The Irish Stock Exchange (ISE) (Irish: Stocmhalartán na hÉireann) is Ireland's only stock exchange and has been in existence since 1793. It is an Irish private company limited by guarantee. It was first recognised by legislation in 1799 when the Irish Parliament passed the Stock Exchange (Dublin) Act. At different periods in its history, the ISE included a number of regional exchanges, including the Cork and Dublin exchanges. In 1973, the Irish exchange merged with the other British and Irish stock exchanges becoming part of the International Stock Exchange of Great Britain and Ireland (now called the London Stock Exchange).Between 1973 and 1986 there were no new company listings.
In 1995, it became independent again and since then has expanded internationally and established itself as a global listing centre for international fund and debt securities.
The Irish Stock Exchange operates three markets:
The Main Securities Market (MSM), the principal market for Irish and overseas companies, which admits a wide range of security types such as shares, bonds and funds to listing and trading. The Main Securities Market is a regulated market as defined by Markets in Financial Instruments Directive (MiFID). It is the principal market of the ISE for larger, more established companies - Irish and international - from a broad range of industry sectors including financial services, building, oil and gas, utilities and food.
The Enterprise Securities Market (ESM), an equity market designed for growth companies. The ESM is an exchange regulated market and multi-lateral trading facility (MTF) as defined by MiFID. It is the ISE market for smaller, growth companies and has been specifically designed to meet the funding needs of companies at earlier stages in their development.
The Global Exchange Market (GEM), a specialist debt market for professional investors. GEM is an Exchange regulated market and MTF as defined by MiFID.
The exchange is owned by Irish Stockbrokers and the country currently has two large, and half a dozen medium-sized, brokerages but most observers believe this cannot continue indefinitely, as sales from trading commissions and fees from corporate deals tumble because of the recession.
On 6 June 2000, the ISE closed its trading floor in Anglesea Street (a listed building), Dublin 2, and switched to an electronic trading platform called ISE Xetra which has enabled it to expand its membership base to include international banks and used by the Deutsche Börse Group. Trading on the ISE is settled via the CREST settlement system which is operated by Euroclear (UK and Ireland) and cleared by Eurex Clearing AG. It operates three markets - the Main Securities Market, the principal market for Irish and overseas companies; the Enterprise Securities Market (ESM), an equity market designed for growth companies; and the Global Exchange Market (GEM), a specialist debt market for professional investors.
The published index of shares is known as the Irish Stock Exchange Quotient or ISEQ Overall Index. Other indexes of the exchange include the ISEQ ESM Index, the ISEQ 20, the ISEQ General, ISEQ SmallCap, and ISEQ Financial. The ISE also has two other ISEQ 20 based indices, the ISEQ 20 Capped Index and the ISEQ 20 Leveraged Strategy Index.
The exchange is regulated by the Central Bank of Ireland under the Markets in Financial Instruments Regulations (MiFID) and is a member of the World Federation of Exchanges and the Federation of European Stock Exchanges.
Two reports of an investigation into the "wholly inappropriate sale of perpetual bonds" by Davy Stockbrokers to credit unions failed to involve any of the credit unions affected, leaving them "in the dark and powerless to add any value to the findings of this investigation". The ISE, who have Davy as one of its largest shareholders, then declined to give them access to the reports. The Chairman of one the Credit Union's who suffered large losses told his members ''The failure to publish the reports is to place the complaints process in a shroud of secrecy. Such a failure of openness, transparency and fairness can only serve to undermine confidence in the complaints process, forcing those with grievances into the courts. Such a course of action is not in the interest of any of the stakeholders."
The number of equity companies quoted is dwindling as companies go broke, de-list or move overseas but their lucrative fund and debt securities listings could prove attractive to other exchanges, although a parliamentary committee in December 2009 was told that they do not intend to merge with a larger rival.
In April 2010, the chief executive of Financial Regulation at the Central Bank of Ireland told the same committee that "senior management of the exchange should step up to the plate" after failing to help charities, credit unions and rich individuals who received letters informing them that many investments made by stockbrokers over the past decade are now worthless.
It employs 92 people who are paid an average of €98,000 when pensions and employer contributions are taken into account.