CSE gets mar­ket liq­uid­ity boost from deal with GXG

Financial Mirror (Cyprus) - - FRONT PAGE -

The Cyprus Stock Ex­change (CSE) and GXG Mar­kets (GXG) have struck a deal to pro­mote dual and par­al­lel list­ings on the GXG Main Quote Mar­ket and the ECM Mar­ket of the CSE, an agree­ment that is ex­pected to boost liq­uid­ity for the cash-starved Cyprus bourse fol­low­ing the bank­ing fall­out in 2013 and the Troika bailout.

The CSE’s un­reg­u­lated ECM sec­tor has al­ready at­tracted 21 eq­uity and two fund list­ings in the last two years, with a to­tal mar­ket cap of about 750 mln eu­ros or about a quar­ter of the whole CSE.

Ex­change Direc­tor Non­das Me­taxas said that most of th­ese list­ings are for­eign-owned or Cyprus-based com­pa­nies with over­seas ac­tiv­i­ties, and have pre­ferred to list on the CSE rather than the Lon­don Stock Ex­change’s AIM mar­ket as the costs are lower and the terms are more re­laxed.

Af­ter the March 2013 bailout im­posed on Bank of Cyprus, that used to ac­count for about half of all trades on the CSE, the stock was re­in­stated in De­cem­ber 2014 and has since helped dou­ble daily trades from 307,000 eu­ros last year to an av­er­age 645,000 eu­ros to date this year. This bring the to­tal traded to EUR 38.7 mln, far ahead of match­ing and even ex­ceed­ing last year’s full year vol­ume of EUR 75.4 mln.

The deal with Den­mark-based GXG is ex­pected to open up new op­por­tu­ni­ties for CSE stocks, as mar­ket play­ers on AIM are also ac­tive on the GXG, Me­taxas said.

At the same time, CSE board chair­man Yior­gos Ko­u­faris said that the Ex­change is re­struc­tur­ing its in­dex and will now have just two mar­kets – Main and Al­ter­na­tive – with eight and 70 list­ings, re­spec­tively.

A fur­ther four sub-sec­tors will be ac­tive as of Mon­day: public bonds with 41 list­ings, pri­vate bonds with nine, col­lec­tive funds with 14 and ‘spe­cial cat­e­gory’ where 17 stocks will re­main for six months un­til they meet the ba­sic reg­u­la­tions for free float and re­port­ing. Af­ter that they will be struck off.

A CSE an­nounce­ment said that “35 mem­bers op­er­ate ac­tively at GXG Mar­kets, a con­sid­er­able num­ber of which is also op­er­at­ing in other mar­kets of the EU such as the Lon­don Stock Ex­change (LSE), of­fer­ing sig­nif­i­cant liq­uid­ity in the mar­ket. Fur­ther­more, is­suers with se­cu­ri­ties listed on the GXG Main Quote which are in­ter­ested in dual list­ing on the Cyprus Stock Ex­change, will ben­e­fit from the mul­ti­ple and flex­i­ble ser­vices that CSE of­fers at a low cost, as well as a con­sid­er­able num­ber of lo­cal mem­bers, re­mote mem­bers, and in­ter­na­tional cus­to­di­ans.”

The CSE said that the new agree­ment with GXG “does not af­fect the close co­op­er­a­tion with the Athens Ex­change Group (ATHEX GROUP), with an agree­ment in the frame­work of the Com­mon Plat­form.”

GXG Mar­kets (www.gxg­mar­kets.com) is owned by the Swedish GXG Global Ex­change Group su­per­vised by the Dan­ish Fi­nan­cial Su­per­vi­sory Author­ity and the Cyprus Stock Ex­change (www.cse.com.cy) is su­per­vised by the Cyprus Se­cu­ri­ties and Ex­change Com­mis­sion.

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