Blue chips cease trading at Prague Stock Exchange

One of the largest Czech banks, Ceska sporitelna savings bank, is about to take its stocks off the Prague Stock Exchange or PSE, joining the numbers of other high-quality stocks that have left the market. The only large Czech bank to continue trading on the prestigious main market of the Prague Stock Exchange is Komercni banka. The question remains for how long.

An increasing number of blue chips have been leaving the Prague Stock Exchange recently. For example, at the end of last year, the majority owner of the largest Czech construction company IPS Skanska abolished public tradability of its shares. The year before, the breweries Krusovice and Pilsner Urquell and the North Bohemian water company left the public stock market. Some experts expect that another blue chip, the Czech wireless operator Ceske Radiokomunikace, will follow suit.

Ceska Sporitelna wants to stop trading its stocks because of low liquidity, as more than 91 percent are held by Austria's Erste Bank Sparkassen. However, it is one of the most attractive titles on the PSE and the move is expected to have a negative impact on the market.

According to analysts, Ceska Sporitelna's exit only confirms the well known problem of the Prague Stock Exchange - it has failed to become a market where companies seek capital and individuals invest their savings as is common in developed countries.