Stock Exchange pleased with virt-x launch

Antoinette Hunziker-Ebneter chief executive of virt-x Keystone

The Swiss Stock Exchange (SWX) said on Friday that it had continued its strategy of internationalisation with success over the past few months.

At the annual news conference of the exchange in Zurich, management said that it was pleased with the launch in June of virt-x, the first ever pan-European blue chip exchange.

Virt-x has come under attack from analysts who have argued that the volume of shares traded has been disappointing.

Antoinette Hunziker-Ebneter, head of the SWX Group and chief executive of virt-x, told swissinfo that she was satisfied with the market’s performance.

“We wanted to achieve some competitive prices in some pan-European blue chips and we have managed that,” explained Hunziker-Ebneter.

“And we wanted to show that in some blue chips we can also have some important percentage of volume. We have achieved that as well.”

Looking to the future of virt-x, she said the market’s next goal was to build up sustainable liquidity and focus on the cross-border business.

All of Switzerland’s blue chips moved across to the London-based virt-x trading platform at the end of June. Naturally, this has meant lower trading volumes for those shares remaining on the SWX Swiss Exchange.

“On SWX, we still trade about 30 per cent of the turnover we traded before and this includes bonds, mid and small caps, and warrants,” said Hunziker-Ebneter.

“Of course the majority of the business moved onto virt-x but it’s still the same platform and it’s still the same infrastructure.”

It seems that some banks have been slow in taking up the cross-border trading opportunities offered by virt-x. However, Hunnziker-Ebneter is confident they will soon move onto the virt-x platform.

“The banks are starting to do business on virt-x, but they have to look internally to make sure the links are fully automated and they are starting now to build this up,” added Hunziker-Ebneter.

World equity markets have suffered massive losses over the past twelve months due to the downturn in prices in the over-inflated high-tech sector.

The Swiss share market has been no exception, with many blue chips seeing massive chunks of their value wiped off. This downturn in prices has also translated into a slowing of business, with trading volumes falling sharply.

Antoinette Hunziker-Ebneter admitted that the SWX had suffered from lower trading volumes along with the other major international financial centres. However, she also felt the refocusing on cutting costs would boost business for the SWX in the near-term.

“Of course, as with every stock exchange, there are lower volumes and lower turnover figures,” said Hunziker-Ebneter. “But the good thing about this is that in these difficult times, the banks are much more focused on costs and we are the stock exchange that offers the cheapest way of trading and settling cross-border.”

It seems that despite the slow start to virt-x and the downturn in business on world markets, the SWX remains confident that its leading position in developing new market platforms will keep the company on top as European markets draw ever closer.

by Tom O’Brien