Government stocks decrease at Malta Stock Exchange but shares and bonds of private companies increase
Last year the value of financial titles at the Malta Stock Exchange reached more than €12 billion and were around 100 million Euro less than 2017 because Government lending through stocks went down. The CEO of the Malta Stock Exchange Simon Zammit said that stock transactions went down by slightly more than 30%, mostly because Government stocks are going down while the activity of bonds and shares of private companies is increasing.
A look at the value of the financial titles negotiated last year at the Stock Exchange shows that there has been a slight decrease of 0.85% from the previous year. Mr Zammit explained why there has been a 30% decrease in overall trading.
“This is the same sign we saw in the previous year when trading in Government stocks has continued to decrease. The main issue is that the intervention of the Central Bank has gone down, and has continued to decrease during the year. Also, the Government now needs less capital, and its requirements over the last three years have gone down, so the Government stock issues have decreased and we are seeing lower volumes of trade.”
To compensate for this, there has been an increase in the shares and bonds of private companies.
“Trading of named company shares has remained approximately the same when compared with previous years. We have however seen an increase in the price index of these named companies, an increase of almost 4%, and it was a very interesting year where the price shares of named companies are concerned.”
The CEO said that the new market of small to medium enterprises, which was launched a few years ago, is leading to a number of small companies turning to the Stock Exchange to finance their projects with new capital. He said that this trend is expected to grow this year.
“Last year, we doubled the number of companies which have approached this market. We have ended the year with 12 companies. It is being projected that during 2019, another 12 companies will approach the stock market”.
Mr Zammat said that around 1000 people have attended courses provided by the Stock Exchange Institute which was set up to educate small investors about financial services.