2020 Cyprus Country Report
The 2020 Cyprus Country Report features in-depth articles on the economy, foreign direct investment, international trade and headquartering as well as detailed sector profiles and insights from Cyprus’ 100 most influential political, economic and business leaders shaping the future of their country and its industries.
The 2020 Cyprus Country Report features in-depth articles on the economy, foreign direct investment, international trade and headquartering as well as detailed sector profiles and insights from Cyprus’ 100 most influential political, economic and business leaders shaping the future of their country and its industries.
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and bonds, which operate under the <strong>Cyprus</strong><br />
Securities and Stock Exchange Law and the<br />
Investment Services and Activities and Regulated<br />
Markets Law (MiFID). Shares, rights, warrants,<br />
corporate bonds, government bonds/ treasury<br />
bills, collective investment schemes and Global<br />
Depositary Receipts (GDRs) can be traded on<br />
the CSE, with the most popular being shares and<br />
bonds. Currently, CSE participants include 20<br />
Members (Broker Firms), 13 Custodians and 56<br />
Nominated Advisors.<br />
The Main Market, Alternative Market,<br />
Corporate Bonds Market, Government Bonds<br />
Market, Collective Investment Schemes Market<br />
and the Depository Receipts are all segments of<br />
the Regulated Market, which currently lists 65<br />
International Securities Identification Numbers<br />
(ISINs) for shares, 21 ISINs for bonds and 21<br />
ISINs for funds.<br />
The ECM also accepts listing of shares and<br />
bonds for companies whose registry is not kept<br />
by the <strong>Cyprus</strong> Central Securities Depository<br />
and Central Registry (CSD) – with 44 ISIN’s for<br />
shares and 24 for bonds listed in total. The ECM<br />
offers simplified listing criteria at a low cost and<br />
is successfully attracting companies both locally<br />
and internationally. It has evolved from being<br />
mainly focused on small domestic companies,<br />
to a growing international market offering opportunities<br />
to companies from around the world<br />
– and allows for a more personalised service at<br />
competitive fees, particularly to companies that<br />
are too small to list on a larger exchange or wish<br />
to gain their first experience of listing securities<br />
within the EU. The ECM has proved resilient and<br />
successful in the last years, despite the adverse<br />
economic climate and offers companies with an<br />
attractive commercial proposition the opportunity<br />
to attract funds.<br />
Additionally, the Exchange has the responsibility<br />
for the establishment and management of a<br />
Central Depository and Central Registry (CSD).<br />
The majority of the securities listed on the CSE<br />
are also registered in the CSD. Furthermore,<br />
issuers of non-listed securities that wish to have<br />
their registry maintained by the <strong>Cyprus</strong> Stock<br />
Exchange may assign this job to the <strong>Cyprus</strong> CSD.<br />
DIVERSIFICATION AND EXPANSION<br />
In an effort to expand its business, the CSE is<br />
focusing on sectors that are showing strong performance,<br />
such as funds, shipping, and energy.<br />
The aim is to ensure that the securities’ market<br />
can provide the necessary tools and prospects<br />
to participants to achieve their targets, and also<br />
provide regional market participants and companies<br />
a convenient venue for listing and investing<br />
in a transparent, efficient and business-friendly<br />
environment.<br />
With regards to funds, the <strong>Cyprus</strong> Stock<br />
Exchange has taken several initiatives. CSE operates<br />
two markets for listing funds, the Market for<br />
Tradable Collective Investment Schemes and the<br />
Market for Non-Tradable Collective Investment<br />
Schemes. Listing provides visibility and transparency<br />
to investors, and the Exchange provides fast<br />
and simple listing procedures and a competitive<br />
pricing policy. In addition, the CSE has launched<br />
a new service in order to offer registry services<br />
to fund managers, which means maintaining the<br />
registry of unit holders of non-tradable funds<br />
at the CSE’s Central Depository and Central<br />
Registry in a dematerialised form, and handling<br />
redemptions and transfers of funds’ units.<br />
In the energy sector, the CSE holds a 10%<br />
stake in the Hellenic Energy Exchange (HEnEx)<br />
– which was founded as part of the EU’s target<br />
model to create a single energy market and is expected<br />
to launch operations in accordance with<br />
the new target model as set by EU within <strong>2020</strong>.<br />
The CSE is also examining other opportunities<br />
regarding the energy sector which are expected<br />
to be published in the near future.<br />
TRADING VOLUME<br />
For 2019, the turnover amounted to €85.3<br />
million, which represents a year-to-year decrease<br />
of 35.40%, compared to the turnover of €132.1<br />
million in 2018. The daily average turnover for<br />
2019 was €0.35 million per trading day, compared<br />
to €0.53 million in 2018. At year-end, the<br />
equity market capitalisation, amounted to €1.89<br />
billion, compared to €1.93 billion at the end of<br />
2018, thus registering a decrease of 1.99% from<br />
the previous year. The financial sector was the<br />
largest economic group as far as market capitalisation<br />
of the equity market is concerned, with<br />
56.75%, followed by the industrials services with<br />
12.68% of the equity market capitalisation.<br />
STRONG FUNDS INDUSTRY<br />
A sector that was nearly non-existent a few<br />
years ago, <strong>Cyprus</strong> catapulted itself into recognition<br />
by overhauling and modernising its investment<br />
funds regulatory framework. There has<br />
been growing interest from fund professionals<br />
around the world, but most notably from Europe,<br />
Asia and the Middle East, whose fund managers<br />
are increasingly seeking access to the EU market.<br />
Assets under management (AuM) in <strong>Cyprus</strong> have<br />
increased by 200% from €2.7 billion in 2016 to<br />
€8.3 billion in 2019, demonstrating that <strong>Cyprus</strong> is<br />
able to compete with Europe’s longer established<br />
fund domiciles.<br />
A CSE listing provides a number of advantages<br />
for fund managers and investors. The CSE<br />
is an EU-regulated and recognised Exchange,<br />
Sector Profile<br />
<strong>Country</strong> <strong>Report</strong> CYPRUS <strong>2020</strong><br />
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