Forecasts of Development of the Ukrainian securities market in 2007

 By Aleksandr Okhrimenko, Counsel of the Chairman of the Board of Ukrgasbank JSB, OJSC.

In 2007 positive tendencies, laid on the securities market of Ukraine, shall become apparent to a full extent. It is expected that the scope of operations on the target bonds market shall considerably increase. At the same time the secondary market will be developing as a part of speculative market.

Big hopes are pinned on the securities market of institutions of common investing. In 2007 increase of the scope of investments from individuals into securities of institutions of common investing is expected, as an alternative to deposits. At the same time profit from securities of institutions of common investing shall become more predictable and guaranteed.

In the coming year activation of the Ukrainian IPO market is expected. Attraction of capital into business owning to issue of shares and their sale on the open market is widely supported among big manufacturing companies. It is expected that mortgage bonds will entry the market, which shall essentially change the existing practice of mortgage lending, as well as considerably influence the cost of mortgage borrowing.

It is possible that in 2007 the certificates of funds of operations with real estate will entry the market. But for this purpose adoption of necessary legal acts by the regulatory authorities will be required.

Today one of the main problems, which restrain development of Ukrainian funds market, is inconsistency between the current legal acts and the existing situation on the market, and in separate cases its full absence. As a result, in spite of great interest on the part of investors, the projects on attraction of investments are left unrealized due to the system of mortgages, mortgage certificates, futures, options, warrants, warehouse receipts. The market needs to react quicker to the changing situation.

12.01.2007