Listing the power producer Hidroelectrica on the Bucharest Stock Exchange (BVB) could help upgrade the local bourse to emerging market.

One effect would be higher pensions for six million Romanians, said Lucian Anghel, BVB president, reports local Agerpres.

This listing could be a “unique chance” to “upgrade the capital market”. Without Hidroelectrica, the upgrade to emerging market status would be impossible.

The bourse still needs a very large company, which is not found in the private sector, Anghel explained. An upgrade of the local capital market would bring bigger foreign investments on the local market and would help boost the value of listed Romanian companies.

This would also lead to an increase in the value of local private pension funds’ portfolios, which would, in the end, lead to higher pensions for the six million Romanian employees who contribute to these funds. Local private pension funds currently invest close to 20% of their assets in listed shares, Anghel added.

The initial public offering of Hidroelectrica is expected to take place this year. The electricity producer is currently the state’s most valuable company.

editor@romania-insider.com