The Budapest Stock Exchange (BSE) has adopted a new strategy aimed at encouraging the listing of new shares and attracting new investors, thereby assisting the government in stimulating economic growth.
The BSE struggles with a low number of listed shares and declining revenues. By 2020, the exchange aims to increase the number of large liquid shares from the current three to four daily to at least five and to develop the capital market in close cooperation with the government, utilizing funds from European Union sources, according to a BSE statement.
They also plan to list five shares or corporate bonds annually and raise the market capitalization of shares to about 30 percent of GDP, up from the current slightly below 20 percent.
In 2015, the BSE index jumped nearly 44 percent and is currently at its highest level in six years. The market capitalization of the BSE is lower than that of others in the region, new shares are rarely listed, and trading volume remains lower than it was before the crisis.
“Currently, the priority is to encourage successful listings of shares through the introduction of appropriate obligations for companies that meet high quality standards, necessary to strengthen investor confidence,” the BSE statement notes. “It is also important that shares are listed at price levels that will ensure room for their increase in the future,” it adds.
