The Saudi Arabian stock exchange says recent reforms have aligned the country’s capital markets with international standards.
On April 23, the country adopted a two-day settlement cycle, known as T+2, shifting from a previous system in which settlement occurred the same day equities were traded.
The stock exchange, the Tadawul, also brought in securities borrowing and lending and covered short selling, which it says will assist global investors in managing their settlement processes.
“Tadawul’s shift to T+2 and introduction of securities borrowing and lending together with other recently implemented changes constitute a major delivery of far-reaching capital market reforms to enhance access, liquidity, efficiency and transparency in the Saudi market,” said Khalid Abdullah Al Hussan, chief executive of Tadawul.
The Tadawul’s market capitalisation is more than $400 billion, less than prior to the oil price slide in 2014 but still enough to rank it 23rd out of the world’s exchanges.
More than 60 institutional investors representing more than $18 trillion in assets have become qualified foreign investors in the stock market, says the Tadawul.
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