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Code: 47626 Visited: 227 Publish Date: Feb 24 2018 - 1:53
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TSE
International Interactions of TSE
Tehran, Feb. 24 (SENA) - Tehran Stock Exchange CEO Hassan Ghalibaf-e-Asl drew the picture of TSE’s international status in an interview with SENA. Ghalibaf first tackled the frequently asked question about the volume of foreign investment in Iran.

Tehran, Feb. 24 (SENA) - Tehran Stock Exchange CEO Hassan Ghalibaf-e-Asl drew the picture of TSE’s international status in an interview with SENA. Ghalibaf first tackled the frequently asked question about the volume of foreign investment in Iran. “Although foreign portfolio investment in Iran capital market has nearly quadrupled since the implementation of the landmark nuclear deal in 2015, known as JCPOA, its ratio to the total market capitalization is still trifle, as low as 0.5%,” he said.

Hardship in money transfer is the major hurdle because of international banks reluctance to work with Iran and their refusal to open up local branches. Consequently, intermediary institutions such as custodians which are essential for the day-to-day operation of the capital markets are currently absent.

The lack of hedging instruments like currency future and option contracts is also hindering foreign investment for which Ghalibaf explained that TSE has carried out feasibility studies and presented the suggested regulations to the Securities and Exchange Organization. Establishing a formal currency derivative market is subject to the assent of the Central Bank and SEO.

Reestablishing banking connections, harmonizing rules and regulations, and employing international reporting standards were counted by the CEO as the necessary measures to make the markets comprehensible and trustworthy for foreigners.

Connecting to other stock exchanges was on TSE’s top priority in 2017, accordingly, TSE and Bursa Istanbul reviewed the possibility of listing Iranian public companies on the Turkish side. Bursa Istanbul enjoys the foreign participation of 60% in total market trades. It also ranks as the 8th biggest market in terms of debt market size. The close cultural and political views of the countries is another reason for TSE to follow up on this project.

“In the past two years, following the nuclear deal which brought better international relations for Iran, we entered into an MOU with Bursa Istanbul and pushed the double listing project forward”, the CEO said.

The two stock exchanges with the collaboration of their capital market regulators have worked out the details but certain differences between the markets remain to be resolved. “Capital increase procedure, dividend distribution and corporate governance in Iran are different from international common practices, but in collaboration with Bursa Istanbul, we have come up with satisfying solutions”, Ghalibaf clarified.

 

 
By: Security and Exchange News Agency (SENA)
 
 
 
 
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