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ECSE Enjoys Successful 2005

by Amanda Banks, Tax-News.com, London

17 January 2006


The Eastern Caribbean Securities Exchange (ECSE) enjoyed a year of success in 2005, its fourth year of operation, as the market outperformed all other regional markets in terms of returns to investors, the Exchange has announced.

According to the ECSE, which is based in St Kitts & Nevis, the total overall return to investors was 15.5% last year, surpassing the returns available on any other regional market or on any other traded or non-traded publicly available financial asset class.

The ECSE also successfully implemented its strategy to expand into the wider CARICOM area, undertook an organisational restructuring, and embarked on a new market awareness programme.

From January 1 to December 31, 2005, the ECSE EC-Share Index appreciated by 9.53%, which, the bourse said, "was not achievable in any other asset class or financial market".

Growth recorded by the index was almost double that of the closest competitor, the Barbados Stock Exchange, whose BSE Local Index recorded an increase of 5.19% over the year, while the performance of the other markets "paled in comparison", with most showing declines in values, the Exchange noted.

"This spectacular performance reflects a significant increase in shareholder value, and coupled with an average dividend yield of approximately 6.0% for the year, amounts to a total overall return of 15.5% to investors," the ESCE stated.

Last year saw the ECSE implement its strategy to expand its operations into the wider CARICOM area by listing non-Eastern Caribbean Currency Union (ECCU), CARICOM companies and admitting non-ECCU broker-dealers into its intermediary network.

The development led GraceKennedy Ltd, a leading regional conglomerate headquarted in Jamaica, to become the first non-ECCU company to list on the ECSE in April. This was followed in July by FirstCaribbean International Bank (Barbados) Ltd (FCI), a leading regional financial institution.

In March, Caribbean Money Market Brokers Ltd (CMMB) became the first non-ECCU broker-dealer to be admitted to the membership of the ECSE.

The ECCU comprises eight member countries, including Anguilla, Antigua & Barbuda, Dominica, Grenada, Montserrat, St Kitts-Nevis, St Lucia and St Vincent & the Grenadines.

The ECSE says that its move into the wider Caribbean region is part of its strategy to increase the number of market listings, boost market activity and to leverage the significant capacity of the ECSE and its subsidiaries, and complements the move towards a single regional market and economy.

The first quarter of 2005 also saw the ECSE undergo a restructuring process in which three new divisions were created, namely: the Registry, Issuer and Investor Services; the Trading, Information and Intermediary Services; and the Finance and Administration Divisions.

In addition, the Exchange ushered in a change in management, with Mr Trevor Blake being appointed General Manager on 1 January, replacing Mr Vohra who had served in the role from the ECSE's inception until November 2004.

In 2006, the exchange expects to expand the number of listings "significantly", starting with the Carib Breweries (St Kitts Nevis) Ltd in January.

"We anticipate that the market performance will remain strong in 2006, continuing to return significant value to investors. We will be seeking to increase market activity by encouraging more investor participation and active trading of securities," the ECSE explained.

"Activity is expected to pick up with the recognition of the returns available in the market and with the expansion of the product range. Our market awareness and promotional activities will be geared to supporting this," the bourse added.

A comprehensive report in our Intelligence Report series examining offshore investment, offshore stock exchanges, and hedge funds is available in the Lowtax Library at http://www.lowtaxlibrary.com/asp/subs_reports.asp and a description of the report can be seen at http://www.lowtaxlibrary.com/asp/description_report9.asp

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