While stock prices around the world have been shaky and stock exchange indexes have been in freefall for most of the year, Bank of Bermuda shares have almost doubled and the Bermuda Stock Exchange index has been pushed up 1,303.72 points -- all in just 12 months.

The buying frenzy on what used to be a quiet local market has been boosted by the relaxation of the 60/40 ownership rules last year.

The relaxation -- part of a commitment made by Finance Minister Eugene Cox to the OECD -- allows companies given an exemption to have more than 40 percent foreign ownership.

In December the Bank of Bermuda became the first non-telecommunications company to get an exemption from 60/40 rules.

The bank is Bermuda's largest, with a market capitalisation of $1.29 billion, and said that exemption -- and a listing on the Nasdaq -- would enable the bank to compete on an equal footing with other global institutions.

The news pushed the bank's stocks up to an all-time high of $51, shooting up from a 52-week low of $24.28 at the time.

It then dipped, closing at $47 at the end of April when bank chairman Joseph Johnson said it still intended to list on the Nasdaq.

That cooled speculation that the bank was backing off listing in the wake of the world stock market crash.

Now Bank of Bermuda shares continue to rise, and yesterday closed at $55. The 52 week low is $28.

Bank of Butterfield's stock started soaring on the same day in April that it was granted an exemption.

The Island's oldest bank said it would not be using the exemption to list on any foreign stock exchange, such as the Nasdaq, in the foreseeable future.

Bank of Butterfield shares shot up after the news to close at a record $27.25, with nearly half a million worth of shares sold during that day's trading.

They hit a high of $31.50 and are currently trading at $30.50, more than double the 52-week low of $15.10.

The last exemption was on May 1 this year, to Bermuda Commercial Bank. Now First Curacao International Bank will become a 50 percent stakeholder in the bank. Mr. Cox said the move was in the national interest.

The announcement pushed up the price of the company's stock on the Bermuda Stock Exchange up more than 17 percent to a new 52-week high of $8.20.

Bermuda Commercial Bank warrants soared 150 percent or 30 cents to close at 50 cents a piece after it was announced that the expiry date for the warrants has been extended to May 31, 2002.

BCB shares are now trading at $9.25 and warrants at $2. The BCB stock's 52 week low is $5 and warrants were previously trading at 20 cents.

All this activity has pushed the Royal Gazette/Bermuda Stock Exchange Index up and up, and on Tuesday it reached a new all-time high of 2716.79. The all time low of the index is 896.13.

Volume has also increased with the increased liquidity, with the value of shares traded daily going from several hundred thousand to sometimes millions in a day.

In May last year the index stood at 1,413.07 and on the same day last year $170,66.80 worth of shares changed hands. Yesterday the index stood at 2,708.90 and $1.3 million's worth was traded.

In July William Woods, chief executive officer of the Bermuda Stock Exchange said he hoped that he hoped one day that any company listed on the exchange would be eligible for exemption from the ownership rules.

WHAT 60--40 MEANS The 60/40 ownership rule means that any company which is listed as a local company must be owned by a 60 percent majority of Bermudians or Bermudian companies. The other 40 percent can be owned by people or institutions from off the Island. Conversely international companies have an 80/20 rule. This states that Bermudians can only own 20 percent of companies registered as exempted or international companies. The 60/40 ownership rule is listed in section 114 of the Companies Act.