SECP forms working group for debt market reforms

The Securities and Exchange Commission of Pakistan (SECP) has formed a high-level working group to overhaul the country’s corporate debt market, aiming to simplify and speed up the issuance of corporate bonds and Sukuk.

The working group, headed by SECP Commissioner Muhammad Ali Farid Khwaja, will present recommendations for reforms in the debt market.

In a notice dated 30th July, 2026, the SECP said that a well-developed corporate debt market is essential for mobilising long-term capital, diversifying financing sources and broadening investment opportunities.

“Feedback from market participants indicates that lengthy issuance timelines and the high cost of issuing corporate debt instruments, whether through private placements or public offerings, are among the principal impediments to market development.

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“Accordingly, the SECP hereby constitutes a working group to undertake a comprehensive review of the corporate debt market and recommend practical reforms to improve efficiency, reduce issuance timelines and costs, standardise documentation to facilitate greater market participation,” read the notice.

• ToRs of working group:
• Review the existing credit rating framework and identify measures to improve efficiency, transparency and market confidence.
• Assess the impact of credit rating requirements on issuance timelines, costs and market accessibility.
• Recommend reforms to simplify the rating process and facilitate innovation in rating products.
• Conduct an end-to-end review of the issuance process for privately placed and publicly offered corporate debt securities.
• Assess the time required at each stage of the issuance process and identify regulatory, legal and operational bottlenecks.
• Review the complete cost of issuance, including regulatory fees, professional charges, listing expenses, taxation and other transaction costs, and recommend measures to rationalise such costs.
• Review legal, regulatory and documentation requirements; draft standardised documents and propose amendments in the regulatory framework, if required, to improve efficiency of the issuance process.
• Review the existing taxation framework applicable to corporate debt instruments and recommend measures to reduce tax-related impediments and enhance market attractiveness.
• Consult relevant market participants and benchmark Pakistan’s framework against international best practices
• Review the regulatory and Shariah framework governing Sukuk issuances.
• Identify Shariah, legal and operational impediments affecting Sukuk issuances, including those contributing to higher costs or longer timelines.
• Recommend reforms to facilitate standardised structures, improve market efficiency and expand the Islamic corporate debt market.

The group comprises representatives from the Ministry of Finance, banks, financial institutions, credit rating agencies and other market stakeholders.

“Promoting and strengthening the corporate debt market is a key priority,” said SECP Chairman Dr Kabir Ahmed Sidhu. He added that a robust corporate debt market will provide long-term capital to industry and the government.