DSE brokers make millions in 2013

POSITIVE performance of the Dar es Salaam Stock Exchange (DSE) has enabled brokers to generate huge income since the bourse was established about 16 years ago.

Figures for brokers' sales and buying commissions shows that seven brokerage firms generated roughly 6.5bn/- income from a turnover of 252.3bn/- last year.

The amount generated, if it's divided equally among seven brokerage firms, each company bagged roughly 930m/- in 2013.

The last year revenue was poorly compared by a compounded commission of 1.3bn/- generated in 2012, which was almost similar to 2011 brokers' revenue.

DSE Chief Executive Officer Moremi Marwa said that last year the bourse registered an historic turnover which the market has ever seen in the past 16 years of its existence.

"Yes, it was historic year," Mr Marwa told 'Daily News' on Monday by phone from London.

The CEO said though Tanzania Securities and Orbit Securities controlled 60 per cent of market share, Core Securities, with 20 per cent, registered a hefty turnover after making a single deal selling 8.0bn/- of TBL shares.

"However, for last year the big single transaction (8.0bn/-) was done between Core and Orbit - hence you can urge that Core's market share was relatively large last year due to the effect of this single transaction," Mr Marwa said.

Mr Marwa, who on Monday was honoured to open the London Stock Exchange (LSE), said on market share for brokers, on average, Orbit and Tanzania Securities commands about 60 per cent in total.

"Core has about 20 per cent and the rest four shares the remaining 20 per cent," the CEO said. The others are Vertex International Securities, Zan Securities, Solomon Stockbrokers and Rasilimali Limited.

In principle brokers' commissions ranges between 0.8 per cent and 1.7 per cent, depending on the size of transaction, but the higher the transaction the lower the fees.

Orbit Securities Head of Dealings and Operations Simon Juventus said relatively speaking 2013 was a good brokerage year given the size of activities the bourse registered.

"Yes, it was a remarkable year," Mr Juventus said. The brokers are not the only ones who walked home with heft income but also the DSE and Capital Market and Securities Authority received a healthy share as they both get 0.14 per cent or 353.22m/- of the said transactions.

The turnover for 2013 was 252.3bn/-, which was five times higher than of 2012 of 50.89bn/-.

The 2013 turnover surpassed the transaction of three years namely 2012, 2011 of 51.76bn/- and 2010 of 35.97bn/-.

The 2013 increase was mainly attributed to some efforts that DSE have been pursuing in order to make the market more efficient, for instance it introduced the Wide Area Network-where brokers can now access our trading platform remotely.

The bourse also extended trading hours from two hours to four hours a day, and reduced the settlement cycle from five days to three days on equity and from three days to one day on bonds.