MFA Blog

ESMA Approves Extension of Emergency Short Selling Ban in Greece

Posted on May 3, 2013

On April 30, the European Securities and Markets Authority (ESMA) issued an opinion approving the Hellenic Capital Markets Commission (HCMC) extension of its short selling ban on Greek bank stocks.  The ban’s extension covers all depository receipts and warrants representing shares of seven credit institutions for another three months, through the end of July.  Greece justified the extension of its short selling prohibition by citing the continued fragility and undercapitalization of its banks.

ESMA noted that the emergency extension of the ban was appropriate and proportional in relation to Greece’s current economic situation.  It noted that there remain adverse developments related to the Greek banking sector which constitute a serious threat to financial stability and market confidence in Greece.  These factors contributed to the decision that the duration of the short selling ban is justified.

Read the entire ESMA opinion online here.