Demutualisation of stock exchanges to protect investors: LSE MD

Lahore Stock Exchange (LSE) Managing Director (MD) Aftab Ahmed said on Tuesday that Demutualisation of stock markets would protect investors, attract fresh investment and stabilise the economy. Also, he added, listing of SMEs to the stock market would strengthen the trading.
He was briefing newspapers editors and senior journalists at the LSE. Those who attended include Arif Nizami, Ata-ur-Rehman and Saida Fazal besides other senior journalists. LSE MD said the role of brokers would be limited against investors and the strength of stock exchange's board of directors would reach to 10, including four members of stock exchange and six non-members along with a chief executive.
Highlighting the proactive role of his management, he said the LSE management revoked membership of nine brokers during last one year and constituted investors' protection fund. According to him, the LSE management has decided to invite all the account holders for verification of their shares. Further, he said, instructions had been passed to investors to open CDC accounts to protect their exposures in the market.
Aftab said the LSE management was planning to establish an independent investors' trust with a mandate to satisfy the investors regarding payment of their claims. He said corporate briefing, financial literacy programme and capacity building of staff through training workshops was part of reforms leading to incentives for investors to invest in the market.
He expressed the hope that those steps would attract fresh investment and strengthen the economy. Responding to several queries from editors and senior journalists, Aftab said the LSE management steps to protect investors' rights were quite exclusive, as no one had earlier took those steps. Speaking about the importance of bonds, he said the National Savings had recently issued Rs 25,000 bonds, fetching Rs 20 billion in merely 22 days. It reflects the strength of the bond market in Pakistan where the government can explore further. LSE MD also briefed the guests about history of stock market, saying total number of members was 152, out of which 81 were formally active in trading.