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AfricaMoney | August 21, 2017

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Absa’s NewGold ETF on the SEM this month

Absa’s NewGold ETF on the SEM this month

Mining Weekly reported yesterday that Absa Bank’s corporate and investment banking division will be listing its NewGold exchange-traded fund (ETF) on the Mauritius Stock Exchange (SEM), on July 26.  The listing on the SEM would mark the fifth exchange listing for NewGold, following its admission to the South African, Botswana, Nigerian and Ghanaian stock exchanges.

NewGold, Africa’s largest ETF, enabled investors to directly invest in actual gold bullion, as its securities were structured as debentures and backed by physical gold, with each debenture representing about 1/100th of an ounce of gold.

The physical bullion was held in a secure stockpile by NewGold custodian, Barclays Bank, in London. Absa Capital’s Corporate and Investment Banking division head Vladimir Nedeljkovic said the bank was encouraged by the success of NewGold in the other African markets in which it had been listed.

“Africa is an exciting proposition for this product and we will continue to explore opportunities across the continent,” he commented.

Launched in South Africa in 2004, NewGold was listed in Botswana in 2010, Nigeria the following year and in Ghana in 2012. Absa was also considering listing the fund in Zambia and Uganda. “The listing of NewGold on the SEM helps to further expand the Mauritian investment market by widening the choice of asset classes available to local investors, and by helping to facilitate an increase in liquidity on the SEM,” said Nedeljkovic.

Investors could invest in the NewGold ETF through an investment dealer or broker that was a member of the SEM, in the same way they would invest in shares.

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