ISLAMABAD, April 28: The Securities and Exchange Commission of Pakistan’s annual report 2004 is silent about the records of those companies that made considerable profits last year but never declared dividends. When reporters asked SECP executive director (non-banking financial institutions) Rashid Sadiq at a press conference here on Thursday whether the commission’s annual report possessed any records of those companies which did not declare dividends despite earning profits in total violations of the rules of the regulatory body, the reply of the official was a simple ‘No’.
Mr Sadiq said that on page 41 of the report there were statistics which showed that 214 companies out of 536 had declared dividends in 2004. However, there were neither names nor any information regarding those 322 companies that did not declare dividends.
According to the report, the ratio of companies declaring dividends had decreased last year as compared to 2002 and 2003. In 2003, 245 companies out of 582 had declared dividends, while 255 companies out of 617 declared dividends in 2002.
The regulation of insurance companies and investment banks has been taken out from the ambit of the company law division of the SECP.
Sector-wise, the report reveals that only 37 companies out of total 121 in the textile spinning declared dividends last year. In the textile composite sector, out of 55 companies only 22 issued dividends, while in sugar and allied sectors, 10 out of 22 companies gave dividends.
BLUEPRINT FOR REGULATION: Mr Sadiq said the SECP had developed a blueprint for the regulation and progressive development of the corporate and financial (non-banking) sector. The blueprint was announced as a part of the annual report 2004. Based on this blueprint, the SECP would formulate a medium-term strategy for various sectors which would be implemented in the next five years, he said.
Mr Sadiq said the commission was seeking to remove the imbalance among various sectors which had been a major hindrance to the uniform development of the financial sector.
