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Russian central bank gives legal entities green light to trade foreign shares
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MOSCOW (Reuters) -The Bank of Russia on Thursday gave legal entities the green light to buy the securities of “unfriendly” issuers, those from countries that have imposed sanctions against Moscow, without restrictions.
MOSCOW (Reuters) -The Bank of Russia on Thursday gave legal entities the green light to buy the securities of “unfriendly” issuers, those from countries that have imposed sanctions against Moscow, without restrictions.
Shares in SPB Exchange, Russia’s second-largest bourse which specialises in foreign shares, leapt on the news, surging more than 30% on rival Moscow Exchange as of 1534 GMT.
SPB resumed full trading in foreign equities in August. The central bank’s move could pave the way for brokerages to purchase shares in foreign companies from retail investors.
“Legal entities, irrespective of having qualified investor status, will be able to buy securities of unfriendly issuers without restrictions,” a central bank statement said.
It comes months after sweeping western sanctions, imposed to punish Moscow for its actions in Ukraine, led to the freezing of some of the foreign securities held by investors in Russia.
The central bank this month said it would gradually limit private investors’ access to foreign shares issued by companies from designated unfriendly countries from October.
Brokerages will be prohibited from executing any orders from non-qualified investors that increase their position in such securities from Jan. 1, 2023.
In a separate statement, the central bank extended restrictions on transfers abroad from the bank accounts of non-residents from unfriendly countries by another six months until April 1, 2023.
(Reporting by Elena Fabrichnaya and Alexander Marrow; editing by David Evans and Philippa Fletcher)
The Bank of Russia is the central bank of the Russian Federation, responsible for monetary policy, financial stability, and regulation of the banking sector.
Foreign shares are equity securities issued by companies based outside of an investor's home country, allowing investors to gain exposure to international markets.
A brokerage is a firm or individual that facilitates the buying and selling of financial securities on behalf of clients, earning commissions or fees for their services.
Sanctions are restrictive measures imposed by countries or international bodies to influence or penalize a nation or entity, often affecting trade and financial transactions.
A legal entity is an organization or individual that has legal rights and responsibilities, allowing it to enter into contracts, own property, and be liable for debts.
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