BY MELISHA YAFOI – Post Courier
The Securities Commission of PNGPNG Papua New Guinea is set to launch and regulate the corporate bonds in the country sometimes this month.
This will be the first for the country’s capital markets to move into debt securities after only trading with equities securities for the last 23 years.
Securities Commission of PNG acting chairman Robert Salmon Minak said since the Securities Industry started in 1998, after passage of the Securities Act 1997, it has always been a Equity market. Through equity securities an investor buys shares in the issuing company and own a portion of the company. Presently, PNG is an equity securities market. Equity securities are one type of financial product.
The other three include debt securities, derivatives and hybrid securities which have never been issued in the country to date as a result only a few financial products and services going around in the securities market on PNG.
“What we have down now is that since establishing the securities commission administratively last year we worked with stakeholders, particularly the PNG National Stock exchange to speed up the qork on issue of wholesale corporate bonds, which we have now completed,” he said.
“An order is required by the Securities Commission and the minister responsible to give effect to the bond issue.
“The Securities Commission signed off already and are awaiting the minister to revert on the same. The SCPNGSCPNG Securities Commission of Papua New Guinea approved the Debt Market Rules submitted by the PNGXPNGX PNG National Stock Exchange already, in fact, it was one of the conditions upon which the stock exchange approval was granted by the securities commission and PNGX has fulfilled it.”
He said while the Central Bank does issue bond, those are government bonds and the Securities Commission is now on track to introduce and regulate corporate bonds.
“Once corporate bonds are launched this month, it will have the effect of diversifying the array of financial products and services available to investor in our capital markets,” he said.
“The launch of the wholesale corporate bond market will open up PNG as a debt securities market also.
“This is a milestone in the life of the capital markets in PNG.”