The European Securities and Markets Authority (ESMA) on Wednesday published its official opinion, approving an emergency short selling prohibition by the Hellenic Capital Market Commission (HCMC).
The new measure replaces the previous prohibition which expired last night.
The new ban will remain in place until 24:00:00 (CET) on November 9, 2015. It temporarily prohibits transactions in any shares of five credit institutions admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A” (Alternative Market of the Athens Exchange). It will also concern all depository receipts (ADRs, GDRs) representing those shares.
Justifying its decision, ESMA notes that:
Short sales in the shares of the five Greek credit institutions admitted to trading on the Athens Exchange and comprising the FTSE/Athex Banks Index could still exacerbate the threats to financial stability, especially considering the upcoming recapitalisation of the Greek Banking system. Market volatility might render the recapitalization more difficult and more costly.
To view the official announcement from ESMA, click here.