UK and Ireland name stocks subject to shorting ban

Britain's Financial Services Authority published a list of banks and insurers whose shares can no longer be sold short while Irish authorities also moved yesterday to prevent investors profiting from falls in bank shares.

The FSA published the names of 29 financial institutions on its website (www.fsa.gov.uk/pubs/handbook/list_instrument200850.pdf) after imposing the ban on Thursday in a bid to stabilise volatile stocks in the firms hit hardest by the credit crisis.

The Irish Stock Exchange yesterday said it too had amended its market abuse rules to ban the short-selling of Ireland's top four banks and insurers: Bank of Ireland, Allied Irish Banks, Irish Life & Permanent and Anglo Irish Bank.

"A person, other than a market maker, may not enter into any transaction, transactions or arrangements which have the effect of generating a net economic benefit which would arise from a fall in the price of the shares," the ISE said in a statement.

The Belgian financial markets regulator CBFA said yesterday it did not immediately plan to ban short selling.

The US Securities and Exchange Commission also met late on Thursday and a source briefed on the matter said a temporary ban on short sales of some, or all, stocks was being considered.

A spokesman for Britain's Financial Services Authority said other financial services companies such as exchanges, fund managers and private equity groups had not been included on the list.

"If these companies (on the list) fail, it will have a large effect on the wider economy," the spokesman added.