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FINANCIAL SERVICES REGULATORY AUTHORITY

[FSRA]

QUARTERLY STATISTICAL BULLETIN

1st APRIL 2018 – 30TH JUNE 2018

SECOND QUARTER (Q2-2018)

CAPITAL MARKETS DEVELOPMENT DIVISION

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Contents Contents .................................................................................................................................................. 2

Table of Figures ....................................................................................................................................... 3

1. INTRODUCTION .............................................................................................................................. 4

1.1 Highlights: Overview of the Capital Market Industry .................................................................. 4

2. Overview ............................................................................................................................................. 5

2.1 Collective Investment Scheme Managers ..................................................................................... 5

2.2 Collective Investment Scheme (CIS) Asset Allocation ................................................................ 7

2.3 Investment Advisory ................................................................................................................... 10

3. Domestic Securities Exchange Report............................................................................................... 11

3.1 LISTED EQUITY COMPANIES ........................................................................................................ 11

3.2 EQUITY TURNOVER ........................................................................ Error! Bookmark not defined.

3.3 CAPITAL GAINS COMPARISON ON EQUITY PRICES ..................................................................... 12

3.4 SSX ALL SHARE INDEX TREND ......................................................... Error! Bookmark not defined.

3.5 MARKET CAPITALISATION ........................................................................................................... 13

3.8 MARKET CAP. IN 2nd QUARTER 2018............................................................................................. 15

3.9 GOVERNMENT DEBT ...................................................................... Error! Bookmark not defined.

3.10 CORPORATE BONDS ..................................................................... Error! Bookmark not defined.

3.11 NEW BOND ISSUANCES ................................................................ Error! Bookmark not defined.

3.12 SSX MEMBERS .............................................................................. Error! Bookmark not defined.

3.13 CORPORATE EVENTS ON THE SSX ............................................................................................. 19

4.0 LICENCED ENTITIES .......................................................................................................................... 20

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Table of Figures Figure 1 - Evolution of Total Assets ......................................................................................................... 4

Figure 2: Geographical Allocation of Total Assets .................................................................................. 5

Figure 3: Source of Funds (CIS) ............................................................................................................... 6

Figure 4: Geographical breakdown of assets under management (CIS)................................................. 7

Figure 5: Assets Allocation (CIS) .............................................................................................................. 8

Figure 6: Money Market Asset Allocation............................................................................................... 8

Figure 7: Geographical breakdown of CIS Assets .................................................................................... 9

Figure 8: Geographical breakdown of Money Market Assets .............................................................. 10

Figure 9: Geographical breakdown of Total Assets under Advisory ..................................................... 10

Figure 11: SSX All Share Index 2017 VS 2018 ........................................... Error! Bookmark not defined.

Figure 12: SSX Market Capitalization 2017 VS 2018 ................................ Error! Bookmark not defined.

Figure 13: Government Bonds as at Q2-2018 .......................................... Error! Bookmark not defined.

Disclaimer: While reasonable care has been taken to prepare the Statistical Bulletin, the

Authority accepts no responsibility or liability whatsoever resulting from the use of information

contained herein. Note further, that the FSRA has no objection to the material contained herein

being referenced, provided an acknowledgement of the same is made. Any comments and/or

suggestions on any of the statistics may be sent to info@fsra.co.sz.

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1. INTRODUCTION

Financial data reported in the Financial Services Regulatory Authority (FSRA) quarterly

Statistical Bulletin has been sourced from licensees’ statutory returns to the FSRA.

The data from the statutory returns is for the second quarter ended 30 June 2018.

All the figures reported in the statutory returns and in this bulletin are in Emalangeni.

1.1 Highlights: Overview of the Capital Market Industry

As at 30th June 2018, assets managed and advised within the capital markets industry, decreased

by 1% to E 25 040 076 641.28 from the E 25 238 451 570.29 reported in Q1-2018. The assets

in the capital markets industry as at 30 June 2018 represents 56% of GDP.

The assets under management for the quarter under review decreased from E6 993 153 403.96

reported in Q1-2018 to E6 037 998 339.30. This represents a 13.6% decrease in assets under

management as compared to the previous period. Assets under advisory increased by1.2% from

E 18 816 513 395.94 in Q1 to E 19 002 078 301.98 in Q2. Figure 1 below, depicts the growth

in total assets from Q1-2015 to Q2-2018.

Figure 1 - Evolution of Total Assets

Source: FSRA 2018

-

5 000 000 000,00

10 000 000 000,00

15 000 000 000,00

20 000 000 000,00

25 000 000 000,00

30 000 000 000,00

Q1 -2016

Q2 -2016

Q3 -2016

Q4 -2016

Q1 -2016

Q2 -2016

Q3 -2016

Q4 -2016

Q1 -2017

Q2 -2017

Q3 -2017

Q4 -2017

Q1-2018

Q2 -2018

Figure1-Evolution of Total Assets As At 30 June 2018

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Figure 2 below illustrates the geographic asset allocation of all assets within the capital markets

industry. As seen in the graph, 26% are invested domestically; 60% are invested within the

Common Monetary Area (CMA), excluding Swaziland; and 14% is invested offshore (Outside

of CMA). It is worth noting that currently, Investment Advisors do not have a local asset

requirement, hence they tend to skew the geographic asset allocation away from domestic

assets.

Figure 2: Geographical Allocation of Total Assets

Source: FSRA 2018

2. Overview

2.1 Collective Investment Scheme Managers The total assets under management for the quarter under review were E 6 037 998 339.30. The

source of funds of these assets are depicted in figure 3 with 46% from pension funds 19% from

companies while retail investors accounted for 17%.

Figure 2- Geographical Allocation Of Total Assets As At 30 June 2018

Domestic - 26% CMA - 60% Offshore - 14%

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Figure 3: Source of Funds (CIS)

Source: FSRA 2018

Collective investments scheme source of funds

Retail -17% Professional Investors/High Net Worth -4%

Institutional-Pension - 46% Institutional-Medical Aid Scheme - 1%

Institutional-Insurance short term - 1% Institutional-Insurance long term - 2%

Unit Trust Schemes - 8% Companies - 19%

Institutional-SACCO - 0% Institutional-Other- 2%

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On aggregate, the 50% local asset requirement was met by the Collective Investment Scheme

Managers, having invested 57% of their assets in local (Eswatini) assets, as illustrated by

figure 4.

Figure 4: Geographical breakdown of assets under management (CIS)

Source: FSRA 2018

2.2 Collective Investment Scheme (CIS) Asset Allocation

Figure 5 gives an overview of the types of assets that are being invested in. As at 30 June 2018,

41% were money markets, 13% were collective investment schemes, 7% were equities and

31% were other portfolio assets. Collective Investment Schemes represents assets that are re-

invested in foreign collective investment schemes. Other portfolio assets consist of financial

derivatives and money market funds of asset managers in the common monetary area (CMA)

and offshore.

Figure 4- Geographical Breakdown Assets Under Management as at 30 June 2018

Domestic -57% CMA-30% Offshore-13%

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Figure 5: Assets Allocation (CIS)

Source: FSRA 2018

The money markets are further broken down with the aggregate holdings shown in figure 6,

0% were in commercial paper, 18% were treasury bills, 51% were cash holdings in banks and

30% were in certificates of deposits.

Figure 6: Money Market Asset Allocation

Figure 5- Structure Of Assets As At 30 June 2018

Corporate Bonds - 3% Bonds/ Debentures - 5%

Equities - 7% Collective Investment Schemes - 13%

Real Estate -0% Other Portfolio Assets - 31%

Money Markets - 41%

Figure 6- Money Market As At 30 June 2018

Treasury Bills -18% Negotiable Certificate of Deposit - 30%

Commercial Paper - 0% Banks - 51%

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Source: FSRA 2018

Figure 7 gives a geographical breakdown of the aggregate investment holdings. In the quarter

under review, 41% of fund holdings were in the money markets. This suggests that collective

investment scheme managers may have repatriated funds to Eswatini to comply with the local

asset requirement, however, there is still concern that almost half of the fund assets are held in

cash and cash equivalents instead of being invested in long term investments. Figure 8 shows

further geographical breakdown of the money market assets.

Figure 7: Geographical breakdown of CIS Assets

Source: FSRA 2018

-

1 000 000 000,00

2 000 000 000,00

3 000 000 000,00

4 000 000 000,00

5 000 000 000,00

Domestic CMA Offshore Total

Figure 7- Geographical Breakdown of Fund Assets As At 30 June 2018

Corporate Bonds-3% Bonds/ Debentures-5%

Equities-9% Collective Investment Schemes-11%

Real Estate-0% Other Portfolio Assets-27%

Money Market-41%

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Figure 8: Geographical breakdown of Money Market Assets

Source: FSRA 2018

2.3 Investment Advisory Assets under advisory are shown in figure 9 and are broken down geographically. These are

funds for which investment advisor licence holders offer advisory services to clients through

segregated mandates. Figure 9 shows that 69% of the funds are channelled to the CMA, 16%

of the funds are channelled to domestic assets and 15% are offshore.

Figure 9: Geographical breakdown of Total Assets under Advisory

-

100 000 000,00

200 000 000,00

300 000 000,00

400 000 000,00

500 000 000,00

600 000 000,00

700 000 000,00

800 000 000,00

Domestic CMA Offshore

Figure 8- Geographical Breakdown Of Money Market Assets As At 30 June 2018

Treasury Bills-20% Negotiable Certificate of Deposit -33% Commercial Paper-0% Banks -48%

Figure 9-Geographical Breakdown of Assets Under Advisory As At 30 June 2018

Domestic - 16% CMA - 69% Offshore - 15%

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3. Domestic Securities Exchange Report

3.1 LISTED EQUITY COMPANIES There were no new listings in the period under review. Listed companies remained at 7 (seven)

on the SSX Main Board, and none on the SME Board.

TABLE 1: LISTED EQUITY COMPANIES

Mar 2017 Apr 2017 May 2017 Jun 2017

Total companies listed 7 7 7 7

New entrants/listings 0 0 0 0

Domestic Companies 7 7 7 7

Foreign Companies 0 0 0 0

No. of Broking Firms 2 2 2 2

No. of Exempt Dealers 4 4 4 4

No. of Debt Sponsors 1 1 1 1

EQUITY TURNOVER A total turnover of E97 144.71 was recorded from a sale of 24,405 shares over a total of five

(5) trades concluded over the 2nd quarter of 2018. In comparison to the 1st quarter of 2018,

turnover decreased by a whopping 98.97%, down from E9 474 078.00 in the previous quarter,

as investors were anticipating dividend payments from companies whose stock had performed

well. Trades conducted in the 2nd quarter were as follows: SBC Ltd (2 Trades) and Greystone

Partners LTD (3 Trades).

TABLE 2: VALUE TRADED SUMMARY 2nd QUARTER 2018

Company Number of

Shares

Share price Emalangeni Date

SBC Ltd 2 000 800 16 000.00 27/04/2018

Greystone 1 000 285 2 850.00 27/04/2018

Greystone 10 000 295 29 500.00 16/05/2018

SBC Ltd 3 000 800 24 000.00 06/06/2018

Greystone 8 405 295 24 794,75 06/06/2018

TOTAL 97 144.75

Source: SSX Trading Statistics, 2018

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Figure 10: VALUE TRADED ’17 vs ’18

CAPITAL GAINS COMPARISION ON EQUITY PRICES

Below are the listed companies and their respective share prices (cents per share),

compared on an end of quarter basis:

TABLE 3: SHARE PRICE QUARTER COMPARISON AS AT 30 JUNE 2018

Source: SSX Trading Statistics, 2018

COMPANY

SHARE

PRICE

SHARE

PRICE (%) MKT CAP (SZL)

NAME JUN 17 JUN 18 GAINS

Nedbank Limited 1000 1080 8.00% 258 137 593

RSSC 1370 1400 2.19% 1 348 851 280

SEL 3100 3255 4.90% 602 175 000

Swaprop

545 600 10.09% 139 551 900

Swazispa Holdings 600 600 0.00% 41 966 964

Greystone Partners 235 295 25.53% 418 417 560

SBC Limited 735 800 8.84% 771 920 000

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SSX ALL SHARE INDEX TREND The SSX All Share Index increased to 415.30, representing a 0.40% increase from the

previous quarter’s close of 413.66. Trading during the 2nd quarter remained rather subdued, as

evidenced by the few trades that were brought on to the market. Furthermore, the few trades

did not translate into significant increases in the All Share Index, as it increased marginally by

0.40%. The increase in the All Share Index was due to increases in the prices of two (2) equities,

these consisting of a 2.56% increase in the SBC Ltd share price and a 3.51% increase in the

Greystone Partners Ltd share price. Year-on-Year, the All Share Index realised a gain of 7.10%

.

Figure 11: SSX ALL SHARE INDEX ’17 vs ’18

Source: SSX Trading Statistics 2018

MARKET CAPITALISATION SSX Market Capitalisation ended the 2nd quarter with a value of E3.581 billion. This saw the

market capitalisation increase by 0.40%, from the previous quarter’s close of E3.567 billion.

Growth in the market capitalisation was attributable to gains in the share prices of SBC Ltd

(2.56% ), and Greystone Partners Ltd (3.51% ). Year-on-year, the Market Capitalisation

realised a 7.10% gain from E3.344 billion in the 2nd quarter in 2017 to E3.581 billion at the end

of the 2nd quarter in 2018.

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Figure 12: SSX MARKET CAPITALISATION ’17 vs ’18

Source: SSX Trading Statistics 2018

Figure 13: OVERALL MARKET CAPITALISATION BY COMPANY AS AT 30 JUNE 2018

Source: SSX Trading Statistics 2018

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TABLE 4: MARKET CAPITALISATION QUARTER COMPARISON

Company Name Q1 2018 Q2 2018

Royal Swaziland Sugar Corporation (RSSC) 39% 38%

Nedbank 7% 7%

Swazispa Holdings 1% 1%

SWD Empowerment Limited (SEL) 16% 17%

SWAPROP 4% 4%

Greystone Partners Limited 11% 12%

SBC Limited 22% 21% Source: SSX Trading Statistics 2018 RSSC continues to have the highest market capitalisation figure, commanding a 38%, even

though it lost 1% share of the overall market capitalisation of listed entities. SEL and Greystone

Partners gained 1%, while SBC Limited lost 1%. RSSC’s business is that of processing sugar

and ethanol products located in the north-eastern Lowveld. RSSC has two sugar mills in

Simunye and Mhlume as well as an ethanol plant.

SBC LTD (21%) – Holding Company

SWD Empowerment Limited (17%) – Holding Company

Greystone Partners (12%) – Private Equity

Nedbank (7%) – Banking

SWAPROP (4%) – Real Estate

Swazispa Holdings (1%) – Hospitality

GOVERNMENT DEBT

During the period under review, Government through the Central Bank of Swaziland (CBS)

maintained 18 bonds with different maturities, ranging from 3, 5, 7 and 10 years. The total

outstanding bonds as at June 30, 2018 stood at E2.932 billion, reflecting a 6.35% increase

from the total outstanding as at the end of the 1st quarter of 2018 which stood at E2.757 billion.

Year-on-year, total government bonds outstanding increased by 27.3% . This significant

increase saw government raise an additional E300 million in the local bond market, through

Infrastructure bonds SGIFB004 and SGIFB005 whose nominal values stood at E150 million

each, respectively. During the course of the 2nd quarter of 2018, government bond SG021

matured, whose value was E125 million. The total outstanding bonds as at June 30, 2018

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were as outlined below:-

Figure 14: GOVERNMENT BONDS AS AT 30 JUNE 2018

Source: SSX Trading Statistics, 2018

MATURED/REDEEMED GOVERNMENT BONDS

TABLE 6: MATURED/REDEEMED GOVERNMENT BONDS

Bond Name ISIN Code Coupon Maturity Date Nominal Value (SZL)

SG021 SZG000441199 8.25 30-June-18 125 000 000 Source: SSX Trading Statistics 2018

NEW GOVERNMENT BOND ISSUANCES TABLE 7: NEW GOVERNMENT BOND ISSUANCES

Bond Name ISIN Code Coupon Maturity Date Nominal Value (SZL)

SGIFB004 SZG000441348 10.00 29-Mar-28 150 000 000

SGIFB005 SZG000441356 9.75 31-May-26 150 000 000

Source: SSX Trading Statistics 2018

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CORPORATE BONDS Figure 15: CORPORATE BONDS 2ND QUARTER 2018

Source: SSX Trading Statistics, 2018 The 2nd quarter of 2018 realised 5 notes maturing, these being SML400, SML401, FIN010,

FIN106 and FIN113. SELECT LTD returned to the market in the second quarter to raise an

additional E21.92 million, E24.2 million and E5 million through SML605, SML606 and

SML607, while an additional E48 million, E24.2 million and E5 million were raised in the

second quarter by FINCORP with Notes FIN202, FIN203 and FIN204. This saw the

cumulative corporate bonds outstanding as of June 30, 2018 increase to E1.098 Billion, from

the previous quarter’s outstanding amount of E1.038 Billion. This marked a 5.78% increase

in total bonds outstanding. Year-on-year, total corporate bonds outstanding increased by

41.67% .

MATURED/REDEEMED CORPORATE BONDS TABLE 8: MATURED/REDEEMED CORPORATE BONDS

Bond Name ISIN Code Coupon Maturity Date Nominal Value (E)

SML400 SZD000551646 10.00 04-May-18 11 130 000

SML401 SZD000551654 12.50 08-Apr-18 20 000 000

FIN010 SZD000551507 10.30 01-Apr-18 10 000 000

FIN106 SZD000551678 10.00 04-May-18 20 000 000

FIN113 SZD000551878 11.85 29-Jun-18 7 229 800

TOTAL 68 359 800 Source: SSX Trading Statistics, 2018

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NEW CORPORATE BOND ISSUANCES

TABLE 9: NEW CORPORATE BONDS

Bond Name ISIN Code Coupon Maturity Date Nominal Value (E)

SML605 SZD000552042 13.25 10-Apr-21 21 920 000

SML606 SZD000552048 11.75 04-May-20 24 200 000

SML607 SZD000552076 12.25 06-Jun-20 5 000 000

FIN202 SZD000552034 14.00 30-Mar-23 48 000 000

FIN203 SZD000552040 11.75 04-May-20 24 200 000

FIN204 SZD000552084 12.50 06-Jun-21 5 000 000

TOTAL 128 320 000 Source: SSX Trading Statistics, 2018

CORPORATE EVENTS ON THE SSX

1. Corporate bonds SML400 and FIN010 matured during the month of April 2018.

2. Corporate bond SML605 worth E21.92 million started trading during April 2018.

3. Corporate bonds SML401 and FIN106 matured during the month of May 2018.

4. FIN203 and SML606 worth E24.2 million each, commenced trading in the month of May

2018.

5. The SSX Staff was invited to attend the Royal Swazi Spa Annual General Meeting which

was held at the Royal Swazi Convention Centre on May 24, 2018.

6. Corporate bond FIN113 worth E7,229,800 matured during the month of June 2018.

7. FIN204 and SML607 worth E5 million each, commenced trading in the month of June 2018.

8. Government Infrastructure Bond SGIFB004 worth SZL150 million commenced trading on

the SSX in the month of April 2018.

9. Government Infrastructure Bond SGIFB005 worth SZL150 million commenced trading on

the SSX in the month of June 2018.

10. Government bond SG021 worth SZL125 million matured in the month of June 2018.

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SSX MEMBERS Two (2) Stockbroking companies are currently licensed as Dealing Members of the

SSX. These are:-

· Swaziland Stockbrokers Limited (SSL)

· African Alliance Swaziland Securities Limited (AASSL)

Four (4) banks are currently recognised as Exempt Dealers by the SSX. These are:-

· Nedbank Swaziland

· Standard Bank Swaziland

· First National Bank Swaziland

· Swaziland Development and Savings Bank One (1) institution is recognised as a Debt Sponsor for Swaziland Government Bonds by the

SSX. This is:-

· The Central Bank of eSwatini (CBS)

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4.0 LICENCED ENTITIES Table 1: FSRA Licensed Entities within Capital Markets Development Division

License Type Entity Name License Number

Collective Investment

Scheme Manager

African Alliance Swaziland

Management Company

CISM/009/13

Sanlam Swaziland CISM/015/13

Stanlib Swaziland CISM/010/13

JM Busha CISM/012/13

Inhlonhla CISM/022/17

Old Mutual Unit Trust

Swaziland

CISM/013/13

Ecsponent Limited

CISM/003/17

License Type Entity Name License Number

Investment Advisor

Inhlonhla IA/018/13

Imbewu Yesive IA/005/13

Allan Gray Swaziland IA/007/13

Ecsponent Swaziland IA/020/14

African Alliance Swaziland

Management Company

IA/003/13

African Alliance Swaziland

Limited

IA/002/13

Sanlam Swaziland IA/014/13

Stanlib Swaziland IA/001/13

Old Mutual Investment

Group Swaziland

IA/008/13

Momentum Asset

Management Swaziland

IA/013/13

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BLZI IA/004/13

MB Financial Consultants

IA/021/16

Swaziland Employee

Benefit Consultants

IA/023/16

Insika Financial Services IA/022/16

Pan African Asset

Management Swaziland

IA/024/17

Swaziland Employee

Benefit Consultants

IA/023/16

Umelusi Capital IA/025/18

Aluwani Capital Partners

Swaziland

IA/026/18

License Type Entity Name License Number

Stock Broker African Alliance Securities STB/016/13

Swaziland Stock Brokers

Limited

STB/017/13

License Type Entity Name License Number

Trustee Nedbank Swaziland TR/002/13

Standard Bank TR/004/15

License Type Entity Name License Number

Dealer Swaziland Savings and

Development Bank

DR/001/13

Capital Markets Regulated Entities as at 31 March 2018

…………………………………END OF REPORT……………