 3, 2007
Another project : Preparing a new Prospectus for Unit Trust of Fiji
We are currently working on another project; preparing a new Prospectus for the Unit Trust of Fiji. The current prospectus expires on 7 November 2007 and a new prospectus is being prepared that will apply for 3 years from 8 November 2007.
The major part of this work is to ensure that the new Prospectus complies with all capital markets, unit trust, trustee laws, regulations and rules as well as the Unit Trust of Fiji's Trust Deed.
The prospectus is a primary document referred to by potential investors when considering investing in a particular instrument.
Entities that source investments in Fiji's capital markets are required to prepare prospectuses which are to be approved by the Capital Markets Development Authority.
For any assistance on a similar project or any other work involving banking, financial sector, capital markets and unit trusts, please contact us via e-mail to gilbert@connect.com.fj or call telephones (679) 3396427 or (679) 9921427.
The major part of this work is to ensure that the new Prospectus complies with all capital markets, unit trust, trustee laws, regulations and rules as well as the Unit Trust of Fiji's Trust Deed.
The prospectus is a primary document referred to by potential investors when considering investing in a particular instrument.
Entities that source investments in Fiji's capital markets are required to prepare prospectuses which are to be approved by the Capital Markets Development Authority.
For any assistance on a similar project or any other work involving banking, financial sector, capital markets and unit trusts, please contact us via e-mail to gilbert@connect.com.fj or call telephones (679) 3396427 or (679) 9921427.
Wednesday, September 12, 2007
Corporate Governance in Fiji's Capital Markets Industry
We have just completed assisting some New Zealand consultants working on developing Corporate Governance Principles for the capital markets industry in Fiji.
In the first leg of the consultancy that has just been completed, we conducted interviews with players in the capital markets industry to get an appreciation of the state of corporate governance in the various entities.
A report on this leg of the consultancy has been prepared and submitted to the Capital Markets Development Authority which provided some recommendations on potential areas that can be covered in the Principles to be drawn up for the industry.
A follow up Conference at the end of September 2007 will be focused towards identifying and putting together appropriate Principles for the industry.
For this assignment, we provided the local expertise on technical capital markets issues to the lead New Zealand consultants who had more specific experience in corporate governance.
Please read my profile on the right hand side of this webpage for information on some of our other clients.
For potential consulting work, pls contact us on telephones (679) 3396427 or (679) 9921427 or e-mail gilbertv2@connect.com.fj.
In the first leg of the consultancy that has just been completed, we conducted interviews with players in the capital markets industry to get an appreciation of the state of corporate governance in the various entities.
A report on this leg of the consultancy has been prepared and submitted to the Capital Markets Development Authority which provided some recommendations on potential areas that can be covered in the Principles to be drawn up for the industry.
A follow up Conference at the end of September 2007 will be focused towards identifying and putting together appropriate Principles for the industry.
For this assignment, we provided the local expertise on technical capital markets issues to the lead New Zealand consultants who had more specific experience in corporate governance.
Please read my profile on the right hand side of this webpage for information on some of our other clients.
For potential consulting work, pls contact us on telephones (679) 3396427 or (679) 9921427 or e-mail gilbertv2@connect.com.fj.
Sunday, July 15, 2007
Capital Markets Development Authority CEO emphasises Corporate Governance
The new Chief Executive Officer of the Capital Markets Development Authority, Mrs Mereia Volavola, has emphasised that good corporate governance is essential to improve accountability for companies operating in the capital markets.
Read more on her comments in an article from the Fiji Times below.
"Good governance key, Monday, July 16, 2007
Good corporate governance is essential to help companies and financial intermediaries improve accountability, says the new chief executive officer of the Capital Markets Development Authority, Mereia Volavola.
Speaking at her welcoming ceremony on Friday, she said financial intermediaries were essential in fostering financial stability and healthy economic growth.
Good corporate governance enabled more efficient use of capital and attracts quality and long-term investors at lower costs.
In the long run, the country's competitiveness and development will improve if good corporate governance is exercised.
Good governance is one area the CMDAwill focus on in the years ahead, Ms Volavola said.
She said many companies in Fiji were yet to fully appreciate how the stock and bond market works and how companies can benefit from it through enhanced company value and flexibility.
There are 16 companies listed on the Suva-based South Pacific Stock Exchange compared to six in 2000.
Market capitalisation, said Ms Volavola, rose from $243million in 2000 to $897million this year, representing a 269 per cent increase.
The CMDA she said, would continue its education program on the significance of the stock exchange.
"More companies need to be listed on the South Pacific Stock Exchange. Some large companies the insurance companies, the commercial banks and tourism companies remain unlisted," Ms Volavola said.
"Experience to date shows that most companies continue to satisfy their capital needs predominantly by using retained earning, bank-funded debt or through private equity deals with associates and friends."
With the review of the CMDA legislation, Ms Volavola said there was a need for a balance between a regulatory framework that guides peoples actions and economic freedom that allows them to innovate, experiment and take risk.
"One of the most important factors in determining how much material progress a society made was its ability to maintain a vigorous capital market," she said.
"Creating prosperity had largely been a matter of bringing together people who are prepared to invest capital with people who are able to use it to create wealth.""
Read more on her comments in an article from the Fiji Times below.
"Good governance key, Monday, July 16, 2007
Good corporate governance is essential to help companies and financial intermediaries improve accountability, says the new chief executive officer of the Capital Markets Development Authority, Mereia Volavola.
Speaking at her welcoming ceremony on Friday, she said financial intermediaries were essential in fostering financial stability and healthy economic growth.
Good corporate governance enabled more efficient use of capital and attracts quality and long-term investors at lower costs.
In the long run, the country's competitiveness and development will improve if good corporate governance is exercised.
Good governance is one area the CMDAwill focus on in the years ahead, Ms Volavola said.
She said many companies in Fiji were yet to fully appreciate how the stock and bond market works and how companies can benefit from it through enhanced company value and flexibility.
There are 16 companies listed on the Suva-based South Pacific Stock Exchange compared to six in 2000.
Market capitalisation, said Ms Volavola, rose from $243million in 2000 to $897million this year, representing a 269 per cent increase.
The CMDA she said, would continue its education program on the significance of the stock exchange.
"More companies need to be listed on the South Pacific Stock Exchange. Some large companies the insurance companies, the commercial banks and tourism companies remain unlisted," Ms Volavola said.
"Experience to date shows that most companies continue to satisfy their capital needs predominantly by using retained earning, bank-funded debt or through private equity deals with associates and friends."
With the review of the CMDA legislation, Ms Volavola said there was a need for a balance between a regulatory framework that guides peoples actions and economic freedom that allows them to innovate, experiment and take risk.
"One of the most important factors in determining how much material progress a society made was its ability to maintain a vigorous capital market," she said.
"Creating prosperity had largely been a matter of bringing together people who are prepared to invest capital with people who are able to use it to create wealth.""
Sunday, July 1, 2007
Mereia Volavola takes over at CMDA
Mrs Mereia Volavola takes over as Chief Executive Officer at the Capital Markets Development Authority from today, Monday 2 July 2007. Mrs Volavola previously worked at the Reserve Bank of Fiji, Home Finance Company Limited and Housing Authority. She has over 16 years of experience in the financial sector in Fiji. Mrs Volavola has a Bachelor of Arts degree in Management and Economics from the University of the South Pacific and a Master of Business Administration with Honours in Banking & Finance from the University of Bangor, Wales, United Kingdom. Mrs Volavola's husband is currently Deputy Chief Executive Officer at the Fiji Islands Trade and Investment Bureau (FTIB). We wish Mrs Volavola well in her new career.
More Fijians investing in the stock market
The Capital Markets Development Authority (CMDA) says that more indigenous Fijians are investing in the unit trust and stock markets compared to other ethnic groups.
CMDA said that about 64% of investors in the unit trust market are indigenous Fijians while other residents comprised 36%.
The analysis done by CMDA is interesting is that it may mean the following :
"More Fijians invest in stock market, Saturday, June 30, 2007
More indigenous Fijians are investing in the unit trust and stock market compared to other ethnic groups, says the Capital Markets Development Authority chief executive Suren Kumar.
Mr Kumar said market statistics showed that about 64 per cent of the investors in the unit trust market are indigenous Fijians, while other Fijian citizens and residents comprised 36 per cent.
Mr Kumar said the new trend for Fijians towards investing was heartening and should be supported. "Apart from individuals, a substantial number of provincial and tikina-owned companies, vanua and communal groups also invest in the unit trust and stock market," he said.
Mr Kumar said this as the CMDA launched the Fijian version of "Investing for retirement" (Na vakatubu i lavo me baleta na tiko marau ena gauna ni vakacegu mai na cakacaka) and another booklet, Why should you invest (Na cava na vuna mo vakatubu I lavo kina) this week.
He said financial literacy was fundamental to market development.
This corresponds with the Bureau of Statistics 2002-2003 Household and Income Expenditure Survey which indicates that in aggregate, indigenous Fijian households are saving some 18 per cent of their incomes with little differences between the major ethnic groups.
However, Mr Kumar said the same report highlighted that only 13 percent of indigenous Fijians over the age of 54 considered themselves as retired compared to 26 per cent to 28 per cent of other Fiji citizens.
"These statistics support some of our concerns and initiative to translate and publish the Fijian version of 'investing for retirement' as the statistics indicated some indigenous Fijians could not retire completely because of their financial obligations to their families and communities," he said.
He said there w as a greater need for more indigenous Fijians to plan for their retirement earlier in their working lives.
"We hope many will take advantage of these publications and take time to learn fundamentals and seek advice from licensed advisers, brokers or unit trust representatives before making any investing decision," he said."
CMDA said that about 64% of investors in the unit trust market are indigenous Fijians while other residents comprised 36%.
The analysis done by CMDA is interesting is that it may mean the following :
- confirms that indigenous Fijians are passive investors who when they do invest leave their investments as they are for years without active monitoring of the investment's performance and the markets;
- Fijians are still not very well educated in terms of finance and financial matters hence the reliance on professional fund managers, such as unit trusts, to manage their investments for them;
- other races in Fiji use their own savings to set up their own businesses rather than give it to others to use (such as that done by indigenous Fijians);
- viewed from a different perspective, the above point could also suggest that Fijians are funding the businesses owned by other races (e.g. investment in businesses majority owned by other races which are listed on the South Pacific Stock Exchange, Suva, Fiji).
Further analysis may need to be done by the CMDA to dig into what is behind the statistics it has given out.
Read the commentary on CMDA's review in a Fiji Times article below."More Fijians invest in stock market, Saturday, June 30, 2007
More indigenous Fijians are investing in the unit trust and stock market compared to other ethnic groups, says the Capital Markets Development Authority chief executive Suren Kumar.
Mr Kumar said market statistics showed that about 64 per cent of the investors in the unit trust market are indigenous Fijians, while other Fijian citizens and residents comprised 36 per cent.
Mr Kumar said the new trend for Fijians towards investing was heartening and should be supported. "Apart from individuals, a substantial number of provincial and tikina-owned companies, vanua and communal groups also invest in the unit trust and stock market," he said.
Mr Kumar said this as the CMDA launched the Fijian version of "Investing for retirement" (Na vakatubu i lavo me baleta na tiko marau ena gauna ni vakacegu mai na cakacaka) and another booklet, Why should you invest (Na cava na vuna mo vakatubu I lavo kina) this week.
He said financial literacy was fundamental to market development.
This corresponds with the Bureau of Statistics 2002-2003 Household and Income Expenditure Survey which indicates that in aggregate, indigenous Fijian households are saving some 18 per cent of their incomes with little differences between the major ethnic groups.
However, Mr Kumar said the same report highlighted that only 13 percent of indigenous Fijians over the age of 54 considered themselves as retired compared to 26 per cent to 28 per cent of other Fiji citizens.
"These statistics support some of our concerns and initiative to translate and publish the Fijian version of 'investing for retirement' as the statistics indicated some indigenous Fijians could not retire completely because of their financial obligations to their families and communities," he said.
He said there w as a greater need for more indigenous Fijians to plan for their retirement earlier in their working lives.
"We hope many will take advantage of these publications and take time to learn fundamentals and seek advice from licensed advisers, brokers or unit trust representatives before making any investing decision," he said."
Friday, April 27, 2007
Capital Markets Development Authority - Chief Executive Officer Vacancy
The Capital Markets Development Authority, in Fiji, is seeking applications for the position of Chief Executive Officer.
The Chief Executive Officer will be responsible to the Authority for exercising a clear vision and leadership in driving both the developmental and regulatory aspects of Fiji's capital markets.
Some of the issues the authority is working on include : compliance listings, IPO's, rights issues, takeovers, capital raising and other corporate actions.
The ideal person should have :
Applications enclosing a curriculum vitae setting out details of qualifications, experience and referees are to sent to the following address no later than 5pm, Friday, 25 May 2007 :
Address : Chairman, Capital Markets Development Authority, PO Box 2441, Government Buildings, Suva or e-mailed to ceo@cmda.com.fj. Envelopes should be labelled "Chief Executive Officer Vacancy - Confidential".
The Chief Executive Officer will be responsible to the Authority for exercising a clear vision and leadership in driving both the developmental and regulatory aspects of Fiji's capital markets.
Some of the issues the authority is working on include : compliance listings, IPO's, rights issues, takeovers, capital raising and other corporate actions.
The ideal person should have :
- an advanced degree in finance, commerce, law or related disciplines;
- a high level of proven managerial and business development experience;
- a sound knowledge of the workings of capital markets;
- proven skills in strategy formulation and implementation;
- a minimum of ten years (or near) experience.
Applications enclosing a curriculum vitae setting out details of qualifications, experience and referees are to sent to the following address no later than 5pm, Friday, 25 May 2007 :
Address : Chairman, Capital Markets Development Authority, PO Box 2441, Government Buildings, Suva or e-mailed to ceo@cmda.com.fj. Envelopes should be labelled "Chief Executive Officer Vacancy - Confidential".
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