EBRD expands listed SME support to the Baltic states

By Axel  Reiserer

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Following the successful launch of its dedicated research programme in May in support of the development of small and medium-sized enterprises (SMEs), the European Bank for Reconstruction and Development (EBRD) is expanding the initiative to the Baltic states.

Based on an agreement with Nasdaq Baltic, the operator of the stock exchanges in Estonia, Latvia and Lithuania, the programme will now also include the following three companies – AUGA group (Lithuania), HansaMatrix (Latvia) and Ekspress Grupp (Estonia). The coverage of the Baltic companies began today with the publication of the AUGA group research report and will be followed by reports on Ekspress Grupp and HansaMatrix on 15 and 18 December, respectively. The coverage will last for two years.

Funded by the TaiwanBusiness-EBRD Technical Cooperation Fund, the programme is providing research coverage for a set of SMEs listed on the stock exchanges in Bulgaria, Croatia, North Macedonia, Romania, Serbia and Slovenia. The reports are publicly available free of charge on the programme’s website www.listed-sme.com.

The aim is to produce free, publicly available, high-quality research reports to overcome information barriers that depress market liquidity. Making markets more transparent by increasing the amount of reliable information is regarded as key to increasing the availability of financing for SMEs.

The two-year research programme is being conducted by WOOD & Company, an investment bank specialising in emerging markets. The programme is fully aligned with the objectives of the European Commission’s Action Plan on Building a Capital Markets Union, which specifically mentions improving access to finance, including risk capital, notably for SMEs as one of the five priority areas.

Ian Brown, EBRD Head of the Baltics, said: “We are pleased with the expansion of our research programme which demonstrates the high demand in the market for information and the quality of these reports. The current coronavirus pandemic has reinforced the need to progress with the development of capital markets in the three Baltic states, and the EBRD is happy to support this.”

Kaarel Ots, CEO of Nasdaq Tallinn Stock Exchange, said: "As the golden rule of investing states, one should always understand the company you are investing in. One of the best ways to do that is to read high quality research about it. I’m happy to see the EBRD’s new initiative that provides investors with a free and professional research coverage and helps companies to be more visible and transparent. As the bottom line, having this research at hand helps investors to make better investment decisions."

Daiga Auziņa-Melalksne, CEO of Nasdaq Riga Stock Exchange, said: “The shortage of easily accessible research on listed companies has been identified as one of the reasons companies struggle to attract more retail investors. We hope that the EBRD’s SME equity research programme will improve issuers’ visibility regarding investors and facilitate greater liquidity.”

Saulius Malinauskas, CEO of Nasdaq Vilnius Stock Exchange, said: “Having more Baltic listed companies covered by professional research will help our companies promote themselves better among both regional and international investors. The EBRD’s project is another step towards having in-depth research available for the Baltic listed companies.”

The EBRD has been investing in the Baltic states since 1991. To date, the Bank’s total investment there stands at more than €2.5 billion through more than 280 projects.

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