ADX in talks with insurers for listing of debt instruments

Abu Dhabi Securities Exchange (ADX) is talking to issuers to list their debt instruments on the bourse as part of its efforts to diversify listings, ADX Deputy Chief Executive, Rashed Al Baloushi, said yesterday.

"We are working hard with the issuers of debt instruments to list on the exchange; ETFs (exchange traded funds) was our aim to have them on our exchanges; we are in the final stages and will have these instruments trading this year."

In June 2009, Al Baloushi had said that the introduction of ETFs, the first in a regional bourse, had been planned in the first quarter of 2009 but held up by the global financial crisis.

Elie Ghanem, head of markets products, said in November 2009 that the National Bank of Abu Dhabi could be the first ETF issuer and manager.

Commenting on derivatives, Al Baloushi said: "We were planning derivatives but the crisis took place and you don't introduce instruments during crisis, so we decided to wait for the right time.

"We strongly believe in derivatives but then derivatives only for individual exchanges in Abu Dhabi, Dubai or Kuwait will not do. We will have to have association of bigger exchanges, otherwise like most of the smaller derivatives market, they will vanish."

Al Baloushi also expects more companies to launch initial public offerings this year. "We will see listing of few companies this year. I am sure there are some in the pipeline, because unlike the rest of the word, infrastructure is moving forward in Abu Dhabi, more and more projects are coming. There are a few private companies like Al Qudra and Manazil, which are waiting for the right time before they go to one of the exchanges – Dubai or Abu Dhabi," he said. Abu Dhabi is also attracting interest from international companies for listings.

"Internationally, we keep receiving some requests, but we don't want to list for the sake of listing. A company coming to Abu Dhabi exchange should have a value to our investors. We don't want quantity but want to have liquidity," said Al Baloushi. He said the markets have stabilised now and he is not expecting anything shocking.

"The P/E ratio is low, oil price is high, economy is moving well, companies are still solid despite losses, all of these shows that economy is going to development path, which means markets will follow the economy," he said.

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