ISLAMABAD: Zafar Hijazi, the Securities and Exchange Commission of Pakistan (SECP) chairman, said that the stock market regulator has the authority to tell any profit-making company to go public and share its earnings with a higher number of investors, rather than keep the benefits limited to “just one family”.
Hijazi was speaking at an investors’ awareness programme organised by AKD Securities as well as the Karachi and Islamabad stock exchanges, ahead of the formation of the Pakistan Stock Exchange (PSE).
Hijazi said the SECP was yet to exercise the power. “Though this power has never been exercised by the SECP, we want highly successful and profitable companies to be listed as well,” said the SECP chairman. “All we need is the courage to take this step, however, we will not make any decision in haste or without proper direction,” he added.
The SECP chief added that a record number of regulations have been framed in the last two years. “Everything is being done to ensure that market manipulators and those who make money through fraudulent means do not escape.”
He said that the economic future stands with the capital market of the country.
“Since there are no more functioning DFIs in the country, the only option for financing requirements is through the banking sector but that too, has its limitations,” he added. “The only viable and progressive funding option for the industries is the PSE and it will also be an attractive option for investment,” Hijazi said.
However, he added that the regulator has to be at the forefront to ensure fair practices, transparency and eradicating manipulations.
“The current investment cycle has gaps, which erode investors’ money but we will plug all these gaps by penalising mischievous elements,” he added.
Meanwhile, AKD Securities CEO Fareed Alam said capital markets were not limited to equity and stock exchanges only, adding that there is huge potential in the debt market as well.
“We are looking into this segment too,” said Alam. “We are hoping that the regulator and the government ease restrictions on trade of government papers.
“This is essential in view of the growing investment needs for China Pakistan Economic Corridor. If Pakistan can raise $10-20 billion through T-bills or PIBs then the political leverage of Pakistan will be enhanced.”
Published in The Express Tribune, December 23rd, 2015.