The Securities and Commodities Authority held a meeting with both the Abu Dhabi Stock Exchange and Dubai Financial Market to discuss the state of the financial market in the country, study the situation closely and contain the implications of the decline in indicators in the markets, and take urgent measures to deal with this decline.
The meeting was chaired by Dr. Obaid Saif Al Zaabi, the Authority’s CEO, and was attended by a number of the Authority’s advisors and representatives of the directors of technical departments therein. The meeting was also attended by Ghanem Al-Dhahri, Executive Vice President of the Abu Dhabi Stock Exchange and Khalifa Rabbaa, Vice President of Operations from the Dubai Financial Market, in addition to a number of technicians and legal From both markets.
The attendance of the authority and the financial market during the meeting stressed the strength of the fundamentals of the state economy, its solidity and immunity from the reality of positive macroeconomic indicators, and pointed to the success of the local public joint-stock companies listed in achieving good profits from last year, and the growth rate of net profits increased to 9% compared to net profits In the previous year, they also noted the mechanisms developed by the authority in cooperation with markets to contain negative results of some companies, whether related to the merger of the losing company with another company or companies, and the acquisition of existing companies as well as the entry of strategic partners, and contains Cash debts to shares in the capital of the company, and the issuance of convertible bonds to shares with the exception of the priority right of the shareholders of the company, and they also praised the mechanism developed by the Authority at the end of last year regarding the procedures for companies listed in the market whose accumulated losses amount to 20% or more of its capital.
The attendees also discussed several other measures that would contribute to supporting the factors of balance between buying and selling, and they explained that the uncovered short selling mechanism that helps in the drop in global markets and is prevented by regulatory bodies in times of crisis, is not activated in the state markets. Also, the financial markets are currently studying the possibility and feasibility of reducing maintenance margin on margin trading in accordance with international practices in this regard.
The meeting also pointed out that statistical studies and benchmarked comparisons have shown that the country's markets have a low correlation with financial markets that suffer from an unjustified drop crisis.
At the same time, the authority is currently activating the powers granted to it to facilitate companies' buy-backs of their shares in accordance with the international practices in effect at the time of declining markets, and the authority is also in contact with the central bank to consider mechanisms for banks to liquidate shares used as collateral when prices fall.
In addition to the foregoing, the authority works closely with listed markets and companies to fully activate the continuity of holding associations through various electronic means such as electronic voting, invitations to be sent via email and text messages.