Under pressure of the international financial institutions (IFIs) the Securities and Exchange Commission of Pakistan (SECP) has notified constitution of a committee to merge the three stock exchanges that would be later offered to some strategic foreign investor.
An official source said that the matter was decided hurriedly as the Finance Ministry had earlier directed the SECP to appoint Khalid Mirza as Chairman Lahore Stock Exchange (LSE) and Moin Fudda as Chairman Islamabad Stock Exchange (ISE).
After their appointment, the Finance Ministry directed SECP to notify the constitution of the committee. SECP was instructed not to spread its terms of reference of the committee which give it 45 days to finalise its recommendations.
The government wants to avoid agitation from the members of the LSE and ISE, who would be the most affected in case the proposed merger of the three stock exchanges takes place. The government is looking at the model of Indian stock exchanges for the merger, the source said.
According to the notification issued on March 20, 2015 the committee is headed by Khalid Mirza, Chairman LSE and includes Munir Kamal, Chairman Karachi Stock Exchange (KSE) and Moin Fudda, Chairman ISE.
The committee is tasked to review the existing corporate structure of the stock exchanges in line with the requirements of the Stock Exchanges (Corporatization, Demutualization and Integration) Act 2012 (the Act). It will review progress and prospects of the exchanges in bringing in foreign strategic investment as required under the Act.
While the first crucial step in the transformation of the Pakistani capital market has been taken with the demutualization of stock exchanges, integration would be revolutionary measure that would assist in bringing the market at par with global counterparts.
The committee shall accordingly recommend suitable scheme of integration for the stock exchanges for achieving economies of scale and liquidity.
The committee may invite professionals and market participants to obtain feedback and views and coordinate with the relevant bodies and associations to meet its overall objectives.
The committee shall submit it recommendations to the SECP within 45 days.
i am preparing myself to see Karachi Stock Exchange big crash……………2015
i had already discussed in March 2015 that KSE-100 will follow a big market crash this year that can continue middle of 2016. i had also mentioned that there will be a small up move on April 2015 and then final movement of index fall will start. now KSE-100 is at 32300. i expect index reach 22027-22509 area at first move. if further fall then we can see KSE-100 at 16003-16415 area and this is the most expected area for index reversal.
i believe that market is over priced and this big fall is a normal market correction as we have recently (2010-2013) seen in Bangladesh stock market. i also believe that Finance Minister, Prime Minister or anyone else can not control/stop this market crash. small investors should be very very careful before entering new trade. they should follow proper risk management + money management in their trading.
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