KSE okays bonds automated trading system, exchange trade fund

[Naveed Yaseen]

By Tanveer Ahmed

KARACHI: Karachi Stock Exchange (KSE) has approved bonds automated trading system and exchange trade fund in the market.

The board of directors of KSE gave the approval to bonds automated trading system in a meeting held on Tuesday. The issue has been forwarded to Securities & Exchange Commission of Pakistan (SECP) for the final nod.

The meeting also reviewed the matter concerning the suspended members of KSE and final decision would be taken on Wednesday, the last date given by the board to these members to clear off their liabilities or their cards would be sold to pay off the investors’ claims.

According to a director of KSE, the bonds automated trading system would deal with the automated trading of debt securities and the National Clearing Company (NCCPL) would handle the settlement issues. In the first phase, Term Finance Certificates (TFCs) would be traded at the stock exchange and later other bonds and securities would be added to the ambit. Presently, the trading of debt securities and instruments are traded out of the system by the market dealers both authorised and unregistered. KSE director hoped that trading in the bonds at the market is likely to commence in September this year.

Analysts said that initiative would provide the much-needed transparency in the trading of debt securities market and would be beneficial for the stock market performance.

However, they said that initially the volumes of the debt securities would be quite low but as soon as the market develops, the volumes and the capitalization would improve.

“In this way the corporate bond market would be properly developed giving access to the low-scale and retail investor,” they added.

http://www.dailytimes.com.pk/default.asp...2009_pg5_2