Warsaw Stock Exchange picks NYSE as IT partner, wins shorting battle

Warsaw Stock Exchange picks NYSE as IT partner, wins shorting battle

The exchange is thought to want to upgrade to a platform capable of handling specialist derivatives trades, including spread trading.

NYSE Technologies won the project over Nasdaq OMX and Millennium IT, the software vendor bought for £18m by the London Stock Exchange Group last year to build its own trading system.

This will be the WSE’s first link-up with a multinational exchange group ahead of its planned privatisation in November. But although NYSE was one of the four exchange groups that considered buying WSE last year, this IT deal is just a soft partnership – NYSE is not investing in the WSE at this stage.

The WSE has also won its long-fought battle with Polish regulators to allow the short selling of stocks.

“Short selling will be allowed , with many safeguards created by WSE and the National Depository for Securities during the extensive discussions with the Financial Supervision Authority,” said Jaroslaw Ziebiec, director of the bourse’s financial instruments development department, in June.

“Primarily, short selling needs to be flagged – that’s the most important feature. WSE will also have the possibility to suspend short selling in the event of a significant decrease in the value of the WIG index or the price of individual shares.”

The bourse has been in discussion with the PFSA for much of the past six months on relaxing Poland’s restrictive rules on shorting.

Ziebiec suggested that, once the short selling hurdle was cleared, the exchange would enjoy a boost in liquidity and be in a good position to begin offering new products.