Maltese, Irish stock exchanges announce joint venture

The Malta Stock Exchange has unveiled a new joint venture with the Irish Stock Market which will create a new European market for wholesale debt securities.

The ISE will own 80% of the venture, but it will be run and regulated out of Malta.

It will deal with complex debt listings such as asset-backed securities that have to be listed on exchanges even though they are typically traded in one-to-one over-the-counter transactions.

The ISE already runs the third biggest debt security market in Europe, with 22,500 bonds listed, including some that would be suitable for the new Maltese joint venture.

The Maltese offering will attract different customers, particularly in areas like shipping finance, where Malta is well established and Dublin isn't.

"We believe there's room for another [securities] market. If we don't do it, someone else will," ISE chief Dierde Somers said, adding that the ISE also wants to use its expertise to get a bigger presence in a market that is rapidly growing and increasingly complex.

The Maltese deal has been in the making for several years and Somers said the ISE would like to roll out similar joint ventures with other stock exchanges, potentially in the Middle East.

"The collapse here did not impact one bit on our reputation in this market," she said, while the ISE's director of international primary markets Gerard Scully said there had been a "warmer reception" for Ireland in the last six months in particular.

The move into international joint ventures comes against a stark contraction in the stock exchange's more traditional equities market.

The ISE has seen the value of its quoted companies decimated in recent years, as the banks' values collapsed, Anglo Irish Bank was nationalised and two other financial (Irish Life & Permanent and AIB) were all but nationalised.