Spain extends short selling ban
23 October 2012 Madrid
Image: Shutterstock
Spain鈥檚 regulator the CNMV has decided to extend a ban on short selling for an additional week and has submitted a proposal to the European 网爆吃瓜 and Markets Authority (ESMA) to impose a further three month ban, effective from 1 November 2012.
The additional seven-day ban is an extension of the CNMV鈥檚 previous three month ban, which it introduced on 23 July to stabilise the volatility of the Spanish market.
Spain鈥檚 short selling extension is in part due to the ongoing structuring process of the Spanish financial sector to cover capital needs.
The process, which was outlined in the 23 July Memorandum of Understanding (MoU) between the European Commission, the Kingdom of Spain and the Bank of Spain, has not yet concluded, and a range of uncertainties could still affect Spanish financial stability.
鈥淩aising the ban on short sales would heighten uncertainty through its likely impact on the market. Conclusion of this process is considered to be absolutely necessary to ensure the stability of the financial system and the Spanish capital market.鈥�
鈥淢oreover, a number of events or circumstances that led to the adoption of the July decision and which may threaten the integrity of the Spanish financial markets are currently persisting,鈥� said a statement from the regulator.
Italian regulator Consob lifted Italy鈥檚 short selling ban, which was also introduced in July, on September 14.
On 24 July, Greece鈥檚 Capital Market Commission extended its short-selling ban, which has been in place since August 2011, to 31 October 2012.
The additional seven-day ban is an extension of the CNMV鈥檚 previous three month ban, which it introduced on 23 July to stabilise the volatility of the Spanish market.
Spain鈥檚 short selling extension is in part due to the ongoing structuring process of the Spanish financial sector to cover capital needs.
The process, which was outlined in the 23 July Memorandum of Understanding (MoU) between the European Commission, the Kingdom of Spain and the Bank of Spain, has not yet concluded, and a range of uncertainties could still affect Spanish financial stability.
鈥淩aising the ban on short sales would heighten uncertainty through its likely impact on the market. Conclusion of this process is considered to be absolutely necessary to ensure the stability of the financial system and the Spanish capital market.鈥�
鈥淢oreover, a number of events or circumstances that led to the adoption of the July decision and which may threaten the integrity of the Spanish financial markets are currently persisting,鈥� said a statement from the regulator.
Italian regulator Consob lifted Italy鈥檚 short selling ban, which was also introduced in July, on September 14.
On 24 July, Greece鈥檚 Capital Market Commission extended its short-selling ban, which has been in place since August 2011, to 31 October 2012.
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