Zimbabwe's capital markets experienced mixed performance last year, although the outturn was not all doom and gloom, according to the regulator.

Overall, the economy faced headwinds ranging from liquidity constraints, limited foreign currency, inflationary pressures and exchange rate volatility, which affected businesses across sectors.

The Securities and Exchange Commission of Zimbabwe (SECZim) acknowledged it was a "tough year for the capital markets". Due to the depressed trading, the regulator also faced funding challenges.

Figures from the regulator show a nominal growth of 412 percent in turnover to $726,3 billion across the three trading platforms; the Zimbabwe Stock Exchange (ZSE), the Victoria Falls Exchange (VFEX) and the Financial Securities Exchange (FINSEC).

However, in US dollar terms, this translated to a 56 percent decline to US$198,32 million.

"Two counters delisted from the ZSE in 2023," said SECZim chief executive officer, Mr Anymore Taruvinga, at the regulators annual general meeting held last week.

One of the delistings was micro-finance service provider GetBucks, which delisted from the ZSE with effect from September 18, 2023. Before the delisting, the microfinancier had been struggling after the central bank hiked the bank policy rate to 200 percent per annum as part of measures to contain surging inflation, which has since been stabilised.

Another sign of a difficult environment for the capital markets, two initial public offerings for Revitus and WestPrp Holdings Limited were undersubscribed at 18,27 percent and 8,23 percent respectively.

Revitus, which became the second real estate investment trust after Tigere listed on the ZSE in December last year and is promoted by the NRZ Pension Fund, had its initial public offering 18,27 percent subscribed showing low appetite in the REIT.

During the year under review, two advisory firms surrendered their licences while one asset management firm was barred from taking new business.

According to SECZim, by year-end, 48 percent and 41 percent of securities dealers and asset managers were undercapitalised respectively, reflective of a tight environment.

However, on a positive note, the regulator issued several licenses to capital markets players during the year.

Mr Taruvinga revealed these included five securities advisory, one securities asset management, one securities custody, two securities trustees, nine collective investment schemes, one securities dealing firm, and one securities dealer (stockbroker).

According to SECZim, Funds Under Management (FUM) recorded a year-on-year growth of 975,6 percent from the $1,6 trillion reported as of December 31 2022 to close the year at $17,22 trillion.

Collective investment schemes FUM also registered a growth of 1 076 percent to close at $602,36 billion as of 31 December 2023.

As part of initiatives to boost knowledge in capital markets among Zimbabweans, SECZim launched a Capital Market Awareness Index and an Investor Education Toolkit that provides all the information on investing in capital markets in Zimbabwe and its benefits.