Vienna Stock Exchange on IWI Study: Listed companies need political restart

• IWI study backs Vienna Stock Exchange's demands
• Listed companies have strong leverage effect for national economy
• Market capitalization on Vienna SE close to EUR 100 billion for first time since 2007

(Vienna) The study presented today by Aktienforum and the Federation of Austrian Industries, "Listed Companies – Macroeconomic Effects and Quick Survey 2017" contains further scientific support for the Vienna stock exchange's year-long demands. According to the study conducted by "Industriewissenschaftliches Institut", nine percent of jobs are directly or indirectly linked to an exchange-listed company. Austria’s exchange-listed companies have an enormous leverage effect beyond what the company itself earns through collaboration with suppliers as partners. Every new job at an exchange-listed company creates 2.56 new jobs. Every euro invested in a listed company creates EUR 2.33 for the economy.

"This shows very clearly that every euro invested into a stock of an Austrian company has a multitude of effects on our business location. Growth and employment, for example, and investors also have a chance to earn returns that beat all other types of investment. Since the inception of the ATX, shareholders of Austria's top companies have received returns of six percent on average. Therefore, with a view to encouraging a culture of mature and long-term investors, I urgently suggest the re-introduction in Austria of a holding period that is exempt from capital yields tax," said Christoph Boschan, CEO of the Vienna Stock Exchange.

Although further studies (e.g. Langfield & Pagano, 2015) show that economies with highly advanced equity capital markets are more robust in times of crisis and also recover faster, the regulatory efforts of the past few years have always been to the detriment of investors and the capital market. The Vienna Stock Exchange has been watching the overly enthusiastic regulatory efforts of the European Union with growing anxiety, especially implementation in Austria, which does not always take international competition factors into consideration. For example, overregulation has pushed domestic companies out of the Third Market, which traditionally has been the first entry point for small and medium-sized Austrian companies.  The regulation mandating registered shares has made it almost impossible for small and medium-sized Austrian companies to go public through the Vienna Stock Exchange. Here, the Austrian stock exchange's hands are tied and the only option left is for companies to go public outside the country.

"Equity capital needs to be strengthened again in Austria and should not be disadvantaged versus debt capital. The Vienna Stock Exchange supports the demands of Aktienforum and the Federation of Austrian Industries. We need politicians as strong partners, and are open to a constructive dialogue on market-supporting financial market regulation, free access to the stock market for Austria's SMEs, and more options for Austrians to invest in the domestic capital market," stressed Christoph Boschan.

Although the number of listed companies in Austria has decreased since 2014, market capitalization has risen in the past three years by one-quarter to almost EUR 100 billion (Dec. 2014: EUR 80 billion; Jan 2017: EUR 98 billion). The development of trading volumes in equities on the Vienna Stock Exchange has been very gratifying during the same period (+25%). In January 2017, the trading volume in equities was EUR 4.97 billion, which is a gain of 5.7% versus January of 2016 (EUR 4.7 billion).