SIFs reach new historic highs

Shares of financial investment companies (SIFs) reached new historic highs yesterday, after a frenzied session on the stock exchange, with the optimism of SIF share buyers continuing to be fuelled by positive information emerging on the market.
The BET-FI index, which follows the progression of the five SIFs, witnessed a rise of 6.5% after the first 40 minutes of trading, later losing ground. At the close of trade, the index increased 1.2% against the value registered on Monday, recording the largest closing value ever registered on the index. The five SIFs, which are among the richest companies in Romania, yesterday reached a cumulated market value of 3.5 billion euros.
In addition, information emerged on the market that the Dutch bank ABN Amro would launch an open-end certificate issue, in line with the progression of the BET-FI index. The certificates were launched in March and are part of hundreds of financial products offered by the bank. However, the information, which reconfirms the fact that the SIFs are increasingly targeted by the foreign investors, only appeared yesterday on the Romanian market. The open-end certificates are listed on the Frankfurt Stock Exchange.
ABN Amro is selling and buying back the certificates, deriving a profit from the price difference, whilst covering possible risks by buying shares from the market. The value of certificates currently circulating on the market amounts to 8 million euros, according to the bank’s website, but the bank could supplement its issue, in an attempt to attract the interest of investors.
This year, foreign investors acquired large stakes in SIFs on the Bucharest market, which is supported by statistics released by the CNVM (National Securities Commission) on foreign investments on the capital market. Net purchases of SIF shares from foreign investors amounted to 189 million euros in the first five months of the year, a sum equivalent to 7.5% of the SIF’s market value.