Annual Report 2012 - Lahore Stock Exchange

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Market Operations DivisionThe ongoing Corporate Briefings Program was launched by the CAD to provide a platform to listed companies toregularly interact with their stakeholders. During the year the following programs were organized:Name of CompanyDateDescon Chemicals Ltd./Descon Oxychem Ltd. 30-01-2012Sui Northern Gas Pipelines Ltd. 12-03-2012Fatima Fertilizer Company Ltd. 27-03-2012Pak Elektron Ltd. 22-05-2012The department has actively participated in organizingthe 2nd edition of the IPO summit held in July 2012 by allthe capital market institutions in Pakistan (KSE, LSE,CDC, NCCPL and SAFE) under the chief patronage of theSecurities and Exchange Commission of Pakistan (SECP).The purpose of holding this event on a regular basis is toenable the companies considering listing on stockexchanges to learn about the pathways of managing asuccessful IPO and to provide complete understanding ofall fundamental IPO issues and challenges.The department is an active member of e-IPO Committeeformed by SECP. The Committee is formed to develop asystem for implementation of e-IPO. In addition, thedepartment also remained a part of the TechnicalCommittee formed by SECP to review existing listingregulations to make the listing process efficient and lesscumbersome and suggest measures to encourage listing.The department drafted 'Regulations Governing Listing ofDebt Securities' in consultation with SECP Furthercomments on other regulations namely 'The RegulationsGoverning Over the Counter (OTC) Debt Market' andchanges suggested by the Technical Committee inexisting regulations of the Exchange were provided. Thedepartment also provided its feedback on draft PublicSector Companies (Corporate Governance) Regulationsand a concept paper on e-voting developed by SECP.In order to reach out to listed companies and hear abouttheir experience of listing at the Exchange, a roundtable isbeing planned towards the end of the year. The mainpurpose of the roundtable is to get the feedback of listedcompanies on the listing services being offered by LSE.CompaniesName Reason of Delisting Delisting DateMy Bank Ltd.Azam Textile Mills Limited15 % Non Voting Cumulative PreferenceShares of Nishat (Chunian) Ltd.Open End FundsMerged with and into Summit Bank Ltd.(1:0.80)Merged with and into Saritow SpinningMills Ltd. (500:623.94)06-07-201121-02-2012Converted into ordinary shares 21-02-2012MCB Sarmaya Mehfooz Fund 1 Matured and fully redeemed 05-08-2011JS Principal Secure Fund II Matured and fully redeemed 19-09-2011Term Finance CertificatesIGI Investment Bank Ltd. Matured and fully redeemed 02-08-2011Worldcall Telecom Ltd. Matured and fully redeemed 03-01-2012ANNUAL REPORT 2011-12 49
Market Operations DivisionMARKET OPERATIONS AND DEVELOPMENTThe role of Market Operations and DevelopmentDepartment remains central in the smooth functioning oftrading activities of the Brokers and operations of theExchange. The primary responsibility of the departmentis to manage the risk and exposure associated activities inaccordance with the regulations of the Exchange. Theseactivities are managed through Pre-trade and Post-tradeRisk Management Systems. During the period underreview, the department has made a number ofdevelopments in the Lahore Stock System (LSS) andClearing House System (CHS) to facilitate the users of thesaid software. These developments include: provision ofnew forms and interfaces in post-trade risk managementsystem for rectification of erroneous trades, releasing ofshares, automation of bank invoices for collection ofcharges on transactions, settlement of off-market tradesthrough NCCPL, dissemination of member-wise BTB datain pre-trade and post-trade risk management system,interface for reporting of cash receipt by brokers over andabove Rs. 25,000/- from their clients, same dayavailability of UIN for trading, instant release of marginsagainst pre-settlement delivery, provision of utilization ofexcess margins from designated accounts in addition toHouse Account, short-selling under Ready Marketwithout up-tick under certain condition, etc.In addition, the department has actively worked on theconcept paper of New Broker Registration Regime. Thedepartment also played an active role in the process ofCorporatization and Demutualization of the Exchange.During the period under review, the LSE conducted 16meetings of the Trading Affairs Committee to address thevarious issues of the market participants related withtrading. A series of regulatory changes have beenproposed by the SECP and implemented in the systemaccordingly. Lists for margin eligible securities acceptableas collateral, Securities Eligible for Short-Selling underReady Market, Securities Eligible for Deliverable FuturesContract and Cash Settled Futures Contract have beenrevised for the period under review.In order to reduce trade confirmation related disputebetween broker and investors, the department is activelyworking on the project of sending SMS alert/email alertsfor trade confirmation to the clients on real time basis.Further, the facility of trade confirmation through webshall also be provided to the investors. The departmenthas also initiated the development for integration of CHSand CHA whereby the receipts and vouchers shall beautomatically generated at LSS and CHA by entering theexposure cheques in CHS only. This will significantlyreduce the manual working of the end users of the saidsystems. The Standard Operating Procedures (SOPs) ofthe department are also being updating in line with theinstructions of the Management of the Exchange.In order to determine the exposure limits for capitaladequacy purpose, the department collects audited NetCapital Balance certificates bi-annually from the brokersof the Exchange. The minimum requirement forsubmission of NCB is Rs. 4 million. The current statisticsof NCB submitted by the Brokers are given hereunder:LSE Members Net Capital Balance (NCB) Slabfor June 30, 2012NCB Slab Members % age4,000,000 NCB < 30,000,000 64 77%30,000,000 NCB < 60,000,000 11 13%60,000,000 NCB < 90,000,000 0 0%90,000,000 NCB < 120,000,000 5 6%NCB 120,000,000 3 4%Total Members 8350LAHORE STOCK EXCHANGE
Page 1 and 2: L A H O R E S T O C K E X C H A N G
Page 3 and 4: 2LAHORE STOCK EXCHANGE
Page 5 and 6: Corporate InformationLahore Stock E
Page 8 and 9: Board of Directors
Page 10 and 11: First Board of Directorsafter Demut
Page 12 and 13: Profile of DirectorsMr. Aftab Ahmad
Page 14 and 15: Profile of DirectorsMr. Ammar-ul-Ha
Page 16 and 17: Profile of DirectorsMs. Bushra Naz
Page 18 and 19: Profile of DirectorsMr. Masood Akba
Page 20 and 21: Profile of DirectorsMr. Mumtaz Huss
Page 22 and 23: Directors’ Report
Page 24 and 25: Directors’ Reportmembers are regi
Page 26 and 27: Directors’ ReportIncomeActual Act
Page 28 and 29: Directors’ ReportDescriptionThe A
Page 30 and 31: Directors’ ReportSEGREGATION OF C
Page 32 and 33: Participation in the International
Page 34 and 35: Directors’ ReportHUMAN CAPITAL IN
Page 36 and 37: Directors’ ReportPOSSIBLE LISTING
Page 38 and 39: Directors’ ReportBOARD COMMITTEES
Page 40 and 41: Corporate Governance
Page 42 and 43: Statement of Compliance with CCGFor
Page 44 and 45: Organizational Roundup
Page 46 and 47: Market Operations DivisionMarket Op
Page 48 and 49: Market Operations DivisionName of C
Page 52 and 53: Market Operations DivisionThe follo
Page 54 and 55: Corporate Management DivisionSittin
Page 56 and 57: Corporate Management DivisionHUMAN
Page 58 and 59: Corporate Management DivisionWeb an
Page 60 and 61: Regulatory Affairs DivisionSitting
Page 62 and 63: Regulatory Affairs DivisionInvestor
Page 64 and 65: Technology Services DivisionSitting
Page 66 and 67: Technology Services DivisionAssets
Page 68 and 69: Technology Services Division In ord
Page 70 and 71: Financial Management DivisionSittin
Page 72 and 73: LSE Highlights
Page 74 and 75: PictorialVisit of National Defence
Page 76 and 77: PictorialMr. Thomas Morris Chief Ec
Page 78 and 79: PictorialSECP Chairman Mohammad Ali
Page 80 and 81: Visitors’ CommentsThank you for s
Page 82 and 83: Visitors’ CommentsMany thanks to
Page 84 and 85: Financial Highlights
Page 86 and 87: Summary of key operating & financia
Page 88 and 89: Income & Expenditure StatementVerti
Page 90 and 91: Financial HighlightsBalance Sheet H
Page 92 and 93: Financials
Page 94 and 95: Auditors’ Reportaccordance with t
Page 96 and 97: Income and Expenditure AccountFor t
Page 98 and 99: Statement of changes in Funds and R
Page 100 and 101:
Financial Notes
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Financial Notes2.3 Constitution of
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Financial Notes2.5 Significant even
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Financial Notes- ProvisionsProvisio
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Financial Notes• Offsetting Finan
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Financial Notes5.2 Fixed assetsa) P
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Financial Notes5.4 Foreign currenci
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Financial Notes5.11 Borrowing costs
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Financial NotesooooooooIncome from
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Financial Notes8 Liabilities agains
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Financial Notes2012 2011Note (Rupee
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Financial Notes11 Trade and other p
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Financial NotesBalance of Members
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Financial Notes14.3During the year
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Financial Notes16 Property and equi
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Financial Notes2012 201118 Long ter
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Financial NotesOpening(Restated)201
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Financial Notes(c)In addition to th
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Financial Notes35 Finance cost2012
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Financial Notes39 Financial instrum
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Financial NotesBank balancesBank Ba
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Financial Notes2012 2011(Rupees in
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Financial Notes39.3.5 Operational r
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Financial Notes41.2 Classification
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Annual Report 2012 - Lahore Stock Exchange

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