Capital market captain sails to new shores
Mbongeni Mguni | Monday May 6, 2024 06:00
Mmegi: Briefly, take us through your career, specifically what led you to choose the capital market as a career choice?
Tsheole: In terms of my career, I was originally a sciences student at high school, at Molefi Senior Secondary School, doing pure sciences. My intention was always to pursue a science-based career, up until I got to National Service where after interacting with a lot of people, I realised I would do much better in the social sciences. Therefore, I went to the University of Botswana and chose a Bachelor of Social Science and in this, we were taught several subjects such as psychology.
At the university, I took Economics as a single major and I grew so interested in that. I actually went to work for the Bank of Botswana for several years in the dealing room, which was a very exciting job. I then moved to the Stock Exchange in product development and did a lot of great things there. I ended up being the CEO for eight years which I call eight transformative years and I’m glad that that’s the career that I ultimately chose.
Mmegi: What would you say are the major milestones in the capital market during your years at the BSE?
Tsheole: There were several achievements or milestones during my time. Number one is the demutualisation which we achieved in 2018. It was a record-time demutualisation for the African market, turning the BSE into a company limited by shares and also in the process getting shares for employees for free. The employees of the BSE own about five percent of the company and I think that was a very big milestone.
Also, when I took over there were about 23,000 investors on the BSE and now we are talking about more than 100,000 investors which is a great milestone in terms of the output. It’s good that we have been able to grow the investors and do a lot of investor education.
Also, the implementation of the new Central Securities Depository (CSD) system is going to bring in a lot of state-of-the-art-based services and benefits to the investors. The CSD is going to introduce securities borrowing and lending, retail investors are going to come up there and be able to see their shares on the mobile phone.
In addition, another achievement is the introduction of the opening bell ceremony. That’s a very flagship project that we have been doing to popularise the market. I also think the Tshipidi Mentorship Programme is a major milestone where we have mentored up to 60 companies so far which I think is a step in the right direction. Further, the joining of the World Federation of Exchanges is a step in the right direction and the BSE is now a full member. We worked very well to bring the BSE to where it is now. The assumption of the presidency of the African Securities Exchanges Association was a major success, I mean being voted in by our African peers to lead them.
These are just some of the many successes we have noted, including the increase in the number of instruments, increase in liquidity and increase in market capitalisation.
Mmegi: The local capital market, including the BSE, has fought to come out of the shadow of South Africa. Where are we with this fight to distinguish ourselves and attract capital, skills, and deals in our own right?
Tsheole: We have managed to fight the shadow of South Africa. South Africa is a big market, while Botswana is a small market and a small economy. However, there are several areas where we have out-competed our peers and, in fact, there are one or two listings that were supposed to go to Johannesburg, but we managed to divert them to Botswana. This was mainly because of the quality of the Exchange that we are growing.
Mmegi: Please talk to our readers a little bit about the products and services you brought to the BSE and the market such as the ETFs and others.
Tsheole: I pioneered the Exchange Traded Funds in Africa and started the first ETF outside South Africa, in Botswana. I created the model, framework and regulations for this particular ETF and the rest of the African continent followed the BSE in replicating this market product. We also started the commercial paper market and now we have almost 40 or so commercial papers. Green bonds and products, we managed to start them off in the country and we have also managed to attract AAA-listed entities into our market, during my tenure. These are some of the successes that we managed.
Mmegi: What areas of growth do you see for the capital market going forward?
Tsheole: There are several areas of growth that I see in the capital market, depending on government regulation and rules. I think we are likely to see a lot of medium-sized companies coming onto the market to raise capital, after our mentorship programme. I think that will be a step in the right direction, especially as we are looking at pools of capital coming back into the market. Therefore, I think it’s a good opportunity for medium-sized companies to tap into the market and grow.
Also, I see Botswana acting as a regional capital-raising centre for companies. During my tenure, we managed to attract regional companies such as United Capital which is in Zambia, operating there, but it has listed bonds in Botswana. The next step is for them to come and do a full Initial Public Offer.
I think the rest of the guys who are remaining will actually push for this to come to fruition.
Mmegi: What have been your frustrations over the years within the BSE and the general capital market?
Tsheole: I think the frustrations are not many. Just that there is an urgent need to grow financial literacy in Botswana. I also believe there is an urgent need to really get a full understanding of the capital market amongst the policymakers in Botswana, so that all the policies that we do, do not negatively affect the market.
Mmegi: What are your long-term career goals or what is the sky for you?
Tsheole: The news is already out that I have decided to take an international opportunity. I was offered a role in the Republic of Rwanda to develop their capital market. I will be basically going there to contribute to capital market development in Rwanda.
I have served the Botswana capital market with all my heart and I thought it was the right time also to look outside Botswana and make a contribution generally.