Press release on the decision by the Ljubljana Stock Exchange
The Bank of Slovenia can not comment on the decision by the Ljubljana Stock Exchange to suspend trading in some securities issued by certain Slovenian banks, as the reasons for its decision are unknown to us.
In its public announcement the Ljubljana Stock Exchange states that trading has been suspended because key information required by investors for informed decision-making is not available. From the announcement itself it is not possible to find out the actual circumstances that Ljubljana Stock Exchange deemed to be those preventing informed decision-making by investors.
Within the framework of its own activities, the Bank of Slovenia does not see any reason for the particular treatment received by the four banks in whose securities trading has been suspended. Insofar as such reasoning might be linked to stress testing, it should be noted that tests are being conducted on ten banks, and not just on the aforementioned four. The stress testing exercise has not been concluded up till now. It is therefore impossible at this stage to predict the results of these tests, or to speculate about the effects that the results will have on individual banks involved in the testing, or on other banks.
In the past few days the Bank of Slovenia has held discussions with the Ljubljana Stock Exchange on the impact of the announcement of the results of the stress tests on trading in bank securities and, in this connection, on the possible suspension of trading in such securities for the protection of investors. In so doing the Bank of Slovenia clearly stated that anticipation of the announcement of the stress test results cannot be grounds for a suspension of trading, as this has not been the practice in the past. Similarly, anticipation of the announcement of the results cannot be the basis for speculating about the measures to be taken against a particular bank: the type of measure depends on the degree of the problems, and at this stage these have not yet been identified for any of the banks involved.
The Bank of Slovenia considers the decision by the Ljubljana Stock Exchange to be a precautionary measure based on the conclusions of public discussions and speculation on the results of the stress tests. In any case, the decision by the Ljubljana Stock Exchange is not justified by information about the performance of the exposed banks within the framework of the stress test results. When such an important decision as the suspension of trading in the securities of particular Slovenian banks is being made by the Ljubljana Stock Exchange, there should in any case be greater willingness to consult all the institutions involved, in advance (timely), with regard to the action to be taken.