The Romanian capital market kicks off the year with a 4 percent increase and a new all-time high number of 133 000 investors

By RBJ
The Romanian capital market started the year with a series of significant rallies at the level of the BET index, which includes the 20 most traded companies, and the BET-TR index, which also includes dividends. The companies listed on the Bucharest Stock Exchange (BVB) included in these indices closed the first month of 2023 with a 4% growth. The BET index closed the last trading session at a level of 12,139 points, and the BET-TR at a level of 23,611 points. In fact, in January all the BVB indices were in the black, except for BET-FI, which had a 1% decrease. The biggest surge was recorded by the index that includes the energy companies, BET-NG climbing 6%.
The positive evolution of the capital market comes after a year 2022 marked by volatility and uncertainties. At the level of the Romanian capital market, new all-time highs were recorded last year in terms of total transaction value, average daily liquidity, and number of transactions. Thus, the Bucharest Stock Exchange reached a new record in 2022 in terms of the total value of transactions carried out on all markets with all types of financial instruments after total transactions exceeded RON 24 billion, up 11% from 2021. Also, at the level of last year, the average daily trading liquidity for all types of financial instruments listed on the Regulated Market (RM) and the Multilateral Trading System (MTS) increased by 11% and reached RON 95.6 million. The investors achieved a new record in 2022 in terms of the number of transactions with all types of financial instruments carried out in the RM and MTS: 1.67 million transactions. At the same time, international uncertainties led to market declines of 10.7% for the BET index and 1.9% for the BET-TR index at the end of last year.
The number of investors in the capital market in Romania continued to grow and reached 133,000 investors at the end of 2022, according to data from the Investor Compensation Fund (FCI). By comparison, at the end of 2021, there were almost 82,000 investors. This is a 62% increase achieved in a single year. Moreover, the figure of 133,000 investors represents a new all-time high for the capital market in Romania.
In a difficult regional and international context, in 2022, 42 financing rounds were carried out on the BVB. The total value of last year’s funding rounds reached EUR 1.9 billion, being very close to the 2021 maximum of EUR 2 billion. In the last 4 years, 149 financing rounds took place at the BVB, which totaled EUR 6.1 billion. Out of the 149 rounds, 38 were equity issues and 111 were bond issues. From the perspective of listings, the year 2023 began at BVB with the listing of a new issue of corporate bonds, worth RON 490 million.
Radu Hanga, President of the Bucharest Stock Exchange said: „ The capital market started the year very well as reflected by the price appreciation of many listed companies, with the BET index going up by 4%. The financing rounds carried out through the capital market continue, we already saw a first listing this year for corporate bonds worth almost half a billion lei, and we have clear signals that several companies are preparing to go public. Romania has taken steps to join the Organization for Economic Cooperation and Development (OECD) and the successful completion of this course will bring added value to all Romanian companies who will understand that through better corporate governance they can have access to important resources of capital held by international investors.”
Adrian Tanase, CEO of the Bucharest Stock Exchange said: „ A series of concrete projects to improve the relationship with investors and increase the liquidity of the companies listed on the stock exchange have already been started this year. Together with the EBRD, we launched the “Investor Relations and Liquidity Support Programme” and we have recently added a section dedicated to individual investors to the BVB Research platform. The official request for the authorization of the Central Counterparty was submitted to the Financial Supervisory Authority, an application containing over 150 documents accompanied by their translations into English. We are following the steps that are required by the regulations and finally this application will be evaluated by the ESMA. Our target is the operationalization of the CCP in the fourth quarter of this year.”
The Bucharest Stock Exchange became increasingly visible in the public space, both as an issuer and as a market and system operator, through the capital market promotion projects it initiated and continued to develop. After the rebranding carried out in 2021, when it adopted a new visual identity, in 2022 BVB celebrated 140 years since the establishment of the first stock exchange in Romania. The anniversary event was organized under the High Patronage of the President of Romania. The Central Counterparty project has entered a technical stage of implementation and authorization, and the first derivative products will be available on the capital market in 2023. The Made in Romania project, launched in 2017 by BVB to promote Romanian companies, has reached the 5th edition, and since the beginning of the program, 16 companies have listed shares or bonds on the stock exchange, so that their financing rounds exceeded EUR 212 million. More than 70 analysis reports were published in 2022 alone under the BVB Research Hub project, a tool aimed at improving the coverage of analysis reports for local issuers and increasing access to fundamental analysis for local investors. ESG scores for 11 listed companies are also available on bvbresearch.ro. As part of the efforts to promote Romania as a regional financing hub, BVB organized together with maib, the largest bank in the Republic of Moldova, the first high-level forum “Moldova – Romania: Capital bridges”, in Bucharest, and the conference “Accessing international capital markets”, in Chisinau, events dedicated to promoting opportunities in the capital market.
The evolution of the capital market in Romania has been internationally recognized by the global index provider FTSE Russell and, as of 2020, Romania has been promoted to Emerging Market status. Currently, there are 13 Romanian companies included in the Emerging Markets indices, and among these companies, there is also the BVB as an issuer, a company listed in 2010 on its own market.