March 06, 2007	Tuesday	Safar 16, 1428

KARACHI, March 5: A joint meeting of the Securities Exchange Commission of Pakistan (SECP) and the Karachi Stock Exchange (KSE) was held on Monday “to discuss various outstanding matters”, stated a joint press release issued late in the evening.

The KSE and the SECP agreed on a procedure to handle payment of bonus shares/ right allotment letters / cash dividends to CFS financees after collecting the same from the financiers.

The given below are the agreed modalities:

— The current practice of forced release of CFS contracts will be replaced with the new electronic procedures.

— The KSE to prepare a list of CFS Financees and Financiers on book closure date detailing the position of each financee and financier with respect to each scrip.· All unreleased CFS in the particular scrip shall remain locked from the commencement of spot trading until the commencement of book closure.· On receipt of cash dividend by the financier, the same shall be collected by the KSE and delivered to the Financees.

— Upon receipt of bonus shares by the financier in its CDC blocked account, the CDC shall transfer the same in favour of KSE for onward distribution to the financees recorded as on the ex-date.

— As regards right, the right allotment letters received by the financiers will be collected by the KSE for onward delivery to financees.

CFS MARKET: Ready Market Purchase, when financed on CFS market, margins applicable thereon shall be released. Ready market margins shall then be applicable on second ticket open purchase immediately.

Upon release of the second ticket purchase, the margins shall remain applicable till settlement date, unless there is a corresponding sale in the ready or CFS market on the same day of release in which case no margins will be held.

It has been agreed that the CFS facility is available only against ready market net purchases per client on UIN basis, inclusive of CFS released positions (2nd ticket purchase contract).

It has been further agreed that financee may rollover its second ticket purchase contract beyond 22 working days at its discretion. However, the financier will have the option of releasing its position after 22 working days as per existing practice.

UIN DATA: The commission agreed with the KSE members that information requested by the SECP is causing undue hardship. With a view to alleviating the same, the SECP agreed that such data be collected on need basis wherever deemed necessary by the commission.

CASH SETTLED FUTURES: The KSE confirmed that cash settled future contracts will be introduced in the market from April 2, 2007, in highly liquid scrips.

INSTITUTIONAL MARGINS: A series of meetings were held with financial institutions and the KSE and SECP teams to finalise modus operandi for taking margins directly from financial institutions. Legal formalities are now being ironed out to enable financial institutions to place margins directly to the KSE.