Jordan Securities Commission Proposes Draft Project to Amend the Instructions of Margin Finance
31-Dec-2012
In cooperation with the Financial Services Companies Association, Jordan Securities Commission (JSC) reviewed the Instructions of Margin Finance & prepared a Draft Project to Amend the Instructions of Margin Finance, in order to maintain its goals of regulating the capital market & protecting it from risks it may face, as well as regulating the relation between the broker & the client, financially.
The “Draft Project” included the following amendments:
Companies financing their clients in Margin Finance must increase their capital to JD (5) million instead of JD (1.750.000) million. In condition that these companies paid in net ownership rights are not less than (75%).
In addition to, decrease the amount of Margin Finance Limit offered to clients from (250%) to (150%) of the ownership rights of a Brokerage Company.
As well as specify the Margin Finance Limit of one security to (25%) instead of (100%) of the ownership rights of a Brokerage Company. This shall decrease risks of securities centered with a broker & specify the amount of Margin Finance Limit for one client & for companies controlled by him to 10% of the net ownership rights of a Brokerage Company or to JD (2) million whichever is less.
The (JSC) proposes this “Draft Project” to all concerned parties in Jordan capital market including brokers, investors, auditors & others, to state their opinions on the suggested “Instructions” within two weeks from the date of being disseminated. The Commission wishes to be acquainted with their opinions & suggestions to benefit from these prior to being finalized.
The attached “Instructions” are merely a “Draft Project” that may be altered & amended as deemed proper for public interest, nor is any part of it is final yet.
* To view the “Draft Project to Amend the Instructions of Margin Finance”, kindly click here.
Kindly send your views & opinions to the following addresses:
Email: info@jsc.gov.jo.
Fax: 5682615.