KARACHI: Securities and Exchange Commission of Pakistan (SECP) has welcomed the new board of directors of Pakistan Stock Exchange (PSX) constituted on Friday, which comprised of Chinese investors.
SECP chairman Zafar Hijazi visited the PSX on Friday and met members of the Board of Directors of PSX including representative of the Chinese consortium. The SECP Chairman was accompanied by senior level officers of the SECP on the occasion.
During his discussions with the PSX Board, the Chairman SECP welcomed the incoming PSX Board and appreciated contribution of the outgoing Directors.
The Chairman desired that PSX Board should confirm to highest governance standards, appointment of independent Directors should be expedited and that PSX management should be strong, professional and independent. He stated that PSX must focus on investors protection and risk management and for the same, the Exchange should assume the role of a full-fledged self-regulatory organization in line with best practice, while ensuring segregation of regulatory and commercial function.
He reiterated that in line with SECP’s policy of zero tolerance towards market manipulation and unfair trade practices, PSX must focus on strong enforcement, compliance and risk management.
He mentioned SECP’s various recent reform to improve risk management and hinted at strict action against anyone involved an illegal activities.
In particular, he pointed out the recent constitution of a committee to review existing models of financing by brokers in light of best practices and local requirements whose report is expected shortly, and expected that the PSX Board would facilitate implementation of recommendations of the committee.
Hijazi further expressed his desire that the Chinese Consortium would play a pivotal role by insuring a commercially driven strategy and sharing its experiences with regards to the same. A detailed three-year business plan is anticipated from PSX which should propose concrete measures for development and activation of the equity, debt, derivatives, SME and commodities markets, along with practical initiative for expending market outreach and investors base.
The PSX Board appreciated the SECP’s efforts for creation of a fair, transparent and modern capital market, in particular the recent reforms carried out in consultation with the stakeholders, and assured the SECP of its commitment towards fulfilment of the SECP’s expectation towards PSX.
