FEDERATION OF EURO-ASIAN STOCK EXCHANGES
ANNUAL REPORT APRIL 2009
ZAGREB STOCK EXCHANGE
Roberto Motusic
General Manager
Despite the global market volatility and
recessionary environment forecast the
Zagreb Stock Exchange (ZSE) will continue
its work on implementation of a new
products and services. Year 2009 will test the
capabilities of market and stock exchange
HISTORY AND DEVELOPMENT
The ZSE was incorporated in 1991 as a
joint-stock company with 25 commercial
banks and insurance companies. Today, the
ZSE has 47 shareholders and 42 members.
Prerequisites for ZSE membership include:
compliance with the Securities Law,
licensing with CROSEC and acceptance of
the ZSE rules. A seat on the ZSE currently
costs approximately US$ 73,000. Members
are required to comply with the rules and
regulations of the ZSE and must register at
least one licensed broker.
Year 2008 was the most eventful year for the
Croatian capital market. The year that
started on the bull note has lost their entire
lustrous gain that they gained in 2007 .This
was sparked by the subprime crisis and
their ripple effects, bad economic news
started from the USA and spread throughout
the Europe and the effect was so cascading
that they ruined the sentiments in Emerging
capital markets globally and index of
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Despite the global market volatility and
recessionary environment forecast the
Zagreb Stock Exchange (ZSE) will continue
its work on implementation of a new
products and services.
flexibility. Narrowing the targets and carefully
selecting priorities to stabilize the system,
and regain the investors’ confidence are the
primary tasks.
Croatian Capital Market crashed more than
67%. Any positive development, long term
growth story, fundamental storey everything
blown by bears that came in hurry. Strong
final-month rally (CROBEX +7.2%) helped
partially reverse losses incurred through the
year.
Turnover decrease 26% (yoy basis), but
number of transactions almost doubled.
Final result is 17 billion kunas equity
turnover, 5 billion less than in 2007 but
significantly more than in year 2006.
We anticipate further government action as
well as the use of other tools to stimulate
growth.
Business sentiment continues to fall very
sharply to multi-year if not multi-decade lows
on both sides of the Atlantic and will roll over
to emerging markets as well. Equity market
valuations acknowledge this recessionary
environment. The consensus view of market
participants is that stocks are cheap, but it
is possible equity valuations could re-test
lows given the pending weakness in future
corporate earnings.
FUTURE OUTLOOK
The sustained nature of the financial sector
distress all around the globe and emerging
macro data points to a more prolonged
economic downturn than previously
envisaged. Although it’s not directly in line
with the current state of Croatian economy
and companies financial results, global
investors fear could affect domestic capital
market, liquidity and stock prices.
There is on going stock exchanges
consolidation within the region (Vienna and
Warsaw SE trying to position themselves as
East-European leaders in SE mergers and
acquisitions. Some smaller exchanges are
looking for close cooperation including
ownership relations with larger players). The
ZSE will carefully observe what’s on the
market and follow these trends.