KARACHI, Jan 3: The Board of Directors of the Karachi Stock Exchange in its meeting held on Monday, unanimously elected Muhammad Yasin Lakhani, as the Chairman for the year 2005.
This is 5th time that he has been elected as the President/ Chairman of the Exchange.
Addressing the Board, Mr Muhammad Yasin Lakhani in his induction speech expressed his thanks to the Board members for reposing their confidence in him and said that he would have the privilege to work with a great and enlightened team of Directors.
Referring to the progress and growth of the market, the Chairman said that the bourse had reached new heights and it looked forward to hitting even higher marks during the current year.
He expressed the view that the positive market environment was the result of excellent co-operation between the KSE and the SECP. He said that this was also due to the heavy investments made by the KSE in the development of IT technology and other necessary infrastructures starting from the establishment of Central Depository Company in 1994 coupled with introduction of screen-based trading in 1998, introduction of T+3 settlement system in 1999 and effective risk management systems from September 2001 onward.
He pointed out that KSE is virtually demutualised with four non-member Directors on its Board and an independent management headed by a very able Managing Director Mr Moin M. Fudda.
Apart from those measures, the economic turnaround and accelerated privatization programme of the government had also contributed in improving the confidence of investors and broad-basing the equity investment in the country, he said.
Referring to the demutualization and integration of the stock exchanges, he said that the bourse would look at different models in close cooperation with the SECP to see which one was most suitable to our country's requirement.
He said that the KSE had the precedent of closely working with the SECP in the past during the setting up of CDC and such coordination would continue in future as well.
Giving the outline of bourse's future strategy, the chairman KSE stated that the bourse would concentrate more on the following developmental issues during the year:
1) Efforts would be made to increase investors' base in the country for which the KSE would work with the Privatization Commission in its efforts to broad-base investors through the dis-investments
2) Members would be requested to open their offices throughout the country to attract investment in the KSE.
3) The KSE would need marketing for attracting foreign portfolio investments, which would come on the back of local investors' confidence. Today the KSE, he said, was among the top performing markets of the world and the country's credit rating had been notched upward.
He said that in the coming days this rating would put Pakistan capital market into the investment grade. In the meantime the smart investors would draw out the strategy to pick up choicest investment.
With continued economic policies under the able leadership of Prime Minister Mr. Shaukat Aziz, the KSE was very optimistic about the country's future, said Mr Lakhani and added that he remained "very bullish" on Pakistan.
4) The KSE would work to further improve corporate governance and in that respect he referred to the investment of the bourse in setting up Corporate Governance Institute under the able guidance of Mr. M.J. Jaffer, Director.
Protecting small investors interests' would be the corner stone of that policy, Mr.Lakhani said and added that with improved governance, the listed companies, their stakeholders and the exchequer, all would be benefited. He said that after the introduction of corporate governance as a part of the Listing Regulations there had been significant improvement in the performance of listed companies.
5) With regard to introduction of new products and development of debt market, the chairman KSE said that currently there were structural impediments. He said that banks also needed to diversify their operations and the board would approach SECP for their assistance.
To encourage debt market KSE would advise the government to increase the percentage of offer to investors rather than in the IPOs where a large chunk was taken up by financial institutions and hence no trading takes place in debt instruments.
