Bucharest Stock Exchange (BVB), the operator of the Romanian capital market, recently announced that it will reduce trading fees starting October 1, 2014, in an effort to make the market more accessible to investors.

“We are continuing our efforts and projects, aimed to the revitalization of the Romanian capital market. Many of these steps, including the improvement when it comes to the cost of access to the market are carried out in cooperation with the ASF and other regulators. This process will be continued”, said Ludwik Sobolewski, CEO of BVB.

The new trading fees, as a sum of BVB and ASF (Financial Supervisory Authority) fees, will be 0.1% (10 bps), charged for both buy and sell sides, to all participants, excluding the fees for the Market Makers, which are lower.

Currently, BVB charges 0.045% of the value of share transactions from the buyer and 0.117% from the seller. These will be reduced to 0.04% and 0.1%. The ASF now charges 0.08% of all buy transactions, but it will cut down its fee to 0.06% starting September 16. Fees will be reduced for other market segments as well.

Currently, an investor who buys and then sells shares worth EUR 1 million on the Bucharest Stock Exchange pays EUR 2,220 worth of fees to BVB and ASF. After the fee cut from BVB, the same investor will have trading costs of about EUR 2,000, about 10% lower. However, both BVB and ASF fees are included in the fees that investors pay to their brokers. So it's up to the brokers if they will pass this fee cut further to their clients of if they will continue to charge the same fees as they currently do.

The Bucharest Stock Exchange also announced that it plans to reduce the settlement cycle from three days to two days, starting October 6. This would decrease trading risks for investors.

Andrei Chirileasa, andrei@romania-insider.com