Demutualisation Act to be introduced: SECP

LAHORE (August 21 2007): The chairman, Securities and Exchange Commission of Pakistan (SECP), Razi-ur-Rehman Khan has said that work on preparation of 'Demutualizastion Act' is underway and currently rules of the proposed act are being made. He stated this to journalists after inaugurating Arif-Habib Rupali Bank branch at the Lahore Stock Exchange (LSE) here on Monday.

In response to a question about slow pace of the demutualization, he said the process had started on January 2006, which was to be completed in 18 months period, but it delayed. Later, the SECP extended the deadline for another six months, but now no further extension will be allowed, he added. The demutualization process will be completed within the stipulated time by December, he said.

Disagreeing with a questioner that the corporate reforms process had delayed, he said it had been continuing smoothly and there was no delay in it. Razi-ur-Rehman Khan categorically denied the reports that the SECP high-ups were interfering in internal affairs of the LSE Board and exerting pressure on the board directors for replacement of the sitting chairman of the Exchange. “The LSE Board was free to make its decisions and we had nothing to do with it,” he said.

About the issue of enhancing the CFS limit, the SECP chief said that brokers had made their proposals in this regard and in response to it, the SECP gave its counter proposal and a final decision to resolve the issue will be taken in consultation with all stakeholders.

Answering another question, he said this year, 4,000 new companies had been registered with the SECP and the total number had now reached 55,000.

About the filling of the vacant posts of directors and commissioners in the SECP, he said these would be filled with suitable candidates. When asked about the small SECP employees' complaints about their promotions, he said it was a routine matter. Some of the employees frequently sent anonymous letters to him in this regard but it was not an issue, he remarked.

Arif Habib Rupali Bank Chairman and former Karachi Stock Exchange (KSE) chief Arif Habib informed journalists that with this bank opening, the total number of the bank branches had increased to nine while it will increase to 2 by end of this year and them to 20 by the next year.

Commenting on the stock market performance, he said it has been doing well for the last two-three years and demutualization would have a further positive impact on it to promote commercial culture. Earlier, the SECP chief formally inaugurated the bank branch. LSE chief Hamesh Khan, Managing Director Hamid Imtiazi, General Manager Mian Shakeel Aslam, members, brokers and bankers were present on the occasion.

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