State Bank of Pakistan and Pakistan Stock Exchange take Important steps for Pakistan’s Economic Growth

 

At the PSX Gong event, the Governor SBP announced important steps to further deepen the credit and capital markets.

The Pakistan Stock Exchange (PSX) gaunt ceremony was hosted by the Governor of the State Bank of Pakistan. SBP and PSX have recently been working closely to improve and expand the access of capital market participants to government debt securities. To facilitate investment by non-residents in stock exchanges. Remove barriers that prevent companies from taking advantage of their group companies’ shares and promoting information-sharing arrangements between banks and capital markets.

On the occasion, SBP Governor Dr. Raza Baqir said that he was happy to visit PSX for this gong event as it has helped to improve credit and capital markets and financial intervention in Pakistan. SBP and PSX have expressed their commitment to work together.

He said that the SBP has amended the rules for appointment of primary dealers for government loan securities. This will expand the list of eligible companies to act as primary dealers, including security depositories and clearing agencies. The move aims to expand the investor base of public securities, improve liquidity, increase transparency and promote market growth. In addition, the SBP has softened the selection and performance standards of development finance institutions, investment banks and brokerage houses to encourage them to become part of the core dealer system, which is currently dominated by banks. Is. Therefore, among the other concessions offered to primary dealers, a large and diverse group of institutions will now have direct access to the primary auction.

He said that while the government loan market in Pakistan is well developed, the participation of clients in the capital market has been historically limited and SBP wants to encourage broad-based ownership of government securities among retail investors. The SBP governor noted that the revised primary dealer rules would meet the needs of a diverse group of investors, including capital market clients, corporates and individuals, and attract a new client to the public securities market. Governor Baqir said the move was taken after detailed discussions with stakeholders and a comprehensive review of international best practices.

Governor Baqir said the SBP had changed its rules of procedure to facilitate sponsors, shareholders and companies to raise more financing against the security of shares of its group companies. He added that the amendment would help sponsors and companies to increase liquidity for further investment in new business opportunities and projects, and would result in greater economic activity. As a result, it will also promote economic documentation, transparency and good practices of corporate governance.

Dr. Baqir informed the audience that the SBP and PSX have jointly signed an agreement between the banks and the Central Depository Company of Pakistan (CDC) or the National Clearing Company of Pakistan Limited (NCCL) for the existing bank account. The YC is working to expand the scope of information exchange. ۔ He was pleased to announce that significant progress had been made and hoped that this important initiative would be successfully implemented by the end of next month. He added that such arrangements would help capital market players mobilize domestic resources and bring them to productive use effectively.

The Chairman of the Board, PSX, Mr. Suleiman S. Mehdi gave a hearty welcome to the Governor SBP. PSX Board Members; Mr. Farrukh Khan, MD & CEO, PSX; And senior management of PSX. In addition to SBP’s senior management, senior members of the market, bank presidents and treasury heads were also present at the gong ceremony.

On the occasion, the SECP Chairman eloquently stated that “as progressive regulators, the SECP and the SBP have a common interest in improving and developing the capital markets and the economy as a whole. ۔

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