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THE PRESIDENT AND CEO’S MESSAGE |
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| We have another record year behind us. A rise in the market values of Norwegian shares resulted in high volumes and a large number of transactions for VPS. Institutions and active private individuals are trading more than before, both in value and in quantity. However, there is little activity among the population in general in the securities market. There are approximately 340,000 private shareholders in Norwegian listed companies, which is about eight per cent of the population. The corresponding figure in Sweden is twenty-five per cent. In Norway, private individuals own just over five per cent of the shares in the companies listed on the Oslo Stock Exchange. Both the share held by private individuals and the number of private shareholders has shown a falling trend over the past five years. It is true that about 1.1 million private individuals hold units in mutual funds, but they reduced their holdings somewhat in 2004. VPS wishes to do its part so that more private individuals can invest in the securities market, either directly or via mutual funds. We have succeeded in simplifying clearing and settlement of securities. We will continue to make it easier and cheaper for shareholders, for companies and for stockbrokers. It is our intention to replace paper-based reports with electronic dispatches. This will reduce costs considerably. VPS is in the process of carrying out the most extensive renewal of its systems solutions since it introduced Internet-based solutions in 2000. This will apply in particular to mutual funds solutions and the systems used by account operators. We are confident that these improvements will make it simpler to achieve lower costs for our customers and contribute to higher sales of securities services. At the same time, we will alter technical architecture which will make it far easier to integrate VPS’s services with our customers’ net solutions. VPS has consolidated its position by acquiring Manamind AS, which is now a separate company in the VPS Group. Manamind develops and sells products that help to give our customers easier access to information about the securities market and to buy and sell securities. The company has advanced products that merge analyses and data from several sources. These solutions will be further enhanced with information from VPS’s registers and will be the main channel for the distribution of open information to our customers. Cross-border clearing and settlement of securities is high on the political agenda in Europe. The main question is how can we increase the efficiency of cross-border settlement? There is a large degree of consensus on what is needed to achieve this. Harmonization of legislation and tax regulations, standardization of the ways of effecting clearing and settlement and corporate actions, and more use of joint IT solutions – these are three important elements that can help to reduce the obstacles to cross-border settlement. International customers do not find it very practical having to relate to different regulations, different systems and different technical solutions. This can be simplified by establishing identical processes or identical systems. A development like that can bring about a closer integration between operators who are involved in clearing and settlement and in the activities of central securities depositories. VPS has purchased a substantial share in the Norwegian Futures and Options Clearing House, with a view to strengthening and uniting clearing and settlement activities in Norway. It is natural that the next step will be to consider and discuss an integration of settlement systems with the central securities depositories in the Nordic countries. We all have an integrated structure between settlement and end investor accounts which allows cost-effective, advanced solutions for investors, issuers and securities houses. We also have many of the same customers, who are looking for a greater degree of harmonization. This can give lower costs through greater use of joint technology. The combined effect of these investments will mean that we strengthen our position in the Norwegian market and at the same time enter into a binding cooperation with other operators. This will lead to cost reductions and simplifications for VPS and our customer TOP |
 President and CEO Jan Hellstrøm |
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