28 Sep 2023 11:18

Moscow Exchange board approves strategy to 2028

MOSCOW. Sept 28 (Interfax) - The supervisory board of the Moscow Exchange has approved a new strategy for the group's development to 2028, the exchange reported.

The exchange aims to increase its IFRS net profit to at least 65 billion rubles by 2028.

"Our goal is to have a profit of 65 billion rubles or more by 2028 with a steady trend toward growth. We intend to achieve this on the back of rapid growth of fee and commission income - CAGR in the amount of 13% or higher. We will strive to achieve a Cost to F&C income ratio in the range of 50%-55% by 2028. We don't see a return on equity of less than 18%," Moscow Exchange CEO Yury Denisov told reporters.

The exchange closed 2022 with IFRS net profit up 29.2% to 36.3 billion rubles from 28.1 billion rubles a year earlier.

"As part of our business initiatives, we set quantitative targets within grouped areas. We think that about ten major IPO or SPO deals per year is quite an achievable goal on equity markets. A stable double-digit number of deals is an achievable goal given a favorable economic situation," the Moscow Exchange's managing director for strategy and international presence, Artem Zheleznov said.

The strategy assumes a substantial increase in the amount of bond issues, both in rubles and in yuan and so-called replacement bonds. "Here we see growth of more than 200% in issues of new corporate bonds," Zheleznov said.

He said that the strategy also sees a tenfold increase in the customer base of the Finuslug financial services platform and a 60% increase in the number of products per client.

Given external restrictions, the new strategy is based primarily on trends on the Russian market, which include the growing role of retail investors, development of digital financial assets (DFA) and an increase in Russian companies' need to raise capital on the domestic market.

The Moscow Exchange plans to expand its list of instruments, including ESG products, and work on increasing their liquidity. Particular attention will be devoted to work with issuers aimed at raising corporate financing on capital markets through placement of shares, bonds and DFA, including with the use of over-the-counter and investment platform services.

A measure of the strategy's success will be substantial growth of the group's market capitalization, which will be supported by the steady growth of fundamental financial indicators, the exchange said.

The Moscow Exchange Group also includes the National Clearing Center (NCC) and National Settlement Depository (NSD).