Inside Financial Markets

SECP issues guidelines for stock brokers

secp SECP issues guidelines for stock brokers

ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) has issued guidelines for stock exchange brokers to ensure that a consistent approach is taken while complying with regulatory requirements of the Securities and Exchange Rules, 1971 (SEC Rules) in calculating and reporting net capital balance.

The SECP conducts inspection of brokerage houses in an attempt to protect investors’ assets, foster principles of good governance and ensure that proper risk management procedures are in place in the capital market.

During the inspections, the commission has noted that the requirements prescribed in the Third Schedule of SEC Rules for preparing net capital balance were being interpreted differently by the brokers and auditors. Moreover, inconsistency was also observed on the part of auditors with regard to the format for certification of the net capital balance.

In a press release, the commission said it considered it appropriate to issue clarifications to ensure clarity and consistency including treatment of new products and their resultant impact on the net capital balance.

In light of the queries and suggestions received from different market participants from time to time, the SECP has issued guidelines with respect to the Third Schedule read with Rule 2(d) of the SEC Rules including certification of net capital balance under the regulatory framework, whichare available on SECP’s website.


Sanie Khan

Sanie Khan holds a deep knowledge of the financial markets in Pakistan. Based in Karachi, he has over 20 years of hands-on management experience in financial technologies and managing operations in the financial sector. He was the General Manager at the Pakistan Stock Exchange (PSX) for 17 years. He along-with senior members of Exchange

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Inside Financial Markets was a joint publication of Pakistan Stock Exchange (PSX)and Society of Technical Analysts Pakistan (STAP)