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EU Member-Countries Extend Short Selling Bans to September 30

Belgium, France, Greece, Italy, and Spain extended their bans on European bank stocks until the end of September.
For details:

Belgium

http://www.fsma.be/en/OtherNews/Article/press/div/2011-08-25_shortselling.aspx

France

http://www.amf-france.org/documents/general/10122_1.pdf

Greece

http://www.hcmc.gr/photos/anakoinoseis/files/25.8.2011_Press_Statement_short%20selling.pdf

Italy

http://www.consob.it/mainen/press_release/comunicato_20110825.htm

Spain

http://www.cnmv.es/Portal/AlDia/Comunicaciones.aspx?lang=es

The Financial Times (“European Shorting Ban Extended,” August 25) reported that, “Dealing in the banned stocks has since dropped 62 percent from its pre-ban spike, according to Bloomberg data. This has however left trading at just three-quarters of its pre-spike average. The drop in liquidity implies investors will pay more to buy or sell those stocks. Trading in the biggest European banks not covered by the ban also more than halved after the bans.”

A story appearing earlier this week in the Financial Times (“Short Sellers Remain Calm Despite Bans,” August 23) reported that “securities lending data show that the amount of stock on loan – used as a proxy for tracking the scale of short positions – has dropped just 0.1 per cent on average since immediately before the bans were announced.

“The latest figures, provided by Data Explorers, also show that, on average, just 2.35 per cent of each stock is on loan. The low numbers will fuel the pro-shorting lobby’s argument that shorting is not the problem, not least because bank shares have continued to decline.

Complete details of EU member-countries’ short selling regulations (August 25) available at:
http://www.esma.europa.eu/index.php?page=home_details&id=595 .

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