IMF stresses importance of secondary securities market in financial deepening

In its latest report on Albania, the International Monetary Fund notes that “a key factor in financial deepening would be a secondary liquid market for government securities.”

In this way, IMF joins other international financial institutions such as the EBRD, which previously noted that Albania and the whole Western Balkans region would have great benefits if the financing of the economy were more balanced between bank lending and capital markets.

According to EBRD studies, the financing of investments through the capital market brings significant growth to employment, labor productivity and profitability of enterprises.

Meanwhile, the IMF also notes that “the development of capital market institutions requires high standards in the area of ​​transparency and internal direction.”

This finding comes shortly after the first private securities exchange, ALSE, was licensed in Albania.

In this way, Albania is getting ready to have a capital market that will provide the public with an important alternative channel to invest and secure funding.

ALSE comes as a project initially supported by Credins Bank, and later were included two other important financial institutions, the American Investment Bank and AK Invest.

In the first year of its activity, ALSE will focus on trading of Albanian government securities.

The licensing of the first private securities exchange represents a historic step for Albania’s financial market.

The existence of a stock exchange is essential for a more efficient use of funding sources in the economy.

In the view of the Financial Supervisory Authority, the creation of a securities exchange is a concrete and clear indication of the maturity level reached by the Albanian financial market.

In its official announcement, the AMF underlined that the securities exchange will enable profit-making companies to have an opportunity to grow, by selling their shares to a large number of shareholders and diversifying them.

In a longer-term perspective, the stock exchange will be a good opportunity to attract companies from other speaking areas, such as the Kosovo market, also serving as a platform for all Albanian investors.

Specialized financial institutions have insisted in the last years on the necessity of building a functional stock market.

SCAN

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