The formation of the stock market in Belarus began in 1993. Then 80 commercial banks organized the Interbank Exchange. Over the next 5 years, the number of participants decreased to 28. Many credit and non-banking organizations did not fulfill the mandatory financial requirements. In December 1998, the Belarusian Currency and Stock Exchange OJSC (BCSE) was formed.
A bit of history
Although more than 20 years have passed since the moment when the Belarusian Currency and Stock Exchange was formed, in its development today there is a regression. This is due to strict regulation of the country's economy.
In the 90s in Belarus, all citizens received from the state checks "Housing" and "Property". The former were used to privatize apartments and houses or to repay part of the cost of real estate construction. The second was to stimulate the development of the stock exchange. They were exchanged for shares in enterprises, but not all, but those that were listed on the government. At first, this plan worked. Citizens exchanged checks for the Central Bank. Companies with Russian capital appeared that accumulated these checks in order to redeem controlling stakes in manufacturing enterprises.
Before the government decided to conduct open trading on the stock exchange, transactions on the sale and purchase of securities were carried out on the OTC market. It was impossible to find out the real price of the shares. After changes in legislation, the situation has changed. The results of trading on the Belarusian Currency and Stock Exchange showed that in some cases the market price of the Central Bank exceeded their nominal and book value, which indicates the high potential of some enterprises. In addition, JSCs began to place their securities in the secondary market in order to attract more funds.
But the state hacked its own idea in the bud when it introduced a restriction on the disposal of shares, began to intervene in the management of the enterprise, introduced a 40% tax on income from the Central Bank, etc. As a result, the market stopped before it had time to develop.
In 2009, for the first time since the existence of the Belarusian Currency and Stock Exchange OJSC, the volume of transactions in the stock market exceeded that of the currency segment. But this happened due to the sale of the state-owned BPS-Bank to the Russian Sberbank.
In 2010, attempts were made to rectify the situation: the income tax was reduced and most of the restrictions were lifted. But they were unsuccessful.
Structure
The BCSE includes the currency, stock and derivatives market sections. Only banks have access to the foreign exchange and derivatives segments. At the first, trades are carried out through separate accounts of the National Bank and between credit institutions. In the second section, state and non-state central banks are traded.
Belarusian Currency and Stock Exchange: Securities
The GS market operates in the “double auction”, repo (fixed pricing), “simple auction” and “repo auction” modes. In the market of municipal securities, in addition to the above, there are also "discrete auction" and "forward transactions". Trading on the Belarusian Currency and Stock Exchange is carried out remotely through computer equipment. Participants can enter into various types of transactions.
The issuers are mainly banks. Given the restrictions (entry limit of 1 million euros), this is not surprising. There are no tools for trading either - only stocks and bonds are represented on the market. But they are practically put out of circulation.As long as there are restrictions, the shares of enterprises will be concentrated in the hands of the state, the market will not be attractive to investors.
Forex Trading
The main player on the currency platform is the National Bank of the Republic of Belarus. He regulates exchange rates on the Belarusian Currency and Stock Exchange based on the number of offers and demand for a specific currency (based on the results of daily trading). If there are more buyers than sellers, the difference in supply is covered by the National Bank from its reserves. If the offer covers the demand, then the regulator can buy out an excess amount of currency. In a similar way, the exchange rate for the national currency per day is formed.
In March 2016, after the adoption of the relevant regulatory act, the Belarusian Currency and Stock Exchange began to carry out activities initiated by Forex, banks, non-banking organizations. The National Forex Center is formed by resident legal entities with a statutory fund of more than 2 billion rubles, banks and financial organizations included in a single register. Organizations must make a contribution to the fund - at least 55 thousand dollars.
Three whales
The BCSE has created three main products:
- Official site.
- Belarusian automated quotation system (BEKAS).
- Information system.
The results of trading on the Belarusian Currency and Stock Exchange are daily displayed on the official website of the organization.
BEKAS, operating on the basis of Internet technologies, is used to search for a counterparty for transactions and their mandatory registration.
IS "Stock Market" collects data on the status of all processes occurring on the securities market.
Thousands of users daily receive information from all of these sources:
- about the results of the auction immediately after their completion, about exchange rates;
- archival data for any period;
- on the results of trading in government securities, stocks and bonds;
- OTC market conditions;
- on the results of placements of government securities;
- the ability to track the progress of trading on-line.
All data is provided in electronic form in convenient formats for storage. All users are conditionally divided into two groups, each of which has its own tariffs for using information:
- Mass media and other organizations that use data in print, electronic publications, on websites for the purpose of its subsequent transmission.
- Persons using information for their own purposes.
What hinders development?
- The confusion of laws.
- Lack of various mutual funds and other financial institutions.
- Management of the economy by old command and administrative methods.
- Very stringent conditions for the issuance of the Central Bank. In order to issue bonds, a legal entity must have net assets worth at least 1 million euros and a positive financial result from its core business.
- Lack of clear rules of work (at the legislative level) for investors.
- The lack of a mechanism for the exchange to create its own index.
- Lack of education of citizens in the stock market.
Conclusion
Today, there is a slight revival of the market. How stormy it will be depends on the state, both in the sphere of adoption of laws and in the sphere of privatization.
