18/06/2014
Warnings of a repeat scenario of the collapse of 2006 and claims to the commission to take precautions
Concerns in «Shura» of speculative activity of the stock market
The Finance Committee of the Shura Council feared speculative activity in the stock market with high index market during this period, during the presentation of the report of the CMA in the Shura Council today, that the Commission monitor market risks, and take all precautions to ensure the non-recurrence of a scenario of what happened in 2006. The Committee invited CMA to develop actions to reduce risks in the financial market to protect investors by identifying risks to the market and try to control and mitigate them, by increasing the level of disclosure and transparency, and severe control facilities from banks for equity financing and deepen the market, create more protections for traders.
The Finance Committee recommended that the Commission re-examine the conditions brokerage firms, so as to ensure fair competition and the continued operation of those businesses not rival by State-owned commercial banks, the Committee noted the decline in brokerage firms for more than 70 per cent after falling from 100 to 30 companies over a period of five years, Dr. Abdulrahman Alotaishan Chairman market said in depth is still concentrated in the brokerage firms of the banks themselves, trading amounted to brokerage firms In March last year to 387.9 billion, and the share of banks, brokerage firms, 356.5 billion riyals, the 12 companies and 92 per cent, while the share of 18 other financial transactions worth 31.5 billion, equivalent to about 8 per cent of the value of the trading market, the Commission said that given the low Commission rate may not cover the operating costs, the new exit to some brokerage firms operating in the market and create a near-monopoly market.
And in the interventions of members, Dr. Abdulaziz otaishan saw the rise of the stock market index this year as ' a big jump quickly and a warning to officials and the commission ', calling for market surveillance ' close surveillance ' and stop speculative trading of unacceptable, and prepare to intervene, indicating increased liquidity in the Kingdom, expecting analysts and specialists with many investors out of the real estate market to the stock market. Dr. Al otaishan the specialist financial and a Saudi businessman registered letters to the Ministry of finance and Ministry of economy and SAMA, CMA, warned that the stock market was heading swiftly to collapse, and asks to alerts the investors and to send them letters that the market index may skip the logical price, and the descent of the indicator gradually, Dr. otaishan supported by a senior scientist on the stock market.
Dr. Fayz Alshehri accused recommendations and requests of phantom fraud index and dealings in the market, and the commission to adjust the daily movement in the market, ranging from 8-12 billion, through a systematic and professional treatment and stop fraudulent deals, noting that companies likely to weight indicator in millions of applications to increase the value of its shares of Phantom, and recommendations for electronic victimization in many contributors, and resulted in some firms exceeded the book value by tenfold. Dr. Alshehri noted for the spread of leaking information monthly trading and selling among investors, who were himself on the people involved to get this information, and addressing the body, reviews the listing rules of the stock market, as demanded by the Chairman of the Board for discussion under the dome.
Dr. Abdulaziz Alharqan called the commission review the status of foreign banks licensed in and reduce the exploitation of internal investment licenses in raising funds from local investors and invest outside the Kingdom, and he said on the bond market, the weak, for the transfer of competence to follow bills and consider disputes of the Trade Ministry to CMA, and on attrition staff , close the Office in Jeddah, he wondered about the steps the body put on the market a stock company to go public, as recommended by the Board in Last year's report. Prince Khaled Alsoud also called on the Commission to study the phenomenon of declining subscriptions by about 37 percent from the previous year, and causes and its association with decreased activity, slow economic growth, noting that it reduces liquidity in the stock market and absorption of investment opportunities, that lead to greater competition on current stock and market index, also asked for a general management unit for internal audit to the board, urging the board to exclusively on one side of the internal audit.
The Commission recommended from industrial property ' cities ' incentive plan to guide investment in promising industrial cities in other cities of Riyadh, Jeddah and Dammam, and address the difficulties facing the stalled projects and controls of land rent and withdrawal of lands that do not start in a factory during the period specified. The Council also recommended that the Commission develop a plan to encourage women to invest in industrial property, and the preparation of an operational program to facilitate investment procedures and promote the employment of women, and to include in future reports the volume of investments in the industrial cities, their contribution to total industrial production and gross domestic product of the Kingdom, as well as workers and saudization.
