US$2.2 billion traded on Angola’s fledgling capital market through August

A Capital Market Commission official said that transactions on the Angolan capital market totaled 907.33 billion kwanzas (US$2.2 billion) through August, about one-third of which was traded last month.

According to Johny Soki, director of the Capital Market Commission’s Study and Strategy Office, the figure was influenced by the more than 300 billion kwanzas traded in August, a record in terms of the trading volume.

It was related to the “debt relief policy” implemented by the Ministry of Finance.

The objective is to replace exchange rate-linked instruments and those with short maturities with those with longer maturities to balance the debt profile,” Soki said on the sidelines of a meeting organized by the Capital Market Commission.

The transactions were made between the Public Debt Management Department, represented by the National Bank of Angola (BNA), and market participants registered at the Angolan Debt and Securities Exchange (Bodiva), so the impact is reflected in the volume traded, he said.

In 2021, the volume traded on Bodiva was about 800 billion kwanzas (US$1.9 billion).

Asked why Angolan companies are not yet turning to the capital market as a source of financing, opting instead mainly for banks, he said this was mainly because they still had little information.

“Companies and investors are now discovering the capital market, that this segment exists, and so we are seeing gradual growth,” Soki noted, adding that companies currently have more financial instruments, such as issuing shares and bonds.

“Those are the vehicles companies are turning to when they want to get financing from lenders,” he said.

“We already have a company that has successfully raised money through the stock market (Banco Angolano de Investimento), we have an ongoing process (Banco Caixa Geral Angola), and we have a project to promote issuers to attract more companies,” Soki said, acknowledging that by the end of the year more companies would be financed in this way.