BY MELISHA YAFOI
The PNG Securities Commission is expected to launch and regulate corporate bonds in the country this month.
It will be the first time that the country’s capital markets will turn to debt securities after trading only with equity securities for the past 23 years.
Acting Chairman of the PNG Securities Commission Robert Salmon-Minak said that since the start of the securities industry in 1998, after the passage of the Securities Act 1997, he has always been a stock market.
Through equity securities, an investor buys shares of the issuing company and owns a part of the company.
Currently, PNG is an equity market.
Equity securities are a type of financial product.
The other three include debt securities, derivatives and hybrid securities that have never been issued in the country to date, due to only a few financial products and services circulating in the securities market in PNG.
“What we have done now is that since the administrative stabilization of the securities commission last year, we have worked with stakeholders, in particular the PNG National Stock Exchange to expedite the work of issuing securities. ‘wholesale corporate bonds, which we have now completed,’ he said.
“An order is required from the Securities Commission and the responsible minister to give effect to the bond issue.
“The Securities Commission has already approved and is waiting for the Minister to reconsider the same.
SCPNG has approved the Debt Market Rules submitted by PNGX already, in fact, this was one of the conditions under which stock exchange approval was granted by the Securities Commission and PNGX fulfilled it .
He said that although the Central Bank issues bonds, they are government bonds and the Securities Commission is now on track to introduce and regulate corporate bonds.
“Once corporate bonds are launched this month, it will have the effect of diversifying the range of financial products and services available to investors in our capital markets,” he said.
“The launch of the wholesale corporate bond market will also open up PNG as a market for debt securities.
“This is an important milestone in the life of capital markets in PNG.”