More delays for planned linkup of Athens and Nicosia bourses

NICOSIA (Reuters) – A linkup between the Cyprus and Athens stock exchanges scheduled for April could be delayed for up to six weeks due to legislative and technical issues, the Cyprus bourse said yesterday. Cypriot authorities had targeted April 3 as a starting date, but delays in Parliament and clearance pending from the European Central Bank make the target far from certain, bourse chairman Akis Kleanthous said. It will be the second time Cypriot bourse authorities have overshot their schedule for creating a joint trading platform between the two markets. The project was already postponed from an initial starting date of January 2. Asked when the new platform would be fully operational, Kleanthous told a media briefing, «We don’t know yet, but we are very close.» Cypriot authorities have pursued a linkup with the much larger Greek market with vigor as the only way to ensure badly needed visibility for the island’s small stock market and open it up to a new pool of institutional investors. Cyprus attracts few mutual funds. Underscoring their absence, it has 420,000 individual investors – roughly half the island’s population. But investor interest still comes in surges and splutters, Kleanthous said. «I think the joint trading platform would solve the risk of apnoea (suffocation) we had on the market,» he said. Trading on the new linkup will be in euros, replacing the Cyprus pound in market transactions. That entails fixing an exchange rate on the last working day before the system goes live for the conversions to take effect. The rate would be based on the central bank fixing session at that given time, Kleanthous said, adding that the exchange was, however, ready to start mock trades from April 3. The delay of two to six weeks is based on an optimistic scenario that Parliament can approve key legislation to reform the Cyprus market by the end of next week.