slide1 l.
Download
Skip this Video
Loading SlideShow in 5 Seconds..
The 8th ACG Cross Training Seminar Merits & De-Merits of Direct & In-Direct Accounts in the Pakistan Capital Market PowerPoint Presentation
Download Presentation
The 8th ACG Cross Training Seminar Merits & De-Merits of Direct & In-Direct Accounts in the Pakistan Capital Market

Loading in 2 Seconds...

play fullscreen
1 / 38

The 8th ACG Cross Training Seminar Merits & De-Merits of Direct & In-Direct Accounts in the Pakistan Capital Market - PowerPoint PPT Presentation


  • 275 Views
  • Uploaded on

The 8th ACG Cross Training Seminar Merits & De-Merits of Direct & In-Direct Accounts in the Pakistan Capital Market. by: Shabnam Fahim Syed Faisal Hashmi Shariq Naseem. Agenda. Pakistan Capital Markets. Central Depository Company of Pakistan

loader
I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.
capcha
Download Presentation

PowerPoint Slideshow about 'The 8th ACG Cross Training Seminar Merits & De-Merits of Direct & In-Direct Accounts in the Pakistan Capital Market' - Audrey


An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.


- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript
slide1

The 8th ACG Cross Training SeminarMerits & De-Merits ofDirect & In-Direct Accountsin the Pakistan Capital Market

by:

Shabnam Fahim

Syed Faisal Hashmi

Shariq Naseem

agenda
Agenda
  • Pakistan Capital Markets.
  • Central Depository Company of Pakistan
  • Merits and Demerits of Direct and Indirect account Method
pakistani capital markets
Pakistani Capital Markets
  • Market regulators
  • Stock Exchanges
  • Instruments Traded
  • Trading Environment
  • Clearing and Settlement
  • Past Brief and Current Situation
market regulators
Market Regulators
  • Securities & Exchange Commission of Pakistan (SECP)
    • Regulating stock exchanges, NBFCs, CDC and Corporate Sector
    • Functional Responsibility: framing of rules and regulations
    • Recent developments, REIT, VPS, NBFC rules, debt market
  • State Bank of Pakistan (SBP)
    • Regulating banking institutions
    • Policy measures
        • Monetary
        • Credit
        • Foreign exchange mechanism
slide5
Stock Exchanges

Three Stock Exchanges in Pakistan:

The Karachi Stock Exchange

Lahore Stock Exchange

Islamabad Stock Exchange

The Stock Exchanges:

Most active and Liquid- KSE

Self regulatory body

instruments traded
Instruments Traded
  • Equity
    • Ordinary Shares
    • Preference Shares
  • Bonds
    • TFCs
    • Other Debt Instruments- TBs, PIBs
  • Derivatives
    • Stock Exchange offers equity futures
    • Monthly contract- overlap of at least 2 trading days b/w contracts
the trading environment
The Trading Environment
  • Equities
      • All Stock exchanges have own trading platforms
      • Automated Trading System:
        • Processing based on bids & offers and
        • Intimation of trades executed
      • Circuit Breakers- 5%
  • Bond Market
    • Primary Market
      • PIBs Auctioned monthly & TBs fortnightly
      • TFCs by Pakistani Companies
    • Secondary Market
      • PIBs and TBs traded freely
      • Investors hold TFCs until maturity- low liquidity
clearing and settlement
Clearing and Settlement
  • Clearing
      • Government bonds through SBP
      • Others through National Clearing Corporation
  • Scrip less
      • Settlement System T+3
      • Payment released-broker ascertains stock transfer- CDC A/c
  • OTC
      • No formal organized market
  • Physical
      • Less than 1% Settlement
slide9
KSE Current Situation
  • Pakistan Included in MSCI Emerging Market index- May 2005
  • World Bank-Investment report 2005- one of top ten reformer countries
  • Market capitalization- $ 57 billion with 663 securities (April 17, 06)
  • 4th year- one of the best performing markets- Business Week- US newspaper, USA today
  • Past four years compound annual growth rate-56%
  • KSE100 share index- increased 53.6% July 05 - May 06 - 3rd highest
  • Capital markets exceptional performance– Reasons
    • Pakistan Economic Revival- GDP growth- 2002 onwards
    • Consistent and transparent economic policies
    • Successful privatisation process-PTCL/National refinery etc
    • Impressive Corporate Results
    • Sound Monetary Polices- SBP, & Capital Market reforms- SECP
slide11
CDC ...

… the Country’s only Securities’ Depository

slide12

Central Depository Company (CDC)

  • Incorporated in 1993
  • To manage and operate the Central Depository System (CDS)
  • Live Operations in 1997
our services
Our services
  • Depository Services
  • Trustee and Custodial Services
  • Registrar & Transfer Agent (in near future)
legal framework
Legal Framework
  • Companies Ordinance
  • Central Depository Company Regulations
  • Central Depositories Act
  • Listing Regulations
slide15

Achievements

  • Implementation of National Clearing & Settlement System
  • Launch of trustee and custodial services
  • Launch of Investor Account Services
  • Launch of enhanced version of CDS (eCDS)
  • Induction of Open-end Mutual Funds in CDS
  • Launch of CDC call centre
  • CDC Access
securities handled through cds
Securities handled through CDS
  • Ordinary Shares
  • Preference shares
  • Term Finance Certificates

Certificates of Open-ended mutual Funds

  • Certificates of Closed-end Funds
  • Modaraba Certificates
transactions supported through cds
Transactions Supported through CDS
  • Deposit of Securities
  • Delivery (Transfer) of Securities
  • Withdrawal of Securities
  • Pledge
  • Corporate Action
    • Merger / De-merger
    • Consolidation /Split
    • Conversion
  • IPO
  • Issuance and Redemption of Open End Mutual Fund Units
slide19

Account Holders

  • Account Holders
      • Account holders have direct access to the CDS & are allowed to keep their beneficially owned securities in CDS.
  • Participants
    • Participants also have direct access to CDS and are allowed to provide custody services to their clients in addition to keeping their beneficially owned securities.
account categories
Account Categories
  • Main Account – Transitory Account
  • House Account – Account Holder’s own account
  • Sub Account – Client Account
  • IAS Account – Client Account
slide21

Account Structure

Central Depository System (CDS)

Account Holder

Account Holder

Participants

Main A/C

Main A/C

Investor A/C.

House A/C

House A/C

Sub-A/C

admission criteria
Direct Account

Member Stock Exchanges

Financial Institutions

Qualified investors that meet:

Technical requirements

Business Integrity requirements

Capacity requirements

having Data Processing & Operational Capabilities

Indirect Account

Any person or corporate entity.

Admission Criteria
slide23
Merits & De-Merits

of

Direct & In-Direct Accounts

benchmarking
Benchmarking
  • Forthcoming slides would provide you the behavior of Direct & In-direct Accounts, taking different important parameters of Capital Markets as the Yardstick.
  • We would analyze the merits & de-merits of both the type of accounts, by placing each of them individually, in different dynamic Capital Market motions.
  • This exercise would allow us to determine the effectiveness of each type of account in a more practical & realistic milieu.
efficiency
Efficiency

In-Direct

In the dynamic Capital Markets, dependency Is always treated as a Shortcoming. No matter how efficient your Custodian is, you remain dependent on them and dependency is not advisable.

slide38
Thank You!

  • Shabnam_fahim@cdcpak.com
  • Faisal_hashmi@cdcpak.com
  • Shariq_naseem@cdcpak.com