MERJ is world’s fastest growing stock exchange | 09 April 2020
MERJ Exchange Limited, the pioneering operator of the Seychelles securities market ‘MERJ EXCHANGE’, has officially been named the fastest growing exchange in the world, according to the latest data released by the World Federation of Exchanges (WFE).
In contrast with shrinking capitalisation globally, MERJ EXCHANGE expanded by 325% in the past year to US $1.2 billion. The pace surpasses even the 318% for Tadawul, which listed Saudi Aramco as the world’s most valuable company last year. Most of the world’s 83 stock exchanges have seen capitalisation decline, on average by 7%, according to the data compiled by the WFE for the 12 months to the end of February.
This growth is the product of 9 years of hard work for the team that launched Trop-X in 2011 and reflects growing international recognition of Seychelles as a modern financial centre with a robust regulatory framework.
The team have spent much of the last year marketing the benefits of the exchange on the international stage and have now built a considerable pipeline of high quality issuers and other service providers who will be bringing quality capital markets business to the Seychelles.
In a set of projections attached to the recent IPO, the group are hoping to grow the capitalisation of the market to $30bn bringing considerable business to the ecosystem of service providers that are fed by the MERJ model.
Critical advances by the regulatory framework in the Seychelles have allowed the team to compete on the international stage thanks to successful reviews by the OECD (Organisation for Economic Co-operation and Development), IOSCO (International Organisation of Securities Commission) and FATF (Financial Action Task Force).
Imminent upgrade of the FSA (Financial Services Authority) to full membership of IOSCO, will be the final piece of the jigsaw that really enables MERJ to compete on the international stage.
Founder Bobby Brantley commented: “When we began there was no securities market in the Seychelles, we have had to build all the rules and infrastructure, but what has been more of a challenge is convincing issuers and partners around the world that Seychelles is robust environment for a securities market. We know it is, but we have worked very hard to get that message out internationally. We are now seeing the fruits of our labours, and also the great strides that have been made at government level and by the FSA and the Central Bank of Seychelles in establishing Seychelles’ high standards. We now have a framework that is succeeding and we are set for a period of tremendous growth, despite the upheaval of the coronavirus. We look forward to bringing high quality business to the exchange and driving greater international engagement with our financial services sector.”
Listings on MERJ EXCHANGE in the past year have ranged from US consumer finance group Investment Evolution Corporation to Chinese agricultural company Burdock Industry Limited and African venture fund Minervest.
Along with equity listings from America, Africa and Asia, MERJ also became the first stock market globally to list digital versions of shares, or tokenised equity. The structure combines the highest regulatory compliance with distributed ledger technology to vastly reduce listing and administrative costs.
By building an ecosystem for the digital era, MERJ is providing an access point to the capital markets that integrates seamlessly with mobile phone technology.
Given the high penetration of mobile phone usage throughout Africa, MERJ is hoping to become the go-to listing venue for companies in the region.
“This tremendous growth we’re seeing is a reflection of the rapid pace at which financial markets are shifting towards more efficient structures,” said Edmond Tuohy, CEO of MERJ Exchange Limited. “MERJ is disrupting the traditional stock exchange model, breaking down cross border barriers and streamlining processes, ultimately reducing costs for both investors and listed companies.”
During the past decade, the Seychelles has successfully created a financial services sector with a regulatory framework that is recognised by the IOSCO, OECD and FATF. The alignment of regulatory standards with major markets around the world has also positioned MERJ EXCHANGE to become a full member of ANNA, meaning it can issue ISINs, the standard international codes found on stocks and bonds.
Created in 2011 as Trop-X, the exchange operating group set out to build a borderless capital market that leverages technology to reduce unnecessary cost and red tape, while maintaining the highest governance standards. In February of this year MERJ was named ‘Exchange of the Year’ at an industry awards ceremony in London, beating stiff competition which included the Swiss national exchange, SIX.
One of the exchange’s key innovations is the select use of distributed ledger technology, which is used as a tool to simplify a number of the complexities of operating a cross-border multi-currency platform. In addition, investors can either access the exchange directly via web or mobile app or through more traditional broker and member channels. The efficiencies created mean that companies from the world’s fastest growing economies can list securities at a much earlier stage than would be economic on traditional markets, taking advantage of the benefits of a full exchange listing and a diverse global investor pool.
While coronavirus is inevitably disrupting many IPOs worldwide, companies listing on MERJ EXCHANGE are often motivated by a recognised framework for liquidity rather than raising fresh capital. If anything, that need is greater during an economic downturn, said Bobby Brantley, the exchange’s co-Founder. “Our job during these uncertain times is to enable the market liquidity that keeps the wheels of the global economy turning.”
MERJ EXCHANGE Limited, formerly Trop-X (Seychelles) Limited, is an established securities exchange operator, operating MERJ EXCHANGE, a vertically integrated combination of exchange, clearing house and securities depository. The group operates to IOSCO standards as a full member of ANNA. MERJ is also currently the only recognised securities exchange globally to support secondary markets for regulated digital tokens alongside traditional listed securities. STRGlobal Award Winner 2020. MERJ is an affiliate of the World Federation of Exchanges.