Media Category: News

CDC conducts Knowledge Sharing Sessions for Academic Institutions

CDC conducted knowledge sharing sessions for a number of educational institutions during the second quarter of 2014. Students and faculty members belonging to ICMAP, Bahria University and Maddarsah Jamia-tur Rasheed visited CDC and were imparted knowledge about the Capital Market business and CDC’s pivotal role and responsibility.

Mr. Farooq Ahmed Butt and Mr. Arif Ahmed from the Product Development and Marketing department at CDC conducted these sessions.

In intriguing debates the attendees inquired about the operations of stock market in light of trading, custody and settlement. Islamic modes of financial solutions for the capital market of Pakistan were also discussed at length. Refreshments were served after the sessions were concluded.

ICMAP (Cost Management Students), Bahria University (BBA students) and Scholarly students doing specialization in Islamic Fiscal Jurisprudence which is a 2-year specialization course for Sharia scholars in Islamic Finance, Trade, Banking, Takaful, Business Laws and Practices were the audience along with their respective faculty members.

CDC Trustee & Custodial Services welcomes NIUT on board

CDC has taken over the trusteeship of National Investment (Unit) Trust (NIUT), the First and Largest Mutual Fund of Pakistan. NIUT carries an investment portfolio of around Rs.64 billion, invested in over 385 listed companies with around 51,000 unit holders.

With NIUT on board, CDC sustained its legacy to act as the market leader in the business of trusteeship services and captured 94% of the market share hence winning the trust and confidence which the industry had reposed in it. With NIUT, Trustee and Custodial Services has outclassed all its previous records and crossed 459 billion in terms of net assets.

CISSII Agreement Signing Ceremony between CDC and Life Insurance Companies

The CISSII (Centralized Information Sharing Solution for Insurance Industry) participation agreement was signed on 25th April 2014 at a local hotel between CDC and EFU Life Assurance, Jubilee Life Insurance Company, MetLife Alico Pakistan, Adamjee Life Insurance Company, East West Life Insurance Company, Pak-Qatar Family Takaful and Dawood Family Takaful Limited.

The signing ceremony was attended by Mohammad Asif Arif, Commissioner Insurance Division, SECP, Muhammad Hanif Jakhura, CEO, CDC, and CEOs and other senior executives of life insurance and family takaful operators.

The objective of the directive was to promote a formal information-sharing mechanism by making membership mandatory for life insurance companies and family takaful operators.

CISSII will bring in greater efficiencies and transparency in the Insurance Industry by exchange of critical information including acceptance of claim and underwriting of hazardous risks.

CDC Share Registrar Services achieves ‘100 clients’ milestone

Since 2008, CDC is providing Share Registrar and Transfer Agent Services to Securities Issuing companies for managing their Security Holders. CDC continued its practice of achieving newer heights when its Share Registrar Services reached 100 clients landmark and became the 3rd largest R/TA in Pakistan. This is a significant achievement considering that this service commenced operations in 2008.

Experienced staff, excellent customer support, legal / regulatory compliances and IT infrastructure provides the edge to CDC Share Registrar Services over other competitors and are the reason behind the voluminous growth of this service. The clientele includes the national airline to textile giants and leading cement manufacturers to mainstream banks.

CDC conducts Investor Awareness Seminars in upcountry

After a successful campaign in Karachi and Hyderabad, CDC conducted Investor Awareness Seminars in Lahore, Islamabad, Rawalpindi, Multan, Gujranwala and Faisalabad from 16th to 22nd March 2014. These seminars were organized particularly in the context of current regulatory initiatives where subscriptions of CDC Access SMS and Email Alerts have been made mandatory by the Securities & Exchange Commission of Pakistan. This initiative was also taken in line with CDC’s belief that an informed investor is more enabled to keep his investment secure. The audience was briefed about CDC’s role, responsibilities and service offerings. The free-of-cost CDC access portfolio was also introduced. Investors were apprised about their role, responsibilities and rights as well.

Constructive criticism from the attendees included a demand that all Capital Market entities should conduct collaborative programs so that all the stakeholders can come under one roof and discuss concerns, opportunities and challenges. According to them such acts of solidarity will quash uncertainty, doubts and rumors which always surround the capital market, giving investors the feel-good factor that their investment portfolios are in safe hands. It was also suggested that mechanisms and processes that ratify the Broker’s trustworthiness should be devised. Officials from SECP and ISE also attended the seminar held in Islamabad.

The attendees in almost all cities also stressed that CDC should show presence on a monthly basis in the form of day-long sessions or IPV desks. All the queries and concerns were dealt with expertly by the CDC team.

CDC to provide Settlement services for Government Securities traded on KSE’s Bond Trading System

Being at the forefront of capital market development since its inception, CDC has introduced a number of initiatives and undertaken many challenges.  Recently, another major milestone was marked in the ever-progressing timeline of CDC with the initiation of settlement of Government Securities through KSE’s bond trading platform. This is a substantial development for Pakistan Capital Market as for the first time the retail segment will have a liquid and direct platform for trading in Government Securities through KSE’s Bond Automated Trading System (BATS).

KSE undertook this project at the initiative of the honorable Federal Minister for Finance, Revenue, Economic Affairs, Statistics and Privatization, Mr. Mohammad Ishaq Dar, who had urged the management of KSE and SBP to lay the groundwork. A committee was then established comprising of the senior most representatives of CDC, KSE, NCCPL, SECP and SBP as well as the leading money market brokers and banks. After much deliberation, the operational framework for the initiative was established. A key element to this endeavor was SBP conferring upon CDC special participant status in the Pakistan Real-time Inter-bank Settlement Mechanism (PRISM) and Real Time Gross Settlement (RTGS). The stepping stone for this was the launch of Investment Portfolio Services (IPS) by CDC whereby investors can open IPS accounts (directly maintained at CDC for investment) in GoP securities. CDC is the only non-banking institution to be given this capacity.

All trades take place on BATS, which is a trading platform developed by KSE for the trading of fixed income securities. Prior to the launch of this service, trading in government securities was done over-the-counter, and the retail involvement was negligible. The BATS platform will provide the transparency and liquidity which are essential in order to accommodate the retail segment in this ground-breaking initiative.

Formal trading began with a soft launch on January 31, 2014 at the KSE premises. Later, the official launch of the service took place on February 18, 2014 in Karachi at a local hotel. The invitees included senior management from CDC, KSE, Pakistan Capital Market and the banking sector. The guest of honor was the honorable finance minister, Mr. Muhammad Ishaq Dar.

Government Securities are issued by the State Bank of Pakistan on behalf of Ministry of Finance. These securities are considered low-risk primarily due to the fact they have sovereign guarantee of the government. Currently, this facility extends to three types of securities which include:

  • Treasury Bills: Short-term zero-coupon instruments that are issued at discount with maturities of 3-month, 6-month and 1-year.
  • Pakistan Investment Bonds: Long term bonds which pay fixed semi-annual coupon in addition to repayment of principal at maturity. They are issued at maturities of 3, 5, 7, 10, 15, 20 and 30 years.
  • Ijara Sukuk: A Shariah-compliant Islamic floating and semi-annual coupon bond.

Investors wishing to trade in government securities need to open their IPS accounts with CDC by submitting the account opening form along with fulfilling all the necessary formalities. A key feature of this facility is a facilitation agreement which needs to be signed between CDC and all the relevant parties involved (investor and broker). In addition to this, another integral aspect of this service is that trades are only executed for good value positions. This means that investors need to ensure availability of funds or securities prior to execution of the trade. All trades will be on a delivery versus payment mode, i.e. delivery will be only against actual payment received.

CDC has always strived for the development of financial markets and this initiative by KSE is one of the many that are testament to its vision. By investing in government securities, investors can have the comfort of risk-free returns through an efficient and effective framework that allows them to maintain control and broaden their investment horizon.