BVB’s capitalization plunged by more than €1 billion, during a new wave of generalized declines. BVB’s Board approved the use of global accounts for the transfer of all BVB-listed shares on Friday, hoping to raise the local stock exchange’s attractiveness in the eyes of foreign investors, who mostly operate through global accounts. At present, brokers can trade shares only through the individual accounts of clients, while, through global accounts, they will be able to buy shares through a single global account, and then distribute these to the individual accounts of clients.
Brokers say the measure is welcome, but that its likelihood of attracting many foreign investors is rather low, considering that BVB’s major problems are not of an administrative nature. “The intention of modifying regulations regarding global accounts is praiseworthy, but it will have no effect on the liquidity on the market. Foreign funds will return when fundamental economic problems are solved,” said Florin Ilie, Head of Equities Market within ING Bank Romania.
