The Malta Stock Exchange index closed at 3,795.391 points, losing 4.88 per cent on the week, after last week's gains of 1.31 per cent. Despite this drop, the MSE index recovered 1.676 per cent yesterday but year to date the index is now down over 23 per cent. This week, 10 equities were negotiated, with eight equities closing in negative territory and just two equities closing in positive territory. During the week, Lombard Bank plc was the best performer, while Bank of Valletta plc lost most ground.
A total of 267 trades were registered on the stock exchange, with a total turnover of over €9.09 million. In the equity market, 149 deals were executed for a total value of €705,961 million. In the government bond market, 55 deals were carried out, for a value of over €4.64 million, while in the corporate bond market, 41 deals were executed for a total value of €304,201. In the Treasury bills market, 22 deals were executed for a total value of over €3.44 million.
In the banking sector, Lombard Bank plc was the best performer. Lombard registered an increase of 0.33 per cent on the week. The closing price for the week was €3.06, a rise of €0.01, with 6,097 shares changing hands over nine deals. On the other hand, HSBC Bank Malta plc lost last week's gains, as it registered a loss of €0.20 from last week's share price, closing the week at €3.20, decreasing by 5.88 per cent on the week, with a volume of 59,397 shares traded over 51 deals, for a total value of €192,959. FIMBank plc continued to lose some of its share price. The equity closed at US$1.904, a fall of US$0.004, or 0.21 per cent, as 104,100 shares changed hands on three deals.
Bank of Valletta plc continued its negative run, as it lost €0.509 on the week, closing the week at €4.181, therefore decreasing by 10.85 per cent, with 30,702 shares being traded over 39 deals. Following a company announced late on Monday, BoV shares did not trade on Tuesday and Wednesday but fell on Thursday by €0.801 or 17.41 per cent.
The share price recovered some of this week's losses yesterday, registering a rise of €0.382. This week, BoV traded at a high of €4.689 and a low of €3.75. In a company announcement, Bank of Valletta plc stated that, with reference to the company announcement issued on August 1, where BoV commented on the results for the third quarter of the current financial year, the group noted that, after a period of relative calm between mid-March and mid-June, the international capital markets had witnessed a renewed bout of volatility that had been predominantly experienced in the equity sector, with the fixed income markets being affected to a much lesser extent, particularly when compared with conditions earlier in the year. It was also noted that any additional markdowns that had been required to the date of the announcement had been comparatively modest. The directors observed that, subject to this state of affairs continuing, and the volatility not spreading to the fixed income sector, the board expected that the results for the second half of the current financial year would show a significant improvement over those reported for the first half.
The collapse of Lehman Brothers announced on Monday, triggered a fresh round of disruption in the wider global credit markets, resulting in greater volatility and the widening of credit spreads. Coming so close to Bank of Valletta plc's financial year end (September 30), it is likely that these conditions will have a material adverse impact on the results for the last quarter of the current financial year. The bank's portfolio includes a holding of Senior (non-subordinated) Lehman paper. Although it is too early to determine what recoveries will be made therefrom, it is believed that any ultimate loss that may arise from this holding will be modest in the context of the results of the bank for the current financial year to date. The results for the Bank of Valletta group for the year ending on September 30 will be notified to the Malta Stock Exchange on October 31.
Go plc was the only other equity to register a rise in its share price, as it registered an increase of €0.001, closing the week at €2.31, thus increasing by 0.04 per cent from last week, as 13,500 shares changed hands on 10 deals. On Friday, Go plc announced that Forgendo Ltd (the joint venture company between Go plc and Emirates International Telecommunications (Malta) Ltd) has acquired a further 125,000 shares in Forthnet SA issued share capital, for a total consideration of €269,450.
International Hotel Investments plc decreased by €0.045 on the week. The closing price for the week was €1.015, therefore decreasing by 4.25 per cent on the week, as 48,327 shares changed hands over 15 deals. Crimsonwing plc registered a loss of 3.47 per cent on the week, after closing the week at €0.50, decreasing by €0.018, with 47,377 shares changing hands on eight deals.
Middlesea Insurance plc also experienced a loss in its share price. Middlesea closed the week at €2.95, a fall of 3.28 per cent on the week, or €0.10, with 31,410 shares changing hands on two deals. Grand Harbour Marina plc traded once during the week, registering a loss of €0.05 in its share price. The equity closed the week at €2.10, losing 2.33 per cent on the week, after trading 3,000 shares. Maltapost plc was another equity to register loss in its share price. The closing price for the week was €0.79, €0.01, or 1.25 per cent, less than last week, having traded 27,500 shares over 11 deals.
On Monday, HSBC Bank Malta plc announced that it published a prospectus dated September 15 in respect of an issue of €25,000,000 5.9 per cent Bonds 2018 of a nominal value of €100 per bond issued at par subject to an over-allotment option not exceeding €5,000,000. Application has been made to the Listing Authority for the admissibility of the bonds to listing and to the Malta Stock Exchange for the bonds to be listed and traded on its official list. Yesterday, HSBC announced that the pre-placement offer was over-subscribed. Applications from the public open on September 24 and close on September 30 or before in the event of over-subscription.
This article, which was compiled by Jesmond Mizzi Financial Services Ltd (JMFS), does not intend to give investment advice and the contents therein should not be construed as such. JMFS is licensed to conduct investment services by the MFSA. The directors or related parties, including the company, and their clients are likely to have an interest in securities mentioned in this article. For further information please contact JMFS at 67/3 South Street, Valletta, or on tel. 2122 4410 or e-mail jmizzi@jmfs.net.