Swedish gambling operators see fall in share prices
Malta greylisting from Financial Action Task Force and 15% global corporation tax deal believed to be behind the decline
Several Swedish gaming companies have experienced a sharp decline in share prices, thought to be related to the greylisting of Malta by the Financial Action Task Force.
Evolution suffered a share price fall from SEK1,468 (£124.27) on 28 June down to SEK1,361 and have fallen further reaching a so far nadir of SEK1,355.
Meanwhile Kindred saw a share fall of SEK143, down to SEK133.
Kambi has seen a decline in its share price since last week, and has fallen down to $48.25 from $49.95.
Yet Betsson and LeoVegas managed to fare significantly better, with just marginal decreases in value, and both have now seen a recovery in their prices.
Malta’s greylisting by the Financial Action Task Force has huge knock-on effects for the Swedish gaming market, as several of them have operations in the country and have offices on the island.
The taskforce is an international anti-money laundering and terrorist financing watchdog, looking to set global standards in preventing these illegal activities. It currently has 39 members and is strongly reliant on regional bodies to implement its programme.
The members voted that Malta is not considered to be meeting the requirements for crimes related to money laundering and tax evasion.
Yet only this month Malta had agreed to a high-level commitment to work with the taskforce and MONEYVAL, the Council of Europe’s monitoring body that assesses compliance with international standards to combat money laundering and terror networks.
The agreement is aimed at strengthening Malta’s effectiveness at countering activities such as money laundering.
Malta did adopt a Mutual Evaluation Report with the taskforce in 2019, and is thought to have made progress on many of its recommendations, for example reinforcing its approach with designated non-financial businesses and professions supervision.
Also, in improving its analytics for financial intelligence, supporting the police and empowering prosecutors in their investigations into complex money-laundering cases.
A further reason behind the decline of gambling stocks is the recently agreed global minimum rate of 15% corporation tax at the latest G7 conference in Cornwall.
All organisations will be liable to pay the rate from each country that it operates from.
Several analysts believe that the tax will have a serious adverse effect on net profits for Swedish gambling operators.