Tap into pension, insurance fund, urges RBM

Reserve Bank of Malawi (RBM) has urged businesses to take advantage of the Malawi Stock Exchange (MSE) as a source capital for their businesses.

In an interview on the sidelines of MSE Symposium on Wednesday in Blantyre, RBM governor Dalitso Kabambe said companies should now start preparing to list on the stock exchange to easily access the equity which is likely to flood the market.

He said: “Funds are growing rapidly outside the stock exchange, especially for pension and life insurance fand it is estimated that by next year, the country will have a combined total of pension and life insurance funds to the tune of K1.4 trillion, against a total equity at the MSE of K762 billion.”

Kabambe said if not addressed by listing more companies on the local shares market, the development will likely cause sub-optimal asset allocation, liquidity issues and an asset bubble; hence, the need to utilise the stock market.

In his remarks, MSE chairperson Augustine Chithenga said the symposium was meant to reach out to the public on the benefits of listing and trading on the MSE.

“There are lots of funds coming from the public but people choose to keep the money in their houses and banks, but we are saying there is an alternative where people can invest the money in stock exchange.

“We are asking companies to list so that they offer opportunities for investments,” he said. n