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Mexican finance leaders plan stock market reform to stanch exodus

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Economy 5 hours ago (Sep 08, 2022 05: 56PM ET)

Mexican finance leaders plan stock exchange reform to stanch exodus Reuters. Employees just work at their positions as a ticker displays stock market data at Mexico’s stock market, in Mexico City, Mexico June 1, 2021. REUTERS/Toya Sardo Jordan

By Carolina Pulice

MEXICO CITY (Reuters) – Mexico’s government and finance institutions will propose a bill this month to improve current rules, looking to attract companies to the country’s stock market by rendering it better to access debt and equities markets, the top of the country’s currency markets association told Reuters.

Mexico’s main BMV stock market is wanting to lure IPOs. Recently, several prominent companies made a decision to de-list their shares from the exchange. Included in these are brokerage Monex, airline Aeromexico and Carlos Slim’s retailer Sanborns.

The executive president of the Mexican Association of CURRENCY MARKETS Institutions (AMIB), Alvaro Garcia Pimentel, told Reuters the institution is attempting to propose a bill that could allow smaller companies to list debts and equities quicker and at less expensive.

“We built this project so smaller companies could issue debt and have the same fiscal treatment as public offers for debts and equities,” he said, saying rates will be more competitive and financing longer-term.

He said the proposal, come up with with the federal government and the BMV and BIVA stock exchanges, ought to be presented to Congress this month.

Mexico’s Finance ministry said it really is “working closely with the BMV to strengthen (the country’s) financial market.”

BMV and BIVA didn’t immediately react to a obtain comment, although CEO of BIVA spoke of the planned reform at a conference the other day.

Garcia told Reuters the groups may likely create another proposal, this time around concentrating on hedge funds.

“This might develop a new law allowing funds to participate through hedging operations, derivatives and direct leverage,” he said, saying AMIB was in talks with the federal government.

Luis Gonzali, an institutional asset manager, said if the bill passes it could not merely attract new companies but make Mexico’s financial market more “dynamic.”

“The measure would to a certain degree mitigate what we’ve seen for several years: a trend of de-listing and few companies taking part in Mexico’s financial sector,” he added.

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