With the launch of the new common Nordic list on October 2, the OMX Nordic Exchange became a reality, promoting greater interest, opportunity and investment in the Nordic region. As one of the first regional listings of its kind, the Nordic list is also expected to become a model for other regions to follow.

After months of planning, the Nordic list went live on Oct. 2, representing a major step forward for the Nordic Exchange and offering a model for other regions, that could benefit from closer economic cooperation.

While the local stock exchanges will continue to be the listing venue, the Nordic list, comprising listings from the Danish, Finnish and Swedish markets, will provide a broader view of the market, making it easier to find and compare companies and ultimately facilitating more extensive cross-border trading. The Iceland Stock Exchange is scheduled to join the Nordic Exchange in 2007.

Jukka Ruuska, President of Nordic Marketplaces at OMX, says the launch is the realization of a long-term vision. “We’ve always believed it would be very beneficial for Nordic market participants to create one integrated marketplace, not only for the immediate benefits of increased liquidity and exposure, but also to ensure in the future that a competitive infrastructure is in place,” he says.

With exchanges around the world consolidating at a rapid pace, the individual mid-sized exchanges in the Nordic countries were in danger of losing investor interest, he adds. “We believe a fully integrated market will have critical mass for the long run.”

The Nordic list should lead to greater liquidity as well as greater awareness among Nordic nations of the companies doing business in the region. Peter Thostrup, EVP of Denmark’s Bang & Olufsen, agrees that the new Nordic list will give Nordic-based companies more clout and attention.

“Broadening our home base will facilitate better turnover of shares, which is of importance to our shareholders. At the same time, as a consumer brand, we will also get the added benefit of higher exposure to consumers in Sweden and Finland.”

Also among those who believe the list will be a boost for the region’s markets are those who deal directly with investors.

“We strongly believe in the Nordic countries as a single market,” says Jessica Gertun, Director of Corporate Communications at Internet-based trading firm Nordnet. Nordnet’s customer base has already demonstrated a demand for the approach as well, she adds. “Investors are increasingly interested in cross-border trading. The trend is growing because customers realize that this works.”

The Nordic list may also be a model for other regions, such as areas of Central and Eastern Europe where many smaller economies and exchanges are not necessarily able to attract significant outside investment on their own.

“When we began, we thought our situation was unique, but we’ve learned that there is a great deal of interest in our solutions in other regions,” Ruuska says. “We can apply the lessons we’ve learned and help other exchanges find greater opportunities as well.”

The launch of the common Nordic list will promote greater interest, opportunity and investment in the Nordic region.

By Keith Regan Illustration Sofie Stavtorp

MarketView 2006:3