SECP suspends shares trading in 4 insurance firms

Suspension may be extended if non-compliance continues

KARACHI: Trading in shares of four insurance companies has been suspended for a period of 60 days by the Securities and Exchange Commission of Pakistan (SECP).

A notice issued by the Deputy General Manager – Companies, Muhammad Ghufran, on Thursday announced that trading in shares of four insurance companies, namely Dadabhoy Insurance Company Ltd, Progressive Insurance Company Ltd, Platinum Insurance Company Ltd and Union Insurance Company Ltd will be suspended from July 24 for a period of 60 days.

The order was issued in line with Section 9(7) of the Securities and Exchange Ordinance of 1969 which allows the regulator to “suspend for a period not exceeding 60 days the trading in any listed security.”

The clause also allows the SECP to extend this suspension by a further 60 days if non-compliance continues on the part of relevant companies, or if the SECP considers the suspension to be in public interest.

Senior analyst at Aziz Fida Husain Securities, Hasnain Asghar Ali, said, “these companies have been incurring regular losses and have not been able to pay dividends to investors as required under the rules of the exchange.”

However, he added that the “volume of shares traded in these companies is relatively low so it will only affect a very limited number of people.” The SECP had suspended trade in all four insurance companies previously as well.

Published in The Express Tribune, July 23^rd, 2010.