The diversification of financing sources is becoming more and more necessary. In an environment marked by very high inflation levels and with rising financing costs due to the accelerated rise in rates, obtaining own resources is essential. This, together with the investments that must be made to face the transformation of production models, becomes the perfect breeding ground to boost the stock market. The president of the National Securities Market Commission (CNMV), Rodrigo Buenaventura, took advantage of his intervention at the thirteenth edition of Spain Investors Day to demand the development of the Spanish market. “It must grow because, as in the other large European markets, we need more listed companies in relation to the size of our economy,” he insisted.
Although in recent years stock market instability has considerably reduced the number of IPOs, Buenaventura highlighted the role played by BME Growth. The stock market for small and medium-sized companies, formerly MAB, starred in 15 debuts last year, a figure that contrasts with the only premiere that the Stock Exchange hosted in 2022, that of OPDE. “In recent years, the Growth segment has been incorporating new companies moderately and we have successful examples of some that, after passing through the alternative market, have moved to the main market. But it is not enough, we need more companies on the Stock Market ”, he claimed in clear reference to MásMóvil –already excluded from the Stock Market–, Grenergy or AtrysHealth.
In order to foster market development and contribute to less dependence on bank financing, Buenaventura recognized that it is necessary to reduce market access requirements, a task in which the CNMV has been immersed for the last six years. Of course, cost and time savings should not jeopardize investor protection, he clarified. The regulator also promised to strengthen the fight against market abuses.
Buenaventura stressed that one of the latest measures aimed at achieving flexibility is the proposal sent to the Government last year to significantly reduce supervision rates. The objective pursued with this is threefold: to guarantee the financial autonomy of the supervisor so that it can continue to be financed without resorting to the public budget, to adjust the rates to the supervision costs and to facilitate the competitiveness of the Spanish market. This proposal is added to other measures already implemented such as the suppression of prospectuses in the issuance of promissory notes for terms of less than one year, the simplification of the requirements for the admission of fixed-income securities, the non-compulsory nature of submitting quarterly accounts and the elimination of the requirement to present a series of documents in the issue prospectuses.
The president of the CNMV highlighted that, together with the initiatives approved in Spain, work is being done at the European level for the approval of a directive to speed up and stimulate IPOs, the so-called Listing Act. Buenaventura is confident that it can be completed under the Spanish presidency of the EU in the second half of 2023. The head of the institution pointed out that this proposal addresses some of the key elements to encourage companies to prepare their jump to the market.
Within investor protection, Buenaventura insisted that good corporate governance is essential. Although the room for maneuver in this area is limited, the CNMV hopes to publish the code of good practice for institutional investors in the coming weeks. This code seeks to promote greater involvement in companies so that they have investors who are better informed, more active and involved in their strategy and decisions. It is a non-binding guide, but the entities that use it must indicate in their annual report how they have applied its principles in the previous year.
For his part, the governor of the Bank of Spain, Pablo Hernández de Cos, stressed that although the euro zone economy is the most affected by the war in Ukraine, it is showing greater resilience than expected a few months ago, with growth which could be around 3.4% at the end of 2022. With inflation as the great workhorse, the ECB has been forced to tighten its monetary policy. But in addition to the rate hike, Cos, in line with what Lagarde is demanding, called for consistency between fiscal and monetary policy. Given the rumors that point to a recession, the governor of the Bank of Spain believes that “it would be relatively short and shallow.”
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