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In cooperation with its market participants, the SWX Swiss Exchange has made changes at the regulatory and index levels which will improve its equity market and thereby increase this market's attractiveness. The regulatory changes will apply only to new listings and will become effective on 1 April 2004. The total market capitalisation will be replaced by the market capitalisation of the free float as the criterion for admission. A special opening will be available for new companies that are less than three years old and use IFRS (International Financial Reporting Standards) or US GAAP (United States Generally Accepted Accounting Principles). They may continue to be listed on the SWX but will be subject to quarterly financial reporting. Other companies will remain exempt from quarterly reporting. In future, however, companies which do provide quarterly reports will be marked accordingly on the SWX web site if they so desire. There is no longer a need for a separate listing segment for young growth companies. The SWX New Market will therefore be discontinued.
Other regulatory changes that are highly relevant in terms of the new structure have already been announced (see media release of 11 November 2002): from 2005, companies listed on the SWX will have to carry out their accounting according to IFRS or US GAAP. Companies that are oriented towards their home markets in terms of financing may, however, continue to use the Swiss GAAP ARR standards, which are tailored to the Swiss marketplace. Specific requirements extending beyond the provisions of international accounting standards with regard to transparency will continue to apply to invesTMent and real estate companies.
New indices for the equity market of the SWX
At the index level, companies listed on the SWX will be distributed among three index families: the SPI® Family, the SMI® Family and the SXITM Family. This regrouping will allow improved benchmarking and extend the range of benchmark indices.
With the new SWX Special Industries SXITM Family, the SWX will, for the first time, offer Swiss and foreign companies a platform for special sectors. These special sectors will be selected mainly on the basis of their progressiveness and the number and international significance of the companies from these sectors that are listed on the SWX. The SXITM Family will premiere two new indices that track one of Switzerland's leading sectors: the SXI LIFE SCIENCESTM index (pharma, medtech and biotech) and the more specific SXI Bio+ MedtechTM subindex. These indices satisfy a growing demand on the part of foreign institutional investors to participate in this segment of the Swiss equity market. The newly created SPI EXTRATM meets the market demand for the possibility of investing in Swiss small and mid caps not included in the SMI®. It makes investing in this area, which is important for Switzerland and Swiss companies, more attractive and will serve as a benchmark for the development of the Swiss small and mid caps sector. The index will first be published in April 2004. The SMI® will be expanded by the SMIMTM, an attractive liquidity selection index in the mid-cap area. Security selection will be based on liquidity and capitalisation criteria adapted to the mid-cap area. The SMIMTM meets the demand for securities with liquidity levels below those required by the SMI®.
Schedule
The changes which have been decided will be introduced in stages. They should be fully implemented by January 2005. The SWX Swiss Exchange will publish detailed information before the various stages are implemented.
- January 2004: decisions of the Admission Board and the Index Commission
- February 2004: approval from the SFBC (regulatory changes)
- April 2004: entry into effect of the regulatory changes and launch of SPI EXTRATM
- June 2004: launch of the SXITM Family
- October 2004: launch of the SMIMTM
- January 2005: introduction of the requirement to carry out accounting in accordance with IFRS or US GAAP
