November 29, 2006	Wednesday	Ziqa'ad 7, 1427

KARACHI, Nov 28: The Securities and Exchange Commission of Pakistan (SECP) made changes in the schedule of implementation and a few modalities of the Risk Management Systems (RMS), it was learnt on Tuesday.

“The changes made followed detailed discussions with the management of the stock exchange,” said an official at the exchange. The decisions were conveyed to the directors in an emergent meeting of the board of KSE held on Tuesday. The chairman, MD and member directors participated in the meeting.

Major changes were the increase of maximum deposit margin from 0.2 to 2 per cent of the free float in particular scrip and increase of exposure margins from 30 to the existing 50 per cent.

The margins were previously cut from 100 per cent and were suggested to hold at 30 per cent, which was found to be “too low”, said a stock broker. The effective date would be December 4. By April next year, the margins would be raised to 75 per cent and then to 100 per cent by October 2007.

“The changes have been made to comfort small and medium size brokerages, who could receive a rude shock from the drastic changes in one go,” said an analyst, adding that the regulators have instead decided to phase out over a period of time. The decisions were based on the results of mock trading held at the stock exchanges in the previous weeks, analysts said.