HYDERABAD, June 16: Securities and Exchange Commission of Pakistan Chairman Dr Tariq Hassan on Thursday said that terms of reference of the government-appointed task force to probe stock market’s crash in March were quite broad based and it had conducted a comprehensive survey before concluding its findings.
He was speaking at a roadshow on investment in the capital market here. The roadshow was part of a series of programme to educate potential small investors about stock markets, the SECP and Central Depository Company (CDC).
“It will not be a Hamoodur Rehman Commission report that will not be published,” the SECP chief points out.
He appreciated CDC’s initiative for educating investors of interior of Sindh. “The SECP has been actively pursuing a capital market reform programme towards the development of a modern and efficient corporate sector and capital market. It will continue playing an active role in promoting greater understanding of the capital market. The SECP believes that the best defence against fraud and abusive securities practices is an educated investor,” he added.
Dr Hassan spoke of reasons for a narrow investor base and linked it to lack of infrastructural facilities in smaller cities to cater to small investors as trading activity was mostly concentrated at stock exchanges of Karachi, Lahore and Islamabad.
He said that margin financing had been recently introduced to replace CTO/badla financing which was fraught with risk, adding that COT had been identified as a major source of over speculation and root cause behind almost all market crisis experienced in the past. “The SECP accords high importance to resolution of investors’ complaints which are dealt with expeditiously through the investor complaint cell set up for this purpose,” he said.
Karachi Stock Exchange Chairman Yasin Lakhani said the task force had completed its findings which would be made public soon. He, however, called for introducing and promoting margin financing by banks before June 30 as had been decided to provide facilities to investors otherwise chances of crisis factor could not be ruled out.
Mr Lakhani said the KSE had created CDC for providing facilities to the investors and added that majority of companies were trading through CDC. He urged the investors to do some spadework and examine all options before making any investment.
He informed the participants that the KSE had begun computerized trading and its employees had been given free training with the result that no one was rendered jobless. “The work is being done quite efficiently now. The investors could obtain their statements which could be got corrected if they contained mistakes,” Mr Lakhani said and added that even holdings with CDC could be checked.