Experts recommend OTC market for Myanmar

Some stock exchange experts have recommended that Myanmar establish the over-the-counter (OTC) market for stock trading, aside from the formal stock exchange.

“Although there are 200 public companies in Myanmar, only five of them will be listed on the stock exchange. The transactions of other companies’ shares can be done on the OTC market,” said Dr. Aung Thura from the Thura Swiss Company.

The Yangon Stock Exchange is expected to kick off by October 2015. The preparation is underway with advice from the Tokyo Stock Exchange. Foreign companies have shown interest in acquiring stocks in local public companies.

Another expert who asked not to be named noted that the OTC market will be complimentary to the stock exchange, given that the listing rules and regulations would be less strict and should be more encouraging to local companies.

Initially, the Yangon Stock Exchange plans to allow the listing of only companies which have over Ks 500 million (US$500,000) in capital. They must also be 10 per cent owned by the general public which must cover at least 100 shareholders. To date, two companies have committed to list on the bourse – Mapco and AGD Bank. Daiwa Securities has reportedly been close to reach agreements with other companies.

“We can’t expect to see vigorous interaction immediately after the stock exchange is established. The point is to nurture the stock exchange, to ensure its sustainability,” said Dr. Aung Thura.

Public companies which want to apply for the listing at the Yangon Stock Exchange are now invited to seek consultation with the Myanmar Securities Exchange Centre Co. Opened in June, 1996 as a stock exchange, MSEC has welcomed only two listed companies – Myanmar Citizens Bank Ltd and Forest Products Joint Venture Corporation Ltd. Transaction volume has been low, though.


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