Zagreb Stock Exchange listed its own shares at the official market of the Zagreb Stock Exchange

Friday, 2 September 2016

Zagreb Stock Exchange listed its own shares at the official market of the Zagreb Stock Exchange.
The trading has started on August 31, 2016 under the symbol ZB-R-A.

Total number of ordinary shares available for trading is 4,635,700 with a nominal value of HRK 10,00.
Prior to that, following the General Meeting decision from July this year, a stock split was completed dividing 46,357 shares with a nominal value of HRK 1,000,00. One ordinary share with a nominal value of HRK 1,000,00 was split into 100 shares with a nominal value of HRK 10,00 to gain broader access to investors. Earlier that year ZSE successfully completed capital in-crease process gathering almost HRK 15 million by issuing new shares.

Last year and first half of this year was a ground-breaking period for the ZSE. At the end of 2015 we have successfully acquired Ljubljana Stock Exchange (LJSE). Zagreb and the Ljubljana stock exchanges share a similar development path and financial system framework, with Slovenia’s capital market being very similar to that of Croatia by the degree of its development, structure and potential. Investors in these two markets often consider them as one, and Croatian investors hold considerable investments in Slovenian companies, said Ivana Gazic, ZSE’s President of the Management Board.

It is expected that Ljubljana Stock Exchange acquisition by the Zagreb Stock Exchange to yield positive effects for both exchanges and both capital markets, while also resulting in numerous synergies. The consolidation will be reflected positively on turnovers of both exchanges, in turn increasing their negotiating power with regard to the services both exchanges use and provide. In addition, Zagreb Stock Exchange plans to migrate its trading on the Xetra trading system by the November 2017. LJSE and several other stock exchanges are also using Xetra trading system, and regional and international capital markets participants will benefit from unified access to capital markets and uniform standards.

SEE Link, regional trading integration project, initiated by the Zagreb, Bulgarian and Macedonian stock exchanges with financial support of the European Bank for Reconstruction and Development (EBRD), achieved exceptionally important milestone: SEE Link order exchange system became fully operational enabling integration of the regional market with a market capitalisation of approximately USD 30 billion in almost 400 securities, with the aim of providing an impetus to liquidity and enabling a simpler and more efficient approach to investors and local brokers. Besides three founding exchanges, Athens, Belgrade, Banja Luka, Ljubljana and Montenegro stock exchanges have joined SEE Link as well. Many other markets showed their interest in joining and it is expected that SEE Link will have up to 10 participating stock exchanges till the year end.

EBRD was also actively involved in the capital boost of the Zagreb Stock Exchange acquiring more than 5% in ZSE, becoming second largest shareholder. Zagreb Stock Exchange recently started the process of developing regional capital market for small and medium enterprises (SMEs) and once again EBRD stepped in by securing funding through donor funds to finance a study on the establishment of ZSE SME Growth market, which would facilitate access to capital for small and medium enterprises.

In the European Union countries, nearly 99% of all enterprises are SMEs. Especially in emerging economies, SMEs are the driving force behind economic growth. However, SMEs face more severe credit conditions than larger companies, and still face limited access to capital market financing. ZSE’s process of developing SME market in Croatia and the region is in line with EU initiative to support the process of facilitating access to finance for SMEs through its regulation (Markets in Financial Instruments Directive 2 – MiFID2, shall enter into force in early 2017), enabling SME markets to have less restrictive listing and reporting requirements compared to the main markets.

ZSE was in the first half of this year already twice ranked among the world’s top five entities assigning LEI codes, according to the quality assessment report of the Global Legal Entity Identifier Foundation (GLEIF). In June this year the first ever publication issued by ZSE was presented, entitled “Corporate Governance: a Manual”. The manual was supported by the International Financial Corporation (IFC), and is addressing in a practical and succinct manner the legal and regulatory framework in which Croatian companies operate.

Zagreb Stock Exchange is the first regional self-listed stock exchange, setting new standards of transparency and acting as a corporate governance benchmark, and making a new step in further regionalization, allowing ZSE to efficiently raise new capital for further growth if necessary. All this would not have been possible without the strong cooperation with the regulator, Croatian Financial Services Supervisory Agency.
We hope that often announced governmental privatization plans will take place in the near future along with the new political situation development and that the market will soon see new interesting investment projects.
Looking ahead, we are aware that there is still a great deal of work to be done in developing Croatian as well as regional capital market, however, this is an exciting beginning of a new era and complements our ambition to become a financial institution that will encircle the development path of the companies from startup to regulated market listing.
We hope that our shareholders recognize the value of the many initiated projects, and we thank them for their support in the preservation and further development of the only regulated market in Croatia, representing an integral and essential part of the Croatian financial system, Gazic concluded.