Bermuda Stock Exchange

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The Bermuda Stock Exchange (BSX) was established in 1971. The BSX is the world's largest offshore, fully electronic securities market offering a full range of listing and trading opportunities for international and domestic issuers of equity, debt, depository receipts, insurance securitization and derivative warrants. [1]

The Exchange's 2014 'Year End Review' report stated that its aggregate market capitalization (excluding collective investment vehicles) stood at $US455 billion.[2]

A breakdown of the securities listed on the BSX is given below:

Asset Class Number of Securities Percentage of Total Listings
Collective Investment Vehicles 322 39.9%
Derivative Warrants 399 49.4%
Domestic Main Board Companies 11 1.4%
Domestic Small Cap Companies 4 0.5%
Fixed Income 10 1.2%
International Company or Secondary Listing 34 4.2%
Insurance Linked Security or Program 17 2.1%
International Company and Mezzanine 11 1.4%
TOTALS 808 100%

The exchange specializes in listing and trading of capital market instruments such as stocks, bonds, mutual fund (including hedge fund structures) and depository receipt programs.

The BSX, recognised by the US SEC as a Designated Offshore Securities Market, is a member of the World Federation of Exchanges and is located in an O.E.C.D. member nation. It is designated Investment Exchange status by the UK’s Financial Services Authority and Recognised Stock Exchange by the UK HM Revenue and Customs

The BSX was also granted approved stock exchange status under Australia’s Foreign Investment Fund taxation rules and effective September 1, 2005 The BSX has Approved Stock Exchange status under Australia’s Foreign Investment Fund (FIF) taxation rules.

Designated Exchange status under Canada’s Income Tax Act and is a member of America’s Central Securities Depository Association.

Trading memberships are available to international brokers who meet the BSX requirements, without limitation on numbers, unlike broker-owned exchanges which traditionally limit membership numbers by selling seats on the exchange. There are ten trading members; Appleby Securities (Bermuda) Ltd., Barrington Investments Ltd, BCB Asset Management Lmited, Bermuda International Securities Limited, Butterfield Securities (Bermuda) Limited, Clarien BSX Services Ltd., Cohort Limited, Global Custody & Clearing Limited (A Member of the LOM Group), Hamilton Securities (Bermuda) Limited, Nomura Securities (Bermuda) Ltd. [3]


The BSX was originally known as The Bermuda Exchange and began as a simple idea discussed around the kitchen table by Bermudian Bankers Donald P. Lines and Richard (Rick) Thatcher as a solution to creating liquidity in the local market on behalf of their clients. Prior to the creation of the Exchange, local shares were bought and sold by running an announcement in the local paper, The Royal Gazette. [4]

Mr. Donald P. Lines, Founding Member and Exchange Chairman (1971-1975) and one of the prime movers in the new venture, said “that the plan will create a much higher degree of liquidity in local stocks. It is expected that all of the major utilities and the four banks will lead the way in the Exchange “There has been a need for some time for a more efficient means of trading”.[5]

Mr. Lines admitted that it was not an easy sell, but in the end all four banks at the time —the Bank of Bermuda, The Bank of N.T. Butterfield & Son, Bermuda Provident Bank and Bermuda National Bank—all agreed to participate in the new venture, which was seen by all as a public service to the banks’ clients and to the local community.

It was hoped that the Exchange will create a more active market for local shares and give Bermudians a greater incentive to invest locally. It should also increase the availability of new capital for Bermudian companies.

The 1980s were a period steady growth for the Exchange. In May 1982, the Bermuda Exchange listed its first exempt company security, Chevy Chase Property. Exempt companies are so called because they are exempted from the requirement that at least 60% of their shares be owned by Bermudians. The first listing on the Exchange was soon followed by the listing of Aneco Reinsurance, James Martin Investments Ltd. and a series of Bermuda-incorporated Tyndall – Guardian funds.

During this period, the Exchange was also designated as a recognised Stock Exchange for the purpose of Bermuda law, leading then-Chairman John R. Talbot to note in his Annual Report of April 1984 that the Exchange had finally “come of age”.[6]

Encouraged by the flurry of new listings and the Island’s overall prosperity, driven in part by an increase in the amount of trust business coming out of the UK, the Management Committee began to explore the possibility of international recognition for the Exchange.

Despite the extremely volatile market conditions in 1987, the Bermuda market remained remarkably stable. During this period the Management Committee realised that fundamental changes would be necessary if the Exchange were to be recognised on the international stage. This paved the way for key decisions in the way in which securities were traded and the Exchange’s inevitable incorporation.


The Bermuda Monetary Authority contended that the incorporation of the Exchange was a matter of public interest, requiring greater governmental oversight, and therefore recommended to the Ministry of Finance that the Exchange be incorporated by way of a Private Bill. In January 1992, Peter Rodger, The Bank of N.T. Butterfield & Son legal counsel, and Bank of Bermuda executive William Thompson, acting as representatives of the Management Committee, met with then Finance Secretary Dr. Walwyn-Hughes, to agree the terms of the Bill. Under the terms of the Memorandum, it was agreed that the Exchange would be incorporated by Private Bill as a local company and would enjoy certain exemptions from the Bermuda Companies Act 1981. Specifically, it would be exempted from the 60/40 ownership rule.

The Bermuda Stock Exchange (BSX) was incorporated on March 10, 1993.


Under the terms of incorporation, the Management Committee was replaced with a more formalised Council structure, which permitted the inclusion of non-ownership representation. Thus began a period of rapid and significant growth for the Exchange.

Having agreed to offer new Trading Members a 15% equity stake in the Exchange the Banks had welcomed eight new Trading Members over the course of the year, including the first international member, Nomura Securities (Bermuda) Ltd.

Other milestones included the implementation of the new Listing Regulations and an increase in the number of listed issuers, resulting in a corresponding increase in market capitalisation of over $25 billion.

The same year, the BSX gained international recognition as an affiliate member of The International Federation of Stock Exchanges and the International Organization of Securities Commissions, as well as achieving Designated Offshore Securities Market status from the Securities & Exchange Commission (SEC) in the US.

In her Chairman’s report dated September 1996, Audette Exel noted that 1995/96 had been a “watershed” year for the Exchange; a year in which the BSX had moved from being a cost centre of the three banks to an independent, international stock exchange with its own income stream.[7]


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