The GSE said it took this decision because the two entities violated some market rules.
The GSE said both firms were operating without an authorized dealing officer for more than three months, having a low liquid position and inactivity on the market due to the lack of an Authorised Dealing Officer to execute trades.
“The financial status of the company shows a significant deterioration in its operations, resulting in successive negative returns which have eroded shareholders’ funds. Rule 78 of the GSE Dealing Membership Rules requires a member of the Exchange to comply with the prevailing requirements of the Securities and Exchange Commission in respect of capital, liquidity, reports, and returns.”
“FABL is in breach of regulation 22 of the SEC Regulations, 2003 (L.I. 1728), which requires a Broker-Dealer to maintain at any given time, minimum liquid fund amounting to at least 20% of the aggregate indebtedness of the Broker-Dealer,” portions of the statement from the GSE said.
Also, Liberty Securities Limited was found to be operating with low net shareholders’ fund balance.
By this, the two entities can no longer execute trades on the stock market, provide advisory services to clients on capital market issues and holding in place or trust, clients’ accounts, or their security holdings.
The GSE further assured that there are procedures for existing clients registered with both Licensed Dealing Members to transfer their security accounts and security holdings to any Licensed Dealing Member of their choice.