KARACHI: the Securities and Exchange Commission of Pakistan (SECP) has allowed KASB Securities Limited (KSL) to start business again after it has lifted ban on trading imposed on Nov 18 following the imposition of a six-month moratorium on KASB Bank by the SBP for failing to meet capital adequacy requirements.
The bank is the parent company of the brokerage house and owns a 77.1% stake in it. KASB Bank also acted as the settling bank for KASB Securities.
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According to SECP Executive Director Imran Iqbal Panjwani, KASB Securities will be allowed to execute ‘buy’ orders only against 100% cash. Similarly, ‘sell’ orders will be executed only against pre-existing holdings in the Central Depository Company (CDC) sub-accounts with KASB Securities. The SECP has also asked the KSE to appoint a dedicated, senior official to monitor daily activities of KASB Securities.
The chief regulator said that the ban was lifted on the Karachi Stock Exchange’s (KSE) suggestion of allowing the KSL limited trading. The SECP has directed the KSL to execute buy orders only against 100pc cash and sell orders only against pre-existing holding in CDS-subaccounts with the KASB Securities.
Meanwhile, the KSL also sent letters to customers informing that the SECP had reinstated its operations effective Dec 3. The brokerage stated that the last 15 days had posed a challenge and it appreciated the efforts of regulators and customers for their support and timely resolution of the matter.
The SECP indefinitely suspended the trading facilities of KSL at the KSE and Pakistan Mercantile Exchange Ltd (PMEX) on Nov 18 after the State Bank imposed a six-month moratorium on KASB Bank Limited on Nov 14.
