Guide to NASDAQ OMX Baltic Securities Market Securities Baltic OMX NASDAQ to Guide Guide to NASDAQ OMX Baltic Securities Market Contacts NASDAQ OMX Tallinn Tartu mnt 2, Tallinn 10145, Estonia Telephone: +372 640 8800 Fax: +372 640 8801 E-mail: [email protected] NASDAQ OMX Riga Vaļņu iela 1, Rīga LV 1050, Latvia Telephone: + 371 6721 2431 Fax: + 371 6722 9411 E-mail: [email protected] NASDAQ OMX Vilnius Konstitucijos pr. 7, LT-08501 Vilnius, Lithuania Telephone: + 370 5 272 3871 Fax: + 370 5 272 4894 E-mail: [email protected] © Copyright 2010, The NASDAQ OMX Group, Inc. While every reasonable care has been taken to ensure the accuracy of data contained in this publication, the NASDAQ OMX GROUP, Inc., its subsidiaries and affiliates disclaim any liability for any expenses, losses, damages or costs which might be incurred as a result of the data being inaccurate or incomplete in any way and for any reason. Further, nothing herein is intended to constitute legal, tax or other professional advice. 1 2 / Table of contents Welcome to the Baltic market 5 Latest developments at NASDAQ OMX Baltic 6 An in-depth look at NASDAQ OMX Baltic 9 The Baltic economies 22 Overview of taxation in the Baltic countries 26 Food for the people, fuel for the market 33 Company profiles 35 NASDAQ OMX Baltic Secondary list TOP 30 82 Baltic Fund List 84 Baltic Bond List 86 NASDAQ OMX Baltic members 87 Market data vendors 88 Contacts 89 4 Welcome to the Baltic market Welcome to the 2010 edition of the NASDAQ sentiment after the lows of 2009. Development OMX Guide to the Baltic Securities Market, your of market indices and deeper interest in public indispensable reference point for news and securities market as a capital raising source developments affecting the Baltic securities indicate more optimistic view and increased markets, summaries of all Main List and some of confidence in the Baltic market. the larger Secondary List companies, as well as other investment ideas for established and new Moves towards adopting the Euro as the trading investors. and settlement currency in Estonia and Lithuania by the beginning of 2011, with plans to do Despite the challenging times endured by the the same in Latvia shortly thereafter, signal global financial system, the NASDAQ OMX Baltic the exchanges’ desire to ease the passage exchanges continue to improve the quality of of business for international investors. This is their offering in the region. backed up by efforts to bring investors more real- time information, with the introduction of the next NASDAQ OMX Group’s desire to acquire full generation trading platform, Genium INET, and ownership in the Baltic exchanges as well as more advanced trading surveillance systems. the harmonization of trading technology give proof of the region’s high potential and increase Alongside our continued promotion of better integration with the global securities markets. education services, these initiatives demonstrate Two successful IPOs - Premia Foods and Linas NASDAQ OMX Baltic’s commitment to improving Agro Group - and a rights offerings of City Service local equity culture and to welcoming investors and Ekspress Grupp mark a recovery in market from around the globe. 5 Latest developments at NASDAQ OMX Baltic NASDAQ OMX to increase its presence start using the euro as the trading and clearing in the Baltics currency for equities on its regulated market in NASDAQ OMX acquired the minority stakes Swed- November 2010. NASDAQ OMX Riga will also move bank and SEB held in the NASDAQ OMX Baltic along with its plan to introduce trading in euros exchanges, thereby strengthening its position on its regulated equities market. in the Baltic market. NASDAQ OMX has a strategic interest in developing the region’s capital mar- Making markets more attractive kets and its goal is to reach 100 percent owner- to foreign issuers ship in all NASDAQ OMX’s Baltic entities in the near NASDAQ OMX Baltic has continuously worked future. to improve the attractiveness of its market- place and one of its initiatives has been aimed Trading and clearing of equities in euro at adjusting the setup of its market so that list- Business on the Baltic exchanges is closely ing and trading is as seamless for foreign issuers interrelated, with every third exchange trans- as it is for local customers. Following changes in action being across borders. Therefore, in order regulations passed in early 2010, an electronic to have more homogeneous markets, the Baltic issue of the Listing Guide for Foreign Companies exchanges are working towards introducing a was published. This publication provides foreign single trading and clearing currency in the Baltic issuers with information on the benefits, ser- market. Estonia will adopt the euro as a national vices, requirements and practices of listing and currency from January 1, 2011 and, consequently, trading in the Baltic states. Listing guide is avail- trading and clearing on NASDAQ OMX Tallinn will able on www.nasdaqomxbaltic.com be conducted in euros. NASDAQ OMX Vilnius will 6 Latest developments at NASDAQ OMX Baltic Genium INET efficiency, in reducing latency and in the inter- NASDAQ OMX Baltic and Nordic exchanges suc- face members use for derivatives, fixed income cessfully introduced the INET trading system for instruments trading, and issuing auctions across equities markets on February 8, 2010 followed Nordic and Baltic exchanges. by a new, real time, market surveillance system, SAGA. Volatility Guards - a complementary tool for The Baltic CSDs continuously work on equity markets to reduce the likelihood of erro- implementing their clearing and neous trades and to reduce the impact of sudden settlement strategies and extraordinary liquidity was implemented in Both Latvia’s and Estonia’s Central Securities September 2010. Depositories (CSDs) will introduce a common, centralized, message exchange service called The new trading platform, named Genium INET, the Central Message Hub by the end of 2010. will replace the existing SAXESS trading system This hub will be based on proven state-of-the- and will be used for fixed income trading and art technology, such as Java Messaging Services issuing auctions on the Baltic exchanges. Genium and IBM MQ, replacing existing local proprietary INET, developed to comply with Nordic and Baltic interfaces. Message Hub will ensure the integ- market conditions, will bring improved trad- rity of messages and will allow for further inte- ing interfaces and enhancements in the market gration and interoperability with the SWIFT and model. Target2 Securities systems, which use inter- national ISO20022 standards. After a one-and- It is planned that trading in Nordic derivatives will a-half year development phase, Message Hub be migrated to the new system during autumn is being used in a test environment and, at the 2010, while Nordic and Baltic fixed income trading time of its launch, will be the most reliable and and issuing auctions will be transferred in 2011. cost efficient interface between Baltic CSDs and Genium INET will enable further improvements in market participants. Latest developments at NASDAQ OMX Baltic 7 New core system Depend in Estonian CSD bonds denominated in euros. Until then, bond Estonia’s CSD will introduce a new core system auctions had been held only in the Lithuanian called Depend on January 1, 2011, at the same national currency, the Litas. Government bond time as the country adopts the euro. Cash set- auctions are held on the NASDAQ OMX trading tlement will take place in Target2-Estonia and platform, whereas the clearing and settlement transactions will be settled in Euro only. Clear- of the trades executed at auctions is handled by ing and settlement processes will be amended the Central Securities Depository of Lithuania. to accord with the best practices and interna- tional standards. Settlement will be through Settlement for debt securities in euro Real Time Gross Settlement (RTGS) with optimiza- Quoting and trading in debt securities on NASDAQ tion batches instead of batch processing, which OMX Vilnius has been expanded, not only for should reduce the assets commitment periods trades conducted in litas or euros, but for other and risks for buyers and sellers. currencies as well (settlements are made in litas). Since February 2010, the settlement of trades in NASDAQ OMX Vilnius to hold euro-denominated euro-denominated securities at NASDAQ OMX Vil- Lithuanian Government bond auctions nius are performed via the TARGET 2 payment In July 2010, NASDAQ OMX Vilnius started hold- system. Currently this applies to trades in debt ing primary auctions of Lithuanian government securities. 8 Latest developments at NASDAQ OMX Baltic An in-depth look at NASDAQ OMX Baltic NASDAQ OMX Baltic is part of the NASDAQ OMX NASDAQ OMX Baltic provides customers with con- Group, Inc., the world’s largest exchange com- venient access and quality products. We con- pany with capabilities in trading, technology and tinue to expand what we offer and to provide a service that reach across six continents. NASDAQ wider selection of joint Baltic services and instru- OMX operates a variety of listing platforms to pro- ments to local and international customers. vide multiple global capital raising solutions for private and public companies around the globe. NASDAQ OMX offers trading across multiple asset classes, including equities, derivatives, debt, NASDAQ OMX ownership commodities, structured products and ETFs. in the Baltics NASDAQ OMX Group is the world’s largest provider of technology for the exchange industry – pro- viding services to over 70 exchanges, clearing 100% of NASDAQ OMX Tallinn organizations and central securities depositories Estonian Central Depository (100%) in more than 50 countries. ~93% of NASDAQ OMX Riga NASDAQ OMX Baltic is positioned on the cross- Latvian Central Depository (100%) roads between central, western and northern Europe, the Baltic and CIS markets.