Before the crisis, 20 companies were getting ready to be listed on the Bucharest Stock Exchange

"Even though two years ago, almost 20 companies were getting ready to be listed on the Stock Exchange, none of them did, because of the financial crisis", Stere Farmache, the chairman of the Bucharest Stock Exchange said yesterday during the conference.

"In the beginning of 2008, almost twenty companies had their prospectuses sitting on our desks. The beginning of the financial crisis caused the companies to renounce or postpone those plans. After a while, all of the 20 companies cancelled their plans to get listed", Stere Farmache said.

Last week, the Bucharest Stock Exchange got listed on its own platform, in an attempt to send a positive signals to domestic companies and to encourage them to enter the stock market.

However, the chairman of the BSE yesterday conceded that the Bucharest Stock Exchange still has a long way to go before it becomes a magnet for the companies interested in securing funding. Stere Farmache feels that companies have avoided the stock market as a source of funding because many companies were able to raise relatively cheap funding from banks, amid the economic growth which lasted until 2008.

The chairman of the BSE said: "Most companies preferred to borrow money from banks. Over the last 5-6 years we have experienced an unprecedented expansion of lending, and companies were able to secure funding a lot easier from banks. Furthermore, since 2000 Romanian entrepreneurs have been in an asset acquisition stage and were not ready to share their companies with other shareholders. There were indeed a few companies that were listed on the Bucharest Stock Exchange, but not enough of them to influence the business environment.

Furthermore, the state has been reluctant in using the stock market in the privatization process, opting instead to go for strategic investors".

The chairman of the BSE said that the stock market was attractive to entrepreneurs when it was rising, but many turned its back on it when it suffered losses: "The stock market became interesting for businessmen when it peaked, like it happened in 1997 and 2007. In 2007 we had an intensive campaign to attract issuers to the stock market, and its results became visible in the beginning of 2008, when we were getting ready for the listing of the 20 new companies".