FEDERATION OF EURO-ASIAN STOCK EXCHANGES
ANNUAL REPORT APRIL 2009
MOLDOVAN STOCK EXCHANGE
Dr. Corneliu Dodu
President
Reflecting on 2008, in its outcome it can be
said that for the stock market, it was not
easy, regardless of being efficient and quite
successful in terms of exchange rates. The
pace of investment activity compared with
the previous year, was not down. For two
consecutive years, the stock market has
shown the highest trading volume in the
history of the exchange. Volume last year
was classified as high and reached US$ 95.7
million, which was slightly lower than 2007,
but several times above the volume of past
years. This year the state has actively
initiated auctions for the sale of public
property in various ways, and they have
become favorites of tenders, including on the
Stock Exchange.
HISTORY AND DEVELOPMENT
In 1993 the Law on securities circulation and
stock exchanges was enacted and from this
point in time the institutional infrastructure of
stock market in Moldova began to develop.
In December 1994 the non-profit institution,
the Stock Exchange of Moldova (SEM) was
established as joint-stock close company. 34
promoters – the securities market professional
participants took part in its establishment. The
first transactions were made on June 26, 1995,
and this date is accepted as the birthday of
the Stock Exchange of Moldova, at that time 7
issuers were admitted to the auctions, but as
of January 1, 2008 – we now have 1020
issuers.
In June 1998 the SEM established the National
Securities Depositary (NSD) and a new trading
system were integrated with the depositary
system which allows transactions to be carried
out. At the present time SEM owns a share of
NSD, the rest of shares were divided between
the NSD participants. But according to the
changes made in the law «On Securities
market» which came into effect on January 1,
2008, SEM has the right to own up to 75%
votes.
In April 2000 SEM received the status of a self-
regulating non-commercial organization.
In July 2000 new SEM’s Regulations were
introduced which qualitatively changed the
mechanism of transactions. To date, the
Regulations have undergone significant
changes.
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The pace of investment activity compared
with the previous year, was not down. For
two consecutive years, the stock market
has shown the highest trading volume in
the history of the exchange.
The closing of the process of the
restructuring of investment funds - now they
do not operate as a professional securities
market participants, was completed. A
megaregulator, was established in 2007 as a
single regulatory body for the non-banking
financial sector of national economy.
In the legislative year our government laid
the foundation for new securities market
development, which aims to match the
standards of the MSE to that of international
standards. As from 1 January 2009 the MSE
was declared – a Public Joint Stock
Company, a commercial organization.
Shareholders can be any individual person
or legal person, but brokers and dealers
should have the largest representation.
In July 2007 the Mega regulator – National
Commission of Financial Market was created.
According to the legislation the Mega regulator
regulates and determines state policy of the
nonbank financial market.
In late 2007 and early 2008 changes and
additions to the basic laws on securities
market were put into effect. The aim of their
introduction is the legislation’s conformation to
international standards.
According to the new requirement of the law
«On Securities market» from January 1, 2009,
SEM is a public company, a for profit
organization. The shareholder can be any
individual person. But brokers and dealers
should still have the largest representation.
FUTURE OUTLOOK
Within the bounds of integration of The
Republic of Moldova in the European Union
with the purpose to implement of new
instruments for attracting investments in the
country and markets integration, in 2007 has
been done a fruitful work in adopting new laws
and modifications of the existing legislation on
Stock Exchange Market. It has been approved
a new law regarding the National Commission
of Financial Market (it’s created the Mega
regulator) and it has been assigned a new
membership of the Administrative Board of the
financial market. The code of corporate
governance has been implemented. The new
laws of audit and accounting activities have
been initialized, as well as many normative
and legislative acts of this field. It has been
Planned activities to improve the trading
technology include: installing a test to
"Arena" being used on the Bucharest stock
exchange site, and thus the gradual
introduction of the program "a remote
broker". Examine the question of the
integration of members of the stock
exchange in the Automated System of
interbank payments next generation (SAPI).
In the vortex of events and news, describing
the current world crisis, the MSE would like
to wish the stability and success for the
entire financial community.
implemented the essential modifications and
additions in the legislation of securities market
and legislation regarding join stock
companies. Thus, the basis of the further
development of the securities market is
incorporated in the Republic. It has been
initialized the process of implementation of
new instruments of financial market as
corporate bonds, sustained by government
and all the financial institutions of the country
in order to attract foreign investments. In
present, all the open-end founds created at
the beginning of privatization are in the
process of liquidation, except 6 Investment
Founds, which have been reorganized in
commercial enterprise with no license for
activity on financial market. They are expecting
the legislation regarding the holdings. Thereby,
it has been adopted the basis of future
development of Moldovan financial market.
Securities on Moldovan market still presents a
high interest for local investors as well as for
foreign investors, that leads to the increasing
volume of securities liquidity and positive
tendencies in the market development.