Yesterday, local financial markets witnessed the start of activating the decision of the Securities and Commodities Authority to allow trading of shares of suspended and losing companies through a second trading screen, which was prepared in the Dubai Financial Markets and Abu Dhabi Securities.
The number of deals that were made on these shares reached 180, of which 179 are in the Dubai market and one in the Abu Dhabi market.
The manager at Al-Ansari Financial Services Company, Abdul Qadir Shaath, attributed the weak turnout to these companies to the efforts made by the Securities and Commodities Authority to spread awareness among the investor community of the importance of reading the company’s financial statements and knowing their performance seriously before investing in them.
Shaath told «Emirates Today» that the return of the demand for the shares of the suspended and losing companies is strongly linked to the reform plans presented by their departments, in a way that guarantees their recovery from stumbling and returning them on the path of profitability.
He added that part of the lack of acceptance, yesterday, is also due to the Authority’s requirement that the investor sign a written declaration stating his knowledge of the financial position of the company, and then send it to the brokerage office to implement the purchase, indicating that this in turn takes time and supports the investor’s concerns in demanding shares of companies Some of them lost up to 85% of their capital.
Shaath added that the Securities Commission has put strict controls on the return of suspended and losing companies to circulation, related to undertaking fundamental reforms to save the company, and not only the goal of returning them to the second-class trading screen, so investors are waiting to disclose the expected reform steps, and then they can be satisfied with confidence.
To that, 12 stocks were listed on the second screen of the Dubai Financial Market yesterday: Al-Firdaws Holding, Drake & Scull, Al-Khaleejia for General Investments, Marka, Amlak Finance, DXB Entertainments. Emirates Refreshments, UniKai Food, in addition to the following Gulf companies: “Digital”, “Madinah Finance”, “International Financial Advisors” and “Ithmaar Holding”
The Dubai Financial Market said, in a statement, that it will continue to suspend trading in the shares of each of the brand company because it does not meet the disclosure requirements, and the lack of financial data for 2019, as well as "Drake & Scull", "Gulf General Investments" and "Al-Firdous Holding" », Because not all of them meet the disclosure requirements.
As for the companies that appeared on the screen of the second category of the Abu Dhabi Stock Exchange, they are: "Investment Bank" and "Al-Khazna Insurance".
The Securities and Commodities Authority issued a decision regarding the application of procedures for dealing with troubled listed public shareholding companies, as of the beginning of July, where a follow-up list was made of companies whose shares have been transferred from the first category to the second category, because of the suspension of their listing for a period of six months or more, And those that have accumulated losses of 50% or more of their capital based on the latest annual audited financial statements of the company, for the purposes of monitoring the performance of those companies.
It is noteworthy that the total number of shares suspended from trading and losing in the financial markets in the country, is 14 shares for local and Gulf companies.
Opening the trading floor in "Dubai Financial" tomorrow
The Dubai Financial Market announced yesterday the reopening of the trading floor and customer service offices for investors, starting tomorrow, with the application of precautionary measures to preserve the safety of customers and employees.
The market closed the hall and customer service offices temporarily in mid-March, with the continuation of trading activities in the market as usual, in line with the precautionary measures to contain the virus «Corona».
The shares that were suspended from trading and losing in the Dubai and Abu Dhabi markets are 14 shares for local and Gulf companies.