SECP’s New Regulations Allow Public Access to All Three Tiers of Pakistan’s Capital Markets

The Securities and Exchange Commission of Pakistan (SECP) has allowed public access to stocks data from the triangular foundation of the capital markets in the country – Pakistan Stock Exchange (PSX), National Clearing Company of Pakistan (NCCPL) and the Central Depository Company (CDC), a statement issued by the commission said on Tuesday.

PSX data was already publicly available, but now the SECP has also approved the disclosure framework for paving the way for more information to be provided to the public.

“In adherence to internationally recognized standards of regulation and oversight, the SECP has approved disclosure framework to provide participants and public with sufficient information for better understanding of financial market infrastructures (FMIs), regulatory, supervisory, and oversight policies of SECP with respect to FMIs and complete regulatory and operational landscape,” the statement read.

These disclosure documents will be made available to the general public through respective websites and will be regularly updated, as and when deemed appropriate.

NCCPL is playing a significant role in ensuring growth and prosperity to the Capital Market of Pakistan. “The National Clearing Company of Pakistan Limited and the Central Depository Company of Pakistan Limited are important FMIs facilitating clearing, settling, recording of securities, derivatives and other financial transactions,” SECP’s statement said.

The CDC is a member of the Asia-Pacific Central Securities Depository Group – an international organization facilitating the exchange of information, promoting mutual assistance among member securities depositories and clearing organizations in the Asia Pacific region. “Both institutions are regulated by SECP and play a critical role in fostering financial stability.”

The SECP said that the disclosure framework has been prepared in accordance with the Principles for Financial Market Infrastructure (PFMIs) that pertain to standards of governance, risk management and protection of interests of participants. The PFMIs has been jointly developed by the International Organization of Securities Commission (IOSCO) and Committee on Payments and Market Infrastructures (CPMI) and recognized by the IMF and the World Bank.

Earlier, with the assistance of the World Bank, self-assessment of all these three tiers was carried out – SECP being a regulatory authority and NCCPL and CDC being FMIs – and broad compliance with PFMIs was found. Based on these self-assessments, disclosure documents have been developed for NCCPL and CDC. Moreover, a separate document has been prepared by SECP to disclose its regulatory, supervisory, and oversight policies with respect to FMIs.

The SECP hopes to enhance international investors’ confidence with these global standards in FMIs.