In a significant development for Tanzania's capital market, the Tanzania Mortgage Refinance Company Limited (TMRC) has successfully listed its 4th tranche bond on the Dar es Salaam Stock Exchange (DSE). What sets this listing apart is the fact that all of the bond's investors are locals, which bodes well for boosting liquidity in the capital market.
Compared to previous tranches, the TMRC's ability to attract more Tanzanian investors instills hope for increased activity in the capital market. Notably, retail investors made up a significant portion, accounting for 69 percent, while corporate investors represented the remaining 31 percent during the public offering.
The public offering, which ran from April 3 to April 24, aimed to collect 10 billion Tanzanian shillings (TZS). However, the response exceeded expectations, with the TMRC successfully raising 11.28 billion TZS, equivalent to 112.8 oversubscriptions.
During an event commemorating the bond's listing, Mr. Japhet Justin, the Commissioner for Debt at the Ministry of Finance and Planning, emphasized that this milestone would create more opportunities for individuals to invest and list their shares on the DSE. Mr. Justin also highlighted the importance of reaching out to more people for mortgage loans while raising funds for mortgage refinancing. He commended the TMRC for its consistent listing of bond tranches on the DSE.
Mr. Justin also pointed out that the mortgage sector's contribution to the Gross Domestic Product (GDP) remains relatively small, below one percent. However, he expressed optimism that increased participation in the DSE by investors would lead to a growth in the sector's contribution.
The Chief Executive Officer of the Capital Market and Securities Authority (CMSA), Mr. Nicodemus Mkama, hailed the TMRC bond sale as a positive development for the capital market and the finance sector as a whole. Mr. Mkama highlighted the fact that 69 percent of the investors were retail investors, reflecting progress in the implementation of the National Financial Inclusion Framework. This framework aims to enhance citizen participation in the formal financial sector, including the capital market. He attributed the success to ongoing public awareness campaigns regarding the benefits of investing in the capital market. Additionally, Mr. Mkama acknowledged the government's role in creating an enabling environment for such achievements.
Ms. Mary Mniwasa, the Acting Chief Executive Officer of the DSE, commented on the overall performance of the exchange, revealing that the DSE had listed four bonds worth 135 billion TZS in the past 12 months. Despite the challenging global economic climate, she noted that the demand for corporate bonds remained high.
The TMRC's listing on the DSE marks a significant milestone in Tanzania's capital market development. With increased local investor participation, there is hope for enhanced liquidity and growth in the sector. As the government and market participants continue to promote financial inclusion and investment opportunities, Tanzania's capital market is poised for further expansion.