The capital market under a new regulatory system
Discussing the topic: “Capital market and listing on the Albanian Securities Exchange as a financial alternative for corporations” brought together representatives of the American Chamber of Commerce in Albania, the Albanian Securities Exchange (ALSE), the Albanian Financial Supervisory Authority (AFSA) and Grant Thornton.
AmCham members attending the event were provided with information from experts on the capital market as an avenue for financing, the role of a financial intermediary, the criteria to be listed in the Albanian Securities Exchange and the transparency needed in financial reporting for publicly listed entities.
AFSA General Director Ervin Mete stressed that there is now in place a sufficiently appropriate legal infrastructure for the functioning of transactions that need to be made in order for a full capital market to exist. Along with the legal infrastructure, the aftertrade infrastructure has now also been regulated through the licensing of the Albanian Securities Register (ALREG), which has now taken over the functions of a central depository entity.
The approval of two laws — “On capital Markets” and “On the undertaking of collective investments” — created the necessary legal framework, which serves as a prerequisite for a capital market. The new laws diversify investment opportunities and interests in the capital market.
Mark Crawford, whose company, Aksionieri, serves the needs of the capital market, spoke about the importance of the functioning of the local capital market in Albania in general and the exchange in particular.
ALSE’s Artan Gjergji presented on how the capital market works and explained listing on the Albanian Securities Exchange as a financial alternative for corporations.
Mr. Gjergji explained how the Securities Exchange works as a market where the supply is offered by those that need funding of high value and for a long period, issuing securities to back the funding and on the other hand those who have available funds to buy or invest in these securities for a higher rate of return than the average offered by the financial market. During his presentation Mr. Gjergji explained the benefit and inclusion of securities in business as a way to get access to the necessary capital through their trade. The basic importance of listing on the exchange is to make a profit. This is a good way to get market value for a business and to convert that value to liquidity for the business shareholders. The inclusion in the exchange of the business helps the company to increase access to funds for investments that help increase the volume of activity of the entity. Listing on the ALSE Exchange and the issuance of shares also creates a positive social impact as through their purchase of shares, investors will essentially become co-owners of the business and its success.