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At the signing of the deal are, Shaikh Khalifa, centre, and Kazim,
2nd from right, with other officials

BHB-DFM sign accord for swift transfer of shares

MANAMA, December 18, 2014

Bahrain Bourse (BHB) has signed a memorandum of understanding (MoU) with Dubai Financial Market (DFM) to introduce an electronic system for swift transfer of shares.

This represents a significant advance in the method of share transfer between the two exchanges, by enabling investors to transfer their shares easily and quickly, said a report in the Gulf Daily News (GDN), our sister publication.

DFM listed securities currently include three Bahraini companies - Gulf Finance House, Al Salam Bahrain Bank and Arab Insurance Group.

A total of more than 4.7 billion shares in those companies have been transferred to DFM.

BHB chief executive Shaikh Khalifa bin Ebrahim Al Khalifa signed the MoU with DFM chairman Essa Kazim in the presence of senior representatives from both sides.

The MoU creates the general framework that defines the guidelines of the transfer process and administers the relationship between both sides as well as explaining their capacities.

It has been agreed to introduce the new electronic system during the second half of next year, enabling swift share transfers to be executed during the official working hours of the exchanges.

The system will not require any official correspondence regarding share transfer, validation and endorsement.

Shaikh Khalifa emphasised that the new system will facilitate transferring of shares accurately and securely between DFM and BHB.

"This MoU comes as part of the strong and long co-operation between both markets which aims at achieving a higher objective which is the integrity of the GCC financial markets and bourses and improve the quality of services provided to investors," Shaikh Khalifa said.

He also added that this will be enhanced by the initiative that BHB launched few weeks ago allowing UAE and GCC licensed brokerage firms to directly trade on the BHB without the need of personal presence or representative offices in Bahrain.

This will reduce the transaction cost on the UAE investors trading there.

"We are delighted to sign this MoU with Bahrain Bourse as part of our mutual commitment to provide investors with most sophisticated, efficient and swift services, in line with the growing drive towards electronic and smart services," Kazim said.

"We have maintained wide-ranging and continuous co-operation with the BHB over the past years and constantly explore prospects to further improve investor services and facilitate their activity.

"In fact, this has bolstered the trading activity of the three Bahraini companies dual listed on DFM, as their total trade value there has reached 35 billion dirhams so far this year, representing 10 per cent overall trade value of the market.

"We are privileged to have the Bahraini companies among our listed securities, and we are confident that the new arrangement will further strengthen DFM's leading position as the market of choice for GCC-based companies looking for dual listing abroad," he said.

"The collaboration with BHB to simplify and accelerate the share transfer process is highly important to investors," DFM deputy chief executive and head of clearing, settlement and depository Maryam Fikri said.

"As part of this agreement, we will develop a highly efficient and protected electronic system that enables the swift transfer of shares between the two exchanges as of the second half of next year. - TradeArabia News Service




Tags: Shares | DFM | system | transfer | BHB |

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