The Zimbabwe CSD was launched in September 2014, which will actively enhance the growth in assets under custody for sub-custodians. Going into 2015, the CSD expects to shorten the settlement period from T+5 to T+3 business days. The CSD will also explore the introduction of straight through processing (STP) with custodians’ back-office systems.

The Reserve Bank of Zimbabwe (RBZ) amended exchange control regulations in 2014, allowing foreign investors to participate in both primary and secondary markets for Zimbabwean treasury bills, treasury bonds and corporate bonds.

Market share for sub-custody is dominated by two international banks with local players focusing on direct custody to local pension funds and asset managers. “More local banks are expected to launch custodial businesses in 2015 in order to take advantage of the growth opportunities,” says Takunda Magumise, head of investor services, Stanbic Bank Zimbabwe.

Foreign investors account for more than 60% of the turnover on the Zimbabwe Stock Exchange (ZSE). “We expect markets to stabilise in 2015 as ZSE valuations seem to have incorporated the market’s perceptions on political risk,” says Magumise.