Bond market development in emerging economies: a case study of the Bond Exchange of South Africa (BESA)
- Authors: Hove, Tagara
- Date: 2009
- Subjects: Bond Exchange of South Africa , Bond market -- South Africa , Foreign exchange rates -- South Africa
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:961 , http://hdl.handle.net/10962/d1002695 , Bond Exchange of South Africa , Bond market -- South Africa , Foreign exchange rates -- South Africa
- Description: This study looks at the development of bond markets in emerging economies and focuses on the development of the Bond Exchange of South Africa (BESA). It explores the history, structure, performance and key issues related to the development of this market within the broader context of domestic, regional and global bond market development. BESA's experience provides valuable lessons for other emerging market economies also seeking to build bond markets. The sophistication of the local bond market is not enough to make it appealing to foreign borrowers. Market development demands an enabling market infrastructure and a background of macroeconomic stability, diversified market participants, deregulation of capital flows and an appropriate regulatory and supervisory environment.
- Full Text:
- Date Issued: 2009
- Authors: Hove, Tagara
- Date: 2009
- Subjects: Bond Exchange of South Africa , Bond market -- South Africa , Foreign exchange rates -- South Africa
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:961 , http://hdl.handle.net/10962/d1002695 , Bond Exchange of South Africa , Bond market -- South Africa , Foreign exchange rates -- South Africa
- Description: This study looks at the development of bond markets in emerging economies and focuses on the development of the Bond Exchange of South Africa (BESA). It explores the history, structure, performance and key issues related to the development of this market within the broader context of domestic, regional and global bond market development. BESA's experience provides valuable lessons for other emerging market economies also seeking to build bond markets. The sophistication of the local bond market is not enough to make it appealing to foreign borrowers. Market development demands an enabling market infrastructure and a background of macroeconomic stability, diversified market participants, deregulation of capital flows and an appropriate regulatory and supervisory environment.
- Full Text:
- Date Issued: 2009
The development of the stock market and its effect on economic growth: the case of SADC
- Authors: Elliott, Kevin Andrew
- Date: 2009
- Subjects: Stocks -- Africa, Southern , Stock exchanges -- Africa, Southern , Economic development -- Africa, Southern , Stocks -- Economic aspects -- Africa, Southern
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:967 , http://hdl.handle.net/10962/d1002701 , Stocks -- Africa, Southern , Stock exchanges -- Africa, Southern , Economic development -- Africa, Southern , Stocks -- Economic aspects -- Africa, Southern
- Description: Using a pooled panel data set from nine developing countries within the SADC region from 1992 to 2004, this paper empirically examines; firstly, the relationship between stock market development and long-term economic growth, and secondly, the macroeconomic determinants of stock market development, particularly market capitalisation as a percentage of GDP. The results suggest that there is a strong link between stock market development and economic growth, particularly through the liquidity provided by the market. The evidence obtained lends support to the view that a well-developed and functioning stock market can boost economic growth by enhancing faster capital accumulation and allowing for better resource allocation, particularly in developing countries. In terms of the macroeconomic determinants of stock market development, the results support those of Garcia and Liu (1999), in that we found the indicators of financial intermediary development, the value of shares traded as a percentage of GDP and the macroeconomic instability variable to be important determinants of stock market development.
- Full Text:
- Date Issued: 2009
- Authors: Elliott, Kevin Andrew
- Date: 2009
- Subjects: Stocks -- Africa, Southern , Stock exchanges -- Africa, Southern , Economic development -- Africa, Southern , Stocks -- Economic aspects -- Africa, Southern
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:967 , http://hdl.handle.net/10962/d1002701 , Stocks -- Africa, Southern , Stock exchanges -- Africa, Southern , Economic development -- Africa, Southern , Stocks -- Economic aspects -- Africa, Southern
- Description: Using a pooled panel data set from nine developing countries within the SADC region from 1992 to 2004, this paper empirically examines; firstly, the relationship between stock market development and long-term economic growth, and secondly, the macroeconomic determinants of stock market development, particularly market capitalisation as a percentage of GDP. The results suggest that there is a strong link between stock market development and economic growth, particularly through the liquidity provided by the market. The evidence obtained lends support to the view that a well-developed and functioning stock market can boost economic growth by enhancing faster capital accumulation and allowing for better resource allocation, particularly in developing countries. In terms of the macroeconomic determinants of stock market development, the results support those of Garcia and Liu (1999), in that we found the indicators of financial intermediary development, the value of shares traded as a percentage of GDP and the macroeconomic instability variable to be important determinants of stock market development.
- Full Text:
- Date Issued: 2009
Interest rate risk management : a case study of GBS Mutual Bank
- Authors: Williamson, Gareth Alan
- Date: 2008
- Subjects: GBS Mutual Bank , Interest rates -- Case studies , Interest rate risk -- Case studies , Risk management -- Case studies , Financial risk -- Case studies , Banks and banking -- Case studies
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:986 , http://hdl.handle.net/10962/d1002720 , GBS Mutual Bank , Interest rates -- Case studies , Interest rate risk -- Case studies , Risk management -- Case studies , Financial risk -- Case studies , Banks and banking -- Case studies
- Description: Banks play a pivotal role in the economic growth and development of countries, primarily through the diversification of risk for both themselves and other economic agents. Interest rate risk is regarded as one of the most prominent financial risks faced by a bank. A large portion of private banks’ revenue stems from net interest income that is generated from the difference between various assets and liabilities that are held on the balance sheet. Fluctuations in the interest rate can alter a bank’s interest income and value, making interest rate risk management vital to its success. The asset and liability committee of a bank is the internal committee charged with the duty of managing the bank’s interest rate risk exposure through the use of various hedging strategies and instruments. This thesis uses a case study methodology to analyse GBS Mutual Bank interest rate risk management. Its specific business circumstances, balance sheet structure and the market conditions over a specified period are used to comment on the practicality of a variety of balance sheet positioning strategies and derivative hedging instruments. The thesis also provides recommendations for the bank’s asset and liability committee in terms of its functions and organisation. It is elucidated that the most practical balance sheet hedging strategies are a volume strategy and immunisation, while the most practical derivative hedging instruments are interest rate futures and interest rate collars. It is found that the bank has a well functioning asset and liability committee whose only encumbrance to its functionality is the inadequacy of the informational technology used to measure, control and manage its interest rate risk position. This thesis concludes by summarising the practicality of the various interest rate risk hedging alternatives available to the GBS Mutual Bank. Implementing a particular strategy or instrument depends, of course, on its asset and liability committee’s decision.
- Full Text:
- Date Issued: 2008
- Authors: Williamson, Gareth Alan
- Date: 2008
- Subjects: GBS Mutual Bank , Interest rates -- Case studies , Interest rate risk -- Case studies , Risk management -- Case studies , Financial risk -- Case studies , Banks and banking -- Case studies
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:986 , http://hdl.handle.net/10962/d1002720 , GBS Mutual Bank , Interest rates -- Case studies , Interest rate risk -- Case studies , Risk management -- Case studies , Financial risk -- Case studies , Banks and banking -- Case studies
- Description: Banks play a pivotal role in the economic growth and development of countries, primarily through the diversification of risk for both themselves and other economic agents. Interest rate risk is regarded as one of the most prominent financial risks faced by a bank. A large portion of private banks’ revenue stems from net interest income that is generated from the difference between various assets and liabilities that are held on the balance sheet. Fluctuations in the interest rate can alter a bank’s interest income and value, making interest rate risk management vital to its success. The asset and liability committee of a bank is the internal committee charged with the duty of managing the bank’s interest rate risk exposure through the use of various hedging strategies and instruments. This thesis uses a case study methodology to analyse GBS Mutual Bank interest rate risk management. Its specific business circumstances, balance sheet structure and the market conditions over a specified period are used to comment on the practicality of a variety of balance sheet positioning strategies and derivative hedging instruments. The thesis also provides recommendations for the bank’s asset and liability committee in terms of its functions and organisation. It is elucidated that the most practical balance sheet hedging strategies are a volume strategy and immunisation, while the most practical derivative hedging instruments are interest rate futures and interest rate collars. It is found that the bank has a well functioning asset and liability committee whose only encumbrance to its functionality is the inadequacy of the informational technology used to measure, control and manage its interest rate risk position. This thesis concludes by summarising the practicality of the various interest rate risk hedging alternatives available to the GBS Mutual Bank. Implementing a particular strategy or instrument depends, of course, on its asset and liability committee’s decision.
- Full Text:
- Date Issued: 2008
Securitisation and its application to low cost housing finance in South Africa
- Authors: Zimbwa, Allan Golden
- Date: 2007
- Subjects: South Africa. Constitution , Human rights -- Government policy -- South Africa , Right to housing -- South Africa , Housing -- Law and legislation -- South Africa , Housing policy -- South Africa , Low income housing -- South Africa
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1011 , http://hdl.handle.net/10962/d1002746 , South Africa. Constitution , Human rights -- Government policy -- South Africa , Right to housing -- South Africa , Housing -- Law and legislation -- South Africa , Housing policy -- South Africa , Low income housing -- South Africa
- Description: Section 26 of the Constitution of South Africa Act 108 of 1996 provides that housing is a basic human right and that the government must take reasonable legislative and other measures to achieve the realisation of this right. A number of measures were taken to try to resolve this socio-economic issue. A number of housing institutions were established , various pieces of legislation were passed and housing subsidies were provided. However, housing backlogs remain a challenge. In March 1994 the housing backlog was estimated between 1,3 and 1,8 million units. When more than a million houses were provided by 2001 , the housing backlog had increased to between 2 and 3 million houses. To date subsidies in excess of R29 billion have been spent on housing provision. A study by the Department of Housing concluded that, at the current rate of increase of housing funding vis-a-vis the growing backlog and rapid urbanisation, the household backlog will not be changed in ten years' time. The United States of America (USA) had a similar low cost housing problem, but securitisation alleviated it with the participation of government agencies Fannie Mae, Ginnie Mae and Freddie Mac. In South Africa, the NHFC tried to emulate the USA model by establishing Gateway Home Loans (Pty) Limited (Gateway) in 1999. Gateway, however, was not a success. This research investigates whether securitisation can be applied in South Africa to alleviate the low cost housing issue. The study finds that there is a credit availability gap for the low income sector earning less than R8 000 per month because of the perceived risk of default and unwillingness by banks to lend to this sector. The increase in housing backlog that continues unabated, inadequate housing finance system to low income earners, the lessons learnt from the failure of Gateway, the success factors of the USA securitisation model and the sound and sophisticated South African financial system are the rationale for applying securitisation. A proposal of how to effectively apply securitisation to low cost housing in South Africa is provided with recommendations to revive the primary market.
- Full Text:
- Date Issued: 2007
- Authors: Zimbwa, Allan Golden
- Date: 2007
- Subjects: South Africa. Constitution , Human rights -- Government policy -- South Africa , Right to housing -- South Africa , Housing -- Law and legislation -- South Africa , Housing policy -- South Africa , Low income housing -- South Africa
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1011 , http://hdl.handle.net/10962/d1002746 , South Africa. Constitution , Human rights -- Government policy -- South Africa , Right to housing -- South Africa , Housing -- Law and legislation -- South Africa , Housing policy -- South Africa , Low income housing -- South Africa
- Description: Section 26 of the Constitution of South Africa Act 108 of 1996 provides that housing is a basic human right and that the government must take reasonable legislative and other measures to achieve the realisation of this right. A number of measures were taken to try to resolve this socio-economic issue. A number of housing institutions were established , various pieces of legislation were passed and housing subsidies were provided. However, housing backlogs remain a challenge. In March 1994 the housing backlog was estimated between 1,3 and 1,8 million units. When more than a million houses were provided by 2001 , the housing backlog had increased to between 2 and 3 million houses. To date subsidies in excess of R29 billion have been spent on housing provision. A study by the Department of Housing concluded that, at the current rate of increase of housing funding vis-a-vis the growing backlog and rapid urbanisation, the household backlog will not be changed in ten years' time. The United States of America (USA) had a similar low cost housing problem, but securitisation alleviated it with the participation of government agencies Fannie Mae, Ginnie Mae and Freddie Mac. In South Africa, the NHFC tried to emulate the USA model by establishing Gateway Home Loans (Pty) Limited (Gateway) in 1999. Gateway, however, was not a success. This research investigates whether securitisation can be applied in South Africa to alleviate the low cost housing issue. The study finds that there is a credit availability gap for the low income sector earning less than R8 000 per month because of the perceived risk of default and unwillingness by banks to lend to this sector. The increase in housing backlog that continues unabated, inadequate housing finance system to low income earners, the lessons learnt from the failure of Gateway, the success factors of the USA securitisation model and the sound and sophisticated South African financial system are the rationale for applying securitisation. A proposal of how to effectively apply securitisation to low cost housing in South Africa is provided with recommendations to revive the primary market.
- Full Text:
- Date Issued: 2007
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