Erste Bank to make its debut on the Bucharest Stock Exchange, analysts expect it to hike liquidity

Publish date: Astazi, 14-02-2008
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Erste Bank to make its debut on the Bucharest Stock Exchange, analysts expect it to hike liquidity
 
Erste Bank, the main shareholder in Romania's largest bank by assets Banca Comerciala Romana (BCR), will list shares on the Bucharest Stock Exchange (BSE) on February 14; the market expects the listing to draw more liquidity despite turmoil on the international markets, analysts said.

Erste will debut tomorrow at the reference price it had on closing in Vienna and it will be listed on the international category under the EBS symbol, with hopes it will underpin deals on the market.

Liquidity on BSE is much more lower than on the Viennese market and on the Stock Exchange in Prague. Liquidity on BSE stood at 9.55 million euros while in Prague deals totalized 101 million euros and 623 million euros in Vienna.

The listing of Erste will draw more local investors without reducing liquidity on the other markets where it is already listed, executive manager of BCR, Manfred Wimmer said in mid-January. Investors will also be attracted by the stability of Erste's shares, Wimmer pointed out.

Erste Bank (ERST) closed at 36.77 euros on the Vienna Stock Exchange yesterday while last summer it was traded at 60 euros.

BSE authorized yesterday BCR as market maker for the Erste shares. A market maker is a brokerage firm or bank that maintains a firm bid and asking price in a given security by standing ready, willing, and able to buy or sell at publicly quoted prices (called making a market). As market maker, BCR will benefit from a 30 percent discount for the transaction commissions.

The Erste shares will have the shortest transaction program in Bucharest while in Vienna and Prague the extended program can lead to slight differences between quotations. Deals on the BSE start at 10 a.m. and last until 2.30 p.m. with a pre-opening of 30 minutes and a pre-closing of 15 minutes.

Erste Bank bought the main stake in BCR in late 2006. Erste's participation in BCR now stands at 69.11 percent.

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