Nico Baader, Chairman of the Board of Directors and Chief Investment Officer of Baader Bank AG, was one of the heavyweights at the 2020 IR Conference. Baader spoke in plain language: “A MiFID III will come. And things will not get better, they will get worse!” As you know, there is a big difference between “well-intentioned” and “well done”. Nico Baader illustrated this using the example of MiFID II.

• In the name of investor protection, the regulators launched uniform product information sheets, advice minutes and telephone records. The result: banking advice for private investors was effectively abolished.
• By unbundling research, corporate access and trading, the regulators wanted to improve transparency. The result: less research, less stock exchange trading and less transparency.
• The measures aimed at strengthening the capital market also backfired. Smaller institutions were to be strengthened and the “too big too fail” problem solved. The result: various players withdrew from the capital market business. Smaller banks and brokers are throwing in the towel. And market concentration continues to increase.

or smaller listed companies, the consequences are fatal. Within just one year, 350 European companies lost their coverage by analysts. The companies have to counter this by increasing their participation in conferences and by directly addressing institutional and private investors. Nico Baader dampened hopes that the study on the effects of MiFID II could turn the wheel back. Baader: “MiFID II does not mark the end of the development. MiFID III will come. And then it won’t get better, but worse!” Conclusion: The presentation by Nico Baader made it clear: No matter how large the market capitalisation of a listed company is, it doesn’t just need any bank, but a suitable bank. And companies must prepare themselves for further regulatory turmoil. On our own behalf: If you do not want to lose contact with investors, you need an independent advisor who is not dependent on trading activities in addition to the banks. A competent advisor can also point the way to the right bank. Cometis is such an advisor and offers access to investors – all over Europe! This and all other slides from the IR2020 can be downloaded here.