Cross-Regional: Provision of Research Coverage for Selected listed SMEs



TCRS Number:


Business sector:

Local Currency and Capital Markets Development

Notice type:




PSD disclosed:

20 Feb 2019

Project Description

The Markets in Financial Instruments Directive (MiFID II) which came into effect on 3 January 2018 is bringing significant changes to the capital markets legal environment in the European Union, and it will have profound impact on small and medium-sized enterprises (SME) access to finance through capital markets. The new Directive provides restrictions on the production and distribution of investment research by banks and brokers with a view that investors can better compare price and quality across products and service levels. Consequently, the sell-side will have to charge a fee for investment research separately from execution services. The buy-side will have to allocate research budgets for all asset classes, and either pass the costs of research on to clients or absorb it themselves. Research budgets are foreseen to be cut and analysts expected to move to the buy-side where in-house investment insight will become more important.

According to the CFA institute survey   there are concerns that SME companies will have less coverage and liquidity, which could increase research pricing and lead to an increase in the capital costs of such companies and their ability to raise capital or list on the market. This would eventually negatively impact returns SME companies.

In order to address the new challenges in light of MiFID II, increase the availability of market financing opportunities for SMEs and increase investors awareness of under-researched companies EBRD is planning to introduce a programme to support the research coverage for a set of SMEs listed on the stock exchanges in Bulgaria, Croatia, North Macedonia, Romania, Serbia and Slovenia. The Research Coverage Programme will be overseen by the EBRD, but will entail a high degree of input from local stakeholders in each of the markets, including market regulators, stock exchanges, financial service providers and companies.

This technical cooperation project consists of three assignments.

Assignment 1 will focuse on building online dissemination hub to host the cross-regional investment research reports available for investors on a dedicated website.

Assignment 2 will support preparation of equity research reports for listed companies which are currently receiving minimal or no research coverage. This will increase the awareness about these companies and improve their market liquidity by providing the investment community with high quality research reports.

During assignment 3, a workshop of successful market experience will be held. The workshop will focus on supporting SMEs to get more awareness from investors and will be delivered by representatives of Taiwan capital market.

Any competitive selections for business opportunities relating to this project will be published on the EBRD's website: Consultancy Procurement Opportunities.


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