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Latin America Investment News on Viva Tropical

Salvadoran Stock Exchange is Smoldering, Growing 40% Last year.

Article Summary:

El Salvador’s 20 year-old stock market grew by 40% last year, fueled by clever businesses and investors who helped reach an investment total of $3.5 billion for 2011. The market aims to grow global transaction volumes by 10% securities by 50% to 60% and the primary market to 55% in 2012.

Photo Credit: Estrategia y Negocios

Original Article Text From Estrategia y Negocios via Google Translate :

Salvadoran Stock Exchange is Booming

The Stock Exchange of El Salvador, with nearly 20 years, announced Thursday that its operations are doing very well, with growth last year of almost 40%, fueled, largely because companies and institutions are increasingly taking advantage of the benefits of the financing market.

The 37% growth in 2011 versus 2010, he was led, among other variables, according to the president of the Exchange, Rolando Duarte, financing market in the order of U.S. $ 355 million for both the private sector and the public.

The 37% increase in 2011 represents a total of over U.S. $ 3,555 million while in 2010 it tranzó a total of over U.S. $ 2,590 million.

Among public institutions financed through securitization, is detailed, as confirmed by Duarte, the mayors of Santa Tecla and Antiguo Cuscatlan, with $ 10.4 million and $ 4.4, respectively, in addition to the Mayor of San Salvador financed by this means that about U.S. $ 20.8 million.

Always, through securitization, which is the guarantee of future flows, which can be municipal revenues from fees, tuition, and other future financial flows, the French School raised $ 2.5 million for the construction of a new classroom building.

The Ministry of Finance of El Salvador has made use of this tool market, through the issuance of Treasury bills with a total of $ 116 million. While the Multisectoral Investment Bank (BMI) has also issued Certificates of Debt Restructuring of Municipalities (Cemuni) for U.S. $ 91.5 million to benefit more than 75 mayors Salvadoran, to restructure their debts, to reduce their rates interest halfway.
The BMI also made the issue of U.S. $ 36 million for the Paper Stock Market Development.

As for companies that continue to take advantage of short-term financing for working capital working capital, the Mortgage, an institution specialized in mortgage financing, took $ 36 million through this tool, Saram, a company specializing in animal feed, with $ 1.4 million and Group Q, with $ 20.3 million.

The Exchange also reported as part of the financing market, emissions bank for $ 9 million and other emissions from the Central American Bank for Economic Integration (CABEI) for U.S. $ 22 million.

The holder of the Stock Exchange also confirmed that secondary market boomed in 2011 of 125% over 2010 and for 2012 is projected portfolio securitizations of approximately $ 100 million, where they will, announced Duarte, tourism industry and financial, among others.

“The global transaction volumes could rise 10% in 2012, while growth would also specific items, such as securitizations that could grow 50% to 60% and the primary market to 55%. Also, be thinking of gaining $ 355 million – in 2011 – in the primary market to U.S. $ 500 million, “said Duarte.

Both have grown the stock market in the country that Duarte recalled that when he became president of the public in 1999, in a single transaction tranzaban three million colones (about U.S. $ 300,000 today), before dollarization, and tranzan now up to U.S. $ 22 million in a single operation five minutes.

The president of the Central Securities Depository (CEDEVAL), responsible for securing the property investment in the stock market, Mariano Novoa, provided that initially was handled a capital of less than U.S. $ 600 million, in 2005 and 2006, more than U.S. $ 3,000 million and December 2011, at market prices, has closed more than U.S. $ 5,800 million.

This change or evolution, Duarte attributes it to that initially the market was moved over to repurchase, in which only invests money and equity securities, as now, that is the bulk and primary interest of the Stock Value worldwide.

For Duarte, the employer has been understanding more funding this new market, but the stock is not considered a competition among banks, but a complement.

“Hopefully the state encouraged more and pension funds to finance mega-projects entered without debt, like a subway, a real solution to transport, hydroelectric dams, expansion at the airport, ports, roads.” , said Duarte, who confirmed that last year pension funds allowed the securitization of approximately $ 40 million.

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