The Victoria Falls Stock Exchange (VFEX) has signed a memorandum of understanding with the central bank in which the banking sector regulator will provide assistance to the settlement services for trades conducted in foreign currency.
VFEX is a subsidiary of the Zimbabwe Stock Exchange (ZSE) and was established to kick start the Offshore Financial Services Centre earmarked for the special economic zone in Victoria Falls.
It will accommodate three dual listed counters—Old Mutual, PPC and Old Mutual Zimbabwe—that were forced to exit ZSE when it reopened in August after a one-month to facilitate illicit deals blamed for the routing of the local unit against major currencies.
The completion of the modalities on the clearing and settlement of transactions with RBZ is one of the final steps towards the launch of VFEX, ZSE chief executive officer Justin Bgoni said in a notice Thursday.
“VFEX is looking forward to successful partnership with RBZ as it forges ahead with plans to officially launch before the end of October. The details of the administration of FCA accounts eligible to participate on VFEX will soon be published by RBZ ahead of official launch,” Bgoni said.
Business Times reported Thursday that foreign investors were exiting ZSE due to unsettling policies such as the suspension of fungibility with critics warning that VFEX would not fly in the absence of proper clearing and settlement architecture.
The warning comes after foreign investors have in the past struggled to take their money out of Zimbabwe following the disposal of stocks on ZSE.