FEDERATION OF EURO-ASIAN STOCK EXCHANGES
ANNUAL REPORT JUNE 2013
BULGARIAN STOCK EXCHANGE
Ivan Takev
CEO
At the eve of the 100th anniversary of the
establishment of the first stock exchange in
Bulgaria we have all the reasons to believe
that the domestic capital market is finally on
the track of long-awaited recovery. Indicative in
this respect is the fact that 2013 was the best
year for the market in terms of both liquidity
and performance since the beginning of the
financial turmoil: BSE’s main index SOFIX was
one of the top performing indices in Europe
marking a considerable 42% increase whilst the
trading volumes surged to their 5-year highest.
Investors’ anticipation of a positive trend
on the capital market was motivated by the
improvement in the financial results of the
major listed companies in the recent years
and reflected the prevailing tendency for
steady recovery of the domestic economy.
The optimistic impulse in the investors’
HISTORY AND DEVELOPMENT
The first Stock Exchange Act was adopted
in 1907 and regulated the structure and
operations of stock and commodities
exchanges. The Securities, Stock Exchanges
& Investment Intermediaries Act was adopted
in July 1995, which led to a process of stock
exchange consolidation. In July 1997, the
present Bulgarian Stock Exchange-Sofia
was established. In accordance with the
requirements of the new law, a Securities
& Stock Exchange Commission was set up.
On 9 October 1997 the Commission officially
licensed the BSE-Sofia. The first trading session
on the regulated market took place on 21
October 1997. By the end of 1999 there were
32 companies listed on the Official Market and
about 1,000 companies admitted for trading on
the Free (OTC) Market as a result of the mass
privatization program. On 6 December 2001 the
Commission officially licensed the BSE-Sofia to
organize an Unofficial Market, which replaced
the Free Market and set clear rules for regulation
of all companies traded on the Exchange.
At the eve of the 100th anniversary of the
establishment of the first stock exchange in
Bulgaria we have all the reasons to believe
that the domestic capital market is finally
on the track of long-awaited recovery.
confidence is expected to continue during 2014
considering this year’s forecasts for a GDP
growth of 1.8%.
That is why BSE intends to put some serious
efforts to keep the momentum it gained by its
active involvement in various initiatives aiming
at increased investor awareness and market
visibility. In order to be able to attract more
foreign investors we plan to organize road
shows abroad; something we already started in
late 2013. We also intend to promote a variety
of initiatives, mainly educational, so we can
popularize the stock market among a greater
number of domestic investors.
positive repercussions on the trading and
simplified application of margin and short
sales as well as broader range of post-trading
services in general.
Another landmark event in 2014 is expected
to be the listing of the first Exchange Traded
Fund (ETF) which will increase the variety
of our product offering thus supplementing
our continuous efforts to promote the overall
investability of the market.
In 2014 the Bulgarian capital market will
also experience in full the benefits of the
technological innovations introduced by the
Central Securities Depository which will ensure
In December 1999 a new Public Offering of
Securities Act was adopted by the Parliament.
The law is aimed at providing protection for
investors and creating prerequisites for the
development of a transparent capital market
in Bulgaria with criteria similar to those of the
European Union. FUTURE OUTLOOK
The Securities & Stock Exchange Commission
was first renamed the National Securities
Commission, but in March 2003 it was
replaced by a new supervisory body - the
Financial Supervision Commission (FSC).
More than just a name change, the move
pulled together the regulation of a number
of financial (non-banking) sectors under one
body. The regulatory changes during the year
directly improved conditions for investors and
issuers, as well as underlined the government’s
commitment to encourage wider overall
development of the capital markets. • Expected renewal of privatization of both
BSE and the Central Securities Depository
(CDAD) in a single deal;
• Smooth recovery in terms of economic
environment and equity market performance;
• Forthcoming listing of the first domestic
Exchange Traded Fund (ETF);
• Significant overhaul of the technology in
use at CDAD with long-term impact on the
domestic market structure;
• Continuous efforts for improvement of the
prevailing corporate governance practices;
• Involvement in various educational initiatives
aiming at better investor awareness and
more prudence
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