CDC cuts annual fee by 67 percent

KARACHI (February 26 2005): The Central Depository Company (CDC) has reduced the investor account holders' annual fee by almost 67 percent to increase the number of investors and eliminate cumbersome paper work. The CDC has been making a consistent effort to ensure that its services are highly cost-effective and convenient. CDC's services have set forth a reliable and innovative platform for small investors, moving them towards being an integral part of the country's capital market.

Over the years, CDC has been regularly reducing tariff for its clients. Such steps have positioned CDC as a concerned and efficient service provider at the very core of Pakistan's Capital Market. It has not only played a vital role in bringing efficiency to the market place but has also made it vibrant and transparent.

Moving forward in the direction to provide further comfort to market participants/investors, the CDC Board recently recommended reductions in the following charges which were approved by the Securities and Exchange Commission of Pakistan (SECP).

The annual fee levied on individual investor account holders has been reduced to Rs 500 from Rs 1,500, a decline of 66.67 percent.

The transaction fee levied on investor account holders has been reduced to Rs 0.0048 from Rs 0.0054 per share, a decrease of 11.11 percent. The transaction fee levied on participants/ account holders has been reduced to Rs 0.0024 from Rs 0.0027 per share, a cut of 11.11 percent.

The new revised rates would be effective from March 1, 2005. CDC Investor Account Services (IAS) has become a popular and attractive service for individuals as well as institutional investors and at present IAS holds 4.3 billion securities in over 18,200 investor accounts.

Investors were happy about this decision and were of the opinion that the number of investors would go up as the government's plan to sell shares in state-controlled units through stock market has raised the investors. The government has recently offered 316,000 shares for Kot Addu Power Co and market players expect that the offer is likely to be oversubscribed by nearly five times.

“These investors could avail the facility and incentive provided by the CDC to reduce the paperwork and cumbersome procedures, routing their shares through CDC”, they said.

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