The Securities and Exchange Commission (SEC) is planning to release its decision on credit rules after the next SEC meeting (to be held possibly by month end), according to official sources. "SEC will announce the decision on the credit rules after the next commission meeting," an official told the Business Times.
He said that the SEC at the last commission meeting on Tuesday had deferred a decision as they had wanted time to scrutinize the stockbroker proposals pertaining to margin trading facilities and the credit rules. “The stockbrokers wanted to be able to lend according to their net capital, which will need to do away with the T+5 (trading day plus five market days) for settlement rule and this has to be explored,” he explained.
A stockbroker told the Business Times that SEC has told them informally that the Commission will explore their proposals 'favourably'. “The members wanted more time to examine the proposals submitted by the Colombo Stock Brokers Association pertaining to relaxing the credit rules and by next week they may have a special meeting to announce their decision,” he said.
The SEC in mid May granted additional time for brokers to clear their debtor balances. Accordingly 25% of the remaining debtors over T+3 days are to be cleared by 30th September and the balance 25% is to be cleared by end December this year.