azz divieto totale sino al 19 gennaio
FSA to ban short-selling of financial stocks
By Peter Thal Larsen, Banking Editor
Published: September 18 2008 17:44 | Last updated: September 18 2008 18:09
Short-selling of financial stocks is to be banned in the United Kingdom from midnight on Thursday night under rules drawn up by the Financial Services Authority.
The ban, which has been approved by the watchdog’s board of directors, will prevent investors from creating or adding to short positions in all publicly quoted financial companies. The ban will remain in force until January 19, 2009, when the FSA plans to publish a comprehensive review of short-selling rules.
The ban comes after a week in which the shares of leading financial institutions have come under intense pressure as a result of turmoil in the financial markets. Short-sellers have been blamed for driving down the share price of HBOS, the banking group that on Thursday unveiled it was being rescued through a takeover by Lloyds, its UK rival.
Hector Sants, chief executive of the FSA, said: “While we still regard short-selling as a legitimate investment technique in normal market conditions, the current extreme circumstances have given rise to disorderly markets. As a result, we have taken this decisive action, after careful consideration, to protect the fundamental integrity and quality of markets and to guard against further instability in the financial sector.”
In addition, the FSA is also tightening up its disclosure rules, forcing investors to disclose all net short positions in excess of 0.25 per cent of a company’s share capital.
Though the ban currently applies only to an unspecified list of financial stocks, the FSA said it “stands ready to extend this approach to other sectors if it judges it to be necessary.”
The change in the rules is the FSA’s second attempt to curb short-selling. The regulator has already prevented short-selling of shares in companies that are in the midst of raising cash from investors through a rights issue.
News of the ban comes amid growing political backlash against short-selling, which has been blamed for exacerbating the woes of the country’s banks, and for contributing to the crisis of confidence in some of the country’s largest financial institutions.