BVB hopes short selling will help the local capital market

 The Bucharest Stock Exchange (BVB) welcomes the new regulatory framework for the operations of lending and borrowing of the shares and the execution of the short selling recently approved by the Financial Supervision Authority (ASF) . Earlier this year the ASF issued a new set of regulations relating to those operations.

“We think that short selling is important in itself, as a tool serving investors and improving the quality of the pricing mechanism. Besides, the short selling increases the attractiveness of the market ‎making program, which is essential for the better velocity of the market in equities. Much larger exchanges than the Bucharest Stock Exchange would have a problem of the depth and liquidity of the market if they had not have liquidity providers. In this context it is of paramount importance that the Financial Supervision Authority decided to eliminate the fees of the regulator that were imposed on transactions executed by market makers. We interpret this set of good changes introduced by the ASF as a proof of a complex and comprehensive thinking about the strategy for the development of the Romanian capital market, ” said Ludwik Sobolewski, CEO of Bucharest Stock Exchange.

“We are very satisfied that the legislative package regarding the borrowing and lending activity has been finalized. Now comes the next stage, which is turning the regulations into market practice. We will be observing this process with great interest, ” said Florentina Boboc, regulations director of the ASF.