SMART POLICY- FRA wants private sector to own a chunk (and possibly a majority stake) of the futures exchange: It appears that the Financial Regulatory Authority (FRA) wants the private sector to hold a stake in the long-awaited futures exchange, FRA Vice President Khaled El Nashar told Hapi Journal on Sunday. The move is part of the regulator’s plan to tap the expertise of private-sector financial institutions and is meant to privatize the market from the get go, staving off any future calls for privatization, as is the case today with the EGX, El Nashar added. El Nashar also suggested that Misr Clearing and Depository Company (MCDR) should be opened to private-sector ownership. The FRA could go so far as to sell the private sector a majority stake, he suggested.

Keep an eye on a meeting tomorrow with top players in the finance industry: Plans for the futures exchange will be on the agenda tomorrow when the FRA meets a with number of Egypt’s leading financial institutions. Private-sector commercial and investment banks as well as insurance companies will be at the table along with representatives from the EBRD and the International Finance Corporation. Joining from the government side: FRA, MCDR, and the EGX, El Nashar said.

This is the first high-level public discussion of the futures exchange since EGX boss Mohamed Farid said pre-covid that Egypt could launch derivatives trading in 1H2020. We had also heard last year that MCDR and the EGX were finalizing the regulations and infrastructure needed to launch derivatives trading, which would see derivatives trades settled through a new electronic platform, but no updates on that have come out.