The Kyrgyz Stock Exchange (KSE) has reported the highest growth in trading volume within the Eurasian Economic Commission (EEC), which includes Russia, Armenia, Kazakhstan, Kyrgyzstan, and Belarus. For 2Q24, the KSE's capitalization volume reached $636 mn, representing a fivefold increase from the same period in the previous year.
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In recent years, the KSE has broadened its market activities. The exchange began trading in precious metals in 2022 and introduced government securities trading in 2023. The surge in trading volumes in 2023 can be attributed to large-scale transactions in the primary market. Noteworthy transactions include:
- Aiyl Bank, which completed a transaction totalling KGS 4.8bn ($56.4mn)
- State Mortgage Company, with a transaction amounting to KGS 3.8bn ($44.7mn)
- Entrepreneurship Development Fund, engaging in a transaction of KGS 503mn ($5.9mn)
- National Electric Grid of Kyrgyzstan, which executed a transaction for KGS 5.3bn ($62.3mn)
Aida Chodulova, Vice President of the KSE, indicated that banks and state-affiliated companies have been instrumental in these additional capitalization efforts.
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Chodulova highlighted that all securities transactions, whether public or private, are now mandated to go through the KSE. The exchange is currently implementing new software to modernize its system and improve accessibility. Future developments include exploring IPOs, enhancing digitalization, and expanding the commodities and precious metals sectors. Additionally, the KSE plans to introduce trading in currency pairs and establish a crypto exchange sector.
In 2023, the KSE conducted auctions for State Treasury Bonds with a two-year term, issued in both the national currency and Russian rubles. Commercial banks and insurance companies in Kyrgyzstan participated, with Russian Gazprombank purchasing some of the securities for Russian investors.
The KSE had planned to issue "green" state treasury bonds with a five-year maturity, with intentions to sell some to Russia. However, this initiative was suspended due to international economic sanctions imposed on Russia following its invasion of Ukraine.
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