Bucharest Stock Exchange (BVB) announces that starting January 5, 2015, will come into force a new market segmentation, by replacing the I, II and III Tiers with the Premium and Standard Tiers. The Financial Supervisory Authority (FSA) recently approved the proposals to amend BVBs’ regulations, so the new concept, which takes into account the liquidity of the shares or the potential liquidity, on principles similar to those of BVBs’ indices system, can be implemented.
“The new segmentation will contribute, together with all other changes implemented in 2014, to a better identification of equities traded on the BVB's Main Market. It is a good step for the companies and for investors. But it also gives a better picture of the market for all potentially interested parties, and has some instruments embedded, aimed at the higher quality of investors' relations”, stated Ludwik Sobolewski, BVB CEO.
This new segmentation of the regulated market is part of a package of measures adopted by BVB with the objective of increasing issuers’ visibility, liquidity and market efficiency, thereby contributing to the common objective of local capital market stakeholders - the upgrade from Frontier Markets status to Emerging Markets status.
Selecting issuers for analysis to promote to Premium tier is based on the following alternative criteria:
- The shares are among the 25 most liquid securities, as to liquidity coefficient;
- The average free-float capitalization for the last 3 months exceeds EUR 40 million.
In addition, BVB may upgrade at this tier also issuers with a liquidity coefficient not less than 0.0002 if they will have signed a contract with a market maker who will support the market liquidity of shares.
The fulfilment of these criteria will not automatically lead to upgrading an issuer to Premium tier.
BVB will conduct periodic assessments on these requirements and inform both issuers who become eligible for Premium tier and issuers that are already at this tier but that will not meet the criteria anymore and will give them a certain period of time in order to take the necessary steps to increase the liquidity of the shares issued so that they remain at the top tier of BVB.
In addition, as part of BVB’s efforts to improve the corporate governance climate, new eligibility criteria regarding transparency and IR services will be enforced in January 2015 for BET and BET-TR indices. The criteria refers to the following requirements: reporting in English, IFRS reporting, conference calls/analyst & investor meetings when quarterly results are released.
Bucharest Stock Exchange runs markets for shares, bonds and other instruments, through regulated platforms and alternative systems, and provides a wide range of services to participants of financial markets. Bucharest Stock Exchange is a public company, listed on its own market since 2010. For more information refer to www.bvb.ro.