All-time high trading value on Bucharest Stock Exchange, total transactions reached 4 billion Euro in 2020
New all-time high trading value with all types of financial instruments traded on the Bucharest Stock Exchange (BVB) in 2020: the investors active on the Romanian stock exchange traded financial instruments with a total value of RON 18.3 billion, the equivalent of EUR 3.77 billion. It is the highest value ever recorded on the main segment of the Romanian stock exchange and exceeded by almost 25% the previous record from 2007. At that time, the value of transactions with all types of financial instruments accounted for RON 14.7 billion.
Record trading values were achieved on the main segment in 2020 also for the average daily liquidity. Thus, the daily trading average with all types of financial instruments (shares, fixed income instruments, structured products, fund units, ETFs) reached RON 73.36 million, the equivalent of EUR 15.15 million, up 54% from the level of 2019 and up 24.9% from the level of RON 58.72 million posted in 2007.
The Romanian capital market closed 2020 with an increase of 3.4% for the BET-TR index, which also includes dividends, a performance that occurred in a context dominated by the uncertainties generated by the coronavirus pandemic. Moreover, the BET-TR index ended 2020 at a level of over 16,500 points, which is a new all-time high.
“The capital market has demonstrated, in perhaps the most complicated year in recent history, why it is a source of opportunities for both companies and investors interested in increasing their well-being. The individual investors found at BVB excellent trading opportunities that matched their risk profile. At the same time, the companies were able to rely on the trusted mechanisms offered by the capital market, and the Romanian state was able to access, quickly and efficiently, the liquidity it needed in an extremely difficult context. In 2020, on BVB, 3 companies went public, were launched 6 issues of government securities and 11 issues of bonds, which brought the total financing made through the capital market to RON 5.4 billion lei or EUR 1.1 billion. Our goal is to increase liquidity and we have done so successfully because last year we had the best trading year in the history of BVB. Therefore, it is no longer necessary to look at 2007 as a landmark because we have already exceeded that level. We can’t drive the stock market if we look in the rearview mirror all the time. We focus on what we have to do to develop our capital market,” said Radu Hanga, President of the Bucharest Stock Exchange.
“We look forward to 2021 when we expect the stock market to continue to consolidate its position as the main financing channel for the Romanian companies and the main source of capital accumulation for investors. We want to bring BVB as close as possible to retail customers and explore all the channels that help us achieve this goal. The year 2021 had a strong positive start on most capital markets, and the public health protection measures adopted by various states, as well as the launch and distribution of vaccines signal that the current health crisis can be overcome. We continue to live in an environment marked by low interest rates and excess liquidity, which will support equity prices,” BVB’s President also said.
“The year 2020 will certainly remain in the history of the capital market as a benchmark for the future development of the stock market. The promotion to the status of Emerging Market, the initiation of the Central Counterparty project and the start of the partnership for the implementation of technological solutions at the level of the BVB group are the key elements meant to fundamentally transform the Romanian capital market,” stated Adrian Tanase, CEO of BVB.
“The number one priority for 2021 is to increase the number of investors and increase voluntary participation in the capital market. It is essential to have a partnership with the authorities for the development of the capital market and we want to see as many state-owned companies on the stock exchange because listing minority stakes makes the activity of these companies more efficient through the rules imposed by the capital market. It is very important for the Government to use the capital market intensively, we saw this in 2020 through government bond issues, and we want to see decisions also regarding new company listings because it is for the benefit of Romania to have transparent and performant companies. We are optimistic about 2021, we want to have consistent decisions regarding the economic development of Romania and, once the risks generated by the pandemic will be diluted, there are all the prerequisites to have a better year than 2020. Also, for 2021, we expect Romania’s representativeness in the Emerging Markets indices to increase as other Romanian companies could be included in their structure,” further said BVB’s CEO.
The Romanian capital market was included, starting from September 2020, in the Emerging Markets according to the classification made by the global index provider FTSE Russell. Romania’s promotion to Emerging Market status was possible once two Romanian companies – Banca Transilvania and Nuclearelectrica – met the criteria required for the upgrade.