FEAS Yearbook FEAS Yearbook 2014 | Page 89

FEDERATION OF EURO-ASIAN STOCK EXCHANGES ANNUAL REPORT JUNE 2013 TIRANA STOCK EXCHANGE Anila Fureraj General Manager Tirana Stock Exchange is the only securities market in Albania. The development of transparent capital market, based on international standards and activation of capital market as a trading platform for different financial instruments, is the main objective of TSE. The presence of an active domestic capital market and efficient, would give companies the option to increase capital by understanding that brings real benefits for the capital market. An active and efficient capital market will expand the capital market in Albania by providing various investment opportunities and HISTORY AND DEVELOPMENT TSE is the first and the only stock exchange in Albania, established in 1996 originally as a department of Bank of Albania (BoA). The activity at hand, at that time, was the trading of the T-Bills with 12 months-to-maturity, five series of government bonds and privatization vouchers. It also held out the primary auctions for Treasury Bills until August 1st, 1998, than this market moved to Monetary Operations Department, at BoA. TSE was structured as a joint stock company and a state - owned one,, on March 2002, and shareholder was State, represented by Minister of Finance (100% of the shares). It’s authorized and subscribed Capital is equal to 20,000,000 lek (~EUR163,000) with a no. of shares of 20,000. On 07.13.2007, after several periodical - limited licenses since 2002, the Albanian Financial Supervisory Authority, licensed Tirana Stock Exchange with an infinite validity license. The license empowers TSE “To operate as a securities market for the trading of Government/ Corporate Debt Securities and Shares” with no time restriction. The development of transparent capital market, based on international standards and activation of capital market as a trading platform for different financial instruments, is the main objective of TSE. mechanisms to ensure efficient and transparent pricing will increase access to finance for Albanian companies. As requirement of new law “On Securities” were draw the Rules of Tirana Stock Exchange that was approved by Financial Supervisory Authority Board. In these rules are include in a systematic manner rules of membership, listing, trading, clearing and settlement of transaction on securities that will be trading in Tirana Stock Exchange. Rules of Tirana Stock Exchange were prepared and adapted with contemporary general principals for functioning of capital market of Market Structure -Trading TSE is an order-driven “open outcry - call market” which uses a manual trading system with physical presence of licensed commissioners (members) on the trading floor. Securities’ prices on the trading sessions are set according to “single price method”, while trading is held: - every Monday and Wednesday, from 10.00 - 12.00, for the official market. - every Friday for trading in the parallel market. The eligible tradable instruments are: shares, government and corporate bonds. In order to trade, TSE commissioners should be physically presented in the trading sessions. Each trading session is conducted in two rounds. Organized as an auction market, TSE calculates a single price for each tradable instrument, at the end of each trading day. Clearing and settlement for every type of securities traded at TSE, is done on a net basis within T+3, in full accordance with “Delivery versus Payment - DVP” principle. Clearing and settlement for transactions executed at TSE is done in cooperation with second tier commercial banks and Albanian Share Registrar for joint-stock company shares. Membership TSE records 5 licensed members, three commercial banks and two private companies, which offer brokerage services for investors. European countries and have like purpose protections of investors and ensure a full transparency of companies that will be listing in Exchange, protection of minor stakeholders interests and ensure the equal treatment for all shareholders, application of International Standard of Accounting for all companies that be listing in Exchange and prevention of illegal practice in trading securities on Exchange. The capital market needs for particularly attention from business. Till offer and demand for the market product will be in continuously in development, than time is coming that activity of this market will grow and will be useful for participant of this market. FUTURE OUTLOOK Activating the securities market as a common trading platform for several financial instruments, will be the strategic objective of the TSE. Achievement of such an important goal shall be carried out through: • Working closely with and assisting in the continuance of domestic top level businesses, TSE members, etc. to make them aware of advantages the securities market may offer them as well as providing these stockholders with necessary information, in order to be listed at TSE, • Bilateral negotiations with Albanian Government towards the inclusion of TSE in the privatization process of the state-owned enterprises (SOEs). These negotiations will cover identification of potential strategic and non-strategic state owned companies, which can be privatized through IPO, • Negotiations with the Albanian Government and the Ministry of Finance towards the assignment of TSE, by Ministry of Finance (MoF), as Government’s agent in organizing primary auction for long-term public debt securities, • Negotiation and cooperation with MoF and AFSA towards the compilation of legal and fiscal incentives, which are deemed necessary to encourage private companies to raise their capital through IPOs and TSE listing, PAGE 89