The Latvian securities market, though it is the smallest in the Baltic countries, nonetheless has the preconditions for successful, profitable trading with the shares of various companies.
* On the Riga Stock Exchange there are presently shares of five companies quoted on the Main List, and 27 companies – on the Secondary List.
* The development of the public stock market in Latvia was mainly promoted by the process of privatization of the state-owned companies, which started in 1992.
* On the Riga Stock Exchange there are still more than 95% of a total of 33 listed companies, which have entered public trading as
a result of privatization.
* For 17 years there were several companies owned by private shareholders, who used the exchange as a platform for raising capital.
* In 2000 the share turnover on Riga Stock Exchange reached its highest level – 240 million EUR. It is historically still the highest point.
* The main problem of the Latvian stock market is a lack of new share issues and listings. During last six years there were no new issuers on the Exchange.
* Numerous drawbacks have led to the Latvian securities market being illiquid in recent years. These include a very low number of freely tradable shares, poor corporate governance, and a population with poor knowledge of investment in securities markets and able to raise funds from bank loans until the beginning of 2009.
* The low interest in the securities market is evidenced by the Central Depository’s data, which record all publically traded financial instruments in Latvia. As of the end of 2010, of 79 676 securities accounts, 38 973 or 48,9% were in the Preliminary Register and are thereby not yet deregistered or transferred to securities accounts at banks so that one may trade them freely, for instance, by selling.
* In the coming years hopes are placed on privatization of several state-owned companies, including the telecommunication companies – Lattelecom and LMT, and sale on the stock market of the national air company airBaltic.
Facts for 2011
* Most companies, whose shares showed record price increases in 2010, experienced sharp drops in 2011. Among them was the telecommunications equipment maker SAF Tehnika, whose share price in 2010 showed the sharpest rise – by 500%, but in 2011, one of the sharpest falls – by 42,6%.
* In 2011, looking at both the Official and the Secondary securities lists, the largest increase in share price – by 130,3% – was posted by shares in Kurzemes atslēga1, but the largest fall, by 80,3%, was posted by shares in Latvijas zoovetapgāde.
* In 2011, a total of 20 235 trades were made on the exchange, trading 23,84 million shares valued at EUR 37,15 million. This included EUR 30,34 million in trades in shares on the Official list.
* In 2011, the largest number of trades – 4571 – was made with shares in the pharmaceuticals producer Olainfarm. Also in 2010, the largest number of trades (4 371) was made in shares of this company.
* The largest turnover, as in 2010, was with shares of Grindeks, another pharmaceuticals produces – amounting to EUR 10 million (around EUR 5 million in 2010).
* Compared to the stock exchange in Lithuania, the number of trades and the number of shares traded on the Latvian Stock Exchange is 7,3 and 12,5 times smaller, respectively, and compared to Estonia, 4,1 times and 6,1 times smaller.
Stock Exchange – www.nasdaqomxbaltic.com
Financial and Capital Market Commission – www.fktk.lv
The Securities Commission of the Republic of Lithuania – www.vpk.lt
Financial Supervision Authority – www.fi.ee
Securities Register – www.e-register.ee