The SIFs decline halted during the last two sessions of last week, after SIF Banat-Crisana (SIF1) and SIF Moldova (SIF2) announced they would propose to their shareholders an increase to the maximum stake cap from 1% to 2%. The two SIFs intend to increase their share capital by distributing bonus shares from last year's profit and modify their charter by eliminating the quorum restrictions in view of decision-making during future EGM.

The market's reaction to the two announcements was nothing spectacular, as it had been three years ago, when there was talk of an increase in the stake cap from 0.1% to 1%. Brokers say the steps taken by the SIFs have to do with their image and will not have any impact on shareholders, as long as the stake cap is set at 1% by law.

"The proposition of the two SIFs about increasing the cap has no direct effects, and is purely for image. The SIF bosses probably want to show that they are willing to go through with such a step, considering they opposed the stake cap increase in the beginning," stated Adrian Mihaila, manager of Eldainvest in Galati.

Still, some brokers expect the announcement of the two SIFs to receive a positive response from the market and trigger the rebound of the SIFs and the market in general, considering the capital increase performed by SIF Transilvania (SIF3) last year led to a significant increase for its stock.

"I believe this news will have a positive impact on the market and I expect prices to resume an upward trend over the coming months," says Marius Trif, chairman of Carpatica Invest.

SIF shares were among the worst hit by the corrections of the last few months, losing an average of about 40% since July.

The share capital increase and the amendment of the charter in order to reduce the quorum requirements for the extraordinary general meeting of shareholders (EGM) are steps