Interview with the Director of the Algerian Stock Market

The Prime Minister announced a bond issue for next April. Will these bonds be listed on the Algiers Stock Exchange?

First and foremost, we must be clear that the State has already issued bonds through the Stock Exchange. These are ATB (assimilated treasury bonds), which are intended exclusively for institutions to finance the budget deficit. Currently, they involve approximately DZD 400 billion in assets.

In response to your question, for the time being we do not have any information except for the fact that it is a national bond issue that pays around 5%. We do not know if the loan will be listed. But if it is listed, it will have advantages and will be more attractive.



You must remember that the stock market is totally tax exempt. This applies to both natural and legal persons. Therefore, if the next bond issue of the State is listed, the yield for its securities would increase.

On the one hand, bonds listed on the stock exchange are exchangeable and become liquid at any time. If the holder of these securities needs funds, he can access them easily and immediately.

Today, several companies are listed on the Algiers Stock Exchange, but despite significant floating, the securities are not liquid, why is that?

Currently, there are four companies listed with a capitalization of DZD15 billion dinars. We are waiting for the arrival of two companies, one is public, a subsidiary of the cement group GICA, and one is private, Biopharm, which will bring the capitalization of the Algiers Stock Exchange to around $900 million.

Before addressing the problem of liquidity, you must understand that all the initial public offerings on the Stock Exchange have been successes on the primary market. The last was the NCA Rouiba IPO, which received a demand of 106% compared to the offer.

On the other hand, on the secondary market, we have noted that there is a problem at the end of the liquidity contract. Because the market depth is not significant. That means that there is no incentive for the investor to put his money in the Stock Exchange since there are only four securities listed.


Are the banks playing the game by facilitating securities purchase transactions on the Stock Exchange for their customers?

The public banks have not wanted to take risks due to the issue of penalization of the management process. For example, if the security purchased by these banks drops, there is a risk of legal action. Therefore, these financial establishments avoid buying these securities. This has blocked operations to make these securities liquids.


Have you taken additional actions to make the market more dynamic and more liquid?

The secondary market cannot flourish if there are not enough listed companies. Four listed companies, that is very few. The ideal scenario is to feed the market. To do that, we need a lot of communication. We organize tours at the national level, meetings and seminars. We even launched a special Android application for the Algiers Stock Exchange.


What is currently missing in the legislation to make the Algiers Stock Exchange a dynamic place?

On the capital market, we simplified the conditions for access to the Stock Market, for small and medium-sized companies by changing the opening level. To bring in large companies, we must open at least 20%, and for small and medium-sized companies, the minimum is 10%.


Why aren’t there private trading companies?

Historically, the public banks had exclusivity as intermediaries for Stock Exchange transactions. But we have recently seen the arrival of private brokers such as BNP Paribas, Société Générale and Tell Market, since the laws allow it.

Will there be other private companies taking an interest in trading or no? That depends on the ecosystem. If we have an active and dynamic market, private brokers could come. The Algiers Stock Exchange is currently receiving many requests from individuals who want to create private trading companies. This is permitted by law, and the approvals are granted by the Consob.

When will we have real-time quotes on the internet?

For the ATBs, we have had real-time continuous electronic listings since December 2015. However, the listings of shares are twice per week due to the small number of companies listed on the Stock Exchange. But despite that, we have set ourselves the goal of making these capital listings electronic and continuous as soon as the new information system is implemented, which is ongoing.