Riyadh – Mubasher: The Saudi Stock Exchange (Tadawul) on Wednesday announced a raft of key changes to the Nomu-Parallel Market.

The changes aim to develop the market, raise the number of listed companies on Nomu, and improve the market liquidity, Tadawul said in a statement.

This came two years after launching Nomu in a bid to support small-and-medium-sized enterprises (SMEs).

The structural changes will be implemented on two phases; one will be in the first quarter and the other in the second quarter of 2019.

Under the first phase, firms will be allowed to be directly listed on Nomu without an initial public offering (IPO), while the process for issuers looking to transition from the Parallel Market to the Main Market will be facilitated.

The changes will also include setting requirements for issuers to report financial results semi-annually rather than on a quarterly basis, establishing access mechanisms by applying minimum liquidity threshold, cutting normal trade threshold and establishing Nomu Capped Index.

The second phase will involve listing close-ended funds (CEFs) and real estate investment trusts (REITs) on Nomu, implementing volatility guards, and establishing an independent research fund.

Nomu lost more than a third in value since being launched on 26 February 2017 till the end of trading on 26 February as it plunged 1,486 points, or 30%, to 3,514 points. 

“The changes also come hand in hand with the Saudi market upcoming inclusion in FTSE Russell and S&P international indices as an emerging market in March 2019, followed by the inclusion in MSCI Emerging Market Index in May 2019, which will enhance the Saudi market’s position among international markets,” Tadawul’s CEO Khalid Al Hussan said.

These changes are part of Tadawul’s plans to develop the capital market, in line with the objectives of the Saudi Vision 2030’s financial sector development programme, Al Hussan noted.