Abu Dhabi Securities Market organizes the 2nd Annual Forum for the market members
Abu Dhabi Securities Market (ADSM) organized the Second Annual Forum for public joint companies and brokerage firms at Abu Dhabi National Exhibitions Center. More than 200 company presidents and managers for joint companies and financial brokerages attended.
H.E Khalil Fulathi, vice chairman of ADSM board of directors, assured in the address he gave on behalf of H.E Naser Al Suwaidi, chairman of ADSM board of directors, that organizing the second annual forum aims as consolidating communication with “our” partners from public joint companies and brokerage firms in order to assure the continuity of “our” success throughout the development and advancement which started seven years ago.
H.E said that ADSM made big and important steps towards strengthening investment environment in the UAE, which witnesses distinguished economic and investment activity all over the whole region. The United Arab Emirates, in general, and Abu Dhabi in particular have become in front of the eyes of the investors all over the world. He mentioned that the Abu Dhabi is working for implementing a plan to liberate and diversify its economy and improve the role of private sector through projects that will be implemented during the next five years in order to develop education, health, tourism and industry sectors. The value of those projects is exceeding hundreds of billions UAE Dirhams. All these are basic elements for investment decisions and the activities of financial markets.
ADSM will work during the coming period, in cooperation with Securities and Commodities Authority (SCA), for developing the whole legal frame and to enact legislations for Collective Investment Schemes, Trust law, Custody law, and to make laws for exchanging the units of investment funds, and legislations for protecting junior investors, organizing the job of the brokers by licensing several professions in financial consultation, organizing the margin exchange and set conditions and requirements for financial funds that could help brokers to consider risks, and legislations of merger and acquisition, and strengthening the role of the markets so as to be able to deal dynamically with the needs of the financial market, Fulathi confirmed.
H.E thanked and appreciated Securities and Commodities Authority (SCA) for its role and its control in organizing stock exchange market in the UAE. We are sure that we together will assume responsibilities in coping the economical development in our country.
H.E Khalil Fulathi said that ADSM management ratified a multi-pivot strategy. The most important pivots of this strategy are strengthening and developing the environment organization of the market transactions in accordance with the best world practices. Proposals were offered to SCA, as a competent authority, to modify and create several systems such as the proposal for involving investment funds, a proposal for setting standards for the behavior of investment portfolios managers, and proposals for increasing the efficiency of brokers, financial Funds rules, and organizing the margin trading.
The second theme concentrates on supporting the public joint companies in their pursue for reaching the highest levels of governance, and we drafted a proposal for achieving governance in the companies which aims at endearing the principle of disclosure and transparency. The proposal was offered to the listed companies in ADSM to give their comments before sending it over to SCA which approved the restrictions in their final form. He added that with the insistence of ADSM support to the listed companies for development and facing the future challenges, ADSM will organize road show forum in participation of several companies’ representatives in London and New York during 11–15 June 2007, to provide the investment opportunities for assets managements, world portfolios and pension funds. Further roads show will follow for all companies which have the desire to get foreign investments.
He also mentioned that the third theme on which ADSM strategy depends concentrates on boosting ADSM relations with brokers and working on changing that relationship from monitoring into a real partnership that depends on sense of responsibility on both sides in order to improve the market performance. He made it clear that ADSM management believes in the importance of the role played by the brokers in defining the aspects of investment environment and its influence. That is why ADSM management is serious in heading forward for offering training programs for brokers and increasing their professional efficiency to develop market transactions, recognizing scientific methods and approaches in investment decision making, helping the investors to approve those methods, and offering them the advice which eventually help in sustaining market stability and reducing sharp price variation.
He added: “ADSM management works for the development of brokerage and getting it out of the traditional concept of implementing the customer wishes to a broader concept that comprises making analytical studies that depend on scientific, technical, objective logical bases and managing the portfolios. We confirm the connecting link between the outside offices for brokers group in order to enable them and their customers to remotely trade in a way that serves the interests of the investors. The number of E-orders during the last 6 months is about 52% of the total daily orders.”
The fourth theme of the market strategy concentrates on taking care of the investors, either individuals or institutions. ADSM considers the investor as the pivot for all investment process. So, it works hard to avail an investment environment that is just for all investors by approving the principles of disclosure and transparency, and the equality in reaching the information as well as inventing new investment tools to disperse risks and reduce costs.
He added that ADSM management will go ahead, in cooperation with the relevant various authorities, to increase investment awareness among different categories of the investors with special emphasis on junior investors who represent the spinal cord for any economy in the world. I would tell you that ADSM management started studying how to find new investment channels in order to disperse the junior investors’ risks which could be appropriate to invest their savings which entails preparation for listing the Exchange Traded Funds (ETFs) that facilitates dispersing the risks. We hope, in cooperation with SCA, to start trading them during the next few months. He also confirmed that ADSM is working for creating investors protection fund that will be declared later.
HE Khalil Fulathi said: “ADSM which comprises 64 local and arab companies classified in 9 sectors, achieved wide leaps either as per the trading volume, foreign investment, investors database, or the no. of trades ....etc, has become a point of attraction for many world investment institutional companies.
He assured the principle of the companies’ financial data disclosure and corporate governance which has influence on the performance of the shares in the market, have become one of the most important standards for measuring the performance of securities markets in the world. (53) public joint companies representing 84% of the listed companies in ADSM disclosed, till now, their financial data according the requirements of world standards during the first quarter of this year. Those data showed that those companies achieved net profits of (6.4) Billion Dirhams, 8.4% increase compared to the same period of the last year. Those results show that ADSM movement goes comparatively proper with the reality and performance of those companies.
H.E expressed that ADSM management welcomes any proposals or comments offered by the listed companies, brokers, or media people, serving the public interests, and the march of development under the wise leadership of H.H Sheikh Khalifa bin Zayed Al-Nahyan, President of UAE, and the directions of H.H General Sheikh Mohammad bin Zayed Al Nahyan, Crown Prince of Abu Dhabi, Deputy chief commander of Armed Forces, and Chairman of Abu Dhabi Executive Council.
H.E Rashid Al Baloushi, Acting Director General of ADSM, also addressed in the second annual forum of the listed companies. He gave a comprehensive presentation about ADSM activities and its achievements and future plans. He confirmed that ADSM works for having the optimal option in the region to lead the process of developing capital market in the UAE through effective cost, and self organization throughout legal environment that assures integrity, disclosure and transparency.
He said that the number of trades in ADSM since the beginning of the year up to last May is (339,449,000) transactions. The number of traded shares is (AED 11,482) billion, while the trading value amounted (AED 35,941) billion with a daily average of (AED 339) million. The number of brokerage firms in ADSM also increased to (93) companies by the end of May 2007.
Al Baloushi said: “The numbers of investors issued by ADSM reached (1954) numbers for nationals and (2588) numbers for Arab and Gulf investors, i.e. the total number of investors in ADSM reached (853,000) by the end of May 2007, while, the net foreign investments in ADSM amounted (AED 1400) billion which means the value of purchased shares is more than that of the sold ones of the same value”.
Al Baloushi highlighted the leading role of ADSM in the region, as ADSM signed Custody Agreement with HABC, and memorandum of understanding (MoU) with a number of securities markets like (Muscat, Bahrain, Hong Kong, Singapore, and Pakistan). ADSM also completed the electronic link with Muscat Securities Market; Cross-listing agreements were also signed with a number of Arab Exchanges and Central Depositories (Oman, Qatar, Bahrain, Egypt, Palestine, and Sudan).
Al Baloushi added that ADSM invested in E-trading systems so as to increase the affectivity and capacity to cope with the growing increase of the various market activities.
He said that: “ADSM is a member of a number of organizations, unions, and international institutions including International Organization for Securities and Commissions (ISCO), World Federation of Exchanges (WFE), Federation of Eur-Asian Stock Exchanges (FEAS), African & Middle East Depositories Association (AMEDA), and Federation of Arab Stock Exchanges.
ADSM management honored a number of listed companies and brokerage firms. H.E Khalil Fulathi, vice chairman of ADSM BOD gave the awards of the best listed company in disclosing the financial data of 2006 to: Finance House , Abu Dhabi Islamic Bank, United Arab Bank, Invest Bank, National Bank of Ras Al Khaimah, First Gulf Bank, Abu Dhabi Commercial Bank, Dana Gas, Ras Al Khaima Poultry & Feeding Company, Ras Al Khaima Ceramics Company. Emirates International Securities, award of the most active brokerage firm regarding the number of traded shares for 2006, Abu Dhabi Financial Services, award of the most active brokerage firm regarding the value of traded shares for 2006, Al Anssari Financial Services, award of the most active brokerage firm regarding the investors database for 2006, Direct Broker for Financial Services, award of the most active brokerage firm regarding the volume of foreign trading for 2006, The United Brokerage Company, award of the first brokerage firm commenced electronic connection with Muscat Securities Market, and last Emirates International Securities, award of the highest ratio of localization for 2006.
