By Tom Sims<\/p>\n
FRANKFURT (Reuters) -An investigation by Germany’s financial watchdog has found no reason to change companies’ practice of communicating with analysts before publishing results, following media concerns about the potential disclosure of insider information.<\/p>\n
Regulators have taken a closer look at so-called pre-close calls after media reports highlighted an apparent connection between high volatility in share prices and the communication with analysts.<\/p>\n
Germany’s BaFin watchdog disclosed at a conference on Monday the findings of a study it began last year. Details will likely be published this week.<\/p>\n
“We do not currently see any systematic problems with the execution of pre-close calls,” Christoph Schell, a BaFin official who studies market surveillance and abuse, said at the conference.<\/p>\n
Strong price reactions are isolated cases, and there is no need to tighten rules around the calls, he added.<\/p>\n
Last year, the European Union’s securities watchdog warned that companies should not share market-sensitive information with external analysts ahead of their financial statements.<\/p>\n
The practice of pre-close calls is widespread – not just in Germany. It is typically communication before the publication of financial statements, between a company and analysts who generate research, forecasts and recommendations on the company’s shares and bonds. Supporters say the calls contribute to the orderly functioning of markets.<\/p>\n
Schell said that BaFin found in its study that 63% of companies listed on Germany’s DAX index of blue-chips and the MDAX of smaller companies hold pre-close calls.<\/p>\n
More than 90% of those companies conduct individual chats with analysts, he said.<\/p>\n
BaFin found that 70% of the market trading around calls it investigated showed no significant market reaction, while only 10% did.<\/p>\n
“We have investigated these cases and have so far found no evidence of any unauthorized disclosure of insider information,” Schell said.<\/p>\n
He added that companies should nevertheless be as transparent as possible, by announcing the calls on their websites and holding them in a group format rather than individually.<\/p>\n
(Reporting by Tom Sims. Editing by Mark Potter)<\/p>\n","protected":false},"excerpt":{"rendered":"By Tom Sims FRANKFURT (Reuters) -An investigation by Germany’s financial watchdog has found no reason to change companies’…\n","protected":false},"author":2,"featured_media":152144,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5310],"tags":[64869,44702,64867,2000,299,64865,1824,64866,64870,64868],"class_list":{"0":"post-152143","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-germany","8":"tag-analysts","9":"tag-bafin","10":"tag-christoph-schell","11":"tag-eu","12":"tag-europe","13":"tag-financial-watchdog","14":"tag-germany","15":"tag-insider-information","16":"tag-pre-close","17":"tag-smaller-companies"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@uk\/114613903915166806","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/152143","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/comments?post=152143"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/152143\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media\/152144"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media?parent=152143"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/categories?post=152143"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/tags?post=152143"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}