Wirecard was just the new Star in the German share index (Dax). In September, the company from Aschheim was ousted in Munich, the venerable Commerzbank Dax. And also in Germany rare digital business model: Wirecard handles, among other things, for Online stores and payments, and provides virtual credit cards. In front of the Dax-rise of the Wirecard course rose had fallen, then, as expected (and the market).
However, in 2019, began at once the big. Within a few days of the Wirecard exchange rate fell from more than 160 euros on 100 euros. An unusually violent movement for a value in the Dax. The most important trigger for reports in the business newspaper Financial Times. They suggested that Wirecard in Asia, difficulties with employees, the rule would have made the rights of air bookings. The company rejected the accusations. The British newspaper responded with an even more detailed presentation of their research. And the markets played during the crazy.
all of This would be unpleasant, but not totally uncommon, if not on Monday by a German overseer interfered. The German Federal financial Supervisory authority (Bafin) for the first time, something she has not used yet: the prohibition of so-called net-short sales in an individual share: Wirecard. Short sales are a way to bet on falling prices. You sold shares you don’t own, but has borrowed. Falls later, as expected, of course, you can buy the same shares cheaper and the lender. The difference is the profit. In times of volatile stock prices, such were prohibited short sales sometimes, out of concern that they will drive the markets down. This was in the Wake of the financial crisis in 2008, for financial assets.
source: Thomas Reuters © TIME-graph
To relatively normal trading hours, there was such a thing. The investors perceived the actions of the Bafin therefore, as a sign of solidarity of the supervisor with Wirecard and against the Financial Times. The share price rose once again.
The Bafin would like to see it that way, however, is not understood. “This is not a partisanship on the part of the Bafin,” said a spokeswoman for the TIME. “We will not protect a single company, but the trust in a functioning market.” The Bafin does not take party, she wants to make especially clear, because you yourself is still in the middle of an investigation to find out whether there has been market manipulation in the securities of Wirecard. Wirecard had suggested that the reports in the press, and the attacks of certain market could depend on the participants share together, and a criminal complaint against unknown-refundable.
This article dates back to the TIME no 09/2019. Here you can read the entire issue.
If the Bafin will therefore, by his own admission not hit, what is the step should be then? The spokesperson justified the to the TIME, among other things, with additional information available to the supervisors. “We have recently seen an increased net-short positions, to a greater extent than is publicly known,” she said. The authorities have a lead in knowledge, you will be different than the Public reported minor positions.
These positions, however, were not so gigantic, that they were the only “serious threat to market confidence in Germany”, as confirmed by the Bafin to the ban. For the supervisors, else add to this more frequently, and because it is vague. “It’s news, the truth of which is not clarified were priced in the value of the share, as if they were true,” said the spokeswoman. “We have seen the risk that the price of education could no longer function adequately.” How to prove such a non-functioning price formation, the remains, however, unclear. What this means, if the news of the FT votes. In any case, however, Bafin has provided a justification for their Intervention, the other companies is likely to lead to price falls in the future in Bonn to ask for help.