Starting in 2011, businesses will also be able to place bonds on Deutsche Börse’s Entry Standard. For SMEs (small and medium-sized enterprises) in particular, the move will open up new means of financing, allowing them to use the segment to raise outside capital.
“Raising capital has become more difficult for SMEs since the financial crisis,” said Frank Gerstenschläger, member of the Executive Board of Deutsche Börse AG and responsible for the Xetra business area. “Our expanded Entry Standard for corporate bonds offers SMEs another tailor-made financing alternative. Including bonds in stock-market trading is simple, quick and cost-effective. What is more, corporate bonds are very attractive for investors because the current low interest rate on government bonds is encouraging them to look for alternative investment opportunities.”
Deutsche Börse’s expansion into bonds is a logical next step for the idea behind the Entry Standard. Capital-seeking companies that want to issue bonds can now do so within the regulatory framework of the Entry Standard. The proven formal transparency requirements will be supplemented with a prospectus that has been approved by a national supervisory authority and rated by a recognized rating agency.
Issuers will benefit from the expertise of over 100 Deutsche Börse listing partners as experienced advisors. In cooperation with trading participants, companies can place new bonds directly with national and international investors using a direct subscription option via the stock exchange. Corporate bonds are traded using the proven infrastructure of the Frankfurt Stock Exchange. For risk-conscious private and institutional investors with experience on the capital market, this opens up simple and cost-effective access to SME corporate bonds.
