The Cyprus Stock Exchange is struggling to cope with the number of companies hoping for a floatation and at a press conference last week, CSE council members, CSE Chairman Paris Lenas and general manager Nondas Metaxas addressed the issue and even put forward some proposals to deal with the listings backlog, which presently stands at around 90 companies.
The most important idea to emerge from the discussions was the lauch of a possible twin-track processing scheme to drastically cut the waiting list for companies seeking a listing. Lenas said that the twin-track examination procedure for applicants could be based on size, in order to cut through the backlog as quickly as possible, but was quick to add that it would not be a case of larger companies jumping the queue. Instead, there would be parallel procedures.
However, the annoucement was vague and gave no indication of how and when the new process would be introduced, nor would Lenas give any indication of how many companies could expect to be approved by the end of this year. He said: 'I never give bank guarantees. We will do our best'.
Other plans were revealed at the press conference, which was in fact not called specifically to deal with CSE issues but to announce the holding of the annual general meeting of the Association of National Number Agencies (ANNA) in Nicosia. A meeting was scheduled for May 30 to discuss the introduction of a separate Financial Times CSE index, which would be made up of 15 or 20 companies. Plans for the FTSE index, which would undoubtedly boost the international profile of the CSE, could be put into practice very soon, possibly within the next month. The CSE also mooted plans to venture into derivates and confirmed that it will introduce four new categories in the "other companies" sector, thus bringing it in line with European exchanges. Some of these changes could be brought into play within weeks.
The press conference did raise questions about the CSE's shortcomings and its Chairman was the first to admit that organisation of the CSE could benefit from change. He said ' We have to admit we have some bureaucratic procedures, because we are a public benefit organisation'. He also referred to the CSE's need for more autonomy, with privatisation as a possible means to an end, and criticized the Securities Commission for the delay in introducing mutual funds in Cyprus.
If at least some of the proposals for change are adopted, investors and spectators could well see the CSE on the rise. A FTSE index for the exchange would certainly do wonders for its profile and, having dispensed with the queue of flotation hopefuls, the CSE's self-esteem will no doubtl grow.
It could hardly plunge much lower, with the extraordinary revelation that at present the board of the CSE was "too embarrassed" to allow anyone into its offices.
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