The exchange changed the composition of the Supreme quotation list, moving from shares to nine companies. As the message exchange among those in the second quotation list — the number of Interregional distribution grid companies, shares of the world trade Center, paper Vozrozhdenie Bank and MOESK, “Mostotrest” and KAMAZ. Shares of two issuers — “Interregional distribution grid company of Centre” and “public Irkutsk joint stock company of energy and electrification” — was transferred from the first to the third quotation list. Also from the second to the third quotation list were upgraded shares of nine issuers, among which “AVTOVAZ”, JSC “Lenenergo”.
However, the only company whose shares were transferred to the top quotation list were “Russian grids”.
According to the exchange, after the approved changes, which will come into force on 31 January, in the quotation list of the first level of the Moscow exchange will include 60 shares of 52 issuers, the second 35 shares of 33 issuers.
The reason for the change was the increase in requirements for issuers. The new rules, the exchange began to introduce from June 2016. The reform of listing companies applying for inclusion of their shares in the top quotation list, must within 3 years provide IFRS financial statements, and have at least 20% (but not less than three) independent members in the Board of Directors.
In addition, we introduced a new criterion of inclusion in the quotation lists the proportion of shares in free circulation (free float).
A number of major companies have had to make changes to the composition of the Board of Directors by entering them independent representatives. In particular, at the end of December 2016, Matthias Warnig, who was the Trustee of the state in the Board of Directors of Rosneft, became an independent Director of the oil company. This appointment was connected with the desire of the Issuer to maintain its position in the highest quotation list.
“The listing reform led to a substantial increase of quality of corporate management of Russian public companies, for greater transparency and attractiveness of the Russian stock market. The company did do a lot of hard work to implement best practices in corporate governance and reporting to increase the confidence of investors”, — said Chairman of the Board of the exchange Alexander Afanasyev in comments distributed by the exchange.
The intention to exclude from the quotation list of the highest shares of several issuers in December 2016, said managing Director for stock market of the stock exchange Anna Kuznetsova. According to her, the criteria for a higher quotation list of the 65 issuers then corresponded to 35 issuers in the second tier requirements are consistent with half of the 32 issuers. In addition to the free float at the stock exchange were also complaints about the quality of corporate governance of companies, said Kuznetsova.
Most of the effects of changes in the quotation lists of the exchange can affect the work of non-state pension funds (NPF). They are, according to the regulations of the Central Bank, can invest pension savings funds only in securities from top-tier quotation list. According to the regulator, at the end of the third quarter the volume of pension accumulation under control of NPF amounted to 2.1 trillion rubles, or 13.8% of these funds were invested in Russian stocks.
According to Deputy Director UK “Kapital” Alexey Belkin, paper, excluded from top-tier quotation list of the exchange, and rarely occur in pension portfolios NPF. “It’s still not as liquid securities, as Gazprom or Sberbank, so I don’t think funds will have to sell any significant volumes of paperwork,” he said. Besides, according to the Manager, among the first excluded from the quotation list of a lot of securities companies of the electricity sector, which is not particularly popular among investors.
However, the Central Bank does not rule out that some funds could still be problems. “The Bank of Russia after analyzing the situation, the NPF would send a prescription by setting a deadline for its elimination. In practice, the time limit for correction of violations in each specific case depends on a number of circumstances, including the share of securities in the portfolio, the availability of an active market for them”, — quotes “Interfax” words of the representative of the regulator. The Central Bank noted that, in any case, the elimination of violations must be based on respect for the interests of insured persons, providing the security and profitability of investments.