Memorandum to all stockbroking firms: Fungibility

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Memorandum to all stockbroking firms: Fungibility

We are pleased to advise that following our representations, the Reserve bank of Zimbabwe is agreeable to the restoration of partial and full fungibility on dually listed shares. The restoration has been granted on the following conditions:

  1. Shares with Full Fungibility

    1. 1




    Where shares are fully fungible primary listings should be on the Zimbabwe Stock Exchange with Exchange Control prescribed minimum number of shares registered and maintained on the local register at all times. Foreign investors will however be permitted to buy the fungible portion of the shares in the dual listed company.


    For avoidance of doubt and interpretational obscurity, the table below shows the portion of dually listed shares that can be traded between markets of dual listing.

    Dually Listed Shares

    Name of co. Primary Secondary Fungibility % fungible1
    • ABC Holdings
    Botswana Zimbabwe Full 43
    • BICC Cafca
    Johannesburg London, Zimbabwe Partial 0
    • KMAL
    Zimbabwe London Partial 3
    • NMB Bank
    Zimbabwe London Partial 0
    • Old Mutual
    London Zim, JHB, Namibia, Malawi Full 40
    • PPC Portland
    Johannesburg Zimbabwe Partial 0
    • Trans Zambezi
    Luxembourg JHB, Zim, Lusaka Partial 0
    • Hwange Colliery
    Zimbabwe London, JHB Partial 0

    1The % fungibility column shows the number of shares on a counter, that can move across markets of dual listing

  1. Shares with Partial Fungibility

    1. 1


    Shares with partial fungibility will continue to be traded under the existing procedures prior to the suspension. This means that movement of the shares will be one-way and inward.



    However, consideration for the reverse movement of the shares to external registers may be exceptionally granted on case by case in instances where such upliftments are aimed at raising capital for expansion purposes.

    1. Procedures for trading in dually listed shares

A) Local Sellers

        1. Shares are delivered in negotiable order to a Zimbabwe broker.
        2. Shares can be sold offshore if the price offshore is higher and there is no buyer in Zimbabwe.
        3. These shares are then sold offshore by a Zimbabwe Broker through a foreign broker.
        4. The foreign broker then confirms the sale to the Zimbabwe Broker
        5. The shares and documentation in negotiable order are sent to the Zimbabwe Stock Exchange to approve the removal
        6. The transfer secretary issues a Removal Receipt upon approval by the Zimbabwe Stock Exchange and transfers the shares to the foreign register.
        7. The Zimbabwe broker confirms to the seller the sale and removal of the shares to the foreign register.
        8. The foreign broker on settlement day remits the proceeds to the Zimbabwe broker’s foreign currency account.
        9. The Zimbabwe broker pays his Zimbabwe client.
        10. The Zimbabwe broker furnishes proof of the receipt of foreign funds to the Zimbabwe Stock Exchange within 7 days of the sale. The letter from the Zimbabwe broker’s bank confirming receipt of funds is to be signed by two authorised signatories and submitted to Zimbabwe Stock Exchange and Exchange Control.
        11. The Zimbabwe Stock Exchange will monitor the activities of brokers and transfer secretaries.
        12. The Removal Receipt is the official authorisation for the removal of the shares.
        13. The 7-day period will be strictly enforced. Primary responsibility for ensuring compliance with the procedures rests with the Zimbabwe Stock Exchange who will report any non-compliance to the Reserve Bank of Zimbabwe.
        14. In addition, Zimbabwe Stock Exchange will submit to Exchange Control, a weekly return on the trade and movement in dually listed shares.

B) Foreign Investors

        1. Shares are delivered in negotiable order to a Zimbabwe broker together with proof for the inward transfer of funds to Zimbabwe.
        2. The Zimbabwe broker, delivers the shares and documentation to the Zimbabwe Stock Exchange to approve the removal. The documentation should include proof of inward transfer of funds and the investor statement showing shares purchased with the inward transfer of funds, shares sold and the proceeds received to purchase the shares to be uplifted.
        3. The transfer secretary issues a Removal Receipt upon approval by the Zimbabwe Stock Exchange and transfers the shares to the foreign register.

C) Inward Transfer of Shares

      1. Foreign investors may transfer shares from an external register to the Zimbabwe register, sell the shares and repatriate the proceeds using existing procedures in place for dual listed shares.
      2. Zimbabwe resident individuals shall not purchase shares externally unless they have foreign ‘free funds’.
      3. Zimbabwean companies and corporate shall not purchase shares externally.



E. Munyukwi
Chief Executive Officer

2016-12-10T18:13:40+00:00 March 27th, 2009|News|0 Comments

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