FEDERATION OF EURO-ASIAN STOCK EXCHANGES
ANNUAL REPORT JUNE 2013
MACEDONIAN STOCK EXCHANGE
In 2012, market capitalization of the 32
listed companies was around 421 million
euros.
Ivan Steriev
CEO
In 2012 the trend of negative movements of
the key stock market indicators continued at
MSE. During this year 14,905 transactions
were executed compared to 23,426 in 2011.
The market in 2012 was significantly reduced
if we consider the total turnover (around 91
million Euros) which represents a decrease
of 59% compared to 2011. However, the fact
that there were no big block trades executed
in 2012 (unlike the two block trades with
Skopje brewery in the amount of almost 80
million Euros in 2011), should be taken into
consideration. Therefore, by adjusting the
turnover in 2011 (i.e. the value of these block
trades to be excluded), reduction of turnover
in 2012 amounted to more objective 36%. The
average daily turnover was around 370,000
Euros. The turnover through the MSE electronic
trading system - BEST, which is the most
relevant indicator of the market activity, was
around 20% lower compared with 2011. Market
HISTORY AND DEVELOPMENT
The Macedonian Stock Exchange was founded
on September 13, 1995 and commenced
trading on March 28, 1996, as a central
marketplace for trading in securities and the
first organized stock exchange in the history
of the Republic of Macedonia. Its mission is
to provide attractive, efficient, transparent and
secure functioning of the organized secondary
securities market in the Republic of Macedonia.
For its 17 year history, the Macedonian Stock
Exchange has managed to establish a sound
market and information infrastructure and a
cohesive legal and regulatory framework, as well
as solid expertise upon which the functioning of
the Macedonian securities market is based.
The MSE was founded as a not-for-profit joint
stock company with founding capital of 500,000
Euros. According to the legislation that was in
force in 1996 the only eligible founders of the
MSE were banks and other financial institutions
(saving houses and insurance companies). MSE
initially had 19 members: 13 banks, 3 saving
houses and 3 insurance companies. Starting
PAGE 62
capitalization of the 32 listed companies was
around 421 million euros i.e. decreased by 5%
YTD and represents 5,4% of GDP. The main
stock index MBI10 annually decreased by 12%
and recorded value of 1731.18 points. Foreign
investors accounted 11,6% of the total annual
turnover on the buying side, and 21% on the
selling side.
These figures demonstrate that the situation
in the Macedonian securities market is still
complex, but also there is huge potential for re-
growth. This conclusion comes from the current
level of turnover and market capitalization. The
comparison of the turnover with shares through
the BEST system in 2012 (25.2 million euros)
with the turnover in 2007 (471.4 million euros)
is self-explanatory. At the same time, the share
of market capitalization to GDP of just over
5% and comparative analysis with markets
in many other countries show that there is
from June 20, 2001 (with the amendments of
the Securities Law), MSE started to operate
on a for-profit basis, with a founding capital of
500,000 EUROs. MSE shareholders may be
any legal and private domestic and foreign
entity. All MSE members must be licensed for
trading in securities by the Macedonian SEC.
Only brokers, authorized by the MSE members
may trade in securities at MSE. MSE currently
has 15 members - 10 brokerage houses and
5 banks. Currently MSE has 36 shareholders
(brokerage houses, banks, legal entities and
private investors).
FUTURE OUTLOOK
Macedonian Stock Exchange:
• In accordance with the latest amendments
of the Macedonian Securities Law, a new
process of mandatory listing of certain group
of joint stock companies will be introduced. It
is expected that number of listed companies
to be doubled. These changes will contribute
for increment the transparency of these joint
stock companies and eventually to affect the
huge potential for growth - whether through
future price increases of the shares of listed
companies, additional capitalization of current
listed companies or new listings. Any positive
combination of increased turnover and/or
market capitalization will result in improvement
of the MSE turnover ratio as well.
We expect that the performance of the
Macedonian stock market in 2013 will be at
a similar level as in 2012, i.e. it is expected
to operate in not very easily predictable and
quite complex economic environment. What is
certain is that starting from 2013 the working of
the MSE will be positively affected by regulatory
changes related to new process of mandatory
listing of certain group of Macedonian joint
stock companies and newly introduced tax
holidays on capital gains for the next three
years.
trading on a middle and long term.
• Implementation of joint program (by
Securities and Exchange Commission,
MSE and Macedonian Central Securities
Depository) for education of investors and
issuers of securities.
• Analysis of the possibility for introduction
of new financial instruments on the market
and support of financial intermediaries in
issuing such instrument, with stressing
on development of debt and structured
products.
• Improving the market infrastructure through
technical and normative developments of the
MSE functionalities.
• Support of the companies who will show
interest in conducting a public offering via
MSE.
• Adoption of new methodologies for
calculation of indices published by MSE.
• MSE increase its participation on- going
projects related to the implementation of the
Memorandum of Partnership of exchanges
in South East Europe and within regular
activities of the Federation of Eurasian Stock
Exchanges (FEAS).