THE SEGMENTS OF THE SECONDARY MARKET IN THE GRAND DUCHY OF LUXEMBOURG

<![endif]-->We talked in a previous article about:OFF-EXCHANGE SEGMENTSOF THE BELGIAN SECURITIES MARKET

Today we talk about: THE SEGMENTS OF THE SECONDARY MARKET IN THE GRAND DUCHY OF LUXEMBOURG 

I.  PARTICIPANTS AND ISSUES TRADED 

The only stock exchange  in the country  is that in the city of Luxembourg, which was set up as a public limited company  in 1928 and has grown considerably  in  importance  in the past two decades  as a market  for  international  securities. At the end of 1974 the exchange had 26 member firms, called "agents de change agrees en bourse". These members, like those in Belgium, are both commission minded and spread minded, in contrast to the "agents de change" in France and Italy who are in principle forbidden to trade on their own account.

The members are domestic banks and the Luxembourg branches of foreign banks and broker firms. The number of members has increased continually in recent years.

At the end of 19 76 the stock exchange had 32 members, five of which were broking firms and the rest banks.

Some of the 80or so banks in Luxembourg carry on securities business outside the exchange only. 

Security trading is subject to State banking supervision. An official of the Ministry of Finance is responsible for supervision of the exchange as State commissioner. But, as on other stock exchanges, it is primarily the members of the appropriate stock exchange committees who monitor dealings.

By numbers of issues traded, it is Eurobonds that predominate. The trend  in the number of  securities traded  can be seen from

Table F - 1

Number of issues listed on the Luxembourg

Bourse (at year-end)

THE SEGMENTS OF THE SECONDARY MARKET IN THE GRAND DUCHY OF LUXEMBOURG 

Apart from the issues enumerated in Table F - 1, at least a dozen warrants on shares of foreign issuers are listed on the exchange. Since the Bourse publishes neither aggregate data on the volume in circulation nor data on turnover, it is very difficult to say just how important the individual categories are for the stock exchange secondary market. The most active securities would seem to be bonds denominated in Luxembourg, Belgian and French francs and in European Community units of account, but sales in stocks of Luxembourg steel companies and Benelux multinationals as well as in units of a few major investment funds is also substantial. The face amount outstanding of listed bonds in19 73 was about $15 000 million in the case of foreign issues and $ 500 million in the case of domestic issues.