Jordan Securities Commission (JSC) approved to raise the maximum allowed limit of the ratio of account receivables to net owners’ equity from (75%) to (100%).
A series of meetings & discussions, was held by (JSC) with capital market institutions, a number of investors & the Association of Capital Market Registered Persons. As a result of these meetings, (JSC) Board of Commissioners decided on February 22.2011 the following:
1. Extend the granted period of time to one year, for licensed Financial Services Companies to conduct Financial Broker businesses to raise the capital of a Limited Liability Company (LLC) to JD (5) million & of a Public Shareholding Company (PSC) to JD (10) million. This period of time shall conclude on December 31.2012 instead of December 31.2011.
2. Address the Amman Stock Exchange (ASE) to review the pre closing & the pre opening sessions within the Electronic Trading System. As well, undertake necessary decisions for the benefit of the market.
3. Raise the maximum allowed limit of the ratio of account receivables to be granted to brokerage companies’ clients to owner’s equity from (75%) to (100%).
4. Address the Association of Capital Market Registered Persons, the (ASE) & the Securities Depository Center (SDC) to provide suggestions relevant to standards of choosing companies allowed to finance their shares within the Margin Trading List during a period of time not exceeding one week of this decisions’ date.
The Board of Commissioners emphasized the importance of the following procedures & pursuing them by concerned parties:
1. The amended draft of the Securities Law no. 76 for the year 2002 submitted on May 2.2010 to the Prime Ministry to be approved. The draft included the following issues:
* New provisions to encourage establishing mutual funds that enhance liquidity & attract institutional investment.
* Provisions guarantying the rights of financial brokerage companies that finance their clients according to margin finance, in case of attachments, or bankruptcy or death of the client.
2. Pursue cooperation between the (JSC) & the Central Bank of Jordan (CBJ) to execute the project of Centralizing Risks on Brokerage Companies Clients.
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