AIRLINK 74.10 Decreased By ▼ -1.20 (-1.59%)
BOP 4.91 Decreased By ▼ -0.03 (-0.61%)
CNERGY 4.31 Decreased By ▼ -0.08 (-1.82%)
DFML 39.05 Decreased By ▼ -2.13 (-5.17%)
DGKC 84.80 Increased By ▲ 1.49 (1.79%)
FCCL 22.28 Increased By ▲ 0.63 (2.91%)
FFBL 31.49 Decreased By ▼ -0.51 (-1.59%)
FFL 9.25 Decreased By ▼ -0.17 (-1.8%)
GGL 10.04 Decreased By ▼ -0.04 (-0.4%)
HASCOL 6.75 Decreased By ▼ -0.07 (-1.03%)
HBL 113.95 Decreased By ▼ -0.05 (-0.04%)
HUBC 139.24 Increased By ▲ 0.14 (0.1%)
HUMNL 11.80 Decreased By ▼ -0.20 (-1.67%)
KEL 4.80 Decreased By ▼ -0.11 (-2.24%)
KOSM 4.38 Increased By ▲ 0.02 (0.46%)
MLCF 37.65 Increased By ▲ 0.14 (0.37%)
OGDC 131.10 Decreased By ▼ -1.75 (-1.32%)
PAEL 24.00 Decreased By ▼ -0.85 (-3.42%)
PIBTL 6.36 Decreased By ▼ -0.24 (-3.64%)
PPL 117.40 Decreased By ▼ -0.40 (-0.34%)
PRL 25.52 Decreased By ▼ -0.54 (-2.07%)
PTC 13.70 Decreased By ▼ -0.02 (-0.15%)
SEARL 56.11 Decreased By ▼ -1.14 (-1.99%)
SNGP 66.14 Decreased By ▼ -0.36 (-0.54%)
SSGC 10.13 Decreased By ▼ -0.11 (-1.07%)
TELE 7.92 Decreased By ▼ -0.29 (-3.53%)
TPLP 10.70 No Change ▼ 0.00 (0%)
TRG 61.83 Decreased By ▼ -0.57 (-0.91%)
UNITY 26.60 Decreased By ▼ -0.44 (-1.63%)
WTL 1.35 No Change ▼ 0.00 (0%)
BR100 7,809 Decreased By -36.8 (-0.47%)
BR30 25,135 Decreased By -121.2 (-0.48%)
KSE100 74,663 Decreased By -173.1 (-0.23%)
KSE30 23,957 Decreased By -47.9 (-0.2%)

ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) has increased the maximum limit for modaraba companies for extending housing finance facilities from Rs20 million to Rs50 million to facilitate its customers.

The SECP has issued SRO 529 (I)/2022 to propose amendments to the Modaraba Regulations, 2021, here on Friday.

“Modarabas with the prior approval of the Registrar may extend housing finance facilities to its customers and the maximum per party limit in respect of housing finance by a modaraba shall be Rs50 million”, the SECP revised regulations said.

Previously, the said limit was Rs20 million.

Provided that the total housing finance portfolio of the Modaraba shall not increase ten percent of the total portfolio of the Modaraba, the SECP added.

The SECP has also allowed modaraba companies to deal or trade in real estate for development or construction purposes.

According to the revised regulations, a modaraba company may hold, deal or trade in real estate for development or construction purposes, where such a purpose or objective is provided in the approved prospectus of a modaraba.

The modarabas may make investment in shares of unlisted company, subject to fulfillment of the following conditions, namely: (i) total exposure in such companies, does not exceed five percent of the equity of the modaraba as disclosed in the latest financial statements; (ii) the directors of the modaraba company have no direct or indirect interest in the investee company; and (iii) the investee company must have operational track record of three profitable consecutive years preceding the decision.

The Commission may, on an application by the modaraba company, relax the above conditions where a modaraba is engaged in venture capital financing, as set out in its approved prospectus, the SECP said.

Every modaraba may create reserve fund to which shall be credited an amount of its after-tax profits or any part thereof. (2) A modaraba, which is not compliant with minimum equity requirements provided in these regulations, shall create reserve fund to which shall be credit an amount equivalent to 100 percent of its annual after tax profit till such time the minimum equity requirements are complied with. Issuance of bonus shares may be made from the above-mentioned reserves since such bonus shares will increase the paid up capital.

“Provided also that a modaraba that has already raised funds through COM on the date of notification of these regulations, shall ensure that such investments are made by June 30, 2022, the SECP added.

Copyright Business Recorder, 2022

Comments

Comments are closed.