March 26, 2019

March 26, 2019

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March 25, 2019

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Ban on Short Selling Shares of Five Greek Banks Extended

On December 7, the European Securities and Markets Authority (ESMA) published an opinion agreeing with the Greek regulator, the Hellenic Capital Markets Commission (HCMC), that the ban on short selling shares in five Greek banks should be extended until midnight on December 21. The ban, previously discussed, was originally set to expire on November 9 and had been extended until December 7.

The ban includes Greece’s four largest banks and one smaller bank—National Bank of Greece, Alpha Bank, Eurobank Ergasias SA and Piraeus Bank, as well as Attica Bank—and prohibits the sales of shares covered by subsequent intraday purchases, as well as all depository receipts (ADRs, GDRs) and warrants representing shares of such banks— even those part of the FTSE/ATHEX Index.

The HCMC commented that lifting the ban could potentially increase both price volatility in the banks’ shares and market uncertainty—particularly at a time when the relevant banks are in the process of being recapitalized, with an anticipated completion by mid-December. The HCMC added that the successful conclusion of the bank recapitalization and restructuring process, as well as the trading of new shares issued by the banks, is required to safeguard the stability of the financial system and of the Greek capital market—all of which ESMA ultimately supported, resulting in its endorsement of the short selling ban extension.

The ESMA opinion is available here.

©2019 Katten Muchin Rosenman LLP

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About this Author

Neil Robson, private equity fund managers counselor, Katten Law Firm, London
Partner

Neil Robson, a regulatory and compliance partner with Katten Muchin Rosenman LLP, focuses his practice on counseling hedge and private equity fund managers and other investment advisers on operational, regulatory and compliance issues. He regularly addresses Financial Conduct Authority (FCA) and EU authorization and compliance under both the EU Alternative Investment Fund Managers Directive (AIFM Directive) and MiFID, cross-border issues in the financial services sector, market abuse, anti-money laundering and regulatory capital requirements, formations and buyouts of...

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